SHARE EXCHANGE AGREEMENT by and among Premier Power Renewable Energy, Inc., a California corporation (“Premier Power”), and, for certain limited purposes, the Undersigned Stockholders of Premier Power, on the one hand; and Premier Power Renewable...
by
and among
a
California corporation (“Premier
Power”),
and,
for certain limited purposes,
the
Undersigned Stockholders of Premier Power,
on
the one hand;
and
Premier
Power Renewable Energy, Inc. (“Pubco”),
a
Delaware corporation,
and,
for certain limited purposes,
the
Majority Stockholder of Pubco,
on
the other hand
September
9, 2008
This
Share Exchange Agreement, dated as of September 9, 2008 (this “Agreement”),
is
made and entered into by and among Premier Power Renewable Energy, Inc., a
California corporation (“Premier
Power”),
and
for certain limited purposes, the stockholders of Premier Power listed on
attached Annex
I
(each
such stockholder, a “Premier
Power Owner,”
and
collectively, the “Premier
Power Owners”),
on
the one hand; and Premier Power Renewable Energy, Inc. (formerly known
as Harry’s
Trucking, Inc.), a Delaware corporation (“Pubco”),
and,
for certain limited purposes, the majority stockholder of Pubco listed on
attached Annex
II
(“Pubco
Stockholder”),
on
the other hand.
R
E C I T A L S
WHEREAS,
on August 29, 2008, the Board of Directors of Pubco adopted resolutions
approving Pubco’s acquisition of the equity interests of Premier Power held by
the Premier Power Owners (the “Acquisition”)
by
means of a share exchange with the Premier Power Owners, upon the terms and
conditions hereinafter set forth in this Agreement;
WHEREAS,
each Premier Power Owner owns the amount of equity interests (in shares of
capital stock or otherwise) of Premier Power set forth opposite such Premier
Power Owner’s name in Column II on Annex
I
attached
hereto (collectively, the “Premier
Power Equity Interests”);
WHEREAS,
the Premier Power Owners desire to sell and transfer their respective holdings
of the Premier Power Equity Interests in exchange for shares of Pubco pursuant
to the terms and conditions of this Agreement and will enter into this Agreement
for the purpose of making certain representations, warranties, covenants and
agreements; and
WHEREAS,
the Pubco Stockholder holds 26,026,000 shares of common stock which represents
approximately 95.5% of the issued and outstanding capital stock of Pubco;
WHEREAS,
the Pubco Stockholder will enter into this Agreement for the purpose of making
certain representations, warranties, covenants and agreements; and
WHEREAS,
it
is
intended that the terms and conditions of this Agreement comply in all respects
with Section 368(a)(1)(B) and/or Section 351 of the Code and the regulations
corresponding thereto, so that the Acquisition shall qualify as a tax free
reorganization under the Code.
A
G R E E M E N T
NOW,
THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
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2
ARTICLE
1
THE
ACQUISITION
1.1 The
Acquisition.
Upon
the terms and subject to the conditions hereof, at the Closing (as hereinafter
defined) the parties shall do the following:
(a) The
Premier Power Owners will sell, convey, assign, transfer and deliver to Pubco
five (5) certificates representing the Premier Power Equity Interests held
by
each Premier Power Owner as set forth in Column II of Annex
I
hereto,
which in the aggregate shall constitute 100% of the issued and outstanding
equity interests of Premier Power, each accompanied by a properly executed
and
authenticated stock power or instrument of like tenor.
(b)
As
consideration for the acquisition of the Premier Power Equity Interests, Pubco
will issue to each Premier Power Owner, in exchange for such Premier Power
Owner’s portion of the Premier Power Equity Interests, the number of shares of
common stock set forth opposite such party’s name in Column IV on Annex
I
attached
hereto (collectively, the “Pubco
Shares”).
The
Pubco Shares issued shall equal approximately 93.08% of the outstanding shares
of Pubco’s common stock at the time of Closing. For example, if there are
1,800,000 shares of Pubco’s common stock outstanding immediately prior to the
Closing, then there shall be 24,218,750 shares of Pubco’s common stock issued to
the Premier Power Owners at Closing.
(c)
The
Pubco
Stockholder shall surrender in the aggregate 25,448,000 shares of Pubco’s common
stock held by them, which shall be cancelled pursuant to Section 7.6 hereof.
1.2 Closing
Date.
The
closing of the Acquisition (the “Closing”)
shall
take place as soon as practicable upon signing of this Agreement, and on or
prior to September 9, 2008, or on such other date as may be mutually agreed
upon
by the parties. Such date is referred to herein as the “Closing
Date.”
1.3 Taking
of Necessary Action; Further Action.
If, at
any time after the Closing, any further action is necessary or desirable to
carry out the purposes of this Agreement, the Premier Power Owners, Premier
Power, the Pubco Stockholder, and/or Pubco (as applicable) will take all such
lawful and necessary action.
1.4 Certain
Definitions.
The
following capitalized terms as used in this Agreement shall have the respective
definitions:
“Affiliate”
means
any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such
terms are used in and construed under Rule 405 under the Securities Act.
“Commission”
means
the U.S. Securities and Exchange Commission.
“Exchange
Act”
means
the Securities and Exchange Act of 1934, as amended.
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3
“Knowledge”
shall
mean the actual knowledge of the officers, directors or advisors of the
referenced party.
“Liens”
means
a
lien, charge, security interest, encumbrance, right of first refusal, preemptive
right or other restriction
“Material
Adverse Effect”
means
an adverse effect on either referenced party or the combined entity resulting
from the consummation of the transaction contemplated by this Agreement, or
on
the financial condition, results of operations or business, before or after
the
consummation of the transaction contemplated in this Agreement, which as a
whole
is or would be considered material to an investor in the securities of Pubco.
“Non-U.S.
Person”
means
any person who is not a U.S. Person or is deemed not to be a U.S. Person under
Rule 902(k)(2).
“Person”
means
an individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any
kind.
“Restricted
Period”
shall
have the meaning set forth in Section 3.4(b)(vi).
“Securities
Act”
shall
mean the Securities Act of 1933, as amended.
“Tax
Returns”
shall
mean all federal, state, local and foreign returns, estimates, information
statements and reports relating to Taxes.
“Tax”
or
“Taxes”
shall
mean any and all applicable central, federal, provincial, state, local,
municipal and foreign taxes, including, without limitation, gross receipts,
income, profits, sales, use, occupation, value added, ad valorem, transfer,
franchise, withholding, payroll, recapture, employment, excise and property
taxes, assessments, governmental charges and duties together with all interest,
penalties and additions imposed with respect to any such amounts and any
obligations under any agreements or arrangements with any other person with
respect to any such amounts and including any liability of a predecessor entity
for any such amounts.
“Trading
Day”
means
a
day on which the principal Trading Market is open for trading.
“Trading
Market”
means
the following markets or exchanges on which Pubco’s common stock is listed or
quoted for trading on the date in question: the American Stock Exchange, the
Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select
Market, the New York Stock Exchange or the OTC Bulletin Board.
“Transaction”
shall
mean the transactions contemplated by this Agreement, including the share
exchange.
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4
“United
States”
means
and includes the United States of America, its territories and possessions,
any
State of the United States, and the District of Columbia.
“U.S.
Person” as
defined in Regulation S means: (i) a natural person resident in the United
States; (ii) any partnership or corporation organized or incorporated under
the
laws of the United States; (iii) any estate of which any executor or
administrator is a U.S. Person; (iv) any trust of which any trustee is a U.S.
Person; (v) any agency or branch of a foreign entity located in the United
States; (vi) any nondiscretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the benefit or account
of a U.S. Person; (vii) any discretionary account or similar account (other
than
an estate or trust) held by a dealer or other fiduciary organized, incorporated
and (if an individual) resident in the United States; and (viii) a corporation
or partnership organized under the laws of any foreign jurisdiction and formed
by a U.S. Person principally for the purpose of investing in securities not
registered under the Securities Act, unless it is organized or incorporated,
owned, by accredited investors (as defined in Rule 501(a) under the Securities
Act) who are not natural persons, estates or trusts).
ARTICLE
2
REPRESENTATIONS
AND WARRANTIES OF PREMIER POWER
Except
as
otherwise disclosed herein or in a disclosure schedule attached hereto, Premier
Power hereby represents and warrants to Pubco and the Pubco Stockholder as
of
the date hereof and as of the Closing Date (unless otherwise indicated), as
follows:
2.1
Organization.
Premier
Power has been duly incorporated, validly exists as a corporation, and is in
good standing under the laws of its jurisdiction of incorporation, and has
the
requisite power to carry on its business as now conducted.
2.2
Capitalization.
The
authorized capital stock of Premier Power consists of 100,000 shares of common
stock, no par value, of which at the Closing, no more than 100,000 shares shall
be issued and outstanding. All of the issued and outstanding shares of capital
stock of Premier Power, as of the Closing, are duly authorized, validly issued,
fully paid, non-assessable and free of preemptive rights. There are no voting
trusts or any other agreements or understandings with respect to the voting
of
Premier Power’s capital stock.
2.3 Subsidiaries.
As of
the Closing, Premier Power has no direct or indirect subsidiaries, except as
disclosed in Schedule
2.3
(collectively the “Premier
Power Subsidiaries,”
and
each a “Premier
Power Subsidiary”).
Each
Premier Power Subsidiary is an entity duly organized, validly existing and
in
good standing under the laws of its respective jurisdiction of formation and
has
the requisite corporate power and authority to own, lease and to carry on its
business as now being conducted. Premier Power owns all of the shares of each
Premier Power Subsidiary, and there are no outstanding options, warrants,
subscriptions, conversion rights or other rights, agreements or commitments
obligating any Premier Power Subsidiary to issue any additional shares of common
stock or ordinary stock, as the case may be, of such subsidiary,
or
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5
any
other
securities convertible into, exchangeable for or evidence the right to subscribe
for or acquire from any Premier Power Subsidiary any shares of such subsidiary.
2.4
Certain
Corporate Matters.
Premier
Power is duly qualified to do business as a corporation and is in good standing
under the laws of the State of California, and in each other jurisdiction in
which the ownership of its property or the conduct of its business requires
it
to be so qualified, except where the failure to be so qualified would not have
a
Material Adverse Effect on Premier Power’s financial condition, results of
operations or business. Premier Power has full corporate power and authority
and
all authorizations, licenses and permits necessary to carry on the business
in
which it is engaged and to own and use the properties owned and used by
it.
2.5
Authority
Relative to this Agreement.
Premier
Power has the requisite power and authority to enter into this Agreement and
to
carry out its respective obligations hereunder. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby by Premier Power have been duly authorized by Premier
Power’s Board of Directors and no other actions on the part of Premier Power are
necessary to authorize this Agreement or the transactions contemplated hereby.
