Stockholder and the Equity Owners jointly and severally represent and
warrant to Earth Biofuels that:
4.1
Authorization.
The Stockholder has full
power and authority to enter into this Agreement, and this Agreement constitutes
the valid and legally binding obligation of the Stockholder, enforceable in
accordance with its terms.
4.2
OWNERSHIP.
THE STOCKHOLDER IS THE HOLDER OF
RECORD AND LEGAL OWNER OF ALL OF THE COMPANY COMMON STOCK.
SUCH COMPANY COMMON
STOCK IS FREE AND CLEAR OF ANY LIENS.
4.3
STOCK CONSIDERATION
(A)
THE STOCKHOLDER WILL ACQUIRE AND HOLD THE
STOCK CONSIDERATION (THE "SHARES") FOR INVESTMENT FOR ITS ACCOUNT ONLY AND NOT
WITH A VIEW TO, OR FOR RESALE IN CONNECTION WITH, ANY "DISTRIBUTION" THEREOF
WITHIN THE MEANING OF THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT").
(B)
THE STOCKHOLDER UNDERSTANDS THAT THE SHARES
WILL NOT BE REGISTERED UNDER THE SECURITIES ACT BY REASON OF A SPECIFIC
EXEMPTION THEREFROM AND THAT THE SHARES MUST BE HELD INDEFINITELY, UNLESS THEY
ARE SUBSEQUENTLY REGISTERED UNDER THE SECURITIES ACT OR THE STOCKHOLDER OBTAINS
AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO EARTH BIOFUELS AND
ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.
THE STOCKHOLDER FURTHER
ACKNOWLEDGES AND UNDERSTANDS THAT EARTH BIOFUELS IS UNDER NO OBLIGATION TO
REGISTER THE SHARES.
9
(C)
THE STOCKHOLDER IS AWARE OF THE ADOPTION OF
RULE 144 BY THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT,
WHICH PERMITS LIMITED PUBLIC RESALES OF SECURITIES ACQUIRED IN A NON-PUBLIC
OFFERING, SUBJECT ONLY TO THE SATISFACTION OF CERTAIN CONDITIONS.
(D)
THE STOCKHOLDER WILL NOT SELL, TRANSFER OR
OTHERWISE DISPOSE OF THE SHARES IN VIOLATION OF THE SECURITIES ACT, THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, OR THE RULES PROMULGATED
THEREUNDER, INCLUDING RULE 144 UNDER THE SECURITIES ACT.
(E)
THE STOCKHOLDER HAS BEEN FURNISHED WITH,
AND HAS HAD ACCESS TO, SUCH INFORMATION AS IT CONSIDERS NECESSARY OR APPROPRIATE
FOR DECIDING WHETHER TO INVEST IN THE SHARES, AND THE STOCKHOLDER HAS HAD AN
OPPORTUNITY TO ASK QUESTIONS AND RECEIVE ANSWERS FROM EARTH BIOFUELS REGARDING
THE TERMS AND CONDITIONS OF THE ISSUANCE OF THE SHARES.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE EQUITY OWNERS
Each Equity Owner hereby severally, but not jointly, represents and warrants to
Earth Biofuels that:
5.1
AUTHORIZATION.
SUCH EQUITY OWNER HAS FULL
POWER AND AUTHORITY TO ENTER INTO THIS AGREEMENT, AND THIS AGREEMENT CONSTITUTES
THE VALID AND LEGALLY BINDING OBLIGATION OF SUCH EQUITY OWNER, ENFORCEABLE IN
ACCORDANCE WITH ITS TERMS.
5.2
OWNERSHIP.
THE MEMBERS ARE THE SOLE OWNERS
OF THE STOCKHOLDER.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1
Confidentiality.
Each of the parties
hereto hereby agrees to keep confidential such information or knowledge obtained
pursuant to the negotiation and execution of this Agreement or the effectuation
of the transactions contemplated hereby ("Confidential Information"); provided,
however, that the foregoing shall not apply to information or knowledge that
(a) a receiving party can demonstrate was already lawfully in its possession
prior to the disclosure thereof by the other party, (b) is generally known to
the public at the time