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EXHIBIT 2.1
QUINTESSENCE OIL COMPANY
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is entered into this ______ day
of March 1999 by and between the attached investors and collectively the
"Investment Group" and Quintessence Oil Company a publicly traded Wyoming
corporation ("QTSN"), (the "Seller") with respect to the following facts:
RECITALS
The Seller is a publicly traded corporation duly formed and in good standing in
the State of Wyoming. As of its most current quarterly report the company had
1,000,000 shares of its common stock outstanding, and 50,000,000 shares of
authorized common stock.
The Seller is a development stage company formed for the purpose of purchasing,
developing and operating oil and gas leases. To date, the company has purchased
one oil and gas lease that it has not had the funds to develop.
The Seller through consultation with its shareholders and Directors have decided
to attract outside investors with the ability and experience to assist the
company in finding new business opportunities to pursue. To attract a new
management team and group of investors to assist in building shareholder value
the company has agreed to sell additional capital stock.
NOW, THEREFORE, in consideration of the mutual agreements, the parties hereto
agree as follows:
1. Purchase of Sale.
On the terms of and subject to the conditions set forth in this Agreement,
Seller agrees to sell, convey, assign, transfer and deliver to the Buyer and the
Buyer agrees to purchase from the Seller, at the closing (the "Closing") on or
before March 29, 1999 ("Closing Date"), 4,840,000 shares of common stock
2. Purchase Price.
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After discussions and negotiations with the shareholders, officers and
directors of QTSN and careful evaluation of the present financial condition of
the corporations and its prospects the parties agreed to issue new shares of
stock at the price of $0.001 per share.
3. Transaction Structure. Investors understand that QTSN has the authority
to issue 50,000,000 shares of capital stock all of which are common stock
("Common Stock"). As of March 1, 1999 the aggregate number of Shares issued was
1,000,000 (which on a total fully-diluted basis of all classes of the Shares or
debt convertible into Shares including giving effect to all options and warrants
would be 1,000,000 shares). The Board of Directors of QTSN (the "Board") is
authorized to provide for the issuance the shares of Common Stock under any and
all circumstances contemplated by the transactions described herein (the
"Transaction").
A. At the closing of the Transaction (the "Closing"), the parties
will pay $0.001 per share and QTSN will issue all certificates as required by
the Purchasers.
4. Due Diligence Review. During the period prior to the Closing, Investors
and their agents and representatives may perform business, accounting and legal
due diligence (the "Due Diligence Review"). The Due Diligence Review shall
include, but not be limited to, investigation of QTSN's historical and current
financial statements, its market and competitive position, and the sustained
ability and growth potential of its revenue, profitability, and cash flow. QTSN
acknowledges that business due diligence shall include discussions with
purchasing and general management representatives of QTSN's key customers,
distributors and contacts selected in cooperation with QTSN's management. The
Due Diligence Review shall begin on the date of acceptance of this Letter
Agreement and will be completed upon completion of definitive documentation of
the Transactions but in no event earlier than ten (10) business days from the
date of acceptance hereof.
5. Closing Conditions. The parties agree to the following:
A. Investor's obligation to consummate the Transactions is subject
to the following conditions:
1. Completion of the Due Diligence Review of QTSN, its
operations, methods of accounting, competitive position,
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customer and supply relationships, legal issues and all other relevant aspects
of QTSN and its business, and the results of such review shall be satisfactory
to the Investors in their sole discretion;
2. Receipt of all necessary corporate, shareholder,
licensor, joint venturer, lessor and other third-party approvals in form
acceptable to Investment Group;
3. Amendment of the certificate or articles of
incorporation of QTSN, if necessary, to permit consummation of the Transactions;
and
B. QTSN's obligation to consummate the Transactions is subject to
the following conditions:
1. Receipt of all necessary approvals; and
2. Acceptance of the new business opportunities presented
by the new investors.
6. Schedule. The parties agree to use their best efforts to close the
Transactions as soon as possible.
7. Exclusivity. QTSN and Investors agree that from the date of Investors
receipt of QTSN's acknowledgment of the agreement with the terms and conditions
set forth in this Agreement, then through April 15 , 1999. As provided herein,
QTSN and each of its record and beneficial owners, officers, directors,
affiliates, agents and representatives, will not directly or indirectly:
A. Submit, solicit, initiate, encourage, accept or discuss with or
from third-parties any proposal or offer from any person or entity related to
any: (i) reorganization, distribution or recapitalization of QTSN, including the
issuance of any stock warrants or options; (ii) merger or consolidation
involving QTSN; (iii) sale of stock of QTSN (except as provided herein) (iv)
sale of any assets of QTSN outside the normal course of business; or (v) similar
transaction or business accommodation involving QTSN or its business or assets
including, without limitation, any debt or equity financing; or
B. Furnish any information with respect to, assist or participate
in or facilitate in any manner any effort or attempt by any person to do or seek
the foregoing.
QTSN agrees to terminate all discussions with any and all third parties
regarding the foregoing transactions and will notify Investment Group of the
fact or receipt of any proposals or offer received after the date of this Letter
Agreement.
