Document:

spni_ex101.htm

EXHIBIT 10.1

 

ASSET PURCHASE AGREEMENT

 

THIS AGREEMENT (the “Agreement”) is made and entered into as of this 23th day of April, 2013, by and between Sputnik Enterprises, Inc., or assign (“Purchaser”) and Wireless NRG, LLC, a Florida Limited Liability Company, (“Seller”).

 

Background

 

Seller is engaged in the business of manufacturing, marketing, and distributing a line of products referred to as Kudos, primarily distributing IPAD solar charging cases under the Kudo brand with accessories and owns certain hardware, software and other assets and intellectual property in connection with the business, (the “Business”). Seller wishes to sell, and Purchaser wishes to purchase all of the assets used in the Business of the Seller upon and subject to the terms and conditions set forth in this Agreement.

 

Agreement

 

Now, therefore, for and in consideration of the mutual representations, warranties, covenants, and agreements contained herein and for other good and valuable consideration, the receipt and legal sufficiency of which is hereby acknowledged, the parties hereto agree:

 

Section 1. PURCHASE AND SALE OF ASSETS

 

Section 1.1 Purchase of Assets. On and subject to the terms and conditions of this Agreement, Purchaser hereby purchases and Seller hereby sells, assigns, grants, transfers, and conveys to Purchaser all of the right, title, and interest of Seller in and to all of the assets of Seller used exclusively in the Kudo products Business (collectively, the “Purchased Assets”) free and clear of any and all liens, claims, charges, security interests, and encumbrances as the same exist on the Closing Date, as follows:

 

	
a.   

	
All intellectual property, trade name, trade secrets, trademarks, personnel contracts, web site domain, social media sites, www.kudocase.com, and content, strategic partnerships, distribution contracts, customer lists, cash, receivables, publications, operating model, manuals, licenses, and all other confidential information relating to the Business; and

 

	
b.   

	
All current, past and future clients.

 

	
c.   

	
All assets of the Seller as identified in Schedule 1.1(c)

 

	
d.   

	
All software programs and copyrighted products, systems and processes used in the Business

 

	
e.   

	
All right title and interest in and to a Patent Application as more clearly defined in Schedule 1.1c.

 

Section 1.2 Assumption of Debt and Excluded Liabilities. Purchaser or if applicable, Purchaser’s assign, shall take title to the assets listed in Schedule 1.1(c) free and clear of all liabilities of the Seller, with the exception of all debt currently owing by the Seller to Vendors as set forth in Schedule 1.2, which obligations shall be transferred to the Purchaser or assign of Purchaser at Closing. All other liabilities of Seller are hereinafter referred to as “Excluded Liabilities,” and are not assumed by the Purchaser or Purchaser’s assign.

 

  

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Section 1.3 Assignment. Purchaser will assign the assets acquired and debt assumed under this agreement to a newly formed wholly owned corporation of the Purchaser, which name shall be Kudo Technologies, Inc., including all patents, patent applications for Kudo Case and Kudo Glide, and intellectual property used in the business.

 

Section 2. PURCHASE PRICE AND CLOSING

 

Section 2.1 Purchase Price. The Purchase price for the Purchased Assets is $1,715,000 and the issuance of 1,831,917 shares of restricted common stock of the Purchaser. The portion of the Purchase Price of $1,715,000 will be paid in the form of a promissory note executed by the Purchaser in favor of the Seller. The promissory note shall be paid in installments of $100,000 beginning no later than 10 days after the filing of an S-1 registration statement by the Purchaser and a declaration of effectiveness by the SEC and continuing every 90 days thereafter in installments of $100,000, with the unpaid principal balance of the note all due in on March 31, 2016. The form Promissory Note is attached as Schedule 2.1. 

 

Section 2.2 Time and Place of Closing. The closing of the purchase and sale of the Purchased Assets (the “Closing”) will be upon the execution of this Agreement, the delivery of all signed documentation as required under this Agreement, and all documentation necessary to perfect the delivery of the assets as determined in the sole discretion of the Purchaser, the delivery of an approved audit for the years ending 12-31-2011 and 12-31-2012 by a member accounting firm of the PCAOB, and the completion and review of due diligence at the sole discretion of Purchaser. The effective time of the closing and the transfer of the Purchased Assets to Purchaser is 12:00 midnight on the Closing Date.

 

Section 2.3 Transfer and Closing Expenses. Seller shall pay all sales and transfer taxes levied on the transfer of the Purchased Assets, if any. Ad valorem taxes, if any, relating to the Purchased Assets shall be prorated as of the Closing Date.

 

Section 2.4 Allocation of Purchase Price. The consideration paid for the Purchased Assets shall be allocated among the Purchased Assets in accordance with the provisions contained in Treasury Regulation Section 1.1060-1T(d). The parties agree to be bound by such allocation and to report the transaction contemplated herein for federal income tax purposes in accordance with such allocation. In furtherance of the foregoing, the parties hereto agree to execute and deliver Internal Revenue Service Form 8594 reflecting such allocation.

 

SECTION 3. REPRESENTATIONS AND WARRANTIES OF SELLER

 

For the purpose of inducing the Purchaser to purchase the Purchased Assets, Seller represents and warrants to Purchaser as follows:

 

  

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Section 3.1 Organization and Qualification. Seller is a Limited Liability Company duly organized, validly existing, and in good standing under the laws of the State of Florida and has all corporate power and authority to conduct the Business, and to own, lease, or operate the Purchased Assets in the places where the Business is conducted and the Purchased Assets are owned, leased, or operated. 

 

Section 3.2 Authority. Seller has full power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution, delivery, and performance of this Agreement by Seller has been duly and validly authorized and approved by all necessary action on the part of Seller. This Agreement is the legal, valid, and binding obligation of Seller enforceable against Seller in accordance with its terms, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting creditors’ rights generally, and to the exercise of judi­cial discretion in accordance with general equitable principles. Neither the execution and delivery of the Agreement by Seller nor the consummation by Seller of the transactions contemplated hereby will (i) violate Seller’s Certificate of Incorporation or Bylaws, (ii) violate any pro­visions of law or any order of any court or any governmental unit to which Seller is subject, or by which any of the Purchased Assets are bound, or conflict with, result in a breach of, or constitute a default under any indenture, mortgage, lease, agreement, or other instrument to which Seller is a party or by which it or any of the Purchased Assets are bound, or (iii) result in the creation of any lien, charge, or encumbrance upon any of the Purchased Assets.

 

Section 3.3 Personal Property. Seller has good and marketable title to all of it’s Assets free and clear of all liens, claims, charges, security interests, and other en­cumbrances of any kind or of any nature. The Purchased Assets include all rights, properties, interest in properties, and assets necessary to permit Purchaser to carry on the Business as the same has heretofore been previously conducted by Seller.

 

Section 3.4 Compliance with Laws. Seller, to the best of its knowledge, is not subject to any judgment, order, writ, injunction, or decree that adversely affects, or might in the future reasonably be expected to adversely affect any of the Purchased Assets or the Business. Seller is, to the best of its knowledge, in substantial compliance with all laws applicable to the Business and the Purchased Assets, including without limitation, all laws related to zoning, occupational safety, labor, wages, working hours, working conditions, environmental protection, and fair business practices. Seller, to the best of its knowledge, has all permits, licenses, approvals, consents, and authorizations which are required for the operation of Seller’s business under federal, state, or local laws, rules, and regulations.

 

Section 3.5 Litigation. There are no formal or informal complaints, investigations, claims, charges, arbitration, grievances, actions, suits, or proceedings pending, or to the knowledge of Seller threatened against any of the Purchased Assets at law or in equity or admiralty, or before or by any federal, state, municipal, or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign which would affect the purchased assets materially. Seller is not subject to any order, writ, injunction, or decree of any federal, state, municipal court, or other governmental department, commission, board, bureau, agency, or instrumentality, domestic or foreign, affecting the Purchased Assets.

 

  

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Section 3.6 Brokers and Finders. Seller has not incurred any obligation or liability to any party for any brokerage fees, agent’s commissions, or finder’s fees in connection with the transactions contemplated hereby.

 

Section 3.7 Governmental Approval and Consents. Seller has obtained all governmental approvals, authorizations, permits, and licenses required to permit the operation of the Business as presently conducted.

 

Section 3.48 INVESTMENT INTENT.

 

	
i.   

	
Restricted Shares. Seller understand that (A) the Shares Sellers are receiving from Purchaser under this Agreement have not been registered under the Securities Act of 1933, as amended (“the Act”) or the securities laws of any state, based upon an exemption from such registration requirements pursuant to Section 4(2) of the Act; (B) the Shares are and will be “restricted securities”, as said term is defined in Rule 144 of the Rules and Regulations promulgated under the Act; and (C) the Shares may not be sold or otherwise transferred or distributed unless exemptions from such registration provisions are available with respect to said resale or transfer or the shares have been registered under the Act.

 

	
ii.   

	
Transferability. Seller will not sell or otherwise transfer any of the Shares, any interest therein unless and until (A) the Shares shall have first been registered under the Act and/or all applicable state securities laws; or (B) Seller shall have first delivered to Purchaser a written opinion of counsel, which counsel and opinion (in form and substance) shall be reasonably satisfactory to Purchaser, to the extent that the proposed sale or transfer is exempt from the registration provisions of the Act and all applicable state securities laws.

 

	
iii.   

	
Investment Intent. Seller is acquiring the Shares for Investment purposes only, without a view for resale or distribution thereof.

 

	
iv.   

	
Legend. Seller understands that the certificates representing the Shares will bear the following or similar legend:

 

The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended, and may not be sold, transferred, further pledged, hypothecated or otherwise disposed of in absence of (i) an effective registration statement for such securities under said Act or (ii) an opinion of company counsel that such registration is not required.

 

Section 4. REPRESENTATIONS AND WARRANTIES OF PURCHASER

 

Purchaser hereby represents and warrants to Seller as follows:

 

  

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Section 4.1 Organization and Qualification. Purchaser’s assign will be a newly formed corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada and has all necessary power and authority to conduct its business, to own, lease, or operate its properties in the places where such business is conducted and such properties are owned, leased, or operated.

 

Section 4.2 Authority. Purchaser has full power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. The execution, delivery, and performance of this Agreement by Purchaser has been duly and validly authorized and approved by all necessary action on the part of Purchaser, and this Agreement is the legal, valid, and binding obligation of Purchaser enforceable against Purchaser in accordance with its terms, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting creditors’ rights generally, and by the exercise of judicial discretion in accordance with equitable principles. Neither the execution and delivery of this Agreement by Purchaser nor the consummation by Purchaser of the transactions contemplated hereby will (i) violate Purchaser’s articles of incorporation or bylaws, (ii) violate any pro­visions of law or any order of any court or any governmental unit to which Purchaser is subject, or by which its assets may be bound, or (iii) conflict with, result in a breach of, or constitute a default under any indenture, mortgage, lease, agreement, or other instrument to which Purchaser is a party or by which its assets or properties may be bound.

 

Section 4.3. Litigation. There is no suit, action, proceeding, claim or investigation pending, or, to Purchaser’s knowledge, threatened, against Purchaser, which would prevent Purchaser from consummating the transactions contemplated by this Agreement.

