Document:

exhibit1018.htm - Generated by SEC Publisher for SEC Filing

    

  Exhibit 10.18
  
 ASSIGNMENT AGREEMENT
  
 THIS ASSIGNMENT AGREEMENT (this “Assignment”) is dated as of March 25, 2011 by and between (i) Abakan Inc., a corporation incorporated in the State of Nevada (“Abakan”), (ii) Polythermics, LLC, a limited liability company organized in the State of Washington (“Polythermics”), and (iii) MesoCoat, Inc., a corporation incorporated in the State of Ohio (“MesoCoat”).
  
 WITNESSETH:
  
 WHEREAS, MesoCoat entered into a Distribution Agreement (the “Agreement”) with Polythermics dated October 10, 2008 pursuant to which MesoCoat granted to Polythermics the exclusive right to distribute MesoCoat’s products intended for applications specific to the oil and gas pipeline industry pursuant to the terms and conditions of the Agreement; 
  
 WHEREAS, Abakan desires to acquire all rights and obligations under the Agreement from Polythermics and Polythermics desires to assign all rights and obligations under the Agreement to Abakan as set forth herein; and
  
 WHEREAS, MesoCoat wishes to consent to the assignment of the Agreement from Polythermics to Abakan and to confirm that the Agreement has been performed and is in good standing as of the date of this Assignment, all conditions thereof having being satisfied by Polythermics on a timely basis. 
  
 NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements herein contained, and other good and valuable consideration provided by Abakan to Polythermics, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree that
 Polythermics hereby assigns, transfers and sets over to Abakan all rights and obligations of Polythermics in and through the Agreement, subject to the following terms, conditions, warranties and representations:
  
 Consideration
  
 The transfer of rights and obligations of the Agreement  under this Assignment is automatically effected and completed upon execution and delivery of this Assignment and Polythermics’ receipt from Abakan, within ten (10) business days of the execution and delivery of this Assignment, of one hundred thousand dollars ($100,000), and ownership of  150,000 shares of Abakan’s common stock. 
  
 EMPLOYMENT AGREEMENT
  
 A condition of Abakan in entering into this Assignment was the prior execution and delivery of an employment agreement between Abakan and John D. Neukirchen which condition will be met prior to finalization of this Agreement.
  
  
  

   

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  Warranties and Representations
  
 Polythermics warrants and represents to Abakan, with the intent that Abakan rely upon these representations and warranties, (i) that the Agreement is in full force and effect, has been fully performed in all respects, and is fully assignable subject to the prior written consent of MesoCoat, which consent is evidenced hereto, and (ii) that said Agreement is in good standing all conditions thereof having being satisfied by Polythermics on a timely basis as of the date of the assignment, including but not limited to Polythermic’s obligation to secure a development contract to finance product development and qualification of at least $1,000,000 within 12 months of the execution of the Agreement, and (iii) that Polythermics has full right and authority to assign the Agreement and that the Agreement is assigned free and clear of any lien, encumbrance or adverse claim, and (iv) that the managers and ownership interest holders of Polythermics have approved the Assignment.
  
 John D. Neukirchen warrants and represents (i) that the execution of this Assignment and the  execution of his employment agreement with Abakan does not constitute a conflict of interest with Polythermics, because the managers and ownership interest holders of Polythermics have been fully appraised of the Assignment and employment agreement and have independently evaluated and agreed upon this Assignment as beneficial to Polythermics and the owners of Polythermics will be met prior to finalization of this Agreement. Mr. Neukirchen personally indemnifies Abakan from any liability, claims or expenses that Abakan might incur arising from the Assignment or third party claims arising from his employment by Abakan.
  
 MesoCoat warrants and represents to Abakan, with the intent that Abakan rely upon these representations and warranties, (i) that the Agreement is in full force and effect, and (ii) that the Agreement is in good standing all conditions thereof having being satisfied by Polythermics on a timely basis as of the date of the assignment, (iii) that Polythermics met in full its obligation to secure a development contract to finance product development and qualification of at least $1,000,000 for MesoCoat within 12 months of the execution of the Agreement.
  
 CONSENT 
  
 MesoCoat does hereby consent to the Assignment of all rights and obligations under the Agreement from Polythermics to Abakan as of the execution date of said Assignment. 
  
 Entire Agreement
  
 This Assignment constitutes the entire agreement between the parties and supersedes every previous agreement, communication, expectation, negotiation, representation or understanding, whether oral or written, express or implied, statutory or otherwise, between the parties with respect to the subject matter of this Assignment.
  
