Exhibit 10.1

STOCK PURCHASE AGREEMENT

BETWEEN

AMERICAN INTERNATIONAL INDUSTRIES, INC. AND OR ITS OWNED SUBSIDIARY

AND

HAMMONDS TECHNICAL SERVICES, INC.

 

DATED February _____, 2005

STOCK PURCHASE AND EXCHANGE AGREEMENT

 

This Stock Purchase Agreement (hereinafter referred to as the "Agreement"), is
entered into as of this __ day of February, 2005, by and among Hammonds
Technical Services, Inc., a Texas corporation, and all of its subsidiaries
("Hammonds"), and American International Industries, Inc., a Nevada corporation,
its nominees or any American subsidiary ("American").

Premises

This Agreement provides for the acquisition by American of at least 51% of all
of the issued and outstanding shares of Hammonds, on the terms and conditions
hereinafter provided.

Agreement

NOW THEREFORE, on the stated premises and for and in consideration of the mutual
covenants and agreements hereinafter set forth and the mutual benefits to the
parties to be derived here from, it is hereby agreed as follows:

ARTICLE I

REPRESENTATIONS, COVENANTS, AND WARRANTIES

OF AMERICAN AND HAMMONDS

As an inducement to, and to obtain the reliance of the American, represents and
warrants as follows:

Section 1.01 Organization. Hammonds is a corporation duly organized, validly
existing, and in good standing under the laws of the state of Texas. The
execution and delivery of this Agreement does not, and the consummation of the
transactions contemplated by this Agreement in accordance with the terms hereof
will not, violate any provision of Hammonds articles of incorporation or bylaws.
Hammonds has full power, authority, and legal right and has taken all action
required by law, its articles of incorporation, bylaws, and otherwise to
consummate the transactions herein contemplated; including, without limitation,
receiving approval from its board of directors.

Section 1.02 Enforceability. This Agreement, when duly executed and delivered in
accordance with its terms, will constitute the legal, valid, and binding
obligation of Hammonds in accordance with its terms, except as may be limited by
bankruptcy, insolvency, and other similar laws affecting creditors'; rights
generally and by general equitable principles.

Section 1.03 Common Stock. The shares of Hammonds Common Stock issued to
American, pursuant to this Agreement will be, upon issuance, free and clear of
any claims, charges, equities, liens, security interests, encumbrances, or
preemptive rights, whatsoever. The shares of Hammonds Common Stock issued to
American pursuant to this Agreement will be, upon issuance, validly issued,
fully paid, and non-assessable.

Section 1.04 Options to Purchase Land. Hammonds currently has an option to
purchase approximately 11 acres of land located in Conroe, Texas.

Section 1.05 Information. The information concerning Hammonds set forth in this
Agreement is complete and accurate in all material respects and does not contain
any untrue statement of a material fact or omit to state a material fact
required to make the statements made, in light of the circumstances under which
they were made, not misleading.

Section 1.06 Receipt of Consideration. Hammonds acknowledges the receipt of good
and valuable consideration from American in connection with this.

Section 1.07 Patents, Technology, and Proprietary Trade Secrets of the ODV
Family of Vehicles. Hammonds upon the execution of this agreement shall assign
all patents, technology, and proprietary trade secrets of the ODV family of
vehicles to Hammonds. Hammonds and the company and its subsidiaries or
subsequent custodians of the ODV patent assignments agrees to pay all
maintenance fees required by the United States Patent Office in order that the
patents remain in full effect through out the legal life of the patents. In the
event that such good standing is not maintained, all rights and benefits of the
ODV patents will immediately be returned to Carl Hammonds or his heirs without
any compensation or consideration whatsoever to the assignee in default.

Section 1.08 Royalties. From and after the execution of this agreement, and
during the period that Hammonds or a subsequent third party shall manufacture
and sell products that commercially exploit the patents, technology and
proprietary trade secrets of the ODV family of vehicles, Hammonds shall pay Carl
Hammonds a royalty of 1% of the net sales of the ODV family of vehicle patents.
In the event of the death or permanent disability of Carl Hammonds, Hammonds
shall continue to pay to heirs and representatives of Carl Hammonds the royalty
of 1% of net sales during the life of the patents for the ODV family of
vehicles. However, in the event that Carl Hammonds shall voluntarily terminate
his employment with Hammonds for any reason, then the royalty payment payable to
Carl Hammonds shall be an amount equal to .5% of net sales of the ODV family of
vehicles whether the products are manufactured by Hammonds or by a third party.