 

Section 4.4. Brokers and Finders. Purchaser has not incurred any obligation or liability to any party for brokerage fees, agent’s commissions, or finder’s fees in connection with the transactions contemplated hereby.

 

Section 5. Indemnification

 

For the purposes of this Section 5, the terms “Loss” and “Losses” shall mean any and all demands, claims, actions or causes of action, assessments, losses, damages, liabilities, costs, and expenses, including without limitation, interest, penalties, and reasonable attorneys’ and other professional fees and expenses. All statements contained in any certificate, Exhibit or Schedule delivered by or on behalf of Purchaser or Seller pursuant to this Agreement shall be deemed representations and warranties hereunder by Purchaser or Seller, as the case may be. Any inspection, preparation, or compilation of information or Schedules, or audit of the inventories, properties, financial condition, or other matters relating to Seller conducted by or on behalf of Purchaser pursuant to this Agreement shall in no way limit, affect, or impair the ability of Purchaser to rely upon the representations, warranties, covenants, and agreements of Seller set forth herein. 

 

Section 5.1 Agreement of Seller to Indemnify Purchaser.

 

  

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(a) Subject to the terms and conditions of this Section 5, Seller hereby agrees to indemnify, defend, and hold harmless Purchaser from, against, and in respect of any and all Losses asserted against, relating to, imposed upon, or incurred by Purchaser by reason of, resulting from, or based upon: (i) the inaccuracy or untruth of any representation or warranty of Seller contained in or made pursuant to this Agreement or in any certificate, Schedule, or Exhibit furnished by Seller, in connection with the execution and delivery of this Agreement and the closing of the transactions contemplated hereby, (ii) the breach by Seller of any covenant or agreement made in or pursuant to this Agreement or any agreement executed by Seller, and delivered to Purchaser in connection with the Closing of the transactions contemplated hereby; and (iii) any Excluded Liability including without limitation the failure to comply with the bulk sales law and any Excluded Liability that attaches to the Assets.

 

(b) Seller’s obligation to indemnify Purchaser for Losses is subject to the condition that Seller shall have received notice of the Losses for which indemnity is sought on or before December 31, 2014.

 

(c) Purchaser’s remedies against Seller for any Losses hereunder shall be cumulative, and the exercise by Purchaser of its right to indemnification hereunder shall not affect the right of Purchaser to exercise any other remedy at law or in equity, to recover damages, or to obtain equitable or other relief, provided, that Seller shall not be liable for damages in excess of the actual damages suffered by Purchaser as a result of the act, circumstance, or condition for which indemnification is sought.

 

Section 5.2 Agreement of Purchaser to Indemnify Seller.

 

(a) Subject to the terms and conditions of this Section 5, Purchaser hereby agrees to indemnify, defend, and hold harmless Seller from, against, for, and in respect of any and all Losses asserted against, relating to, imposed upon, or incurred by Seller by reason of, resulting from or based upon: (i) the inaccuracy or untruth of any representation or warranty of Purchaser, contained in or made pursuant to this Agreement or in any certificate, Schedule, or Exhibit furnished by Purchaser, in connection with the execution and delivery of this Agreement or the closing of the transactions contemplated hereby, or (ii) the breach by Purchaser of any covenant or agreement made in or pursuant to this Agreement or any agreement executed by Purchaser, and delivered to Seller in connection with the Closing of the transactions contemplated hereby.

 

(b) Purchaser’s obligation to indemnify Seller for Losses is subject to the condition that Purchaser shall have received notice of the Losses for which indemnity is sought on or before December 31, 2014.

 

(c) Seller’s remedies against Purchaser for any Losses hereunder shall be cumulative, and the exercise by Seller of its right to indemnification hereunder shall not affect the right of Seller to exercise any other remedy at law or in equity, to recover damages, or to obtain equitable or other relief, provided, that Purchaser shall not be liable for damages in excess of the actual damages suffered by Seller as a result of the act, circumstance, or condition for which indemnification is sought.

 

  

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SECTION 6. Post Closing Matters

 

Section 6.1 Further Assurances. From and after the date hereof, Seller agrees, without further consideration, to execute and deliver promptly to Purchaser, such further consents, waivers, assignments, endorsements, and other documents and instruments, and to take all such further actions, as Purchaser may from time to time reasonably request, with respect to the assignment, transfer, and delivery to Purchaser of the Purchased Assets, and the fulfillment of any condition precedent to the obligations of Purchaser that was waived by Purchaser in order to close the transactions contemplated herein, and the consummation in full of the transactions provided for herein.

 

Section 6.2 Definitions. As used herein, the following capitalized terms are used with the meanings thereafter ascribed:

 

“Affiliate” means any person or entity directly or indirectly Controlling, Controlled by, or under common Control with Seller. 

 

“Area” means the United States, Canada, and Mexico.

 

“Competing Enterprise” means any person or entity that is substantially engaged in the Business.

 

“Control” means the power to direct the management and affairs of a person.

 

“Trade Secrets” means information of the Business which derives economic value, actual or potential, from not being generally known and not being readily ascertainable by proper means to other persons who can obtain economic value from its disclosure or use and which is the subject of efforts that are reasonable under the circumstances to maintain its secrecy or confidentiality, but shall not include Excluded Information. Trade Secrets may include both technical or non-technical data, including without limitation, (a) any process, machine, pattern, compilation, program, method, technique, formula, chemical formula, composition of matter, or device which (1) is not generally known or which the Seller, with respect to the Business has a reasonable basis to believe may not be generally known, (2) is being used or studied by the Business and is not described in a printed patent or in any literature already published and distributed externally by Seller with respect to the Business, and (3) is not readily ascertainable from inspection of a product of the Business; (b) any engineering, technical, or product specifications including those of features used in any current product of the Business or which may be so used, or the use of which is contemplated in a future product of the Business; (c) any application, operating system, communication system, or other computer software (whether in source or object code) and all flow charts, algorithms, coding sheets, routines, subroutines, compilers, assemblers, design concepts, test data, documentation, or manuals related thereto, whether or not copyrighted, patented, or patentable, related to or used in the Business; or (d) information concerning the customers, suppliers, products, pricing strategies of the Business, personnel assignments and policies of the Business, or matters concerning the financial affairs and management of the Business; provided however, that Trade Secrets shall not include any Excluded Information. As used herein, “Excluded Information” means information (i) which has been voluntarily disclosed to the public by the Business, (ii) independently developed and disclosed by parties other than the Business, or (iii) that otherwise enters the public domain through lawful means or without misappropriation by Seller.

 

  

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Section 6.3 Trade Secrets. Seller for itself and each Affiliate acknowledges and agrees that all Trade Secrets related expressly to the Business, and all physical embodiments thereof, are a part of the Purchased Assets, are confidential to and shall be and remain the sole and exclusive property of Purchaser. Seller for itself and each Affiliate agrees that all Trade Secrets related to the Business will be held in trust and strictest confidence, that each Affiliate shall protect such Trade Secrets from disclosure, and that each Affiliate will make no use of such Trade Secrets without prior written consent of Purchaser. The obligations of confidentiality contained in this Section shall apply from the date of this Agreement and with respect to all Trade Secrets at all times thereafter, until such Trade Secret is no longer a trade secret under applicable law.

 

Section 6.4 Remedies. Seller for itself and any Affiliate covenants and agrees that Purchaser by virtue of the consummation of the transactions contemplated by this Agreement will be engaged in the Business in and throughout the Area which is domestically and internationally, and that great loss and irreparable damage would be suffered by Purchaser if Seller should breach or violate any of the terms or provisions of the covenants and agreements set forth in this Section. Seller for itself and any Affiliate, further acknowledges and agrees that each such covenant and agreement is reasonably necessary to protect and preserve unto Purchaser the benefit of its bargain in the acquisition of the Business, including, without limitation, the good will thereof. Therefore, in addition to all the remedies provided in this Agreement, or available at law or in equity, Seller for itself and any Affiliate jointly and severally agrees Purchaser shall be entitled to a temporary restraining order and a permanent injunction to prevent a breach or contemplated breach of any of the covenants or agreements of Seller contained in this Section 6. The existence of any claim, demand, action, or cause of action of Seller against Purchaser shall not constitute a defense to the enforcement by Purchaser of any of the covenants or agreements herein whether predicated upon this Agreement or otherwise, and shall not constitute a defense to the enforcement by Purchaser of any of its rights hereunder.

 

Section 6.5 Blue Penciling. In the event that any one or more of the provisions, or parts of any provisions, contained in this Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, the same shall not invalidate or otherwise affect any other provision hereof, and the parties hereto agree that such provisions shall be reformed to set forth the maximum limitations permitted under applicable law. Specifically, but without limiting the foregoing in any way, each of the covenants of the parties to this Agreement contained herein shall be deemed and shall be construed as a separate and independent covenant and should any part or provision of any of such covenants be held or declared invalid by any court of competent jurisdiction, such invalidity shall in no way render invalid or unenforceable any other part or provision thereof or any other covenant of the parties not held or declared invalid. 

 

Section 6.6 Earn Out Provisions. The Seller will be subject to an earn out schedule to earn common shares of the Purchaser as set forth in Schedule 6.6 attached hereto and incorporated herein.

 

  

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Section 7. General Provisions

 

Section 7.1 Bulk Sales Law Waiver. Purchaser and Seller each agree to waive compliance by the other with the provisions of the bulk sales law or comparable law of any jurisdiction to extent that the same may be applicable to the transactions contemplated by this Agreement. Seller agrees to indemnify and hold Purchaser harmless from and against any loss, damage, liability, cost, expense or claim arising out of any failure to take any required actions under the bulk sales or comparable law of any state.

 

Section 7.2 Expenses. Except as set forth in Section 2 hereof, all expenses incurred by the parties hereto in connection with or related to the authorization, preparation, and execution of this Agreement and the Closing of the transaction contemplated hereby, including without limiting the generality of the foregoing, all fees and expenses of agents, representatives, counsel, and accountants employed by any such party, shall be borne solely and entirely by the party which has incurred the same. 

 

Section 7.3 Binding Effect. This Agreement shall be binding upon the parties hereto and their respective successors or assigns, as permitted herein.

 

Section 7.4 Headings. The Section, subsection, and other headings in this Agreement are inserted solely as a matter of convenience and for reference, and are not a part of this Agreement.

 

Section 7.5 Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one counterpart has been signed by each party and delivered to the other party hereto and such execution shall be conclusively evidenced by a facsimile transmitted copy or electronic mail transmitted copy of the execution page hereof.

 

Section 7.6 Governing Law. This Agreement shall be construed under the laws of the State of Florida, without giving effect to applicable principles of conflicts of law.

 

Section 7.7 Additional Actions. Each party covenants that at any time, and from time to time, it will execute such additional instruments and take such actions as may be reasonably requested by the other parties to confirm or perfect or otherwise to carry out the intent and purposes of this Agreement.

 

Section 7.8 Entire Agreement. This Agreement constitutes the entire agreement among the parties hereto and supersedes and cancels any prior agreements, representations, warranties, or communications, whether oral or written, among the parties hereto relating to the transactions contemplated hereby or the subject matter herein. Neither this Agreement nor any provisions hereof may be changed, waived, discharged or terminated orally, but only by an agreement in writing signed by the party against whom or which the enforcement of such change, waiver, discharge or termination is sought.