  
  
  
  
  
  
  
  
  

   

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  Arbitration
  
 The parties hereby submit all controversies, claims, and matters of difference that arise under this Assignment to arbitration in the State of Florida, by a single arbitrator according to the Commercial Arbitration Rules of the American Arbitration Association from time to time in force. This submission and agreement to arbitrate shall be specifically enforceable. Without limiting the generality of the foregoing, the following shall be considered controversies for this purpose: (i) all questions relating to the breach of any obligation, warranty or condition hereunder, (ii) all questions relating to representations, negotiations and other proceedings leading to the execution hereof, (iii) failure of either party to deny or reject claim or demand from the other party, and (iv) all questions as to whether the right to arbitrate any question exists. Arbitration may proceed in the absence of either party if notice of the proceeding has been given to such party. The parties agree to abide by all awards rendered in such proceedings. Such awards shall be final and binding on all parties. It is the intention of the parties that the selection of arbitrators, the holding of the arbitration hearing, and the issuance of the findings of the arbitrators shall all be accomplished as expeditiously as possible, and the parties shall take all measures required to proceed in that fashion.
  
 Entitlement to Costs
  
 If any legal action or dispute arises under this Assignment, arises by reason of any asserted breach of it, or arises between the parties and is related in any way to the subject matter of the Assignment, the prevailing party shall be entitled to recover all costs and expenses, including reasonable attorneys’ fees, investigative costs, reasonable accounting fees and charges for experts. The “prevailing party” shall be the party who obtains a final judgment in its favor or a provisional remedy such as a preliminary injunction or who is entitled to recover its reasonable costs of suit, whether or not the suit proceeds to final judgment; if there is no court action, the prevailing party shall be the party who wins any dispute. A party need not be awarded money damages or all relief sought in order to be considered the “prevailing party” by a court.
  
 Governing Law and Attornment
  
 This Assignment is and will be deemed to be made in the State of Florida and for all purposes will be governed exclusively by and construed and enforced in accordance with the laws prevailing in the State of Florida, and the rights and remedies of the parties will be determined in accordance with those laws.  Each party irrevocably attorns to the jurisdiction of the courts of the State of Florida and all courts having appellate jurisdiction thereover, and any proceeding commenced or maintained in respect of or arising because of this Agreement will be commenced or maintained only in such of those courts as is appropriate.
  
 Amendment
  
 This Assignment may not be amended except in writing executed by each of the parties hereto.
  
 Assignment
  
 No party may assign any right, benefit or interest in this Assignment without the written consent of every other party and any purported assignment without such consent will be void.
  
  
  

   

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 Further Assurances
  
 Each party will, at its own expense and without expense to any other party, execute and deliver such further agreements and other documents and do such further acts and things as any other party reasonably requests to evidence, carry out or give full force and effect to the intent of this Assignment.
  
 Binding Effect
  
 This Assignment shall be binding upon and inure to the benefit of the parties, their successors and assigns.
  
 Counterparts
  
 This Assignment may be executed in any number of counterparts with the same effect as if every party to this Assignment had signed the same document, and all counterparts will be construed together and will constitute one and the same instrument.
  
 [Signature Page Follows]

   

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  IN WITNESS WHEREOF this Assignment was executed by the parties as of the day and year first above written
  
 Abakan Inc.                                                         
  
 /s/ Robert Miller                                    
 By: Robert Miller                                                 
 Its: Chief Executive Officer                                 
  
 Polythermics, LLC
  
 /s/ John H. Neukirchen                                        
 By: John H. Neukirchen
 Its: Manager
  
 Polythermics, LLC
  
 /s/ Semir Belage                                    
 Semir Belage
 Its: Shareholder
  
 Polythermics, LLC
  
 /s/ James Robert Dunning                     
 James Robert Dunning
 Its: Shareholder
  
 MesoCoat, Inc.
  
 /s/ Andrew Sherman                                             
 By: Andrew Sherman
 Its: President
  
 John H. Neukirchen
  
 /s/ John H. Neukirchen                                        
 John H. Neukirchen
  
 Consenting to this Assignment for the Purposes of the Agreement
  
 MesoCoat, Inc.
  
 /s/ Andrew Sherman                                 
 By: Andrew Sherman
 Its: President
  
             The Majority Shareholder of MesoCoat, Inc.
  
 Powdermet, Inc.
  
 /s/ Andrew Sherman                                    
 By: Andrew Sherman
 Its: President
  

   

 5exhibit1016.htm - Generated by SEC Publisher for SEC Filing

Exhibit 10.16

 

AMENDMENT NO. 2

TO

STOCK PURCHASE AGREEMENT

 

AMENDMENT NO. 2 to the STOCK PURCHASE AGREEMENT dated as of the 28th day of June, 2010 (the "Stock Purchase Agreement") by and between KENNAMETAL INC., a Pennsylvania corporation with its principal offices at 1600 Technology Way, Latrobe, Pennsylvania 15650 ("Kennametal") and ABAKAN INC., a Nevada corporation with its principal offices at 2829 Bird Avenue, Miami, Florida 33180 ("Buyer"). This Amendment shall be effective as of January 19, 2011 (the "Amendment Date").