ARTICLE II

REPRESENTATIONS, COVENANTS, AND WARRANTIES

OF HAMMONDS

As an inducement to, and to obtain reliance of American, Hammonds represents and
warrants as follows:

Section 2.01 Ownership of Hammonds Shares. Hammonds hereby represents and
warrants with that it is legally able to issue to American 51,000 new shares of
Hammonds Common Shares which will represent fifty one percent (51%) of all the
shares outstanding at the time of closing of Hammonds and Hammonds further
hereby represents to American that Mr. Carl Hammonds is or will be the owner of
49,000 shares of Hammonds representing 49% of all outstanding shares of
Hammonds. Hammonds further represents that this 51,000 shares is free and clear
of any claims, charges, equities, liens, security interests, and encumbrances
whatsoever and that Hammonds has full right, power, and authority to transfer,
assign, convey, and deliver such shares; and delivery of such shares at the
closing will convey to American good and marketable title to such shares free
and clear of any claims, charges, equities, liens, security interests, and
encumbrances whatsoever. For the purposes of this Agreement, Knowledge shall
mean actual knowledge after reasonable investigation.

Section 2.02 Information. The information concerning Hammonds set forth in this
Agreement is complete and accurate in all material respects and does not contain
any untrue statement of a material fact or omit to state a material fact
required to make the statements made, in light of the circumstances under which
they were made, not misleading.

Section 2.03 Organization. Hammonds is a corporation duly organized, validly
existing, and in good standing under the laws of the state of Texas and has all
corporate power and authority and has satisfied all legal requirements the
failure of which to do so would have a materially adverse affect on Hammond's;
business as presently conducted. Hammonds is not a party to or subject to any
agreement or commitment, which will, or may restrict the conduct of its business
in any jurisdiction or location. Complete and correct copies of its articles of
incorporation and bylaws, as presently in effect, have been delivered to
American. Hammonds does not own, directly or indirectly, any capital shares or
any equity, profit sharing, participation or other interest in any other person.

Section 2.04 Capitalization. The authorized capitalization of Hammonds consists
of 100,000 shares of common stock, par value $0.001 per share, of which 1,000
shares are currently issued and outstanding. All such issued and outstanding
shares are legally issued, fully paid, and non-assessable and not issued in
violation of the pre-emptive or other rights of any person.

Section 2.05 Title and Related Matters. To the best of Hammond's; Knowledge
Hammonds has good and marketable title to all of its properties, inventory,
interests in properties, and assets, real and personal, free and clear of all
liens, pledges, charges, or encumbrances except (a) statutory liens or claims
not yet delinquent; (b) such imperfections of title and easements as do not and
will not materially detract from or interfere with the present or proposed use
of the properties subject thereto or affected thereby or otherwise materially
impair present business operations on such properties to the best of Hammond's
Knowledge; and (c) such liens or mortgages disclosed to American, including the
lien on the property described in Exhibit "A", as well as the other encumbrances
set forth in the other documents and financial statements attached as Exhibit
2.05, it being acknowledged by American and Hammonds that the Loan Agreement and
related exhibits may, by their terms, not be in default. To the best of Hammonds
Knowledge, no third party has any right to, and Hammonds has not received any
notice of infringement of or conflict with asserted rights of others with
respect to any product, technology, data, trade secrets, know-how, proprietary
techniques, trademarks, service marks, trade names or copyrights which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling, or
finding, would have a materially adverse affect on the business, operations,
financial condition, income, or business prospects of Hammonds or any material
portion of its properties, assets, or rights.

Section 2.06 Litigation and Proceedings. To the best of Hammonds'; Knowledge,
there are no undisclosed actions, suits, proceedings, or investigations pending
or, to the knowledge of Hammonds after reasonable investigation, threatened by
or against Hammonds affecting its properties, at law or in equity, before any
court or other governmental agency or instrumentality, domestic or foreign, or
before any arbitrator of any kind. To the best of Hammonds Knowledge, Hammonds
does not have any knowledge of any default on its part with respect to any
judgment, order, writ, injunction, decree, award, rule, or regulation of any
court, arbitrator, or governmental agency or instrumentality or of any
circumstances which, after reasonable investigation, would result in the
discovery of such a default except as described in Exhibit "B".