 

  

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Section 7.9 Preparation of Agreement. This Agreement shall not be construed more strongly against any party regardless of who is responsible for its preparation. The parties acknowledge each contributed and is equally responsible for its preparation.

 

Section 7.10 Assignment This Agreement shall not be assigned by operation of law or otherwise. However, the assets being acquired by the Purchaser may be transferred to a newly formed corporation at the sole discretion of the Purchaser.

 

Section 7.11 Third Parties Nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective administrators, executors, legal representatives, heirs, successors and assignees. Nothing in this Agreement is intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement, nor shall any provision give any third persons any right of subrogation or action over or against any party to this Agreement.

 

Section 7.12 Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been given (i) on the date they are delivered if delivered in person; (ii) on the date initially received if delivered by facsimile transmission with independent confirmation of receipt followed by confirmation of notice by registered or certified mail or overnight courier service; (iii) on the date delivered by an overnight courier service; or (iv) on the fifth business day after it is mailed by registered or certified mail, return receipt requested with postage and other fees prepaid, to the address set forth herein of such other addresses provided by each party to the other parties in accordance with the terms or provisions hereof.

 

Section 7.13 Partial Invalidity. Wherever possible, each provision hereof shall be interpreted in such manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision or provisions had never been contained herein unless the deletion of such provision or provisions would result in such a material change as to cause completion of the transactions contemplated hereby to be unreasonable.

 

Section 7.14 Survival. The covenants, representations, warranties, and agreements contained herein shall survive the Closing of the transactions contemplated herein, for the length of time that Purchaser or Seller, as the case may be, may assert an indemnification claim for a breach or violation of such covenant, representation, warranty, or agreement pursuant to Section 5. hereof.

 

Section 7.15 Arbitration. Any controversy, dispute, or claim arising out of or relating to this Agreement or a claimed default hereunder, other than requests for injunctive relief or damages for a breach of a Restrictive Covenant including without limitation Sections 6.2, 6.3, 6.4, and 6.5 hereof, shall be resolved by arbitration in accordance with the rules of the American Arbitration Association (the “AAA”), by which each party will be bound.

 

  

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IN WITNESS WHEREOF, each party hereto has executed this Agreement, or caused this Agreement to be executed on its behalf by its duly authorized officers, all as of the Closing Date.

 

 

	Seller: Wireless NRG, LLC 	 	Purchaser: Sputnik Enterprises, Inc.	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By : 	/s/ David Foster	 	By :	/s/ Anthony Gebbia	 
	
 

	
David Foster

Its Managing Member

	 	 	
Anthony Gebbia, CEO

	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By :	/s/ Edward Lachcik	 	 	 	 
	 	
Edward Lachcik

Its Managing Member

	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By : 	/s/ Robert Mehler	 	 	 	 
	 	
Robert Mehler

Its Managing Member

	 	 	 	 

 

  

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SCHEDULE 1.1(c)

List of Assets

 

	
Cash in Banks 

	 	$	124,245	 
	  	 	 	 	 
	
Accounts Receivable 

	 	 	143,331	 
	  	 	 	 	 
	
Inventory Asset 

	 	 	528,310	 
	  	 	 	 	 
	
Total Current Assets 

	 	 	795,886	 
	  	 	 	 	 
	
Furniture/Equipment Assets

	 	 	129,801	 
	  	 	 	 	 
	
Other Assets-Patent 

	 	 	6,976	 
	  	 	 	 	 
	
TOTAL ASSETS 

	 	$	923,663	 

 

Patent Application-Portable Electronic Device Carrier with Charging System

Patent Application for Kudo Glide Product

Website domain and content at www.kudocase.com

Facebook Page for KudoCase

Twitter Account for Kudocase

YouTube account for Kudocase

Big Box Distribution Agreements

License agreement with Apple

All outstanding Member interest or units in A & D Concepts, LLC.

 

  

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Schedule 1.2

List of Liabilities

 

	Accounts Payable	 	$	75,773	 
	  	 	 	 	 
	Customer deposits	 	 	11,628	 
	  	 	 	 	 
	Shareholder Loan 	 	 	
15,000

	 
	  	 	 	 	 
	
Loan Payable BCA Int'l 

	 	 	784	 
	  	 	 	 	 
	Total Liabilities	 	$	103,185	 

 

  

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Schedule 6.6

Earn Out Schedule

 

The Seller shall be entitled to receive earn out shares for the performance of the business Kudos Technologies, Inc. for the first, second and third years after closing.

 

The shares will be earned and issued to Wireless NRG upon the occurrence of the following described events:

 

6,834,750 shares will be earned and issued to Wireless NRG upon completion of the auditor review for the first 12 months after closing if Kudos Technologies, Inc. achieves $3,000,000 in gross revenue or net income of $600,000 for the year ending 12 months after closing.

 

8,666,667 shares will be earned and issued to Wireless NRG upon completion of the auditor review for the 24 months after closing if Kudos Technologies, Inc. achieves $10,000,000 in gross revenue or net income of $2,000,000 for the years ending 24 months after closing.

 

8,666,666 shares will be earned and issued to Wireless NRG upon completion of the auditor review for the 36 months after closing if Kudos Technologies, Inc. achieves $12,000,000 in gross revenue or $3,000,000 in net income for the years ending 36 months after closing.

 

Initials ________ __________ ___________ _________ _________ __________

 

14pmlt_ex101.htm

EXHIBIT 10.1

 

 

­­SHARE EXCHANGE AGREEMENT

This Share Exchange Agreement (the "Agreement") is made and entered into as of the 22nd day of April, 2013, between Prime Estates & Developments, Inc., a Nevada corporation ("Buyer") and Greenbase Ltd, organized under the laws of Cyprus ("Company") and Dimitrios Goulielmos and Evangelia Theocharidou (individually a “Seller” and jointly “Sellers”).

RECITALS

The Buyer desires to acquire all issued and outstanding shares of common stock of Company from the Sellers, and the Sellers wish to have all issued and outstanding shares of common stock of Company acquired by the Buyer solely for the purpose of having a wholly-owned subsidiary with operations in Cyprus, on the terms and conditions set forth in this Agreement by way of an exchange of shares (the “Exchange”).

The board of directors of the Buyer, the board of directors of the Company, and the Sellers have determined that it is in the best interest of the parties for the Buyer to acquire all issued and outstanding shares of common stock of the Company pursuant to a share exchange transaction.

NOW, THEREFORE, in consideration of the terms, conditions, agreements and covenants contained herein (the receipt and sufficiency of which are acknowledged by each party), and in reliance upon the representations and warranties contained in this Agreement, the parties hereto agree as follows:

 

I.  RECITALS; TRUE AND CORRECT; PURPOSE OF TRANSACTION

 

The above stated recitals are true and correct and are incorporated into this Agreement.

The purpose of the transaction contemplated under this Agreement for the Buyer to have a wholly-owned subsidiary with operations in Cyprus, i.e, the Company.

II.  PURCHASE AND SALE

 

2.1  Share Exchange. Subject to all the terms and  conditions of this Agreement, at the Closing,  the Sellers agree to  receive from the Buyer, and Buyer agrees to issue to the Sellers, the sole shareholders  of  the  Company, an aggregate of 100,000,000 Shares of Common Stock of the Buyer (“Buyer Shares”) (the “Share Consideration”) in exchange for the transfer of 2,000 shares aggregate of the Common Stock of the Company (“Company Shares”), owned as set forth on the signature page to this Agreement, which shares constitute all the issued and outstanding shares or rights to acquire issued and outstanding shares of Company, to the Buyer.   Each Company Share that is issued and outstanding immediately before the Closing shall entitle the holder thereof to receive 50,000 Buyer’s Shares.

2.2  Closing. The parties shall hold the Closing as soon as practical after the execution of this Agreement, or such other time as the parties shall agree (the “Closing” or "Closing Date"), at 11:00 A.M., local time, at the offices of Buyer, or at such other time and place as the parties may agree upon.

 

2.3  Schedules. If a Schedule referred to in Article IV or V is not attached to this Agreement, the Company, the Sellers, or Buyer, respectively, is representing that there is no information required to be disclosed on such Schedule.

 

 

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III.  CONDUCT OF BUSINESS PENDING CLOSING

Company, Sellers, and Buyer covenant that between the date hereof and the date of the Closing:

 

3.1 Access to Company.  Company shall (a) give to Buyer and to Buyer's counsel, accountants and other representatives reasonable access, during normal business hours, throughout the period prior to the Closing Date, to all of the books, contracts, commitments and other records of Company and shall furnish Buyer during such period with all information concerning Company that Buyer may reasonably request; and (b) afford to Buyer and to Buyer's representatives, agents, employees and independent contractors reasonable access, during normal business hours, to the properties of Company, in order to conduct inspections at Buyer's expense to determine that Company is operating in compliance with all applicable federal, state, local and foreign (including all laws, rules and regulations of Cyprus and any governmental subdivision thereof)  statutes, rules and regulations, and all material building, fire and zoning laws or regulations and that the assets of Company are substantially in the condition and of the capacities represented and warranted in this Agreement; provided, however, that in every instance described in (a) and (b), Buyer shall make arrangements with Company reasonably in advance and shall use its best efforts to avoid interruption and to minimize interference with the normal business and operations of Company. Any such investigation or inspection by Buyer shall not be deemed a waiver of, or otherwise limit, the representations, warranties or covenants of Company contained herein.

 

3.2  Conduct of Business.  During the period from the date hereof to the Closing Date, Company shall and shall use reasonable efforts, to the extent such efforts are within Company's control, to cause its business to be operated in the usual and ordinary course of business and in material compliance with the terms of this Agreement.

 

3.3  Exclusivity to Buyer.  Until either the exchange agreement is terminated or the exchange closed, Company and Sellers agree not to solicit any other inquiries, proposals or offers to purchase or otherwise acquire, in an exchange transaction or another type of transaction, the business of Company or the shares of capital stock of Company. Any person inquiring as to the availability of the business or shares of capital stock of Company or making an offer therefor shall be told that Company is bound by the provisions of this Agreement. Company as well as its officers, directors, representatives or agents further agree to advise Buyer promptly of any such inquiry or offer.

 

3.4  Access to Buyer.  Buyer shall (a) give to Sellers and to Company's counsel, accountants and other representatives reasonable access, during normal business hours, throughout the period prior to the Closing Date, to all of the books, contracts, commitments and other records of Buyer and shall furnish Company during such period with all information concerning Buyer that Company may reasonably request; and (b) afford to Sellers and to Company's representatives, agents, employees and independent contractors reasonable access, during normal business hours, to the properties of Buyer in order to conduct inspections at Company's expense to determine that Buyer is operating in compliance with all applicable federal, state, local and foreign (including all laws, rules and regulations of USA and any governmental subdivision thereof)  statutes, rules and regulations, and all material building, fire and zoning laws or regulations and that the assets of Buyer are substantially in the condition and of the capacities represented and warranted in this Agreement; provided, however, that in every instance described in (a) and (b), Company shall make arrangements with Buyer reasonably in advance and shall use its best efforts to avoid interruption and to minimize interference with the normal business and operations of Buyer. Any such investigation or inspection by Company shall not be deemed a waiver of, or otherwise limit, the representations, warranties or covenants of Buyer contained herein.