This Agreement has been duly and validly executed and delivered by Premier
Power
and constitutes a valid and binding agreement, enforceable against Premier
Power
in accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors’ rights generally or by general principles of equity.
2.6
Consents
and Approvals; No Violations.
Except
for applicable requirements of federal securities laws and state securities
or
blue-sky laws, no filing with, and no permit, authorization, consent or approval
of, any third party, public body or authority is necessary for the consummation
by Premier Power of the transactions contemplated by this Agreement. Neither
the
execution and delivery of this Agreement by Premier Power nor the consummation
by Premier Power of the transactions contemplated hereby, nor compliance by
them
with any of the provisions hereof, will (a) conflict with or result in any
breach of any provisions of the charter or bylaws (or operating agreement)
of
Premier Power or any Premier Power Subsidiary , (b) result in a violation or
breach of, or constitute (with or without due notice or lapse of time or both)
a
default (or give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, agreement or other instrument or obligation to
which Premier Power or any Premier Power Subsidiary is a party or by which
any
of their respective properties or assets may be bound or (c) violate any order,
writ, injunction, decree, statute, rule or regulation applicable to Premier
Power or any Premier Power Subsidiary, or any of its properties or assets,
except in the case of clauses (b) and (c) for violations, breaches or defaults
which are not in the aggregate material to Pubco taken as a whole.
2.7
Books
and Records.
The
books and records of Premier Power delivered to Pubco prior to the Closing
fully
and fairly reflect the transactions to which Premier Power is a party or by
which it or its properties are bound, and there shall be no material difference
between the unaudited combined financial statements of Premier Power given
to
Pubco and the Pubco
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Stockholder
and the actual reviewed US GAAP results of Premier Power for the six-month
period ended June 30, 2008.
2.8
Intellectual
Property.
Premier
Power has no knowledge of any claim that, or inquiry as to whether, any product,
activity or operation of Premier Power infringes upon or involves, or has
resulted in the infringement of, any trademarks, trade-names, service marks,
patents, copyrights or other proprietary rights of any other person, corporation
or other entity; and no proceedings have been instituted, are pending or are
threatened.
2.9
Litigation.
Except
as disclosed in Schedule
2.9,
Premier
Power and each of the Premier Power Subsidiaries are not subject to any judgment
or order of any court or quasi-judicial or administrative agency of any
jurisdiction, domestic or foreign, nor is there any charge, complaint, lawsuit
or governmental investigation pending against Premier Power or any of the
Premier Power Subsidiaries. Premier Power and each of the Premier Power
Subsidiaries is not a plaintiff in any action, domestic or foreign, judicial
or
administrative. There are no existing actions, suits, proceedings against or
investigations of Premier Power or any of the Premier Power Subsidiaries, and
Premier Power knows of no basis for such actions, suits, proceedings or
investigations. There are no unsatisfied judgments, orders, decrees or
stipulations affecting Premier Power or any of the Premier Power Subsidiaries
or
to which Premier Power or any of the Premier Power Subsidiaries is a
party.
2.10 Legal
Compliance.
To the
best knowledge of Premier Power, after due investigation, no claim has been
filed against Premier Power or any of the Premier Power Subsidiaries alleging
a
violation of any applicable laws and regulations of foreign, federal, state
and
local governments and all agencies thereof. Premier Power and each of the
Premier Power Subsidiaries holds all of the material permits, licenses,
certificates or other authorizations of foreign, federal, state or local
governmental agencies required for the conduct of their respective businesses
as
presently conducted.
2.11 Contracts.
Premier
Power has delivered to Pubco copies of each and every material agreements of
Premier Power and each of the Premier Power Subsidiaries not made in the
ordinary course of business. All of the foregoing is referred to as the
“Contracts.” The copies of each of the Contracts delivered are accurate and
complete. Each Contract is in full force and effect and constitutes a legal,
valid and binding obligation of, and is legally enforceable against, the
respective parties thereto. There is no material default with respect to any
such contract which will give rise to liability in respect thereof on the part
of Premier Power or the other parties thereto. No notice of default or similar
notice has been given or received by Premier Power or any of the Premier Power
Subsidiaries under any of such contracts.
2.12 Material
Changes.
Since
January 1, 2008, except as disclosed in Schedule
2.12
attached
hereto: (i) there has been no event, occurrence or development that has had
or
that could reasonably be expected to result in a Material Adverse Effect, (ii)
Premier Power has not incurred any liabilities (contingent or otherwise) other
than (A) trade payables and accrued expenses incurred in the ordinary course
of
business consistent with past practice and (B) liabilities not required to
be
reflected in Premier Power’s financial statements pursuant to GAAP, (iii)
Premier Power has not altered its method of accounting, (iv) Premier Power
has
not declared
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or
made
any dividend or distribution of cash or other property to its stockholders
or
purchased, redeemed or made any agreements to purchase or redeem any shares
of
its capital stock and (v) Premier Power has not issued any equity securities
to
any officer, director or Affiliate.
2.13 Labor
Relations.
No
material labor dispute exists or, to the knowledge of Premier Power and the
Premier Power Owners, is imminent with respect to any of the employees of
Premier Power which could reasonably be expected to result in a Material Adverse
Effect. None of Premier Power’s or its Subsidiaries’ employees is a member of a
union that relates to such employee’s relationship with Premier Power or such
Subsidiary, and neither Premier Power nor any of its Subsidiaries is a party
to
a collective bargaining agreement, and Premier Power and its Subsidiaries
believe that their relationships with their employees are good. No executive
officer, to the knowledge of Premier Power and the Premier Power Owners, is,
or
is now expected to be, in violation of any material term of any employment
contract, confidentiality, disclosure or proprietary information agreement
or
non-competition agreement, or any other contract or agreement or any restrictive
covenant in favor of any third party, and the continued employment of each
such
executive officer does not subject Premier Power or any of its Subsidiaries
to
any liability with respect to any of the foregoing matters. Premier Power and
its Subsidiaries are in compliance with all U.S. federal, state, local and
foreign laws and regulations relating to employment and employment practices,
terms and conditions of employment and wages and hours, except where the failure
to be in compliance could not, individually or in the aggregate, reasonably
be
expected to have a Material Adverse Effect.
2.14 Title
to Assets.
Premier
Power and the Subsidiaries have good and marketable title in fee simple to
all
real property owned by them and good and marketable title in all personal
property owned by them that is material to the business of Premier Power and
the
Subsidiaries, in each case free and clear of all Liens, except for Liens that
do
not materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by Premier Power
and
the Subsidiaries and Liens for the payment of Taxes, the payment of which is
neither delinquent nor subject to penalties. Any real property and facilities
held under lease by Premier Power and the Subsidiaries are held by them under
valid, subsisting and enforceable leases with which Premier Power and the
Subsidiaries are in compliance.
2.15 Insurance.
Premier
Power and the Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are prudent
and customary in the businesses in which Premier Power and the Subsidiaries
are
engaged. Neither Premier Power nor any Premier Power Owner has any reason to
believe that it will not be able to renew its existing insurance coverage as
and
when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business without a significant increase
in
cost.
2.16 Transactions
with Affiliates and Employees.
None of
the officers or directors of Premier Power and, to the knowledge of Premier
Power and the Premier Power Owners, none of the employees of Premier Power
is
presently a party to any transaction with Premier Power or any Subsidiary (other
than for services as employees, officers and directors), including
any
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contract,
agreement or other arrangement providing for the furnishing of services to
or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to
the
knowledge of Premier Power and the Premier Power Owners, any entity in which
any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner, in each case in excess of $120,000,
other
than for: (i) payment of salary or consulting fees for services rendered, (ii)
reimbursement for expenses incurred on behalf of Premier Power and (iii) other
employee benefits.
2.17 Certain
Fees.
No
brokerage or finder’s fees or commissions are or will be payable by Premier
Power to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions
contemplated by this Agreement.
2.18 Registration
Rights.
No
Person has any right to cause Premier Power (or any successor) to effect the
registration under the Securities Act of any securities of Premier Power (or
any
successor).
2.19 Application
of Takeover Protections.
Premier
Power has taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill (including
any
distribution under a rights agreement) or other similar anti-takeover provision
under Premier Power’s certificate of incorporation (or similar charter
documents) or the laws of its state of incorporation that is or could become
applicable as a result of Premier Power fulfilling its obligations or exercising
its rights under this Agreement.
2.20 Tax
Status.
Except
for matters that would not, individually or in the aggregate, have or reasonably
be expected to result in a Material Adverse Effect, Premier Power and each
Subsidiary has filed all necessary Tax Returns and has paid or accrued all
Taxes
shown as due thereon, and Premier Power has no knowledge of a tax deficiency
which has been asserted or threatened against Premier Power or any
Subsidiary.
2.21 No
General Solicitation.
Neither
Premier Power nor any person acting on behalf of Premier Power has offered
or
sold securities in connection herewith by any form of general solicitation
or
general advertising.
2.22 Foreign
Corrupt Practices.
Neither
Premier Power, nor to the knowledge of Premier Power and the Premier Power
Owners, any agent or other person acting on behalf of Premier Power, has: (i)
directly or indirectly, used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to foreign or domestic
political activity, (ii) made any unlawful payment to foreign or domestic
government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by Premier Power (or made by any person acting on its behalf
of which Premier Power is aware) which is in violation of law or (iv) violated
in any material respect any provision of the Foreign Corrupt Practices Act
of
1977, as amended.
2.23 Manufacturing
and Marketing Rights.
Neither
Premier Power nor its Subsidiaries has granted rights to manufacture, produce,
assemble, license, market, or sell its products to any
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other
Person and is not bound by any agreement that affects Premier Power’s or its
Subsidiaries’ exclusive right to develop, manufacture, assemble, distribute,
market or sell its respective products.
2.24 Obligations
of Management.
Each
officer and key employee of Premier Power and its Subsidiaries is currently
devoting substantially all of his or her business time to the conduct of
business of Premier Power and its Subsidiaries. Neither Premier Power nor any
of
its Subsidiaries is aware that any officer or key employee of Premier Power
or
any Subsidiary is planning to work less than full time at Premier Power or
any
Subsidiary, as applicable, in the future. No officer or key employee is
currently working or, to Premier Power’s or any Premier Power Owner’s knowledge,
plans to work for a competitive enterprise, whether or not such officer or
key
employee is or will be compensated by such enterprise.
2.25 Minute
Books.
The
minute books of Premier Power and its Subsidiaries made available to Pubco
contain a complete summary of all meetings and written consents in lieu of
meetings of directors and stockholders since the time of
incorporation.
2.26 Accounts
Receivable.