Section 2.07 Financial Statements. Exhibit 2.07 contains unaudited financial
statements of Hammonds for the periods indicted. The unaudited financial
statements present fairly, subject to the usual disclaimers and year-end audit
adjustments, the financial position of Hammonds of their dates.

Section 2.08 Taxes and Tax Returns. Hammonds has duly filed with the appropriate
governmental agencies all federal tax returns and reports, all state and local
tax returns and reports with respect to income, payroll, sales and franchise
taxes and all other tax returns and reports, the filing of which is necessary
for the conduct of its business. All such tax returns properly reflect the taxes
of Hammonds for the periods covered. All federal, state, and local taxes,
assessments, interest, penalties, deficiencies, fees, or other governmental
charges or impositions called for by such tax returns, or claimed to be due by
any taxing authority, have been properly accrued or paid and all deposits
required by law to be made with respect to employee's withholding taxes have
been made. There are no material unresolved questions or claims concerning
Hammonds'; tax liability. Hammonds has not received any notice of audit,
deficiency, or assessment or proposed deficiency or assessment by the Internal
Revenue Service or any other taxing authority, nor has Hammonds waived any
statute of limitations with respect to taxes or agreed to any extensions of time
with respect to a tax assessment of deficiency.

Section 2.09 Equipment. Exhibit 2.09 is a schedule of all of the material
machinery, equipment, motor vehicles, furniture, fixtures, and other material
capital assets of every kind and description of Hammonds. All of the tangible
properties and assets owned by Hammonds, or in which it has an interest,
currently being used by it are in good and normal operating condition and
repair, normal wear and tear excepted, free from defects (except such minor
defects as do not interfere with the continued use thereof in the conduct of
normal operations), and are sufficient to carry on Hammonds business as
conducted during the preceding three months.

Section 2.10 Enforceability. This Agreement, when duly executed and delivered in
accordance with its terms, will constitute the legal, valid, and binding
obligation of Seller in accordance with its terms, except as may be limited by
bankruptcy, insolvency, and other similar laws affecting creditor's; rights
generally and by general equitable principles.

Section 2.11 Compliance with Laws. Hammonds is conducting its business and
operations in compliance with all legal requirements applicable to its business
and operations, the failure of which to do so would have a material adverse
affect on Hammonds, and the Hammonds has no knowledge or reason to believe that
Hammonds is in violation or default under any legal requirements applicable to
it or any of its properties which violation or default resulted in or could
result in a material adverse effect.

Section 2.12 Government Authorization. No material permit, concession, grant,
franchise, licenses, or other governmental authorization or approval is
necessary for the conduct of the business of Hammonds.

Section 2.13 Employees; Employee Benefit Plans.

2.13.1 Employees. At the Closing no present or former employee of Hammonds will
have any material claim against Hammonds on account of or for (a) overtime pay,
other than overtime pay for the payroll period ending on or after the Closing,
(b) wages or salaries, or (C) vacations, time off or pay in lieu of vacation or
time off, other than vacation or time off (or pay in lieu thereof) earned with
respect to the current fiscal year of Hammonds. To the knowledge of the
Hammonds, at the Closing no present or former employee of Hammonds will have any
claim against Hammonds (whether under federal or state law, under any employee
agreement or otherwise) on account of or for any violation of any law related to
minimum wages or maximum hours of work.

        2. Employee Benefit Plans. Hammonds has no employee benefit plan or
arrangement, whether formal or informal, and whether legally binding or not,
under which or to which it contributes to or for the benefit of its employees
(including, without limitation, life insurance, hospitalization medical, dental,
bonus, incentive, deferred compensation and similar plans, severance or
termination pay, club memberships, and similar benefits and perquisites) (the
"Plans"), except for a medical benefit plan that it provides for its employees.

        3. Qualified Plans. Hammonds is not and has never been a party to any
Plan which is an "employee pension benefit plan", as such terms defined in
section 3 (2) of ERISA and the rules and regulations promulgated thereunder, and
Hammonds is not a party to a "multi-employer plan" as that term is defined in
section 3 (37) of ERISA.

Section 2.14 Labor Matters.