 

 

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3.5 Conduct of Business. During the period from the date hereof to the Closing Date, the business of Buyer shall be operated by Buyer in the usual and ordinary course of such business and in material compliance with the terms of this Agreement.

 

3.6 Approval. As promptly as reasonably practicable following the date of this Agreement, Company shall take all action reasonably necessary in accordance with the laws of Cyprus and its Organizational Documents to secure the required approval and adoption of this Agreement, including all requisite Seller approval.

 

3.7 Exclusivity to Seller. Until either the exchange agreement is terminated or the exchange closed, Buyer agrees not to solicit any other inquiries, proposals or offers to purchase or otherwise acquire, in a exchange transaction or another type of transaction, the business of Buyer or the shares of capital stock of Buyer. Any person inquiring as to the availability of the business or shares of capital stock of Buyer or making an offer therefor shall be told that Buyer is bound by the provisions of this Agreement. Buyer as well as its officers, directors, representatives or agents further agree to advise Company promptly of any such inquiry or offer.

 

3.8 Mutual Cooperation. The initial press release relating to this Agreement shall be as determined by Buyer.  Thereafter, each of the Company and the Buyer agree to provide 24 hour pre-notification to the other party of any news releases or regulatory filings which the party proposes to issue or file and shall agree to consider any reasonable recommendation or suggestion of the other party with respect thereto. Buyer shall be permitted to make announcements of Company’s newsworthy activities. Each party shall also provide the other party with notice a reasonable time in advance of, and shall permit a representative of the other party to review or participate in, any communications, meetings, or correspondence relating to investor relations matters, including matters relating to public offering activities which are expected to take place following Closing.

 

IV.  REPRESENTATIONS AND WARRANTIES OF COMPANY

Company and each Seller of Company, specifically Dimitrios Goulielmos and Evangelia Theocharidou individually, and the Company and the Sellers jointly and severally, represents and warrants to Buyer as follows, with the knowledge and understanding that Buyer is relying materially upon such representations and warranties:

 

4.1 Organization and Standing.  Company is a Company duly organized, validly existing and in good standing under the laws of Cyprus. Company has all requisite corporate power to carry on its business as it is now being conducted and is duly qualified to do business as a foreign (including all laws, rules and regulations of Cyprus and any governmental subdivision thereof)  corporation and is in good standing in each jurisdiction where such qualification is necessary under applicable law, except where the failure to qualify (individually or in the aggregate) does not have any material adverse effect on the assets, business or financial condition of Company, and all states in which Company is qualified to do business as of the date hereof, are listed in the information in Schedule 4.1. The copies of the Organizational Documents of Company, as amended to date, delivered to Buyer, are true and complete copies of these documents as now in effect. Except as otherwise set forth in the information Schedule 4.1, Company does not own any interest in any other corporation, business trust or similar entity. The minute book of Company contains accurate records of all meetings of its respective Board of Directors and Sellers since its incorporation.

 

 

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4.2 Capitalization. The issued and outstanding capital stock of Company is 2,000 shares. All of such shares of capital stock are duly authorized, validly issued and outstanding, fully paid and nonassessable, and were not issued in violation of the preemptive rights of any person. There are no subscriptions, options, warrants, rights or calls or other commitments or agreements to which Company is a party or by which it is bound, calling for any issuance, transfer, sale or other disposition of any class of securities of Company, except as set forth in Schedule 4.2. There are no outstanding securities convertible or exchangeable, actually or contingently, into shares of common stock or any other securities of Company. Company has no subsidiaries except as set forth in Schedule 4.2.

 

4.3 Authority; No Conflict.  Company’s Board of Directors has approved and adopted this Agreement and the Exchange. This Agreement constitutes, and all other agreements contemplated hereby will constitute, when executed and delivered by Company and Sellers in accordance therewith (and assuming due execution and delivery by the other parties hereto), the valid and binding obligation of Company and Sellers, enforceable in accordance with their respective terms, subject to general principles of equity and bankruptcy or other laws relating to or affecting the rights of creditors generally.  To its knowledge, the making and performance of this Agreement (including, without limitation, the delivery of the Seller Shares) by Seller will not (i) conflict with the Articles of Incorporation or the Bylaws of Company; (ii) violate any order, writ, injunction, or decree applicable to Company or Sellers; or (iii) result in any breach or termination of, or constitute a default under, or constitute an event which, with notice or lapse of time, or both, would become a default under, or result in the creation of any encumbrance upon any asset of Company or Sellers under, or create any rights of termination, cancellation or acceleration in any person under, any agreement, arrangement or commitment, or violate any provisions of any laws, ordinances, rules or regulations or any order, writ, injunction or decree to which Company or Sellers is or are a party or by which Company or Sellers or any of its or their assets may be bound.

 

4.4 Properties. Except as set forth on the information in Schedule 4.4 concerning Company, Company has good title to all of the Assets which it purports to own as reflected on the balance sheet included in the Financial Statements (as hereinafter defined), or thereafter acquired. Company has a valid leasehold interest in all material property of which it is the lessee and each such lease is valid, binding and enforceable against Company, as the case may be, and, to the knowledge of Company, the other parties thereto in accordance with its terms. Neither Company nor the other parties thereto are in material default in the performance of any material provisions thereunder. Neither the whole nor any material portion of the Assets of Company is subject to any governmental decree or order to be sold or is being condemned, expropriated or otherwise taken by any public authority with or without payment of compensation therefor, nor, to the knowledge of Company, any such condemnation, expropriation or taking been proposed. None of the assets of Company is subject to any restriction which would prevent continuation of the use currently made thereof or materially adversely affect the value thereof.

 

4.5 Contracts Listed; No Default. All contracts, agreements, licenses, leases, easements, permits, rights of way, commitments, and understandings, written or oral, connected with or relating in any respect to present or proposed future operations of Company (except employment or other agreements terminable at will and other agreements which, in the aggregate, are not material to the business, properties or prospects of Company and except governmental licenses, permits, authorizations, approvals and other matters referred to in Section 4.17) are listed and described in the information in Schedule 4.5 concerning Company. Company is the holder of, or party to, all of the Company Contracts. To the knowledge of Company, the Company Contracts are valid, binding and enforceable by the signatory thereto against the other parties thereto in accordance with their terms. Neither Company nor any signatory thereto is in default or breach of any material provision of the Company Contracts. Company's operation of its business has been, is, and will, between the date hereof and the Closing Date, continue to be, consistent with the material terms and conditions of the Company Contracts.

 

 

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4.6 Litigation. Except as disclosed in the information in Schedule 4.6 concerning Company, there is no claim, action, proceeding or investigation pending or, to the knowledge of Company, threatened against or affecting Company before or by any court, arbitrator or governmental agency or authority which, in the reasonable judgment of Company, could have any materially adverse effect on Company. There are no decrees, injunctions or orders of any court, governmental department, agency or arbitration outstanding against Company.

 

4.7 Taxes. For purposes of this Agreement, (A) "Tax" (and, with correlative meaning, "Taxes") shall mean any federal, state, local or foreign (including all laws, rules and regulations of Cyprus and any governmental subdivision thereof)  income, alternative or add-on minimum, business, employment, franchise, occupancy, payroll, property, sales, transfer, use, value added, withholding or other tax, levy, impost, fee, imposition, assessment or similar charge, together with any related addition to tax, interest, penalty or fine thereon; and (B) "Returns" shall mean all returns (including, without limitation, information returns and other material information), reports and forms relating to Taxes or to any benefit plans.

Company has duly filed all Returns required by any law or regulation, domestic or foreign, including Cyprus, to be filed by it, except for extensions duly obtained. All such Returns were, when filed, and to the knowledge of Company are, accurate and complete in all material respects and were prepared in conformity with applicable laws and regulations in all material respects. Company has paid or will pay in full or has adequately reserved against all Taxes otherwise assessed against it through the Closing Date, and the assessment of any material amount of additional Taxes in excess of those paid and reported is not reasonably expected.

Company is not a party to any pending action or proceeding by any governmental authority for the assessment of any Tax, and no claim for assessment or collection of any Tax has been asserted against Company that has not been paid. There are no Tax liens upon the assets (other than the lien of property taxes not yet due and payable) of Company. There is no valid basis, to the knowledge of Company, except as set forth in Schedule 4.7, for any assessment, deficiency, notice, 30-day letter or similar intention to assess any Tax to be issued to Company by any governmental authority.

 

4.8 Compliance with Laws and Regulations.  To its knowledge, Company is in compliance, in all material respects, with all laws, rules, regulations, orders and requirements (federal, state and local) applicable to it in all jurisdictions where the business of Company is currently conducted or to which Company is currently subject which has a material impact on Company, including, without limitation, all applicable civil rights and equal opportunity employment laws and regulations, and all state and federal antitrust and fair trade practice laws and the Federal Occupational Health and Safety Act and all similar Cypriot laws, rules and regulations. Company knows of no assertion by any party that Company is in violation of any such laws, rules, regulations, orders, restrictions or requirements with respect to its current operations, and no notice in that regard has been received by Company. To the knowledge of Company, there is not presently pending any proceeding, hearing or investigation with respect to the adoption of amendments or modifications to existing laws, rules, regulations, orders, restrictions or requirements which, if adopted, would materially adversely affect the current operations of Company.

 

 

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4.9 Compliance with Laws.  (a) To its knowledge, the business, operations, property and assets of Company (and, to the knowledge of Company, the business of any sub-tenant or licensee which is occupying or has occupied any space on any premises of Company and the activities of which could result in any material adverse liability to Company) (i) conform with and are in compliance in all material respects with all, and are not in material violation of any applicable federal, state and local laws, rules and regulations, including, but not limited to, the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended (including the 1986 Amendments thereto and the Superfund Amendments and Reauthorization Act) ("CERCLA"), and the Resource Conservation and Recovery Act ("RCRA"), as well as any other laws, rules or regulations relating to tax, product liability, controlled substances, product registration, environmental protection, hazardous or toxic waste, employment, or occupational safety matters whether US or Cypriot; and (ii) have been conducted and operated in a manner such that, to Company's knowledge, Company has foreseeable potential liabilities for environmental clean-up under CERCLA, RCRA or under any other law, rule, regulation or common or civil law doctrine or similar laws, rules and regulations in Cyprus.

 

(b) To its knowledge, no predecessor-in-title to any real property now or previously owned or operated by Company, nor any predecessor operator thereof conducted its business or operated such property in violation of CERCLA and RCRA or any other applicable federal, state and local laws, rules and regulations relating to environmental protection or hazardous or toxic waste matters.

 

(c) Except as disclosed in the information in Schedule 4.9 concerning Company, no suit, action, claim, proceeding, nor investigation, review or inquiry by any court or federal, state, county, municipal or local governmental department, commission, board, bureau, agency or instrumentality, including, without limitation, any state or local health department (all of the foregoing collectively referred to as "Governmental Entity") concerning any such possible violations by Company is pending or, to the knowledge of Company, threatened, including, but not limited to, matters relating to diagnostic tests and products and product liability, environmental protection, hazardous or toxic waste, controlled substances, employment, occupational safety or tax matters. Company does not know of any reasonable basis or ground for any such suit, claim, investigation, inquiry or proceeding. For purposes of this Section 4.9, the term "inquiry" includes, without limitation, all pending regulatory issues (whether before federal, state, local or inter-governmental regulatory authorities) concerning any regulated product, including, without limitation, any diagnostic drugs and products.