All
accounts receivable of Premier Power and its Subsidiaries that are reflected
on
Premier Power’s and its Subsidiaries’ balance sheets or interim balance sheets
or on the accounting records of Premier Power and its Subsidiaries as of the
Closing Date (collectively, the “Accounts
Receivable”)
represent or will represent valid obligations arising from sales actually made
or services actually performed in the ordinary course of business. Unless paid
prior to the Closing Date, the Accounts Receivable are or will be as of the
Closing Date current and collectible net of the respective reserves shown on
the
balance sheet or interim balance sheet or on the accounting records of Premier
Power and its Subsidiaries as of the Closing Date (which reserves are adequate
and calculated consistent with past practice and, in the case of the reserve
as
of the Closing Date, will not represent a greater percentage of the Accounts
Receivable as of the Closing Date than the reserve reflected in the interim
balance sheet represented of the Accounts Receivable reflected therein and
will
not represent a material adverse change in the composition of such Accounts
Receivable in terms of aging). Subject to such reserves, each of the Accounts
Receivable either has been or will be collected in full without any set-off,
within ninety days after the day on which it must becomes due and payable.
There
is no contest, claim, or right of set-off, other than returns in the ordinary
course of business, under any agreement and/or contract with any obligor of
an
Accounts Receivable relating to the amount or validity of such Accounts
Receivable. Schedule
2.26
contains
a complete and accurate list of all Accounts Receivable as of the date of the
interim balance sheet, which list sets forth the aging of such Accounts
Receivable.
2.27 Inventory.
All
inventory of Premier Power and the Subsidiaries, whether or not reflected in
the
balance sheet or interim balance sheet, consists of a quality and quantity
usable and salable in the ordinary course of business, except for obsolete
items
and items of below standard quality, all of which have been written off or
written down to net realizable value in the balance sheet or interim balance
sheet or on the accounting records of Premier Power and the Subsidiaries as
of
the Closing Date, as the case may be. All inventories not written off have
been
priced at the lower of cost or market on the last in, first out basis. The
quantities of each item of
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inventory
(whether raw materials, work-in-process, or finished goods) are not excessive,
but are reasonable in the present circumstances of Premier Power and the
Subsidiaries.
2.28 Returns.
Neither
Premier Power nor any Subsidiary has had any of its products returned by a
purchaser thereof, other than minor, nonrecurring warranty problems.
2.29 Employee
Benefits.
Except
as set forth on Schedule
2.29,
neither
Premier Power nor any Subsidiary has (nor for the two years preceding the date
hereof has had) any plans which are subject to ERISA. “ERISA”
means
the Employee Retirement Income Security Act of 1974 or any successor law and
the
regulations and rules issued pursuant to that act or any successor
law.
2.30 Disclosure.
The
representations and warranties and statements of fact made by Premier Power
and
its Subsidiaries in this Agreement are, as applicable, accurate, correct and
complete and do not contain any untrue statement of a material fact or omit
to
state any material fact necessary in order to make the statements and
information contained herein not false or misleading.
ARTICLE
3
REPRESENTATIONS
AND WARRANTIES OF THE PREMIER POWER OWNERS
Except
as
otherwise disclosed herein or in a disclosure schedule attached hereto, the
Premier Power Owners hereby represent and warrant to Pubco and the Pubco
Stockholder as of the date hereof and as of the Closing Date (unless otherwise
indicated), as follows:
3.1 Ownership
of the Premier Power Equity Interests.
Each
Premier Power Owner owns, beneficially and of record, good and marketable title
to the amount of Premier Power Equity Interests set forth opposite such Premier
Power Owner’s name in Column I on Annex
I
attached
hereto, free and clear of all security interests, liens, adverse claims,
encumbrances, equities, proxies, options or voting agreements. Each Premier
Power Owner represents that such person has no right or claims whatsoever to
any
equity interests of Premier Power, other than the Premier Power Equity Interests
listed opposite such Premier Power Owner’s name in Column I on Annex
I,
and
does not have any options, warrants or any other instruments entitling such
Premier Power Owner to exercise or purchase or convert into additional equity
interests of Premier Power. At the Closing, the Premier Power Owners will convey
to Pubco good and marketable title to the Premier Power Equity Interests, free
and clear of any security interests, liens, adverse claims, encumbrances,
equities, proxies, options, shareholders’ agreements or
restrictions.
3.2
Authority
Relative to this Agreement.
This
Agreement has been duly and validly executed and delivered by each Premier
Power
Owner and constitutes a valid and binding agreement of such person, enforceable
against such person in accordance with its terms, except as such enforcement
may
be limited by bankruptcy, insolvency or other similar laws affecting the
enforcement of creditors’ rights generally or by general principles of
equity.
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3.3 Restricted
Securities.
Each
Premier Power Owner acknowledges that the Pubco Shares will not be registered
pursuant to the Securities Act or any applicable state securities laws, that
the
Pubco Shares will be characterized as “restricted securities” under federal
securities laws, and that under such laws and applicable regulations the Pubco
Shares cannot be sold or otherwise disposed of without registration under the
Securities Act or an exemption therefrom. In this regard, each Premier Power
Owner is familiar with Rule 144 promulgated under the Securities Act, as
currently in effect, and understands the resale limitations imposed thereby
and
by the Securities Act; and each Premier Power Owner agrees not to sell or
otherwise dispose of his or its Pubco Shares without such registration or an
exemption therefrom.
3.4 Status
of Stockholder.
Each of
the Premier Power Owners hereby makes the representations and warranties in
either paragraph (a) or (b) of this Section 3.4, as indicated on the signature
page of such stockholder forming a part of this Agreement:
(a) Accredited
Investor Under Regulation D.
The
Premier Power Owner is an “Accredited Investor” as that term is defined in Rule
501 of Regulation D promulgated under the Securities Act, an excerpt of which
is
included in the attached Annex
III,
and
such Premier Power Owner is not acquiring its portion of the Pubco Shares as
a
result of any advertisement, article, notice or other communication regarding
the Pubco Shares published in any newspaper, magazine or similar media or
broadcast over television or radio or presented at any seminar or any other
general solicitation or general advertisement.
(b) Non-U.S.
Person Under Regulation S. Such Premier Power Owner:
(i) is
not a
“U.S. person” as defined by Rule 902 of Regulation S promulgated under the
Securities Act of 1933 (the “Securities Act”), was not organized under the laws
of any U.S. jurisdiction, and was not formed for the purpose of investing in
securities not registered under the Securities Act;
(ii) at
the
time of Closing, the Premier Power Owner was located outside the United
States;
(iii) no
offer
of the Pubco Shares was made to the Premier Power Owner within the United
States;
(iv) the
Premier Power Owner is either (a) acquiring the Pubco Shares for its own account
for investment purposes and not with a view towards distribution, or (b) acting
as agent for a principal that has signed this Agreement or has delivered
representations and warranties substantially similar to this Section
3.4(b);
(v) all
subsequent offers and sales of the Pubco Shares by the Premier Power Owner
will
be made outside the United States in compliance with Rule 903 of Rule 904 of
Regulation S, pursuant to registration of the Shares under the Securities Act,
or pursuant to an exemption from such registration; such Premier Power Owner
understands the conditions of the exemption from registration afforded by
section 4(l) of the Securities Act and acknowledges that there can be no
assurance that it will be able to rely on such exemption.
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12
(vi) such
Premier Power Owner will not resell the Pubco Shares to U.S. Persons or within
the United States until after the end of the one (1) year period commencing
on
the date of Closing (the “Restricted Period”);
(vii) such
Premier Power Owner shall not and hereby agrees not to enter into any short
sales with respect to the common stock of Pubco at any time after the execution
of this Agreement by such Premier Power Owner and prior to the expiration of
the
Restricted Period;
(viii) such
Premier Power Owner understands that the Pubco Shares are being offered and
sold
to it in reliance on specific provisions of federal and state securities laws
and that the parties to this Agreement are relying upon the truth and accuracy
of the representations, warranties, agreements, acknowledgments and
understanding of such Premier Power Owner set forth herein in order to determine
the applicability of such provisions. Accordingly, such Premier Power Owner
agrees to notify the Company of any events which would cause the representations
and warranties of such Premier Power Owner to be untrue or breached at any
time
after the execution of this Agreement by such Premier Power Owner and prior
to
the expiration of the Restricted Period;
(ix) in
the
event of resale of the Pubco Shares to non-U.S. Persons outside of the U.S.
during the Restricted Period, such Premier Power Owner shall provide a written
confirmation or other written notice to any distributor, dealer, or person
receiving a selling concession, fee, or other remuneration in respect of the
Pubco Shares stating that such purchaser is subject to the same restrictions
on
offers and sales that apply to the undersigned, and shall require that any
such
purchase shall provide such written confirmation or other notice upon resale
during the Restricted Period;
(x) such
Premier Power Owner has not engaged, nor is it aware that any party has engaged,
and it will not engage or cause any third party to engage in any “directed
selling” efforts (as such term is defined in Regulation S) in the United States
with respect to the Pubco Shares;
(xi) such
Premier Power Owner is not a “distributor” as such term is defined in Regulation
S, and it is not a “dealer” as such term is defined in the Securities Act;
(xii) such
Premier Power Owner has not taken any action that would cause any of the parties
to this Agreement to be subject to any claim for commission or other or
remuneration by any broker, finder, or other person; and
(xiii) such
Premier Power Owner hereby represents that it has satisfied fully observed
of
the laws of the jurisdiction in which it is located or domiciled, in connection
with the acquisition of the Pubco Shares or this Agreement, including (i) the
legal requirements of such Premier Power Owner’s jurisdiction for the purchase
and acquisition of the Pubco Shares, (ii) any foreign exchange restrictions
applicable to such purchase and acquisition, (iii) any governmental or other
consents that may need to be obtained, and (iv) the income tax
and
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13
other
tax
consequences, if any, which may be relevant to the purchase, holding,
redemption, sale, or transfer of the Pubco Shares; and further, the Premier
Power Owner agrees to continue to comply with such laws as long as it shall
hold
the Pubco Shares.
3.5 Investment
Risk. Each Premier Power Owner is able to bear the economic risk of acquiring
the Pubco Shares pursuant to the terms of this Agreement, including a complete
loss of such Premier Power Owner’s investment in the Pubco Shares.
3.6 Restrictive
Legends. Each Premier Power Owner acknowledges that the certificate(s)
representing such Premier Power Owner’s portion of the Pubco Shares shall each
conspicuously set forth on the face or back thereof a legend in substantially
the following form, corresponding to the stockholder’s status as set forth in
Section 3.4 and the signature pages hereto:
REGULATION
D LEGEND:
“THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN
THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID
ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.”
REGULATION
S LEGEND:
“THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION UNDER THE
SECURITIES ACT, OR PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM REGISTRATION;
HEDGING TRANSACTIONS INVOLVING THE SHARES REPRESENTED HEREBY MAY NOT BE
CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”
3.7 Disclosure.
The
representations and warranties and statements of fact made by Premier Power
Owners in this Agreement are, as applicable, accurate, correct and complete
and
do not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements and information
contained herein not false or misleading.