QTSN's acknowledgment of and agreement with the terms and conditions set
forth in this Letter Agreement constitute a representation and warranty that
neither QTSN nor any of its record and beneficial owners, officers, directors,
affiliates, agents, or representatives, have entered into any agreements or
accepted any commitments concerning any of the foregoing transactions that are
inconsistent
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with any provisions of this Letter Agreement.
8. Termination. Either QTSN or Investment Group may terminate this Letter
Agreement if the Transactions (exclusive of the Equity Offering and escrow
disbursement) are not closed by April 30, 1997. Such termination shall be
effected without liability to the other party, except for any damages relating
to any willful breach of the terms of this Letter Agreement. Any termination
hereof by either party prior to April 15, 1999 must be based on a material
breach of the terms and conditions hereof.
9. Good Faith Negotiations. The parties agree to negotiate in good faith
the terms and conditions of the definitive documentation required to consummate
the Transactions.
10. Conduct Prior to Closing. Upon acceptance of this Agreement and until
the earlier of its termination or the Closing, QTSN agrees to preserve
substantially intact its business operations and assets and to conduct its
operations in the ordinary course of business consistent with past practices.
Without limiting the generality of the foregoing, QTSN shall not, without the
prior consent of Investment Group; (i) make any material capital expenditure not
previously disclosed to Investors (ii) pay any dividend or make a distribution
of any kind; (iii) issue any Stock, stock options or warrants; (iv) declare a
stock dividend or stock split; or (v) enter into any material contract,
commitment or arrangement except in the ordinary course of business.
11. Finders Fees. QTSN shall be solely responsible to pay any and all
finders' fees for the introduction of Investors to the Transactions.
12. Announcements. All public disclosure regarding the Transactions shall
require the consent of all parties.
13. Closing. The Sellers will cause to be issued all shares provided for
herein and the Purchasers shall send checks to the company's President in full
payment for the shares prior to the shares being delivered.
14. Representations and Warranties of Seller and Grupo.
Seller represents and warrants to the Investment Group that:
(a) Seller is a company duly organized, validly existing and in good
standing under the laws of ___________________________. Seller
has the requisite power and authority to issue
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been
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duly authorized and approved by the officers and directors of the Seller. When
executed by the authorized representatives of Seller, this Agreement will
constitute a legal, valid and binding agreement of Seller, except as such
enforcement may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally or by the scope of equitable remedies which may be
available.
(c) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not result in a breach
of the terms and conditions of, or result in a loss of rights under, or result
in the creation of any lien, charge or encumbrance upon, any of the Assets for
any reason, including but not limited to (i) Seller's charter documents, (ii)
any franchise, mortgage, deed of trust, lease, license, permit, agreement,
instrument or undertaking to which Seller is a party or by which it or any of
its properties are bound, (iii) any statute, rule, regulation, order, judgment,
award or decree.
(d) There is no suit, claim, action or proceeding now pending or to
Seller's knowledge threatened before any court, administrative or regulatory
agency or any basis for such a claim which may result in any judgment, order,
decree, liability or other determination which could have a material adverse
effect, financial or otherwise, upon Seller or any of the Assets. No such
judgment, order or decree has been entered which has or could have such effect.
(e) Assuming the truth and accuracy of Seller's representations and
warranties in this Agreement, there has been no material change since the most
recent 10-Q report filed by the Company.
(f) To Seller's knowledge, Seller on the Closing Date is in material
compliance with all laws, orders and regulations of any governmental department,
commission, board, agency or instrumentality, domestic or foreign, having
jurisdiction over it or its operations, including but not limited to laws,
orders, regulations and rules relating to occupational safety and health,
environmental protection, consumer product safety, product liability, employee
benefit plans and programs, collective bargaining and the payment of withholding
and social security taxes. Seller has received no notice of, and is aware of no
violations of, any of the foregoing laws, orders, regulations or rules.
(g) Neither this Agreement nor any exhibit hereto delivered by
Seller pursuant to this Agreement contains an untrue statement of a material
fact or omits to state a fact that is necessary in order to make the statements
contained herein and therein, in
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light of the circumstances under which they are made, not materially misleading.
15. Representations and Warranties of Buyer.
Buyer hereby represents and warrants to Seller that:
(a) Buyer, the Investors includes individuals.
(b) Neither this Agreement nor any exhibit to this Agreement nor any
written statement or certificate furnished by Buyer in connection with this
Agreement contains an untrue statement of a material fact or omits to state a
fact that is necessary in order to make the statements contained herein and
therein, in light of the circumstances under which they are made, not materially
misleading.
16. Conditions Precedent to the Obligations of Buyer.
All obligations of Buyer under this Agreement are, at its option,
subject to fulfillment of each of the following conditions prior to or at the
Closing:
(a) All representations and warranties of Seller made in this
Agreement or in any exhibit hereto delivered by Seller shall be true and correct
as of the Closing Date with the same force and effect as if made on and as of
that date.
(b) Seller shall have performed and complied with all agreements,
covenants and conditions required by this Agreement to be performed or complied
with by Seller prior to or at the Closing Date.
(c) Buyer and Seller shall have received all consents in writing as
needed and any other parties required for the valid completion of this
agreement.