 

4.10 Information. Company has furnished and will continue to furnish Buyer all information and financial statements as Buyer may reasonably request.

 

4.11 Condition of Assets. The equipment, fixtures and other personal property of Company, taken as a whole, is in good operating condition and repair (ordinary wear and tear excepted) for the conduct of the business of Company as is contemplated to be conducted.

 

4.12 No Breaches. To its knowledge, the making and performance of this Agreement and the other agreements contemplated hereby by Company will not (i) conflict with or violate the Articles of Incorporation or the Bylaws of Company; (ii) violate any material laws, ordinances, rules or regulations, or any order, writ, injunction or decree to which Company is a party or by which Company or any of its respective assets, businesses, or operations may be bound or affected; or (iii) result in any breach or termination of, or constitute a default under, or constitute an event which, with notice or lapse of time, or both, would become a default under, or result in the creation of any encumbrance upon any asset of Company under, or create any rights of termination, cancellation or acceleration in any person under, any Company Contract.

 

4.13 Employees. None of the employees of Company is represented by any labor union or collective bargaining unit and, to the knowledge of Company, no discussions are taking place with respect to such representation.

 

 

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4.14 Financial Statements. Company has furnished or will prior to SEC filing deadlines furnish Buyer Companys’ financial statements (the "Financial Statements") for the period from inception through any necessary SEC filing date. The Financial Statements, when submitted to Buyer for inclusion in the SEC filings, will have been prepared in accordance with Regulation S-X of the SEC by a PCAOB member firm and, in particular, Rules 1-02 and 3-05 promulgated thereunder.  The Financial Statements present fairly, in all respects, the consolidated financial position and results of operations of Company as of the dates and periods indicated, prepared in accordance with generally accepted accounting principles consistently applied ("GAAP").  Without limiting the generality of the foregoing, (i) there is no basis for any assertion against Company as of the date of the Financial Statements of any debt, liability or obligation of any nature not fully reflected or reserved against in the Financial Statements; and (ii) there are no assets of Company as of the date of the Financial Statements, the value of which is overstated in the Financial Statements. Except as disclosed in the Financial Statements, Company has no known contingent liabilities (including liabilities for Taxes), forward or long-term commitments or unrealized or anticipated losses from unfavorable commitments other than in the ordinary course of business. Company is not a party to any contract or agreement for the forward purchase or sale of any foreign (including all laws, rules and regulations of Cyprus and any governmental subdivision thereof)  currency that is material to Company taken as a whole.

 

4.15 Absence of Certain Changes or Events.  Since the date of the last financial statement furnished to Buyer, there has not been:

 

(a) Any material adverse change in the financial condition, properties, assets, liabilities or business of Company;

 

(b) Any material damage, destruction or loss of any material properties of Company, whether or not covered by insurance;

 

(c) Any material change in the manner in which the business of Company has been conducted;

 

(d) Any material change in the treatment and protection of trade secrets or other confidential information of Company;

 

(e) Any material change in the business or contractual relationship of  Company with any customer or supplier which might reasonably be expected to materially and adversely affect the business or prospects of  Company;

 

(f) Any agreement by Company, whether written or oral, to do any of the foregoing; and

 

(g) Any occurrence not included in paragraphs (a) through (f) of this Section 4.16 which has resulted, or which Company has reason to believe, in its reasonable judgment, might be expected to result, in a material adverse change in the business or prospects of Company.

 

4.16 Governmental Licenses, Permits, Etc. To its knowledge, Company has all governmental licenses, permits, authorizations and approvals necessary for the conduct of its business as currently conducted ("Licenses and Permits"). The information in Schedule 4.16 concerning Company includes a list of all Licenses and Permits. All Licenses and Permits are in full force and effect, and no proceedings for the suspension or cancellation of any thereof is pending or threatened.

 

 

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4.17 Employee Agreements. (a) For purposes of this Agreement, the following definitions apply:

 

(1) "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and any regulations promulgated thereunder or similar laws, rules and regulations in Cyprus.

 

(2) "Multi-employer Plan" means a plan, as defined in ERISA Section 3(37) or similar laws, rules and regulations in Cyprus, to which Company contributes or is required to contribute.

 

(3) "Employee Plan" means any pension, retirement, profit sharing, deferred compensation, vacation, bonus, incentive, medical, vision, dental, disability, life insurance or any other employee benefit plan as defined in Section 3(3) of ERISA other than a Multi-employer Plan or similar laws, rules and regulations in Cyprus to which Company contributes, sponsors, maintains or otherwise is bound to with regard to any benefits on behalf of the employees of Company.

 

(4) "Employee Pension Plan" means any Employee Plan for the provision of retirement income to employees or which results in the deferral of income by employees extending to the termination of covered employment or beyond as defined in Section 3(2) of ERISA or similar laws, rules and regulations in Cyprus.

 

(5) "Employee Welfare Plan" means any Employee Plan other than an Employee Pension Plan.

 

(6) "Compensation Arrangement" means any plan or compensation arrangement other than an Employee Plan, whether written or unwritten, which provides to employees of Company, former employees, officers, directors or Sellers of Company any compensation or other benefits, whether deferred or not, in excess of base salary or wages, including, but not limited to, any bonus or incentive plan, stock rights plan, deferred compensation arrangement, life insurance, stock purchase plan, severance pay plan and any other employee fringe benefit plan.

 

(b) The information in Schedule 4.17 concerning Company lists, all (1) employment agreements and collective bargaining agreements to which Company is a party; (2) compensation arrangements of Company with any officer, director or employee; (3) Employee Welfare Plans; (4) Employee Pension Plans; and (5) consulting agreements under which Company has or may have any monetary obligations to employees or consultants of Company or their beneficiaries or legal representatives or under which any such persons may have any rights. Company has previously made available to Buyer true and complete copies of all of the foregoing employment contracts, collective bargaining agreements, Employee Plans and Compensation Arrangements, including descriptions of any unwritten contracts, agreements, Compensation Arrangements or Employee Plans, as amended to date. In addition, with respect to any Employee Plan which continues after the Closing Date, Company has previously delivered or made available to Buyer (1) any related trust agreements, master trust agreements, annuity contracts or insurance contracts; (2) certified copies of all Board of Directors' resolutions adopting such plans and trust documents and amendments thereto; (3) current investment management agreements; (4) custodial agreements; (5) fiduciary liability insurance policies; (6) indemnification agreements; (7) the most recent determination letter (and underlying application thereof and correspondence and supplemental material related thereto) issued by the Internal Revenue Service with respect to the qualification of each Employee Plan under the provisions of Section 401(a) of the Code; (8) copies of all "advisory opinion letters," "private letter rulings," "no action letters," and any similar correspondence (and the underlying applications therefor and correspondence and supplemental material related thereto) that was issued by any governmental or quasigovernmental agency with respect to the last plan year; (9) Annual Reports (Form 5500 Series) and Schedules A and B thereto for the last plan year; (10) all actuarial reports prepared for the last plan year; (11) all certified Financial Statements for the last plan year; and (12) all current Summary Plan Descriptions, Summaries of Material Modifications and Summary Annual Reports. All documents delivered by Company to Buyer as photocopies faithfully reproduce the originals thereof, such originals are authentic and were, to the extent execution was required, duly executed.

 

 

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(c) Except as otherwise disclosed in the information in Schedule 4.17 concerning Company:

 

(1) It is not a party to and has, in effect or to become effective after the date of this Agreement, any bonus, cash or deferred compensation, severance, medical, health or hospitalization, pension, profit sharing or thrift, retirement, stock option, employee stock ownership, life or group insurance, death benefit, welfare, incentive, vacation, sick leave, cafeteria, so-called "golden parachute" payment, disability or trust agreement or arrangement.

 

4.18 Brokers.  Company and Sellers have not made any agreement or taken any action with any person or taken any action which would cause any person to be entitled to any agent's, broker's or finder's fee or commission, except as disclosed to the other party,  connection with the transactions contemplated by this Agreement.

 

4.19 Business Locations.  Company does not nor does it own or lease any real or personal property in any location except as set forth on the information in the Schedule 4.19 concerning Company. Company does not have a place of business (including, without limitation, Company’s executive offices or place where Company’s books and records are kept) except as otherwise set forth on the information in Schedule 4.19 concerning Company.

 

4.20 Intellectual Property.  The information in Schedule 4.20 concerning Company lists all of the Intellectual Property (as hereinafter defined) used by Company which constitutes a material patent, trade name, trademark, service mark or application for any of the foregoing. "Intellectual Property" means all of Company's right, title and interest in and to all patents, trade names, assumed names, trademarks, service marks, and proprietary names, copyrights (including any registration and pending applications for any such registration for any of them), together with all the goodwill relating thereto and all other intellectual property of Company. Other than as disclosed in the information in Schedule 4.20 concerning Company, Company does not have any licenses granted by or to it or other agreements to which it is a party, relating in whole or in part to any Intellectual Property, whether owned by Company or otherwise. All of the patents, trademark registrations and copyrights listed in the information in Schedule 4.20 concerning Company that are owned by Company are valid and in full force and effect. To the knowledge of Company, it is not infringing upon, or otherwise violating, the rights of any third party with respect to any Intellectual Property. No proceedings have been instituted against or claims received by Company, nor to its knowledge are any proceedings threatened alleging any such violation, nor does Company know of any valid basis for any such proceeding or claim. To the knowledge of Company, there is no infringement or other adverse claims against any of the Intellectual Property owned or used by Company. To the knowledge of Company, its use of software does not violate or otherwise infringe the rights of any third party.

 

4.21 Warranties. The information in Schedule 4.21 concerning Company sets forth a true and complete list of the forms of all express warranties and guaranties made by Company to third parties with respect to any services rendered by Company.

 

4.22 Suppliers. Except as set forth in the information in Schedule 4.22 concerning Company, Company knows and has no reason to believe that, either as a result of the transactions contemplated hereby or for any other reason (exclusive of expiration of a contract upon the passage of time), any present material supplier of Company will not continue to conduct business with Company after the Closing Date in substantially the same manner as it has conducted business prior thereto.

 

 

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4.23 Accounts Receivable. The accounts receivable reflected on the balance sheets included in the Financial Statements, or thereafter acquired by Company, consists, in the aggregate in all material respects, of items which are collectible in the ordinary and usual course of business.

 

4.24 Governmental Approvals. To its knowledge, other than as set forth herein, no authorization, license, permit, franchise, approval, order or consent of, and no registration, declaration or filing by Company with, any governmental authority, federal, state or local, is required in connection with Company's execution, delivery and performance of this Agreement.

 

4.25 No Omissions or Untrue Statements.  None of the information relating to Company supplied or to be supplied in writing by it specifically for inclusion in SEC filings, at the respective times that the filings are made contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

4.26 Information concerning Company Complete.  Company shall promptly provide to Buyer notice concerning any of the information concerning Company furnished hereunder if events occur prior to the Closing Date that would have been required to be disclosed had they existed at the time of executing this Agreement. The information provided to Buyer concerning Company, as­­­­­­­ supplemented prior to the Closing Date, will contain a true, correct and complete list and description of all items required to be set forth therein. The information provided to Buyer concerning Company, as supplemented prior to the Closing Date, is expressly incorporated herein by reference. Notwithstanding the foregoing, any such supplement to the information in furnished by Company following the date hereof shall not in any way affect Buyer’s right not to consummate the transactions contemplated hereby as set forth herein.