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES OF PUBCO
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14
Except
as
otherwise disclosed herein or in a disclosure schedule attached hereto, Pubco
hereby represents and warrants to Premier Power and the Premier Power Owners
as
of the date hereof and as of the Closing Date (unless otherwise indicated),
as
follows:
4.1 Subsidiaries.
All of
the direct and indirect subsidiaries of Pubco are set forth on Schedule
4.1
(the
“Pubco
Subsidiaries,”
and
each a “Pubco
Subsidiary”).
Pubco
owns, directly or indirectly, all of the capital stock or other equity interests
of each Pubco Subsidiary free and clear of any Liens, and all of the issued
and
outstanding shares of capital stock of each Pubco Subsidiary are validly issued
and are fully paid, non-assessable and free of preemptive and similar rights
to
subscribe for or purchase securities.
4.2 Organization
and Qualification.
Pubco
and each of the Pubco Subsidiaries is an entity duly incorporated or otherwise
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, with the requisite power
and
authority to own and use its properties and assets and to carry on its business
as currently conducted. Neither Pubco nor any Pubco Subsidiary is in violation
nor default of any of the provisions of its respective certificate or articles
of incorporation, bylaws or other organizational or charter documents
(collectively the “Charter
Documents”).
Each
of Pubco and the Pubco Subsidiaries is duly qualified to conduct business and
is
in good standing as a foreign corporation or other entity in each jurisdiction
in which the nature of the business conducted or property owned by it makes
such
qualification necessary, except where the failure to be so qualified or in
good
standing, as the case may be, could not have or reasonably be expected to result
in a Material Adverse Effect, and no Proceeding has been instituted in any
such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
4.3 Authorization;
Enforcement.
Pubco
has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by this Agreement and otherwise to carry out
its
obligations hereunder. The execution and delivery of this Agreement by Pubco
and
the consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary action on the part of Pubco and no further action
is
required by Pubco, the Board of Directors or Pubco’s stockholders in connection
therewith other than in connection with the Required Approvals, as defined
in
Section 4.5. This Agreement has been (or upon delivery will have been) duly
executed by Pubco and, when delivered in accordance with the terms hereof,
will
constitute the valid and binding obligation of Pubco enforceable against Pubco
in accordance with its terms, except: (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium
and
other laws of general application affecting enforcement of creditors’ rights
generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) insofar
as
indemnification and contribution provisions may be limited by applicable
law.
4.4 No
Conflicts.
The
execution, delivery and performance by Pubco of this Agreement and the
consummation by Pubco of the other transactions to which it is a party and
as
contemplated hereby do not and will not: (i) conflict with or violate any
provision of Pubco’s or any Pubco Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents, (ii)
conflict with, or constitute a default (or an event that with notice or
lapse
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15
of
time
or both would become a default) under, result in the creation of any Lien upon
any of the properties or assets of Pubco or any Pubco Subsidiary, or give to
others any rights of termination, amendment, acceleration or cancellation (with
or without notice, lapse of time or both) of, any agreement, credit facility,
debt or other instrument (evidencing a Pubco or Pubco Subsidiary debt or
otherwise) or other understanding to which Pubco or any Pubco Subsidiary is
a
party or by which any property or asset of Pubco or any Pubco Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, as defined by
Section 4.5, conflict with or result in a violation of any law, rule,
regulation, order, judgment, injunction, decree or other restriction of any
court or governmental authority to which Pubco or a Pubco Subsidiary is subject
(including federal and state securities laws and regulations), or by which
any
property or asset of Pubco or a Pubco Subsidiary is bound or affected; except
in
the case of each of clauses (ii) and (iii), such as could not have or reasonably
be expected to result in a Material Adverse Effect.
4.5 Filings,
Consents and Approvals.
Pubco
is not required to obtain any consent, waiver, authorization or order of, give
any notice to, or make any filing or registration with, any court or other
federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by Pubco of this
Agreement, other than the filing of Form D with the Commission and such filings
as are required to be made under applicable state securities laws (collectively,
the “Required
Approvals”).
4.6 Issuance
of the Pubco Shares.
The
Pubco Shares are duly authorized and, when issued and paid for in accordance
with this Agreement, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens imposed by Pubco other than
restrictions on transfer provided for in this Agreement.
4.7 Capitalization.
The
capitalization of Pubco is as set forth on Schedule
4.7,
which
Schedule
4.7
shall
also include the number of shares of Pubco’s common stock owned beneficially,
and of record, by Affiliates of Pubco as of the date hereof, if any. Pubco
has
not issued any capital stock since its most
recently filed periodic report under the Exchange Act. No
Person
has any right of first refusal, preemptive right, right of participation, or
any
similar right to participate in the transactions contemplated by this Agreement.
There are no outstanding options, warrants, scrip rights to subscribe to, calls
or commitments of any character whatsoever relating to, or securities, rights
or
obligations convertible into or exercisable or exchangeable for, or giving
any
Person any right to subscribe for or acquire any shares of Pubco’s common stock,
or contracts, commitments, understandings or arrangements by which Pubco or
any
Pubco Subsidiary is or may become bound to issue additional shares of Pubco’s
common stock or Common Stock Equivalents. The issuance of the Pubco Shares
will
not obligate Pubco to issue shares of Pubco’s common stock or other securities
to any Person (other than the Premier Power Owners) and will not result in
a
right of any holder of Pubco securities to adjust the exercise, conversion,
exchange or reset price under any of such securities. All of the outstanding
shares of capital stock of Pubco are validly issued, fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws, and none of such outstanding shares was issued in violation
of
any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any stockholder or Pubco’s board of
directors is required for the issuance of the Pubco Shares. There are no
stockholders agreements, voting agreements or other similar agreements with
respect to Pubco’s capital stock to which Pubco is a
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16
party
or,
to the knowledge of Pubco, between or among any of Pubco’s stockholders.
“Common
Stock Equivalents”
means
any securities of Pubco or the Pubco Subsidiaries which would entitle the holder
thereof to acquire at any time Pubco’s common stock, including, without
limitation, any debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or exchangeable
for, or otherwise entitles the holder thereof to receive Pubco’s common
stock.
4.8 SEC
Reports; Financial Statements.
Pubco
has filed all reports, schedules, forms, statements and other documents required
to be filed by Pubco under the Securities Act and the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the
date
hereof (or such shorter period as Pubco was required by law or regulation to
file such material) (the foregoing materials, including the exhibits thereto
and
documents incorporated by reference therein, being collectively referred to
herein as the “SEC
Reports”)
on a
timely basis or has received a valid extension of such time of filing and has
filed any such SEC Reports prior to the expiration of any such extension. As
of
their respective dates, the SEC Reports complied in all material respects with
the requirements of the Securities Act and the Exchange Act, as applicable,
and
none of the SEC Reports, when filed, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The financial
statements of Pubco included in the SEC Reports comply in all material respects
with applicable accounting requirements and the rules and regulations of the
Commission with respect thereto as in effect at the time of filing. Such
financial statements have been prepared in accordance with GAAP, except as
may
be otherwise specified in such financial statements or the notes thereto and
except that unaudited financial statements may not contain all footnotes
required by GAAP, and fairly present in all material respects the financial
position of Pubco and its consolidated Pubco Subsidiaries as of and for the
dates thereof and the results of operations and cash flows for the periods
then
ended, subject, in the case of unaudited statements, to normal, immaterial,
year-end audit adjustments.
4.9 Material
Changes.
Since
the date of the latest audited financial statements included within the SEC
Reports, except as specifically disclosed in a subsequent SEC Report filed
prior
to the date hereof or in connection herewith: (i) there has been no event,
occurrence or development that has had or that could reasonably be expected
to
result in a Material Adverse Effect, (ii) Pubco has not incurred any liabilities
(contingent or otherwise) other than (A) trade payables and accrued expenses
incurred in the ordinary course of business consistent with past practice and
(B) liabilities not required to be reflected in Pubco’s financial statements
pursuant to GAAP or disclosed in filings made with the Commission, (iii) Pubco
has not altered its method of accounting, (iv) Pubco has not declared or made
any dividend or distribution of cash or other property to its stockholders
or
purchased, redeemed or made any agreements to purchase or redeem any shares
of
its capital stock and (v) Pubco has not issued any equity securities to any
officer, director or Affiliate. Pubco does not have pending before the
Commission any request for confidential treatment of information. Except for
the
issuance of the Pubco Shares contemplated by this Agreement or as set forth
on
Schedule
4.9,
no
event, liability or development has occurred or exists with respect to Pubco
or
its Pubco Subsidiaries or their respective business, properties, operations
or
financial condition, that would be required to be disclosed by Pubco under
applicable securities laws at the time this representation is made
or
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17
deemed
made that has not been publicly disclosed at least one (1) Trading Day prior
to
the date that this representation is made.
4.10 Litigation.
There
is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of Pubco, threatened against or affecting Pubco,
any Subsidiary or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an “Action”)
which
(i) adversely affects or challenges the legality, validity or enforceability
of
this Agreement or the Pubco Shares or (ii) could, if there were an unfavorable
decision, have or reasonably be expected to result in a Material Adverse Effect.
Neither Pubco nor any Pubco Subsidiary, nor any director or officer thereof,
is
or has been the subject of any Action involving a claim of violation of or
liability under federal or state securities laws or a claim of breach of
fiduciary duty. There has not been, and to the knowledge of Pubco, there is
not
pending or contemplated, any investigation by the Commission involving Pubco
or
any current or former director or officer of Pubco. The Commission has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by Pubco under the Securities Act.
4.11 Labor
Relations.
No
material labor dispute exists or, to the knowledge of Pubco, is imminent with
respect to any of the employees of Pubco which could reasonably be expected
to
result in a Material Adverse Effect. None of Pubco’s or its Pubco Subsidiaries’
employees is a member of a union that relates to such employee’s relationship
with Pubco or such Pubco Subsidiary, and neither Pubco nor any of its Pubco
Subsidiaries is a party to a collective bargaining agreement, and Pubco and
its
Pubco Subsidiaries believe that their relationships with their employees are
good. No executive officer, to the knowledge of Pubco, is, or is now expected
to
be, in violation of any material term of any employment contract,
confidentiality, disclosure or proprietary information agreement or
non-competition agreement, or any other contract or agreement or any restrictive
covenant in favor of any third party, and the continued employment of each
such
executive officer does not subject Pubco or any of its Pubco Subsidiaries to
any
liability with respect to any of the foregoing matters. Pubco and its Pubco
Subsidiaries are in compliance with all U.S. federal, state, local and foreign
laws and regulations relating to employment and employment practices, terms
and
conditions of employment and wages and hours, except where the failure to be
in
compliance could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
4.12 Compliance.
Neither
Pubco nor any Pubco Subsidiary: (i) is in default under or in violation of
(and
no event has occurred that has not been waived that, with notice or lapse of
time or both, would result in a default by Pubco or any Pubco Subsidiary under),
nor has Pubco or any Pubco Subsidiary received notice of a claim that it is
in
default under or that it is in violation of, any indenture, loan or credit
agreement or any other agreement or instrument to which it is a party or by
which it or any of its properties is bound (whether or not such default or
violation has been waived), (ii) is in violation of any order of any court,
arbitrator or governmental body or (iii) is or has been in violation of any
statute, rule or regulation of any governmental authority, including without
limitation all foreign, federal, state and local laws applicable to its business
and all such laws that affect the environment, except in each case as could
not
have or reasonably be expected to result in a Material Adverse Effect.