            1. No employees of Hammonds are currently represented by any labor
union, nor is Hammonds a party to any collective bargaining agreement, and, to
the knowledge of the Hammonds, there is no organizational effort presently being
made or threatened by or on behalf of any labor union with respect to employees
of Hammonds ;

            2. To its knowledge Hammonds has substantially complied with the
Occupational Safety and Health Act, the regulations promulgated thereunder, and
all other applicable laws respecting employment and employment practices, terms
and conditions of employment and wages and hours, and is not engaged in any
unfair labor practice;

            3. To the knowledge of Hammonds, there is no unfair labor practice
compliant against Hammonds pending before the National Labor Relations Board or
any comparable state agency;

            4. There is no labor strike, dispute, slowdown, representation
campaign or work stoppage actually pending or, to the knowledge of Hammonds,
threatened against or affecting Hammonds; and

            5. No grievance or arbitration proceeding is pending and no claim
therefor has been asserted against Hammonds.

Section 2.15 Transactions with Related Parties. Hammonds is not a party to any
material transaction or proposed transaction, including, without limitation, the
leasing of property, the purchase or sale of raw materials or finished goods, or
the furnishing of services, and Hammonds has not directly or indirectly, entered
into any agreement or commitment which could result in it becoming obligated to
provide funds in respect of or to guarantee or assume any debt or obligation of
any director, officer or employee of Hammonds.

ARTICLE III

PLAN OF EXCHANGE

Section 3.01 The Exchange. On the terms and subject to the conditions set forth
in this Agreement, on the Closing Date (as defined in Section 3.02), Hammonds
hereby agrees to assign, transfer, and deliver to American or it's subsidiary
51,000 shares of Common Stock of Hammonds representing at least fifty one
percent (51%) of all shares outstanding of Hammonds and American subject to bank
approval of collateral and guarantee agrees to acquire such shares on such date;
by delivering in exchange therefor (1) $1,000,000 in cash to be paid to Hammonds
at time of Final Closing of this transaction as per terms of this Agreement (2)
a secured revolving or long term Line of Credit made available to Hammonds by
American, and the assets of Hammonds in the amount of $2,000,000, and (3)
American will deliver 145,000 restricted shares of American stock (72,500 shares
for Mr. Haas and 72,500 shares for Mr. Ganslen) for the purchase of their total
ownership in Hammonds and its subsidiaries. The 145,000 restricted shares will
have a third party guaranteed payment of $10.00 per share, on or before the end
of three years from the date of closing.

Section 3.02 Closing. The closing ("Closing") of the transactions contemplated
by this Agreement shall be on _____________, at 9:00 a.m. or when the condition
in Section 4.01 is satisfied, at the offices of Hammonds 15760 West Hardy Road,
Suite 400 , Houston, Texas 77060 on __________, 2005 ("Closing Date").

Section 3.03 Closing Events. At the Closing, each of the respective parties
hereto shall execute, acknowledge, and deliver (or shall cause to be executed,
acknowledged, and delivered) any and all schedules or other instruments required
by this Agreement to be so delivered at or prior to the Closing, together with
such other items as may be reasonably requested by the parties hereto and their
respective legal counsel in order to effectuate or evidence the transactions
contemplated hereby, including, without limitation:

1. American will deliver a secured loan commitment to Hammonds in the principal
amount of $2,000,000 (terms of loan to be agreed upon).

2. Hammonds will deliver 51,000 shares as agreed in all terms described in this
Agreement, said shares representing at least 51% of all shares outstanding of
Hammonds.

3. The remaining 49,000 shares of stock will be issued to Mr. Carl Hammonds,
said shares representing at least 49% of all of the shares of Hammonds.

4. American shall appoint two (2) new directors to the present Hammonds Board of
Directors, in addition to the present director Mr. Carl Hammonds for a new Board
of Directors, which shall not exceed four (3) total directors. All other present
directors shall resign at time of closing this transaction.

5. Hammonds shall deliver audited financial statements for the years ending 2003
and 2004. The audited Balance Sheet for 2004 and the Income Statement for 2004
should have a Net Worth and Revenues substantially in line with the Financial
Statements hereby attached and made part of this contract.