 

V.  REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer represents and warrants to Sellers jointly and separately and to the Company as follows, with the knowledge and understanding that Company is relying materially on such representations and warranties:

 

5.1 Organization and Standing of Buyer.  Buyer is a corporation duly organized, validly existing and in good standing under the laws of the state of Nevada, and has the corporate power to carry on its business as now conducted and to own its assets and in good standing under the laws of the state of Nevada. Buyer has all requisite corporate power to carry on its business as it is now being conducted and is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where such qualification is necessary under applicable law, except where the failure to qualify (individually or in the aggregate) does not have any material adverse effect on the assets, business or financial condition of Buyer, and all states in which Buyer is qualified to do business as of the date hereof, are listed in the information in Schedule 5.1 is not required to qualify to transact business as a foreign corporation in any state or other jurisdiction. The copies of the Articles of Incorporation and Bylaws of Buyer, delivered to Company, are true and complete copies of those documents as now in effect. Buyer does not own any capital stock in any other corporation, business trust or similar entity, and is not engaged in a partnership, joint venture or similar arrangement with any person or entity. The minute books of Buyer contain accurate records of all meetings of its incorporator and Board of Directors since its date of incorporation.

 

 

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5.2 Buyer's Authority; Due Execution; No Breaches.  Buyer's Board of Directors has approved and adopted this Agreement and the Exchange. Due Execution.  This Agreement constitutes, and all other agreements contemplated hereby will constitute, when executed and delivered by Buyer in accordance herewith (and assuming due execution and delivery by the other parties hereto), the valid and binding obligations of Buyer, enforceable in accordance with their respective terms, subject to general principles of equity and bankruptcy or other laws relating to or affecting the rights of creditors generally. No Breaches.  To its knowledge, the making and performance of this Agreement (including, without limitation, the issuance of the Buyer Shares) by Buyer will not (i) conflict with the Articles of Incorporation or the Bylaws of Buyer ; (ii) violate any order, writ, injunction, or decree applicable to Buyer; or (iii) result in any breach or termination of, or constitute a default under, or constitute an event which, with notice or lapse of time, or both, would become a default under, or result in the creation of any encumbrance upon any asset of Buyer under, or create any rights of termination, cancellation or acceleration in any person under, any agreement, arrangement or commitment, or violate any provisions of any laws, ordinances, rules or regulations or any order, writ, injunction or decree to which Buyer  is a party or by which Buyer  or any of its assets may be bound.

 

5.3 Capitalization. The authorized capital stock of Buyer is as set forth in Schedule 5.3.  Except for the foregoing and for the shares to be issued under the terms of this Agreement or otherwise referred to in this Agreement, there are no agreements, commitments, obligations, options, warrants or similar rights, oral or written, known to Buyer or its affiliates under which additional shares of Buyer are required to be issued after the Closing.  All of the outstanding Buyer Common Stock is duly authorized, validly issued, fully paid and nonassessable, and was not issued in violation of the preemptive rights of any person. The Share Consideration to be issued upon effectiveness of the Exchange, when issued in accordance with the terms of this Agreement shall be duly authorized, validly issued, fully paid and non-assessable.

 

5.4 Properties.  Except as set forth on the information in Schedule 5.4 concerning Buyer, Buyer has good title to all of the Assets which it purports to own as reflected on the balance sheet included in the Financial Statements (as hereinafter defined), or thereafter acquired. Buyer has a valid leasehold interest in all material property of which it is the lessee and each such lease is valid, binding and enforceable against Buyer, as the case may be, and, to the knowledge of Buyer, the other parties thereto in accordance with its terms. Neither Buyer nor the other parties thereto are in material default in the performance of any material provisions thereunder. Neither the whole nor any material portion of the Assets of Buyer is subject to any governmental decree or order to be sold or is being condemned, expropriated or otherwise taken by any public authority with or without payment of compensation therefor, nor, to the knowledge of Buyer, any such condemnation, expropriation or taking been proposed. None of the assets of Buyer is subject to any restriction which would prevent continuation of the use currently made thereof or materially adversely affect the value thereof.

 

5.5 Contracts Listed; No Default.  All contracts, agreements, licenses, leases, easements, permits, rights of way, commitments, and understandings, written or oral, connected with or relating in any respect to present or proposed future operations of Buyer (except employment or other agreements terminable at will and other agreements which, in the aggregate, are not material to the business, properties or prospects of Buyer and except governmental licenses, permits, authorizations, approvals and other matters referred to in Section 5.17) are listed and described in the information in Schedule 5.5 concerning Buyer. Buyer is the holder of, or party to, all of the Buyer Contracts. To the knowledge of Buyer, the Buyer Contracts are valid, binding and enforceable by the signatory thereto against the other parties thereto in accordance with their terms. Neither Buyer nor any signatory thereto is in default or breach of any material provision of the Buyer Contracts. Buyer's operation of its business has been, is, and will, between the date hereof and the Closing Date, continue to be, consistent with the material terms and conditions of the Buyer Contracts.

 

 

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5.6 Litigation.  Except as disclosed in the information in Schedule 5.6 concerning Buyer, there is no claim, action, proceeding or investigation pending or, to the knowledge of Buyer, threatened against or affecting Buyer before or by any court, arbitrator or governmental agency or authority which, in the reasonable judgment of Buyer, could have any materially adverse effect on Buyer. There are no decrees, injunctions or orders of any court, governmental department, agency or arbitration outstanding against Buyer.

 

5.7 Taxes.  For purposes of this Agreement, (A) "Tax" (and, with correlative meaning, "Taxes") shall mean any federal, state, local or foreign income, alternative or add-on minimum, business, employment, franchise, occupancy, payroll, property, sales, transfer, use, value added, withholding or other tax, levy, impost, fee, imposition, assessment or similar charge, together with any related addition to tax, interest, penalty or fine thereon; and (B) "Returns" shall mean all returns (including, without limitation, information returns and other material information), reports and forms relating to Taxes or to any benefit plans.

 

Buyer has duly filed all Returns required by any law or regulation, domestic or foreign, to be filed by it, except for extensions duly obtained. All such Returns were, when filed, and to the knowledge of Buyer are, accurate and complete in all material respects and were prepared in conformity with applicable laws and regulations in all material respects. Buyer has paid or will pay in full or has adequately reserved against all Taxes otherwise assessed against it through the Closing Date, and the assessment of any material amount of additional Taxes in excess of those paid and reported is not reasonably expected.

Buyer is not a party to any pending action or proceeding by any governmental authority for the assessment of any Tax, and no claim for assessment or collection of any Tax has been asserted against Buyer that has not been paid. There are no Tax liens upon the assets (other than the lien of property taxes not yet due and payable) of Buyer. There is no valid basis, to the knowledge of Buyer, except as set forth in Schedule 5.7, for any assessment, deficiency, notice, 30-day letter or similar intention to assess any Tax to be issued to Buyer by any governmental authority.

 

5.8 Compliance with Laws and Regulations.  To its knowledge, Buyer is in compliance, in all material respects, with all laws, rules, regulations, orders and requirements (federal, state and local) applicable to it in all jurisdictions where the business of Buyer is currently conducted or to which Buyer is currently subject which has a material impact on Buyer, including, without limitation, all applicable civil rights and equal opportunity employment laws and regulations, and all state and federal antitrust and fair trade practice laws and the Federal Occupational Health and Safety Act and all similar Cypriot laws, rules and regulations. Buyer knows of no assertion by any party that Buyer is in violation of any such laws, rules, regulations, orders, restrictions or requirements with respect to its current operations, and no notice in that regard has been received by Buyer. To the knowledge of Buyer, there is not presently pending any proceeding, hearing or investigation with respect to the adoption of amendments or modifications to existing laws, rules, regulations, orders, restrictions or requirements which, if adopted, would materially adversely affect the current operations of Buyer.

 

5.9 Compliance with Laws.  (a) To its knowledge, the business, operations, property and assets of Buyer (and, to the knowledge of Buyer, the business of any sub-tenant or licensee which is occupying or has occupied any space on any premises of Buyer and the activities of which could result in any material adverse liability to Buyer) (i) conform with and are in compliance in all material respects with all, and are not in material violation of any applicable federal, state and local laws, rules and regulations, including, but not limited to, the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended (including the 1986 Amendments thereto and the Superfund Amendments and Reauthorization Act) ("CERCLA"), and the Resource Conservation and Recovery Act ("RCRA"), as well as any other laws, rules or regulations relating to tax, product liability, controlled substances, product registration, environmental protection, hazardous or toxic waste, employment, or occupational safety matters whether US or Cypriot; and (ii) have been conducted and operated in a manner such that, to Buyer's knowledge, Buyer has foreseeable potential liabilities for environmental clean-up under CERCLA, RCRA.

 

 

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(b) To its knowledge, no predecessor-in-title to any real property now or previously owned or operated by Buyer, nor any predecessor operator thereof conducted its business or operated such property in violation of CERCLA and RCRA or any other applicable federal, state and local laws, rules and regulations relating to environmental protection or hazardous or toxic waste matters.

 

(c) Except as disclosed in the information in Schedule 5.9 concerning Buyer, no suit, action, claim, proceeding, nor investigation, review or inquiry by any court or federal, state, county, municipal or local governmental department, commission, board, bureau, agency or instrumentality, including, without limitation, any state or local health department (all of the foregoing collectively referred to as "Governmental Entity") concerning any such possible violations by Buyer is pending or, to the knowledge of Buyer, threatened, including, but not limited to, matters relating to diagnostic tests and products and product liability, environmental protection, hazardous or toxic waste, controlled substances, employment, occupational safety or tax matters. Buyer does not know of any reasonable basis or ground for any such suit, claim, investigation, inquiry or proceeding. For purposes of this Section 5.9, the term "inquiry" includes, without limitation, all pending regulatory issues (whether before federal, state, local or inter-governmental regulatory authorities) concerning any regulated product, including, without limitation, any diagnostic drugs and products.

 

5.10 Information.  Buyer has furnished and will continue to furnish Buyer all information and financial statements as Buyer may reasonably request.

 

5.11 Condition of Assets.  The equipment, fixtures and other personal property of Buyer, taken as a whole, is in good operating condition and repair (ordinary wear and tear excepted) for the conduct of the business of Buyer as is contemplated to be conducted.

 

5.12 No Breaches.  To its knowledge, the making and performance of this Agreement and the other agreements contemplated hereby by Buyer will not (i) conflict with or violate the Articles of Incorporation or the Bylaws of Buyer; (ii) violate any material laws, ordinances, rules or regulations, or any order, writ, injunction or decree to which Buyer is a party or by which Buyer or any of its respective assets, businesses, or operations may be bound or affected; or (iii) result in any breach or termination of, or constitute a default under, or constitute an event which, with notice or lapse of time, or both, would become a default under, or result in the creation of any encumbrance upon any asset of Buyer under, or create any rights of termination, cancellation or acceleration in any person under, any Buyer Contract.