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18
4.13 Regulatory
Permits.
Pubco
and the Pubco Subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state, local or foreign regulatory
authorities necessary to conduct their respective businesses, except where
the
failure to possess such permits could not reasonably be expected to result
in a
Material Adverse Effect (“Material
Permits”),
and
neither Pubco nor any Pubco Subsidiary has received any notice of proceedings
relating to the revocation or modification of any Material Permit.
4.14 Title
to Assets.
Pubco
and the Pubco Subsidiaries have good and marketable title in all personal
property owned by them that is material to the business of Pubco and the Pubco
Subsidiaries, in each case free and clear of all Liens, except for Liens that
do
not materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by Pubco and the
Pubco Subsidiaries and Liens for the payment of Taxes, the payment of which
is
neither delinquent nor subject to penalties. Neither Pubco nor the Pubco
Subsidiaries own any real property. Any real property and facilities held under
lease by Pubco and the Pubco Subsidiaries are held by them under valid,
subsisting and enforceable leases with which Pubco and the Pubco Subsidiaries
are in compliance.
4.15 Patents
and Trademarks.
Pubco
and the Pubco Subsidiaries have, or have rights to use, all patents, patent
applications, trademarks, trademark applications, service marks, trade names,
trade secrets, inventions, copyrights, licenses and other intellectual property
rights and similar rights as described in the SEC Reports as necessary or
material for use in connection with their business and which the failure to
so
have could have a Material Adverse Effect (collectively, the “Intellectual
Property Rights”).
Neither Pubco nor any Pubco Subsidiary has received a notice (written or
otherwise) that any of the Intellectual Property Rights used by Pubco or any
Pubco Subsidiary violates or infringes upon the rights of any Person. To the
knowledge of Pubco, all such Intellectual Property Rights are enforceable and
there is no existing infringement by another Person of any of the Intellectual
Property Rights. Pubco and its Pubco Subsidiaries have taken reasonable security
measures to protect the secrecy, confidentiality and value of all of their
intellectual properties, except where failure to do so could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect.
4.16 Transactions
with Affiliates and Employees.
Except
as set forth in the SEC Reports, none of the officers or directors of Pubco
and,
to the knowledge of Pubco, none of the employees of Pubco is presently a party
to any transaction with Pubco or any Pubco Subsidiary (other than for services
as employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge
of Pubco, any entity in which any officer, director, or any such employee has
a
substantial interest or is an officer, director, trustee or partner, in each
case in excess of $120,000, other than for: (i) payment of salary or consulting
fees for services rendered, (ii) reimbursement for expenses incurred on behalf
of Pubco and (iii) other employee benefits.
4.17 Xxxxxxxx-Xxxxx;
Internal Accounting Controls.
Pubco
is in material compliance with all provisions of the Xxxxxxxx-Xxxxx Act of
2002
which are applicable to it as of the
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19
Closing
Date. Pubco
and
the Pubco
Subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurance that: (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
GAAP and to maintain asset accountability, (iii) access to assets is permitted
only in accordance with management’s general or specific authorization, and (iv)
the recorded accountability for assets is compared with the existing assets
at
reasonable intervals and appropriate action is taken with respect to any
differences. Pubco has established disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for Pubco and designed
such disclosure controls and procedures to ensure that information required
to
be disclosed by Pubco in the reports it files or submits under the Exchange
Act
is recorded, processed, summarized and reported, within the time periods
specified in the Commission’s rules and forms. Pubco’s certifying officers have
evaluated the effectiveness of Pubco’s disclosure controls and procedures as of
the end of the period covered by Pubco’s most recently filed periodic report
under the Exchange Act (such date, the “Evaluation
Date”).
Pubco
presented in its most recently filed periodic report under the Exchange Act
the
conclusions of the certifying officers about the effectiveness of the disclosure
controls and procedures based on their evaluations as of the Evaluation Date.
Since the Evaluation Date, there have been no changes in Pubco’s internal
control over financial reporting (as such term is defined in the Exchange Act)
that has materially affected, or is reasonably likely to materially affect,
Pubco’s internal control over financial reporting.
4.18 Certain
Fees.
No
brokerage or finder’s fees or commissions are or will be payable by Pubco to any
broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated
by
this Agreement.
4.19 Issuance
of Pubco Shares.
Assuming the accuracy of the Premier Power Owners’ representations and
warranties set forth in Section 3, no registration under the Securities Act
is
required for the offer and issuance of the Pubco Shares by Pubco to the Premier
Power Owners as contemplated hereby. The issuance of the Pubco Shares hereunder
does not contravene the rules and regulations of the applicable Trading
Market.
4.20 Investment
Company.
Pubco is
not, and is not an Affiliate of, an “investment company” within the meaning of
the Investment Company Act of 1940, as amended.
4.21 Listing
and Maintenance Requirements.
Pubco’s
common stock is registered pursuant to Section 15(d) of the Exchange Act, and
Pubco has taken no action designed to, or which to its knowledge is likely
to
have the effect of, terminating the registration of Pubco’s common stock under
the Exchange Act nor has Pubco received any notification that the Commission
is
contemplating terminating such registration. Pubco has not, in the 12 months
preceding the date hereof, received notice from any Trading Market on which
Pubco’s common stock is or has been listed or quoted to the effect that Pubco is
not in compliance with the listing or maintenance requirements of such Trading
Market. Pubco is in compliance with all such listing and maintenance
requirements.
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4.22 Application
of Takeover Protections.
Pubco
has taken all necessary action, if any, in order to render inapplicable any
control share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or other similar anti-takeover provision
under Pubco’s certificate of incorporation (or similar charter documents) or the
laws of its state of incorporation that is or could become applicable to the
Premier Power Owners as a result of the Premier Power Owners and Pubco
fulfilling their obligations or exercising their rights under this Agreement,
including without limitation as a result of Pubco’s issuance of the Pubco Shares
and the Premier Power Owners’ ownership of the Pubco Shares.
4.23 No
Integrated Offering.
Assuming
the accuracy of the Premier Power Owners’ representations and warranties set
forth in Section 3, neither Pubco, nor any of its Affiliates, nor any Person
acting on its or their behalf has, directly or indirectly, made any offers
or
sales of any security or solicited any offers to buy any security, under
circumstances that would cause this offering of the Pubco Shares to be
integrated with prior offerings by Pubco for purposes of (i) the Securities
Act
which would require the registration of any such securities under the Securities
Act, or (ii) any applicable shareholder approval provisions of any Trading
Market on which any of the securities of Pubco are listed or
designated.
4.24 Tax
Status.
Except
for matters that would not, individually or in the aggregate, have or reasonably
be expected to result in a Material Adverse Effect, Pubco and each Pubco
Subsidiary has filed all necessary Tax Returns and has paid or accrued all
Taxes
shown as due thereon, and Pubco has no knowledge of a tax deficiency which
has
been asserted or threatened against Pubco or any Pubco Subsidiary.
4.25 No
General Solicitation.
Neither
Pubco nor any person acting on behalf of Pubco has offered or sold any of the
Pubco Shares by any form of general solicitation or general advertising.
4.26 Foreign
Corrupt Practices.
Neither
Pubco, nor to the knowledge of Pubco, any agent or other person acting on behalf
of Pubco, has: (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to
foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or
domestic political parties or campaigns from corporate funds, (iii) failed
to
disclose fully any contribution made by Pubco (or made by any person acting
on
its behalf of which Pubco is aware) which is in violation of law or (iv)
violated in any material respect any provision of the Foreign Corrupt Practices
Act of 1977, as amended.
4.27 Accountants.
Pubco’s
accounting firm is set forth on Schedule
4.30
of the
Disclosure Schedules. To the knowledge and belief of Pubco, such accounting
firm: (i) is a registered public accounting firm as required by the Exchange
Act
and (ii) expressed its opinion with respect to the financial statements included
in Pubco’s Annual Report for the year ended December 31, 2007.
4.28 No
Disagreements with Accountants and Lawyers.
There
are no disagreements of any kind, including but not limited to any disagreements
regarding fees owed for services rendered, presently existing, or reasonably
anticipated by Pubco to arise, between Pubco and the
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21
accountants
and lawyers formerly or presently employed by Pubco which could affect Pubco’s
ability to perform any of its obligations under this Agreement, and Pubco is
current with respect to any fees owed to its accountants and
lawyers.
4.29 Regulation
M Compliance.
Pubco has not, and to the knowledge of Pubco no one acting on its behalf has,
(i) taken, directly or indirectly, any action designed to cause or to result
in
the stabilization or manipulation of the price of any security of Pubco to
facilitate the sale or resale of any of the Pubco Shares, (ii) sold, bid for,
purchased, or paid any compensation for soliciting purchases of, any of the
securities of Pubco, or (iii) paid or agreed to pay to any Person any
compensation for soliciting another to purchase any other securities of
Pubco.
4.30 Minute
Books.
The
minute books of Pubco and the Pubco Subsidiaries made available to Premier
Power
and the Premier Power Owners contain a complete summary of all meetings and
written consents in lieu of meetings of directors and stockholders since the
time of incorporation.
4.31 Employee
Benefits.
Neither
Pubco nor any Pubco Subsidiary has (nor for the two years preceding the date
hereof has had) any plans which are subject to ERISA. “ERISA”
means
the Employee Retirement Income Security Act of 1974 or any successor law and
the
regulations and rules issued pursuant to that act or any successor
law.
4.32 Business
Records and Due Diligence.
Prior
to the Closing, Pubco and Pubco Subsidiaries delivered to Premier Power
all
records and documents relating to Pubco and Pubco Subsidiaries, which Pubco
and
Pubco Subsidiaries possess, including, without limitation, books, records,
government filings, Tax Returns, Charter Documents, corporate records, stock
records, consent decrees, orders, and correspondence, director and stockholder
minutes, resolutions and written consents, stock ownership records, financial
information and records, and other documents used in or associated with Pubco
and Pubco Subsidiaries (“Business
Records”).
4.33 No
Undisclosed Liabilities.