RECITALS:

WHEREAS, Kennametal and Buyer are parties to the Stock Purchase Agreement, as amended by Amendment No. 1 effective as of June 28, 2010; and

WHEREAS, Amendment No. 1 set forth provisions for the payment of the Purchase Price in installments, as well as certain other provisions relating to, among other things, liquidated damages and termination of the Stock Purchase Agreement;

WHEREAS, Buyer has been unable to meet the schedule of installment payments set forth in Amendment No. 1 and has requested an extension of the schedule, and Kennametal is willing to extend the schedule on the terms set forth within; and

THEREFORE, Kennametal and Buyer desire to further amend the Stock Purchase Agreement to modify the Purchase Price provisions and certain additional provisions;

In consideration of the mutual agreements, covenants, representations and warranties contained herein, and in reliance thereon, Kennametal and Buyer, intending to be legally bound, hereby agree as follows:

1.1       Amended Language. The parties hereby agree to amend Section 1 (b) of the Stock Purchase Agreement by deleting it in its entirety and replacing it with the following:

"(b)     Purchase Price. As total consideration for the Shares, Buyer shall pay Kennametal the sum of $1,650,000 (the "Purchase Price") in accordance with the terms of this Section 1(b). The Purchase Price shall be paid in installments as follows: the first non-refundable installment in the amount of $500,000 was paid to Kennametal in September 2010 and Kennametal acknowledges its receipt of the same. The remaining $1,150,000 shall be due and payable by no later than January 31, 2011. Payment for the final installment of the Purchase Price or any liquidated damages, as described below, shall be made in immediately available funds by wire transfer to an account designated by Kennametal in writing to Buyer.

 

1

 

 

(i)      
In the event that Buyer is unable to pay the Purchase Price in full by
January 31, 2011, Buyer agrees to pay,
as liquidated damages to Kennametal and in addition to the balance of the Purchase
Price then due and payable, an amount equal to $250,000, which amount is due and
payable immediately, and in any event by no later than February 2, 2011. The remaining
$1,150,000 shall be due and payable by no later than the close of business on February 15, 2011.

(ii)       Buyer
agrees that the Purchase Price, plus any liquidated damages that become due and
payable, shall be paid in full no later than February 15, 2011 (the "Termination
Date"). If the Purchase Price and all amounts that become due and payable under
this Agreement are not paid in full and the Closing has not occurred by the
Termination Date, Kennametal may
terminate this Agreement. Kennametal will retain any and all amounts paid
hereunder as a non-refundable installment or liquidated damages and will otherwise be entitled
to pursue any rights or remedies available to it."

1.2      
Amended
Language. The parties hereby agree
to amend Section 1(d) by deleting it in its entirety and replacing it with the
following:

"(d) The Closing. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take
place at the offices of Kennametal in Latrobe, Pennsylvania, commencing at 10:00 a.m. local time on
the date upon which the Purchase Price is paid in full, but no later than the Termination
Date."

1.3      
Amended Language. The parties hereby agree to amend
Section 1 (f) by deleting it in its entirety and replacing it with the
following:

"(f)     Deliveries on Amendment Date and
Closing. On the Amendment Date, Buyer will deliver to Kennametal a
fully executed copy of Amendment No. 2, and Kennametal will deliver to Buyer a
fully executed copy of Amendment No. 2. At or prior to the Closing, Buyer will
deliver to Kennametal the balance of the Purchase Price, together with any
liquidated damages then due and payable, and Kennametal will deliver to Buyer
the stock certificate(s) representing the Shares, duly endorsed in blank or
accompanied by valid stock powers to
effect the transfer."

1.4            
Remainder of Agreement in
Full Force and Effect. All other provisions of
the Stock Purchase Agreement
remain in full force and effect.

1.5            
Counterparts. This Amendment No. 2 may
be executed simultaneously in two or more counterparts, each of which shall be
deemed an original and all of which together shall constitute but one and the
same instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK]

2

 

IN WITNESS WHEREOF, the Parties have
caused this Amendment No. 2 to be duly executed as of the date first written
above.

 

 

KENNAMETAL INC.

 

 

By: /s/ Frank P
Simpkins         

Name: Frank P.
Simpkins

Title:   Vice President and Chief
Financial Officer

 

 

Date:   January 19, 2011

 

 

ABAKAN INC.

 

 

By: /s/
Robert
Miller               

Name: Robert
Miller

Title:   Chief Executive
Officer

 

 

Date:   January 19, 2011

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Amendment
No. 2

3

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