 

5.13 Employees.  None of the employees of Buyer is represented by any labor union or collective bargaining unit and, to the knowledge of Buyer, no discussions are taking place with respect to such representation.

 

5.14 Financial Statements.  The financial statements of Buyer (the "Financial Statements") are as set forth in Buyer’s SEC filings. The Financial Statements have been prepared in accordance with Regulation S-X of the SEC by a PCAOB member firm and, in particular, Rules 1-02 and 3-05 promulgated thereunder.  The Financial Statements present fairly, in all respects, the consolidated financial position and results of operations of Buyer as of the dates and periods indicated, prepared in accordance with generally accepted accounting principles consistently applied ("GAAP").  Without limiting the generality of the foregoing, (i) there is no basis for any assertion against Buyer as of the date of the Financial Statements of any debt, liability or obligation of any nature not fully reflected or reserved against in the Financial Statements; and (ii) there are no assets of Buyer as of the date of the Financial Statements, the value of which is overstated in the Financial Statements. Except as disclosed in the Financial Statements, Buyer has no known contingent liabilities (including liabilities for Taxes), forward or long-term commitments or unrealized or anticipated losses from unfavorable commitments other than in the ordinary course of business. Buyer is not a party to any contract or agreement for the forward purchase or sale of any foreign currency that is material to Buyer taken as a whole.

 

 

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5.15 Absence of Certain Changes or Events.  Since the date of the last Financial Statement filed with the SEC, there has not been:

 

(a) Any material adverse change in the financial condition, properties, assets, liabilities or business of Buyer;

 

(b) Any material damage, destruction or loss of any material properties of Buyer, whether or not covered by insurance;

 

(c) Any material change in the manner in which the business of Buyer has been conducted;

 

(d) Any material change in the treatment and protection of trade secrets or other confidential information of Buyer;

 

(e) Any material change in the business or contractual relationship of  Buyer with any customer or supplier which might reasonably be expected to materially and adversely affect the business or prospects of  Buyer;

 

(f) Any agreement by Buyer, whether written or oral, to do any of the foregoing; and

 

(g) Any occurrence not included in paragraphs (a) through (f) of this Section 5.16 which has resulted, or which Buyer has reason to believe, in its reasonable judgment, might be expected to result, in a material adverse change in the business or prospects of Buyer.

 

5.16 Governmental Licenses, Permits, Etc.  To its knowledge, Buyer has all governmental licenses, permits, authorizations and approvals necessary for the conduct of its business as currently conducted ("Licenses and Permits"). The information in Schedule 5.16 concerning Buyer includes a list of all Licenses and Permits. All Licenses and Permits are in full force and effect, and no proceedings for the suspension or cancellation of any thereof is pending or threatened.

 

5.17 Employee Agreements.  (a) For purposes of this Agreement, the following definitions apply:

 

(1) "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and any regulations promulgated thereunder.

 

(2) "Multi-employer Plan" means a plan, as defined in ERISA Section 3(37) to which Buyer contributes or is required to contribute.

 

(3) "Employee Plan" means any pension, retirement, profit sharing, deferred compensation, vacation, bonus, incentive, medical, vision, dental, disability, life insurance or any other employee benefit plan as defined in Section 3(3) of ERISA other than a Multi-employer Plan to which Buyer contributes, sponsors, maintains or otherwise is bound to with regard to any benefits on behalf of the employees of Buyer.

 

 

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(4) "Employee Pension Plan" means any Employee Plan for the provision of retirement income to employees or which results in the deferral of income by employees extending to the termination of covered employment or beyond as defined in Section 3(2) of ERISA.

 

(5) "Employee Welfare Plan" means any Employee Plan other than an Employee Pension Plan.

 

(6) "Compensation Arrangement" means any plan or compensation arrangement other than an Employee Plan, whether written or unwritten, which provides to employees of Buyer, former employees, officers, directors or Sellers of Buyer any compensation or other benefits, whether deferred or not, in excess of base salary or wages, including, but not limited to, any bonus or incentive plan, stock rights plan, deferred compensation arrangement, life insurance, stock purchase plan, severance pay plan and any other employee fringe benefit plan.

 

(b) The information in Schedule 5.17 concerning Buyer lists, all (1) employment agreements and collective bargaining agreements to which Buyer is a party; (2) compensation arrangements of Buyer with any officer, director or employee; (3) Employee Welfare Plans; (4) Employee Pension Plans; and (5) consulting agreements under which Buyer has or may have any monetary obligations to employees or consultants of Buyer or their beneficiaries or legal representatives or under which any such persons may have any rights. Buyer has previously made available to Buyer true and complete copies of all of the foregoing employment contracts, collective bargaining agreements, Employee Plans and Compensation Arrangements, including descriptions of any unwritten contracts, agreements, Compensation Arrangements or Employee Plans, as amended to date. In addition, with respect to any Employee Plan which continues after the Closing Date, Buyer has previously delivered or made available to Buyer (1) any related trust agreements, master trust agreements, annuity contracts or insurance contracts; (2) certified copies of all Board of Directors' resolutions adopting such plans and trust documents and amendments thereto; (3) current investment management agreements; (4) custodial agreements; (5) fiduciary liability insurance policies; (6) indemnification agreements; (7) the most recent determination letter (and underlying application thereof and correspondence and supplemental material related thereto) issued by the Internal Revenue Service with respect to the qualification of each Employee Plan under the provisions of Section 401(a) of the Code; (8) copies of all "advisory opinion letters," "private letter rulings," "no action letters," and any similar correspondence (and the underlying applications therefor and correspondence and supplemental material related thereto) that was issued by any governmental or quasigovernmental agency with respect to the last plan year; (9) Annual Reports (Form 5500 Series) and Schedules A and B thereto for the last plan year; (10) all actuarial reports prepared for the last plan year; (11) all certified Financial Statements for the last plan year; and (12) all current Summary Plan Descriptions, Summaries of Material Modifications and Summary Annual Reports. All documents delivered by Buyer to Buyer as photocopies faithfully reproduce the originals thereof, such originals are authentic and were, to the extent execution was required, duly executed.

 

(c) Except as otherwise disclosed in the information in Schedule 5.17 concerning Buyer:

 

(1) It is not a party to and has, in effect or to become effective after the date of this Agreement, any bonus, cash or deferred compensation, severance, medical, health or hospitalization, pension, profit sharing or thrift, retirement, stock option, employee stock ownership, life or group insurance, death benefit, welfare, incentive, vacation, sick leave, cafeteria, so-called "golden parachute" payment, disability or trust agreement or arrangement.

 

5.18 Brokers.  Buyer has not made any agreement or taken any action with any person or taken any action which would cause any person to be entitled to any agent's, broker's or finder's fee or commission, except as disclosed to the other party,  connection with the transactions contemplated by this Agreement.

 

 

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5.19 Business Locations.  Buyer does not nor does it own or lease any real or personal property in any location except as set forth on the information in the Schedule 5.19 concerning Buyer. Buyer does not have a place of business (including, without limitation, Buyer’s executive offices or place where Buyer’s books and records are kept) except as otherwise set forth on the information in Schedule 5.19 concerning Buyer.

 

5.20 Intellectual Property.  The information in Schedule 5.20 concerning Buyer lists all of the Intellectual Property (as hereinafter defined) used by Buyer which constitutes a material patent, trade name, trademark, service mark or application for any of the foregoing. "Intellectual Property" means all of Buyer's right, title and interest in and to all patents, trade names, assumed names, trademarks, service marks, and proprietary names, copyrights (including any registration and pending applications for any such registration for any of them), together with all the goodwill relating thereto and all other intellectual property of Buyer. Other than as disclosed in the information in Schedule 5.20 concerning Buyer, Buyer does not have any licenses granted by or to it or other agreements to which it is a party, relating in whole or in part to any Intellectual Property, whether owned by Buyer or otherwise. All of the patents, trademark registrations and copyrights listed in the information in Schedule 5.20 concerning Buyer that are owned by Buyer are valid and in full force and effect. To the knowledge of Buyer, it is not infringing upon, or otherwise violating, the rights of any third party with respect to any Intellectual Property. No proceedings have been instituted against or claims received by Buyer, nor to its knowledge are any proceedings threatened alleging any such violation, nor does Buyer know of any valid basis for any such proceeding or claim. To the knowledge of Buyer, there is no infringement or other adverse claims against any of the Intellectual Property owned or used by Buyer. To the knowledge of Buyer, its use of software does not violate or otherwise infringe the rights of any third party.

 

5.21 Warranties.  The information in Schedule 5.21 concerning Buyer sets forth a true and complete list of the forms of all express warranties and guaranties made by Buyer to third parties with respect to any services rendered by Buyer.

 

5.22 Suppliers.  Except as set forth in the information in Schedule 5.22 concerning Buyer, Buyer knows and has no reason to believe that, either as a result of the transactions contemplated hereby or for any other reason (exclusive of expiration of a contract upon the passage of time), any present material supplier of Buyer will not continue to conduct business with Buyer after the Closing Date in substantially the same manner as it has conducted business prior thereto.

 

5.23 Accounts Receivable.  The accounts receivable reflected on the balance sheets included in the Financial Statements, or thereafter acquired by Buyer, consists, in the aggregate in all material respects, of items which are collectible in the ordinary and usual course of business.

 

5.24 Governmental Approvals.  To its knowledge, other than as set forth herein, no authorization, license, permit, franchise, approval, order or consent of, and no registration, declaration or filing by Buyer with, any governmental authority, federal, state or local, is required in connection with Buyer's execution, delivery and performance of this Agreement.

 

5.25 No Omissions or Untrue Statements.  None of the information relating to Buyer set forth in SEC filings, at the respective times that the filings are made contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

 

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5.26 Information concerning Buyer Complete.  Buyer shall promptly provide to Buyer notice concerning any of the information concerning Buyer furnished hereunder if events occur prior to the Closing Date that would have been required to be disclosed had they existed at the time of executing this Agreement. The information provided to Buyer concerning Buyer, as­­­­­­­ supplemented prior to the Closing Date, will contain a true, correct and complete list and description of all items required to be set forth therein. The information provided to Buyer concerning Buyer, as supplemented prior to the Closing Date, is expressly incorporated herein by reference. Notwithstanding the foregoing, any such supplement to the information in furnished by Buyer following the date hereof shall not in any way affect Buyer’s right not to consummate the transactions contemplated hereby as set forth herein.

 

VI.  MISCELLANEOUS

 

6.1 Expenses. The parties will pay for all their own expenses and costs.

 

6.2 Survival of Representations, Warranties and Covenants.  All statements contained in this Agreement or in any certificate delivered by or on behalf of Company, Sellers of Company, all jointly and severally, or Buyer pursuant hereto or in connection with the transactions contemplated hereby shall be deemed representations, warranties and covenants by Company or Buyer, as the case may be, hereunder. All representations, warranties and covenants made by Company and by Buyer in this Agreement, or pursuant hereto, shall survive through the Closing Date.

 

6.3 Nondisclosure.  Buyer will not at any time after the date of this Agreement, without Company' consent, divulge, furnish to or make accessible to anyone (other than to its representatives as part of its due diligence or corporate investigation) any knowledge or information with respect to confidential or secret processes, inventions, discoveries, improvements, formulae, plans, material, devices or ideas or know-how, whether patentable or not, with respect to any confidential or secret aspects (including, without limitation, customers or suppliers) ("Confidential Information") of Company.