Except
as set forth in Schedule 4.33 hereto, at the Closing, Pubco and Pubco
Subsidiaries shall have no liabilities, debts or payables (absolute, accrued,
contingent or otherwise) of a nature required to disclosed on a balance sheet
or
in the related notes to the consolidated financial statements prepared in
accordance with GAAP which are, individually or in the aggregate, material
to
the business, results of operations or financial condition of
Pubco.
4.34 Disclosure.
The
representations and warranties and statements of fact made by Pubco and the
Pubco Subsidiaries in this Agreement are, as applicable, accurate, correct
and
complete and do not contain any untrue statement of a material fact or omit
to
state any material fact necessary in order to make the statements and
information contained herein not false or misleading.
ARTICLE
5
REPRESENTATIONS
AND WARRANTIES OF THE PUBCO STOCKHOLDER
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22
The
Pubco
Stockholder hereby represents and warrants to Premier Power and the Premier
Power Owners as of the date hereof and as of the Closing Date (unless otherwise
indicated), as follows:
5.1 Ownership
of Pubco Shares.
The
Pubco Stockholder owns, beneficially and of record, good and marketable title
to
the Pubco Shares set forth opposite its name in Annex
II
attached
hereto, free and clear of any security interests, liens, adverse claims,
encumbrances, equities, proxies, options or shareholders’ agreements, and has no
right or claims whatsoever to any other shares of Pubco capital stock and does
not have any options, warrants or any other instruments entitling it to exercise
to purchase or convert into shares of Pubco capital stock, other than in
connection with the concurrent financing. On or prior to Closing, the Pubco
Stockholder will transfer 25,448,000 shares of Pubco’s common stock to Pubco for
cancellation.
5.2 Authority
Relative to this Agreement.
This
Agreement has been duly and validly executed and delivered by the Pubco
Stockholder and constitutes a valid and binding agreement of it, enforceable
against the Pubco Stockholder in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors’ rights generally or by general
principles of equity.
5.3 Disclosure.
The
representations and warranties and statements of fact made by Pubco Stockholder
in this Agreement are, as applicable, accurate, correct and complete and do
not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements and information contained herein
not false or misleading.
ARTICLE
6
SURVIVAL
OF REPRESENTATIONS AND WARRANTIES
6.1 Survival
of Representations and Warranties of the Parties.
The
representations and warranties of the parties made in Sections 2, 3, 4 and
5 of
this Agreement shall survive six (6) months beyond the Closing Date. This
Article 6 shall not limit any claim for fraud based on such representations
and
warranties. Nothing in this Article 6 shall impair or alter any covenant or
agreement of the parties which by its terms contemplates performance after
the
Closing Date.
ARTICLE
7
COVENANTS
OF THE PARTIES
7.1
Corporate
Examinations and Investigations.
Prior
to the Closing, each party shall be entitled, through its employees and
representatives, to make such investigations and examinations of the books,
records and financial condition of Premier Power and Pubco as each party may
request. In order that each party may have the full opportunity to do so,
Premier Power and Pubco, the Premier Power Owners and the Pubco Stockholder
shall furnish each party and its representatives during such period with all
such information concerning the affairs of Premier Power or Pubco as each party
or its representatives may reasonably request and cause Premier Power or Pubco
and their respective officers, employees, consultants, agents, accountants
and
attorneys to cooperate fully with each party’s representatives in connection
with
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such
review and examination and to make full disclosure of all information and
documents requested by each party and/or its representatives. Any such
investigations and examinations shall be conducted at reasonable times and
under
reasonable circumstances, it being agreed that any examination of original
documents will be at each party’s premises, with copies thereof to be provided
to each party and/or its representatives upon request.
7.2 Cooperation;
Consents.
Prior
to the Closing, each party shall cooperate with the other parties to the end
that the parties shall (i) in a timely manner make all necessary filings with,
and conduct negotiations with, all authorities and other persons the consent
or
approval of which, or the license or permit from which is required for the
consummation of the Acquisition and (ii) provide to each other party such
information as the other party may reasonably request in order to enable it
to
prepare such filings and to conduct such negotiations.
7.3 Conduct
of Business.
Subject
to the provisions hereof, from the date hereof through the Closing, each party
hereto shall (i) conduct its business in the ordinary course and in such a
manner so that the representations and warranties contained herein shall
continue to be true and correct in all material respects as of the Closing
as if
made at and as of the Closing and (ii) not enter into any material transactions
or incur any material liability not required or specifically contemplated
hereby, without first obtaining the written consent of Premier Power and the
Premier Power Owners on the one hand and Pubco and the Pubco Stockholder on
the
other hand. Without the prior written consent of Premier Power, the Premier
Power Owners, Pubco or the Pubco Stockholder, except as required or specifically
contemplated hereby, each party shall not undertake or fail to undertake any
action if such action or failure would render any of said warranties and
representations untrue in any material respect as of the Closing.
7.4 Litigation.
From
the date hereof through the Closing, each party hereto shall promptly notify
the
representative of the other parties of any lawsuits, claims, proceedings or
investigations which after the date hereof are threatened or commenced against
such party or any of its affiliates or any officer, director, employee,
consultant, agent or shareholder thereof, in their capacities as such, which,
if
decided adversely, could reasonably be expected to have a Material Adverse
Effect on such party or any of its subsidiaries.
7.5 Notice
of Default.
From
the date hereof through the Closing, each party hereto shall give to the
representative of the other parties prompt written notice of the occurrence
or
existence of any event, condition or circumstance occurring which would
constitute a violation or breach of this Agreement by such party or which would
render inaccurate in any material respect any of such party’s representations or
warranties herein.
7.6 Share
Cancellations and Transfers.
Immediately prior to the Closing, the Pubco Stockholder shall surrender the
number of shares of Pubco common stock set forth opposite such party’s name in
Column III on Annex
II
attached
hereto for cancellation. In connection with such share cancellation, the Pubco
Stockholder agrees to execute and deliver any documents and instruments
reasonably necessary to effect such cancellation, including originally executed
certificate(s) and stock powers, with proper endorsements and/or medallion
certified signatures as may be required by Pubco’s transfer agent.
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24
7.7 By-laws.
If
necessary, Pubco shall amend its by-laws to permit the election and/or
appointment of additional new directors to Pubco’s Board of Directors as set
forth in Section 7.8(a) below.
7.8 Confidentiality;
Access to Information.
(a) Confidentiality.
Upon
Closing, any confidentiality agreement or letter of intent previously executed
by the parties shall be superseded in its entirety by the provisions of this
Agreement. Each party agrees to maintain in confidence any non-public
information received from the other party, and to use such non-public
information only for purposes of consummating the transactions contemplated
by
this Agreement. Such confidentiality obligations will not apply to (i)
information which was known to the one party or their respective agents prior
to
receipt from the other party; (ii) information which is or becomes generally
known; (iii) information acquired by a party or their respective agents from
a
third party who was not bound to an obligation of confidentiality; and (iv)
disclosure required by law. In the event this Agreement is terminated as
provided in Article 8 hereof, each party will return or cause to be returned
to
the other all documents and other material obtained from the other in connection
with the Transaction contemplated hereby.
(b) Access
to Information.
(i) Premier
Power will afford Pubco and its financial advisors, accountants, counsel and
other representatives reasonable access during normal business hours, upon
reasonable notice, to the properties, books, records and personnel of Premier
Power during the period prior to the Closing to obtain all information
concerning the business, including the status of product development efforts,
properties, results of operations and personnel of Premier Power, as Pubco
may
reasonably request. No information or knowledge obtained by Pubco in any
investigation pursuant to this Section 6.8 will affect or be deemed to modify
any representation or warranty contained herein or the conditions to the
obligations of the parties to consummate the Transaction.
(ii) Pubco
will afford Premier Power and its financial advisors, underwriters, accountants,
counsel and other representatives reasonable access during normal business
hours, upon reasonable notice, to the properties, books, records and personnel
of Pubco during the period prior to the Closing to obtain all information
concerning the business, including the status of product development efforts,
properties, results of operations and personnel of Pubco, as Premier Power
may
reasonably request. No information or knowledge obtained by Premier Power in
any
investigation pursuant to this Section 6.8 will affect or be deemed to modify
any representation or warranty contained herein or the conditions to the
obligations of the parties to consummate the Transaction.
7.9
Public
Disclosure.
Except
to the extent previously disclosed or to the extent the parties believe that
they are required by applicable law or regulation to make disclosure, prior
to
Closing, no party shall issue any statement or communication to the public
regarding the transaction contemplated herein without the consent of the other
party, which consent shall not be unreasonably withheld. To the extent a party
hereto believes it is required by law or regulation
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to
make
disclosure regarding the Transaction, it shall, if possible, immediately notify
the other party prior to such disclosure. Notwithstanding the foregoing, the
parties hereto agree that Premier Power will prepare and file a Current Report
on Form 8-K pursuant to the Exchange Act reasonably acceptable to the Pubco
Stockholder to report the execution of this Agreement and closing of the
transactions contemplated thereby.
7.10 Assistance
with Post-Closing SEC Reports and Inquiries.
Upon
the reasonable request of Premier Power, after the Closing Date, the Pubco
Stockholder shall use its reasonable efforts to provide such information
available to it, including information, filings, reports, financial statements
or other materials of Pubco occurring, reported or filed prior to the Closing,
as may be necessary or required by Premier Power for the preparation of the
post-Closing Date reports that Pubco is required to file with the SEC to remain
in compliance and current with its reporting requirements under the Securities
Act, or filings required to address and resolve matters as may relate to the
period prior to the Closing and any SEC comments relating thereto or any SEC
inquiry thereof.
ARTICLE
8
CONDITIONS
TO CLOSING
8.1
Conditions
to Obligations of Premier Power and the Premier Power Owners.
The
obligations of Premier Power and the Premier Power Owners under this Agreement
shall be subject to each of the following conditions:
(a) Closing
Deliveries.
At the
Closing, Pubco and/or the Pubco Stockholder shall have delivered or caused
to be
delivered to Premier Power and the Premier Power Owners the
following:
(i)
written
resignations of all officers and directors of Pubco in office immediately prior
to the Closing;
(ii)
resolutions
duly adopted by the Board of Directors of Pubco approving the following events
or actions, as applicable:
| (a) |
the
execution, delivery and performance of this
Agreement;
|
| (b) |
the
Acquisition and the terms thereof;
|
| (c) |
adoption
of bylaws in the form agreed by the
parties;
|
|
(d)
|
fixing
the number of authorized directors on the board of directors at two
(2);
and
|
|
(e)
|
the
appointment of Xxxx X. Xxxxx and Xxxxxx de Anquin as directors to
serve on
the Pubco board of directors,
with
|
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Xxxx
X.
Xxxxx serving as Chairman of the Board (the “Premier
Power Directors”).