6. Hammonds after closing agrees to pay a fee of $10,000 a month to American for
consulting and management services.

7. Any and all Finders Fees or Consulting Agreements entered into by Hammonds
must be paid at the closing by Hammonds.

ARTICLE IV

SPECIAL CONVENANTS

Section 4.01 Delivery of Books and Records. At the Closing, Hammonds shall
deliver the originals of the corporate minute books, all shares of capital stock
(in any form) outstanding, books of account, contracts, records, and all other
books or documents now in Hammonds'; possession or its representatives to
American.

Section 4.02 Third Party Consents and Certificates. Hammonds agrees to cooperate
with American in order to obtain any required third party consents to this
Agreement and the transactions herein and therein contemplated.

Section 4.03 Indemnification. Hammonds hereby agrees to indemnify American as of
the date of execution of this Agreement against any loss, liability, claim,
damage, or expense (including, but not limited to, any and all expense
whatsoever reasonably incurred in investigating, preparing, or defending against
any litigation, commenced or threatened, or any claim whatsoever), to which
American may become subject arising out of or based on any inaccuracy appearing
in this Agreement or misrepresentation made under this Agreement, provided that
no indemnification shall be made if the misrepresentation results in damages not
in excess of $5,000. The indemnification provided for in this paragraph shall
survive the Closing and consummation of the transactions contemplated hereby and
termination of this Agreement.

ARTICLE V

MISCELLANEOUS

Section 5.01 Governing Law. This Agreement shall be governed by, enforced, and
construed under and in accordance with the laws of arbitration of the State of
Texas without regard to any conflict of law provisions thereof. Subject to the
provisions of Section 5.05 of this Agreement, any action brought between the
parties may be brought and tried only in the stated or federal courts located in
Harris County, Texas, and in no other place unless the parties expressly agree
in writing to waive this requirement. Each party consents to jurisdiction in
that location.

Section 5.02 Entire Agreement. This Agreement represents the entire agreement
between the parties relating to the subject matter hereof, this Agreement fully
and completely expresses the agreement of the parties relating to the subject
matter hereof. There is no other course of dealing, understandings, agreements,
representations, or warranties, written or oral, except as set forth herein.

Section 5.03 Survival; Termination. The representations, warranties, and
covenants of the respective parties shall survive the Closing Date and the
consummation of the transactions herein contemplated for a period of one year
from the Closing Date.

Section 5.04 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which taken
together shall be but a single instrument.

Section 5.05 Finders and /or Consulting Fee Agreement. All finders and/or
consulting fees will be paid by Hammonds at the time of closing.

Section 5.06 Arbitration. All claims, disputes, controversies, differences or
other matters in question arising out of the terms of this Agreement, including
any exhibits thereto, shall be settled finally, completely and conclusively by
arbitration in Houston, Harris County, Texas, in accordance with the Rules of
the American Arbitration Association (the "Rules"). In the arbitration
proceeding Hammonds shall select one arbitrator, American shall select one
arbitrator and the two arbitrators so selected shall select a third arbitrator.
Should one party fail to select an arbitrator within ten (10) business days
after notice of the appointed of an arbitrator by the other party or should the
two arbitrators selected by the Hammonds and American fail to select an
arbitrator within ten (10) business days after the date of the appointment of
the last of such two arbitrators any person sitting as a Judge of the United
States District Court of the Southern District of Texas, Houston Division, upon
application of the Hammonds or American shall appoint an arbitrator to fill such
space with the same force and effect as though such arbitrator had been
appointed in accordance with the immediately preceding sentence of this Section
5.05. Arbitration shall be initiated by written demand by the party seeking
arbitration. This agreement to arbitrate shall be specifically enforceable only
in the District Court of Harris County, Texas. A decision of the arbitrator
shall be final, conclusive, and binding on all parties, and judgement may be
entered thereon in the District Court of Harris County, Texas, to enforce such
decision and the benefits thereof. Notwithstanding any of the above, this
transaction shall not be considered closed until such time that all legally
binding documents and all audited financials are finished and accepted by
American and Hammonds.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers, hereunto duly authorized, as of the date first
above written.

Hammonds Technical Services, Inc., a Texas corporation American International
Industries, Inc., a Nevada corporation Signature: ___________________ Signature:
___________________ Title:        ___________________ Title:       
___________________

Agreed and Accepted:

 

______________________________________

Mr. Fred Hass

 

______________________________________

Mr. Norman Ganslen