Company will not at any time after the date of this Agreement, without Buyer's consent (except as may be required by law), use, divulge, furnish to or make accessible to anyone any Confidential Information (other than to its representatives as part of its due diligence or corporate investigation) with respect to Buyer. The undertakings set forth in the preceding two paragraphs of this Section 6.3 shall lapse if the Closing takes place as to Buyer and Company, but shall not lapse as to the officers and directors of Buyer, individually.

 

Any information, which (i) at or prior to the time of disclosure by either of Company or Buyer was generally available to the public through no breach of this covenant, (ii) was available to the public on a non-confidential basis prior to its disclosure by either of Company or Buyer or (iii) was made available to the public from a third party, provided that such third party did not obtain or disseminate such information in breach of any legal obligation to Company or Buyer, shall not be deemed Confidential Information for purposes hereof, and the undertakings in this covenant with respect to Confidential Information shall not apply thereto.

 

 

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6.4 Succession and Assignments; Third Party Beneficiaries.  This Agreement may not be assigned (either voluntarily or involuntarily) by any party hereto without the express written consent of the other party. Any attempted assignment in violation of this Section shall be void and ineffective for all purposes. In the event of an assignment permitted by this Section, this Agreement shall be binding upon the heirs, successors and assigns of the parties hereto. Except as expressly set forth in this Section, there shall be no third party beneficiaries of this Agreement.

 

6.5 Notices.  All notices, requests, demands or other communications with respect to this Agreement shall be in writing and shall be (i) sent by e-mail or fax, (ii) sent by the federal postal service, registered or certified mail, return receipt requested, or (iii) personally delivered by a nationally recognized express overnight courier service, charges prepaid, to the addresses specified in writing by each party.

 

Any such notice shall, when sent in accordance with the preceding sentence, be deemed to have been given and received on the earliest of (i) the day delivered to such address or sent by e-mail facsimile transmission, (ii) the fifth (5th) business day following the date deposited with the Postal Service, or (iii) twenty-four (24) hours after shipment by such courier service.

 

6.6 Construction.  This Agreement shall be construed and enforced in accordance with the internal laws of Nevada without giving effect to the principles of conflicts of law thereof.

 

6.7 Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall together constitute one and the same Agreement.

 

6.8 No Implied Waiver; Remedies.  No failure or delay on the part of the parties hereto to exercise any right, power or privilege hereunder or under any instrument executed pursuant hereto shall operate as a waiver, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege. All rights, powers and privileges granted herein shall be in addition to other rights and remedies to which the parties may be entitled at law or in equity.

 

6.9 Entire Agreement.  This Agreement, including the Exhibits and Schedules attached hereto, sets forth the entire understandings of the parties with respect to the subject matter hereof, and it incorporates and merges any and all previous communications, understandings, oral or written, as to the subject matter hereof, and cannot be amended or changed except in writing, signed by the parties.

 

6.10 Headings.  The headings of the Sections of this Agreement, where employed, are for the convenience of reference only and do not form a part hereof and in no way modify, interpret or construe the meanings of the parties.

 

6.11 Severability.  To the extent that any provision of this Agreement shall be invalid or unenforceable, it shall be considered deleted herefrom and the remainder of such provision and of this Agreement shall be unaffected and shall continue in full force and effect.

 

6.12 Public Disclosure.  It is understood by Company that Buyer is required under the Exchange Act to make prompt disclosure of any material transaction.

 

 

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VII.  CONDITIONS PRECEDENT TO THE OBLIGATION OF THE BUYER TO CLOSE AND TO EXCHANGE THE BUYER SHARES WITH THE SELLERS

The obligation hereunder of the Buyer to exchange the Buyer Shares and consummate the transactions contemplated by this Agreement is subject to the satisfaction or waiver, at or before each Closing, of each of the conditions set forth below.  These conditions are for the Buyer’ sole benefit and may be waived by the Buyer at any time in their sole discretion.

 

7.1  Accuracy of the Company’s and Sellers’ Representations and Warranties.  Each of the representations and warranties of the Company and Sellers in this Agreement shall be true and correct in all material respects as of each Closing Date, except for representations and warranties that speak as of a particular date, which shall be true and correct in all material respects as of such date.

 

7.2  Performance by the Company and Sellers.  The Company and Sellers  shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company and Sellers at or prior to each Closing Date.

 

7.3  No Injunction.  No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

7.4  No Proceedings or Litigation.  No action, suit or proceeding before any arbitrator or any governmental authority shall have been commenced, and no investigation by any governmental authority shall have been threatened, against the Company or any Subsidiary, or any of the officers, directors or affiliates of the Company or any Subsidiary seeking to restrain, prevent or change the transactions contemplated by this Agreement, or seeking damages in connection with such transactions.

 

7.5 Opinion of Counsel.  The Buyer shall have received an opinion of counsel to the Company, dated the date of each Closing, substantially in the form of Exhibit 7.5 hereto which among other things shall state that all of Company and Sellers representations and warranties about Company and Sellers are true and correct.

 

7.6  Company Shares.  At or prior to each Closing, the Sellers shall have delivered to the Buyer all of the Company Shares with all endorsements required under the laws of Cyprus for a legal, valid and binding transfer affixed thereto.

 

7.7  Secretary’s Certificate.  The Company shall have delivered to the Buyer a secretary’s certificate, dated as of the Closing Date, as to (i) the resolutions adopted by the Board of Directors approving the transactions contemplated hereby, (ii) the Articles, (iii) the Bylaws, each as in effect at the Closing, and (iv) the authority and incumbency of the officers of the Company executing this Agreement and any other documents required to be executed or delivered in connection therewith.

 

7.8  Officer’s Certificate.  On each Closing Date, the Company shall have delivered to the Buyer a certificate signed by an executive officer on behalf of the Company, dated as of each Closing Date, confirming the accuracy of the Company’s representations, warranties and covenants as of such Closing Date and confirming the compliance by the Company with the conditions precedent set forth in this Section VII as of each Closing Date.

 

 

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7.9  Material Adverse Effect.  No Material Adverse Effect shall have occurred. For the purposes of this Agreement, “Material Adverse Effect” means any material adverse effect on the business, operations, properties, prospects, or financial condition of the Company and/or any condition, circumstance, or situation that would prohibit or otherwise materially interfere with the ability of the Company and the Sellers to perform any of its or their obligations under this Agreement in any material respect.

 

Transfer Agent Instructions.

 

7.10  Corporate Actions and SEC filings.  All actions necessary for the following changes of officers and directors of Buyer shall have occurred:

 

	
·  

	
Dimitris Goulielmos new CEO and Director of PMLT

 

	
·  

	
Panagiotis Drakopoulos new CFO (change from existing CEO)

 

	
·  

	
The existing CFO of PMLT, Mr. Konstantinos Vassilopoulos will become the new Secretary.

 

	
·  

	
The existing Secretary of PMLT, Mr. Panagiotis Tolis will resign.

 

	
·  

	
The Board of Directors of Greenbase Ltd [Eleni Paphiti, Charalambos Angelides] will remain as it is and all other directors of Buyer will remain.

 

Dimitrios Goulielmos as incoming officer, director and 5% shareholders of Buyer will have obtained all SEC filing codes for Form 3 and Schedule 13D filings, all of such filings along with all other required SEC filings in connection with this transaction shall have been prepared, including Form 8-K for change in officers/directors and change of control.  All questionnaires requested by Counsel to Buyer to complete these forms shall be completed by the Sellers and returned to Counsel to Buyer to such Counsel’s satisfaction.

 

Buyer and Company agree that a Super 8-K filing shall be filed in connection with the closing of the transaction and Company and Sellers and the PCAOB auditor of Company shall furnish to Buyer and Buyer’s Counsel all documents, questionnaires, financial statements and other information requested by Buyer and Buyer’s counsel to prepare this Super 8-K filing.  Company at its expense shall also have Cyprus counsel prepare all sections of the Super 8-K filing concerning the laws of Cyprus as are required for inclusion in the Super 8-K as requested by Buyer and Buyer’s Counsel.

 

7.11  Closing Adjustments and Distributions.  Buyer, Company and Sellers agree that there shall be made such adjustments and distributions at Closing to effect the following intent of the parties:

 

a.  The Company’s revenues, expenses and profits of 2012 belong to the Company.

 

b.  The Company’s revenues, expenses and profits of 2013 for Q1 and after belong to Buyer.

 

7.12  Covenants not to Compete.  At closing, Dimitrios Goulielmos and Panagiotis Drakopoulos will execute agreements containing standard commercial terms for covenants not to compete providing that each cannot operate the same type of business that Company and Buyer are running with another business.

 

 

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THE PARTIES TO THIS AGREEMENT HAVE READ THIS AGREEMENT, HAVE HAD THE OPPORTUNITY TO CONSULT WITH INDEPENDENT COUNSEL OF THEIR OWN CHOICE, AND UNDERSTAND EACH OF THE PROVISIONS OF THIS AGREEMENT.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written.

Prime Estates & Developments, Inc., a Nevada corporation

By:  ____________________________

Panagiotis Drakopoulos, CEO

Greenbase Ltd, organized under the laws of Cyprus

By:  ____________________________

_____________, Director

Sellers of Greenbase Ltd.

_____________________________________

Dimitrios Goulielmos 1980 common shares

_____________________________________

Evangelia Theocharidou 20 common shares

 

21

 

 

 

  

22

  

 

 

Schedule 4.5

 

GreenBase ltd. list of agreements:

 

	
1.  

	
NDA between GreenBase ltd. and Prime Estates & Developments Inc.

 

Agreements in which sales of goods and services are provided by Greenbase ltd.

 

	
1.  

	
Greenbase ltd. & Elmos trading limited. 

Agreement Description: Sales of goods trading agreement.  January, 10 2013.

 

	
2.  

	
GreenBase ltd. & Notescape ltd. 

Agreement Description: Sales of goods and services trading agreement.  December, 20 2008.

 

	
3.  

	
GreenBase ltd. & International Legal Services 

Agreement Description: Sales of services trading agreement May, 6 2008.

 

	
4.  

	
GreenBase ltd. & Spot Technology Telecommunications and Trade Limited 

Agreement Description: Sales of goods and services trading agreement Nov, 18 2010.

 

	
5.  

	
GreenBase ltd. & Sprider Stores SA 

Agreement Description: Sales of services trading agreement June, 6 2011.

 

Agreement in which services are provided to Greenbase ltd

 

	
1.  

	
GreenBase ltd. & Golden Link Business Limited 

Agreement Description: Sales of services trading agreement December, 18 2012.

 

 

23

 

 

Schedule 5.3

	
(a)  

	
Buyer is authorized to issue 200,000,000 shares of common stock with $.001 par value per share and 100,000,000 shares of preferred stock with $.001 par value per share.  25,305,532 shares of common stock and 0 shares of preferred stock are outstanding as of the date of execution of this Agreement.

	
(b)  

	
Buyer has the obligation to issue 240,000 options of common stock to its director Konstantinos Vassilopoulos as further set forth in Buyer’s Form 8-K filed with the SEC on 01/09/2013

For the remainder of the schedules required in Section 5, see the Buyer’s filings with the SEC.

 

 

 

 

 

 

 

 

24

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