(iii)
a
certificate of good standing for Pubco from its jurisdiction of incorporation,
dated not earlier than five days prior to the Closing Date;
(iv) an
instruction letter signed by the President of Pubco addressed to Pubco’s
transfer agent of record, in a form reasonably acceptable to Premier Power
and
consistent with the terms of this Agreement, instructing the transfer agent
to
issue stock certificates representing the Pubco Shares to be delivered pursuant
to this Agreement registered in the names set forth in Annex
I;
(v)
evidence
satisfactory to Premier Power of delivery by the Pubco Stockholder of the
original share certificate(s) representing an aggregate 25,448,000 shares of
common stock of Pubco, accompanied by a stock powers properly authenticated
in
original form, to the Pubco transfer agent for cancellation;
(vi)
this
Agreement duly executed by Pubco and the Pubco Stockholder;
(vii) all
corporate records, agreements, seals and any other information reasonably
requested by Premier Power’s representatives with respect to Pubco;
and
(viii)
such
other documents as Premier Power and/or the Premier Power Owners may reasonably
request in connection with the transactions contemplated hereby.
(b) Representations
and Warranties to be True.
The
representations and warranties of Pubco and the Pubco Stockholder herein
contained shall be true in all material respects at the Closing with the same
effect as though made at such time. Pubco and the Pubco Stockholder shall have
performed in all material respects all obligations and complied in all material
respects with all covenants and conditions required by this Agreement to be
performed or complied with by them at or prior to the Closing.
(c) Transfer
of On-Going Business.
At
Closing, Pubco shall transfer to Xxxxx Xxxxxx and Xxxx Xxxxxx all of the
outstanding membership interests of Harry’s Trucking, LLC, a California limited
liability company, which company includes all of the current assets and
operations of Pubco, in complete settlement of outstanding debt owed by such
individuals to Pubco and for assuming any and all debts, payables and
liabilities relating to Pubco prior to the Closing Date. Pubco shall have
delivered documentary evidence of such transfer and transactions reasonably
satisfactory to Premier Power.
(d) No
Assets and Liabilities.
At the
Closing, Pubco shall have no or nominal liabilities, debts or payables and
no
material assets.
(e) SEC
Filings.
At the
Closing, Pubco will be current in all SEC filings required by it to be filed.
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(f) Outstanding
Common Stock.
Pubco
shall have at least 100,000,000 shares of its common stock authorized and shall
have no more than 1,800,000 shares of its common stock issued and outstanding
after cancellation of 25,448,000 shares of Pubco’s common stock held by the
Pubco Stockholder.
(g) Outstanding
Preferred Stock.
Pubco
shall have at least 20,000,000 shares of its preferred stock authorized and
shall have no shares of its preferred stock issued and outstanding.
(h) No
Adverse Effect.
The
business and operations of Pubco will not have suffered any Material Adverse
Effect.
8.2 Conditions
to Obligations of Pubco and the Pubco Stockholder.
The
obligations of Pubco and the Pubco Stockholder under this Agreement shall be
subject to each of the following conditions:
(a) Closing
Deliveries.
On the
Closing Date, Premier Power and/or the Premier Power Owners shall have delivered
to Pubco the following:
(i) this
Agreement duly executed by Premier Power and the Premier Power
Owners;
(ii) resolutions
duly adopted by the Board of Directors of Premier Power authorizing and
approving the execution, delivery and performance of this
Agreement;
(iii) certificates
representing the Premier Power Equity Interests to be delivered pursuant to
this
Agreement duly endorsed or accompanied by duly executed stock powers or
instruments of like tenor;
(iv) a
certificate of good standing for Premier Power and each Subsidiary from their
respective jurisdictions of incorporation or formation, dated not earlier than
five (5) days prior to the Closing Date; and
(v) such
other documents as Pubco may reasonably request in connection with the
transactions contemplated hereby.
(b) Representations
and Warranties True and Correct.
The
representations and warranties of Premier Power and the Premier Power Owners
herein contained shall be true in all material respects at the Closing with
the
same effect as though made at such time. Premier Power and the Premier Power
Owners shall have performed in all material respects all obligations and
complied in all material respects with all covenants and conditions required
by
this Agreement to be performed or complied with by them at or prior to the
Closing.
(c) No
Adverse Effect.
The
business and operations of Pubco will not have suffered any Material Adverse
Effect.
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28
(d) Jumbo
Form 8-K and Financial Statements.
Premier
Power shall have delivered to Pubco and the Pubco Stockholder a substantially
complete draft of its current report on Form 8-K (“Jumbo
Form 8-K”),
reporting the Acquisition, concurrent financing and other information that
would
be required if it were filing a general form for registration of securities
on
Form 10 under the Exchange Act, including audited historical combined financial
statements and unaudited combined financial statements for any interim period
of
Premier Power and pro forma financial statements showing the effect of the
Acquisition on Pubco.
(e) Subsidiary
Transactions.
Premier
Power shall have delivered to Pubco and the Pubco Stockholder documentation
reflecting the completion of transactions involving the acquisition by Premier
Power from certain of the Premier Power Owners of all of the outstanding
membership interests of Bright Future Technologies, LLC, a Nevada limited
liability company, and all of the outstanding equity interests of Premier Power,
Sociedad Limitada, a limited liability company organized under the laws of
Spain.
ARTICLE
9
TERMINATION
9.1 This
Agreement may be terminated at any time prior to the Closing:
(a) by
mutual
written agreement of Pubco and the Premier Power Owners;
(b) by
either
Pubco or the Premier Power Owners if the Transaction shall not have been
consummated for any reason by September 15, 2008; provided,
however,
that
the right to terminate this Agreement under this Section 9.1(b) shall not be
available to any party whose action or failure to act has been a principal
cause
of or resulted in the failure of the Transaction to occur on or before such
date
and such action or failure to act constitutes a breach of this
Agreement;
(c) by
either
Pubco or the Premier Power Owners if a governmental entity shall have issued
an
order, decree or ruling or taken any other action, in any case having the effect
of permanently restraining, enjoining or otherwise prohibiting the Acquisition,
which order, decree, ruling or other action is final and non-appealable;
(d) by
the
Premier Power Owners, upon a material breach of any representation, warranty,
covenant or agreement on the part of Pubco or the Pubco Stockholder set forth
in
this Agreement, or if any representation or warranty of Pubco or the Pubco
Stockholder shall have become materially untrue, in either case such that the
conditions set forth in Section 8.1 would not be satisfied as of the time of
such breach or as of the time such representation or warranty shall have become
untrue, provided,
that if
such inaccuracy in Pubco’s or the Pubco Stockholder’s representations and
warranties or breach by Pubco or the Pubco Stockholder is curable by Pubco
or
the Pubco Stockholder prior to the Closing Date, then the Premier Power Owners
may not terminate this Agreement under this Section 9.1(d) for thirty (30)
days
after delivery of written notice from the Premier Power Owners to Pubco and
the
Pubco Stockholder of such breach, provided
Pubco
and the Pubco Stockholder continue to exercise commercially reasonable efforts
to cure such breach (it being understood that the
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29
Premier
Power Owners may not terminate this Agreement pursuant to this Section 9.1(d)
if
they shall have materially breached this Agreement or if such breach by Pubco
or
the Pubco Stockholder is cured during such thirty (30) day period);
or
(e) by
Pubco,
upon a material breach of any representation, warranty, covenant or agreement
on
the part of Premier Power or the Premier Power Owners set forth in this
Agreement, or if any representation or warranty of Premier Power or the Premier
Power Owners shall have become materially untrue, in either case such that
the
conditions set forth in Section 8.2 would not be satisfied as of the time of
such breach or as of the time such representation or warranty shall have become
untrue, provided,
that if
such inaccuracy in Premier Power’s or the Premier Power Owners’ representations
and warranties or breach by Premier Power or the Premier Power Owners is curable
by Premier Power or the Premier Power Owners prior to the Closing Date, then
Pubco may not terminate this Agreement under this Section 9.1(e) for thirty
(30)
days after delivery of written notice from Pubco to Premier Power and the
Premier Power Owners of such breach, provided
Premier
Power and the Premier Power Owners continue to exercise commercially reasonable
efforts to cure such breach (it being understood that Pubco may not terminate
this Agreement pursuant to this Section 9.1(e) if it shall have materially
breached this Agreement or if such breach by Premier Power or the Premier Power
Owners is cured during such thirty (30) day period).
9.2 Notice
of Termination; Effect of Termination.
Any
termination of this Agreement under Section 9.1 above will be effective
immediately upon (or, if the termination is pursuant to Section 9.1(d) or
Section 9.1(e) and the proviso therein is applicable, thirty (30) days after)
the delivery of written notice of the terminating party to the other parties
hereto. In the event of the termination of this Agreement as provided in Section
9.1, this Agreement shall be of no further force or effect and the Acquisition
shall be abandoned, except as set forth in Section 9.1, Section 9.2 and Article
10 (General Provisions), each of which shall survive the termination of this
Agreement. The first and third paragraphs under the heading “Expenses” in the
Term Sheet, dated August 11, 2008, between Premier Power and the Pubco
Stockholder (the “Term
Sheet”)
shall
be applicable with respect to this Article 9.
ARTICLE
10
GENERAL
PROVISIONS
10.1
Notices.
Any and
all notices or other communications or deliveries required or permitted to
be
provided hereunder shall be in writing and shall be deemed given and effective
on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth
on
the signature pages attached hereto prior to 5:30 p.m. (New York City time)
on a
Trading Day, (b) the next Trading Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
set
forth on the signature pages attached hereto on a day that is not a Trading
Day
or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second
Trading Day following the date of mailing, if sent by U.S. nationally recognized
overnight courier service or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications
shall be as set forth on the signature pages attached hereto.
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30
10.2
Interpretation.
The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
References to Sections and Articles refer to sections and articles of this
Agreement unless otherwise stated.
10.3
Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, void or unenforceable, the remainder
of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated and the parties shall negotiate in good faith to modify this
Agreement to preserve each party’s anticipated benefits under this
Agreement.
10.4
Miscellaneous.
This
Agreement (together with all other documents and instruments referred to
herein): (a) constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof; (b) except as expressly set forth herein,
is not intended to confer upon any other person any rights or remedies hereunder
and (c) shall not be assigned by operation of law or otherwise, except as may
be
mutually agreed upon by the parties hereto.
10.5 Separate
Counsel.
Each
party hereby expressly acknowledges that it has been advised to seek its own
separate legal counsel for advice with respect to this Agreement, and that
no
counsel to any party hereto has acted or is acting as counsel to any other
party
hereto in connection with this Agreement.
10.6
Governing
Law.
This
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Delaware.
10.7
Counterparts
and Facsimile Signatures.
This
Agreement may be executed in two or more counterparts, which together shall
constitute a single agreement. This Agreement and any documents relating to
it
may be executed and transmitted to any other party by facsimile or .pdf, which
copy shall be deemed to be, and utilized in all respects as, an original,
wet-inked manually executed document.
10.8 Amendment.
This
Agreement may be amended, modified or supplemented only by an instrument in
writing executed by Premier Power, Pubco, and holders of a majority of the
equity interests of Premier Power and the holders of a majority of outstanding
voting stock of Pubco; provided that, the consent of any Premier Power or Pubco
shareholder that is a party to this Agreement shall be required if the amendment
or modification would disproportionately affect such shareholder (other than
by
virtue of their ownership of Premier Power or Pubco shares, as
applicable).
10.9 Parties
In Interest.
Except
as otherwise provided herein, the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto.
Page
31
10.10 Waiver.
No
waiver by any party of any default or breach by another party of any
representation, warranty, covenant or condition contained in this Agreement
shall be deemed to be a waiver of any subsequent default or breach by such
party
of the same or any other representation, warranty, covenant or condition. No
act, delay, omission or course of dealing on the part of any party in exercising
any right, power or remedy under this Agreement or at law or in equity shall
operate as a waiver thereof or otherwise prejudice any of such party’s rights,
powers and remedies. All remedies, whether at law or in equity, shall be
cumulative and the election of any one or more shall not constitute a waiver
of
the right to pursue other available remedies.
10.11 Expenses.
At or
prior to the Closing, the parties hereto shall pay all of their own expenses
relating to the transactions contemplated by this Agreement, including, without
limitation, the fees and expenses of their respective counsel and financial
advisers, except as otherwise provided in the Term Sheet.
[Remainder
of Page Left Blank Intentionally]
Page
32
IN
WITNESS WHEREOF, the parties have executed this Share Exchange Agreement as
of
the date first written above.
PUBCO:
a
corporation incorporated and existing under the laws of the State of
Delaware
By:
_______________________________________
Name:
Xxxxx Xxxxxx
Title:
President and Chief Executive Officer
Address
for Notices:
00000
Xxxxxxx Xxxxxx, #000
Xxxxxx,
XX 00000
Tel:
(000) 000-0000
Fax:
__________
Copy
to:
Xxxxxxxxx
Xxxxxxx, LLP
MetLife
Building
000
Xxxx
Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxxx X. Xxxxxxx, Esq.
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Page
33
SIGNATURE
PAGE OF PUBCO STOCKHOLDER
PUBCO
STOCKHOLDER:
VISION
OPPORTUNITY MASTER FUND, LTD.
By:
_______________________________________
Xxxx
Xxxxxxxx
Portfolio
Manager
Address
for Notices:
c/o
Vision Capital Advisors LLC
00
Xxxx
00xx
Xxxxxx,
0xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxx
Xxxxxxx, Esq., Legal and Operations
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Copy
to:
Xxxxxxxxx
Xxxxxxx, LLP
MetLife
Building
000
Xxxx
Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxxx X. Xxxxxxx, Esq.
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Page
34
SIGNATURE
PAGE OF PREMIER POWER
PREMIER
POWER:
a
corporation incorporated and existing under the laws of the State of
California
By:
_______________________________________
Name:
Xxxx Xxxxx
Title:
President
Address
for Notices:
0000
Xxxxxxxx Xxxxx, Xxxxx 000
Xx
Xxxxxx
Xxxxx, XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Page
35
SIGNATURE
PAGE OF PREMIER POWER OWNERS
PREMIER
POWER OWNERS:
XXXX
XXXXX:
__________________________________________
(Signature)
Address
for Notices:
0000
Xxxxxxxx Xxxxx, Xxxxx 000
Xx
Xxxxxx
Xxxxx, XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Check
One:
The
Premier Power Owner hereby certifies that it is:
|
|
[
]
|
an
“Accredited Investor” under Regulation D of the Securities Act (see
Section 3.4 and Annex III of this Agreement;
or
|
|
|
[
]
|
a
Non-U.S. Person, that hereby confirms that the representations and
warranties in Section 3.4(b) of this Agreement are true and correct
as to
such Premier Power Owner, and hereby accepts and agrees to comply
with the
covenants in Section 3.4(b).
|
Page
36
SIGNATURE
PAGE OF PREMIER POWER OWNERS (continued)
XXXXXX
DE ANQUIN:
__________________________________________
(Signature)
Address
for Notices:
0000
Xxxxxxxx Xxxxx, Xxxxx 000
Xx
Xxxxxx
Xxxxx, XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Check
One:
The
Premier Power Owner hereby certifies that it is:
|
|
o
|
an
“Accredited Investor” under Regulation D of the Securities Act (see
Section 3.4 and Annex III of this Agreement;
or
|
|
|
o
|
a
Non-U.S. Person, that hereby confirms that the representations and
warranties in Section 3.4(b) of this Agreement are true and correct
as to
such Premier Power Owner, and hereby accepts and agrees to comply
with the
covenants in Section 3.4(b).
|
Page
37
SIGNATURE
PAGE OF PREMIER POWER OWNERS (continued)
XXXXX
XXXXXXX:
__________________________________________
(Signature)
Address
for Notices:
0000
Xxxxxxxx Xxxxx, Xxxxx 000
Xx
Xxxxxx
Xxxxx, XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Check
One:
The
Premier Power Owner hereby certifies that it is:
|
o
|
an
“Accredited Investor” under Regulation D of the Securities Act (see
Section 3.4 and Annex III of this Agreement;
or
|
|
o
|
a
Non-U.S. Person, that hereby confirms that the representations and
warranties in Section 3.4(b) of this Agreement are true and correct
as to
such Premier Power Owner, and hereby accepts and agrees to comply
with the
covenants in Section 3.4(b).
|
Page
38
SIGNATURE
PAGE OF PREMIER POWER OWNERS (continued)
XXXX
OSTIZ:
__________________________________________
(Signature)
Address
for Notices:
0000
Xxxxxxxx Xxxxx, Xxxxx 000
Xx
Xxxxxx
Xxxxx, XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Check
One:
The
Premier Power Owner hereby certifies that it is:
|
o
|
an
“Accredited Investor” under Regulation D of the Securities Act (see
Section 3.4 and Annex III of this Agreement;
or
|
|
o
|
a
Non-U.S. Person, that hereby confirms that the representations and
warranties in Section 3.4(b) of this Agreement are true and correct
as to
such Premier Power Owner, and hereby accepts and agrees to comply
with the
covenants in Section 3.4(b).
|
Page
39
SIGNATURE
PAGE OF PREMIER POWER OWNERS (continued)
GENESIS
CAPITAL ADVISORS, LLC
a
limited
liability company incorporated and existing under the laws of the State of
Nevada
By:
_______________________________________
Name:
Xxxxxxx Xxxxxxxx
Title:
Managing Member
Address
for Notices:
00000
Xxxxxxx Xxxx.
Xxxxx
0000
Xxxxxx,
XX 00000
Tel:
(000) 000-0000
Fax:
(000) 000-0000
Check
One:
The
Premier Power Owner hereby certifies that it is:
|
o
|
an
“Accredited Investor” under Regulation D of the Securities Act (see
Section 3.4 and Annex III of this Agreement;
or
|
|
o
|
a
Non-U.S. Person, that hereby confirms that the representations and
warranties in Section 3.4(b) of this Agreement are true and correct
as to
such Premier Power Owner, and hereby accepts and agrees to comply
with the
covenants in Section 3.4(b).
|
Page
40
ANNEX
I
|
(I)
Name
of
Premier
Power Owner
|
(II)
Premier
Power Equity
Interests
Transferred to Pubco
|
(III)
Pubco
Shares
Issued to
Premier
Power Owners
(or Designees)
|
|
Xxxx
Xxxxx
|
50,080
|
12,488,056
|
|
Xxxxxx
de Anquin
|
28,436
|
7,090,797
|
|
Xxxxx
Xxxxxxx
|
12,607
|
2,547,126
|
|
Xxxx
Ostiz
|
2,538
|
512,173
|
|
Genesis
Capital Advisors, LLC
|
6,339
|
1,580,598
|
|
Total
|
100,000
|
24,218,750
|
Page
41
ANNEX
II
|
(I)
Name
of Pubco Stockholder
|
(II)
Pubco
Shares Owned Immediately Prior to Transaction
|
(III)
Pubco
Shares Cancelled
|
(IV)
Percentage
of Outstanding Pubco Shares Post-Transaction
|
|
Vision
Opportunity Master Fund, Ltd.
|
26,026,000
|
25,448,000
|
578,000
shares, or 2.22%
|
Page
42
ANNEX
III
ACCREDITED
INVESTOR DEFINITION
|
Category
A
|
The
undersigned is an individual (not a partnership, corporation, etc.)
whose
individual net worth, or joint net worth with his or her spouse,
presently
exceeds $1,000,000.
|
|
|
|
|
Category
B
|
The
undersigned is an individual (not a partnership, corporation, etc.)
who
had an income in excess of $200,000 in each of the two most recent
years,
or joint income with his or her spouse in excess of $300,000 in each
of
those years (in each case including foreign income, tax exempt income
and
full amount of capital gains and losses but excluding any income
of other
family members and any unrealized capital appreciation) and has a
reasonable expectation of reaching the same income level in the current
year.
|
|
|
|
|
Category
C
|
The
undersigned is a director or executive officer of the Company which
is
issuing and selling the securities.
|
|
|
|
|
Category
D
|
The
undersigned is a bank; a savings and loan association; insurance
company;
registered investment company; registered business development company;
licensed small business investment company (“SBIC”); or employee benefit
plan within the meaning of Title 1 of ERISA and (a) the investment
decision is made by a plan fiduciary which is either a bank, savings
and
loan association, insurance company or registered investment advisor,
or
(b) the plan has total assets in excess of $5,000,000 or (c) is a
self
directed plan with investment decisions made solely by persons that
are
accredited investors.
|
|
|
|
|
Category
E
|
The
undersigned is a private business development company as defined
in
section 202(a)(22) of the Investment Advisors Act of 1940.
|
|
|
|
|
Category
F
|
The
undersigned is either a corporation, partnership, Massachusetts business
trust, or non-profit organization within the meaning of Section 501(c)(3)
of the Internal Revenue Code, in each case not formed for the specific
purpose of acquiring the Securities and with total assets in excess
of
$5,000,000.
|
|
|
|
|
Category
G
|
The
undersigned is a trust with total assets in excess of $5,000,000,
not
formed for the specific purpose of acquiring the Securities, where
the
purchase is directed by a “sophisticated investor“ as defined in
Regulation 506(b)(2)(ii) under the Act.
|
|
|
|
|
Category
H
|
The
undersigned is an entity (other than a trust) in which all of the
equity
owners are “accredited investors” within one or more of the above
categories. If relying upon this Category alone, each equity owner
must
complete a separate copy of this
Agreement.
|
Page
43