17. Conditions Precedent to the Obligations of Seller.
All obligations of Seller under this Agreement are, at its option,
subject to fulfillment of each of the following conditions prior to or at the
Closing:
(a) All representations and warranties of Buyer made in this
Agreement or in any exhibit hereto delivered by Buyer shall be true and correct
on and as of the Closing Date with the same force
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and effect as if made on and as of that date.
(b) Buyer shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with by Buyer
prior to or at the Closing Date.
18. Further Assurances.
Following the closing, the parties hereto agree to take such actions and
execute, acknowledge and deliver to Buyer such further instruments of
assignment, assumptions, conveyance and transfer and take any other action as
Buyer may reasonably request in order to more effectively convey, sell, transfer
and assign to Buyer any shares of interest in the equity of _______________ as
required by this agreement.
19. Survival of Representations and Warranties.
All representations and warranties made by each of the parties hereto
shall survive the closing for a period of three years after the Closing Date.
20. Indemnification.
(a) Seller agrees to indemnify, defend and hold harmless Buyer
against any and all claims, demands, losses, costs, expenses, obligations,
liabilities and damages, including interest, penalties and reasonable attorneys'
fees, incurred by Buyer arising, resulting from, or relating to any
misrepresentation of a material fact or omission to disclose a material fact
made by Seller in this Agreement, any exhibits to this Agreement or in any other
document furnished or to be furnished by Seller under this Agreement, or any
breach of, or failure by Seller to perform, any of its representations,
warranties, covenants or agreements in this Agreement or in any exhibit or other
document furnished or to be furnished by Seller under this Agreement.
(b) Buyer agrees to indemnify, defend and hold harmless Seller
against any and all claims, demands, losses, costs, expenses, obligations,
liabilities and damages, including interest, penalties and reasonable attorneys'
fees, incurred by Seller arising, resulting from or relating to any breach of,
or failure by Buyer to perform, any of its representations, warranties,
covenants or agreements in this Agreement or in any exhibit or other document
furnished or to be furnished by Seller under this Agreement, or by reason of any
act or omission of Buyer or any of its successors and assigns
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after the Closing Date that constitutes a breach or default under, or a failure
to perform, any obligation, duty or liability of Seller which is expressly
assumed by the Buyer pursuant to Paragraph _____________________ of this
Agreement.
21. Investment Commitment.
(a) Investors and any affiliates receiving Shares pursuant to this
Agreement represent to Buyer as follows:
(i) The Shares are being acquired for Seller's own account for
investment only and not with a view to the distribution or resale of all or any
portion of the Shares.
(ii) Investment Group has had access to complete information
regarding the assets, properties, business and finances of the Buyer. Seller and
Grupo have met and discussed the assets, properties, business and finances of
Seller with Seller's officers and directors, and have received, read and
understood all reports and documents relating to Seller.
There will be no sale of shares except as provided by
the Securities Act of 1933, as amended (the "Act") and under applicable state
securities laws, or after three years from the issue date pursuant to a proposed
offer, sale, transfer or other disposition of the Shares that is exempt from the
registration requirements of the Act and applicable state securities laws.
(iii) Certificates representing the Shares will bear a legend in
form and substance satisfactory to counsel for Seller referring to the
investment commitment contained in this Agreement, that the Shares have not been
registered under the Act or any state securities laws, and that no transfer of
the Shares may be made unless the Shares are registered under the Act or an
exemption from such registration is available.
22. Notice.
Notice will deemed to be given by one party to the other parties of this
Agreement upon personal delivery by messenger, air courier, express mail or
certified registered mail, return receipt requested, or upon facsimile or
telegram, or ten days after mailing by first class mail by the party giving the
notice, addressed to the parties as indicated below their signatures to this
Agreement, or to any other address or facsimile numbers provided to the parties
in writing in accordance with this Agreement by the party making the
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change.
23. Injunctive Relief.
23.1 Damages Inadequate.
Each party acknowledges that it would be impossible to measure
in money the damages to the other party if there is a failure to comply with any
covenants and provisions of this Agreement, and agrees that in the event of any
breach of any covenant or provision, the other party to this Agreement will not
have an adequate remedy at law.
23.2 Injunctive Relief.
It is therefore agreed that the other party to this Agreement
who is entitled to the benefit of the covenants and provisions of this Agreement
which have been breached, in addition to any other rights or remedies which they
may have, shall be entitled to immediate injunctive relief to enforce such
covenants and provisions, and that in the event that any such action or
proceeding is brought in equity to enforce them, the defaulting or breaching
party will not urge as a defense that there is an adequate remedy at law.
24. Waivers.
If any party shall at any time waive any rights hereunder resulting from
any breach by the other party of any of the provisions of this Agreement, such
waiver is not to be construed as a continuing waiver of other breaches of the
same or other provisions of this Agreement. Resort to any remedies referred to
herein shall not be construed as a waiver of any other rights and remedies to
which such party is entitled under this Agreement or otherwise.
25. Successors and Assigns.
Each covenant and representation of this Agreement shall inure to the
benefit of and be binding upon each of the parties, their personal
representatives, assigns and other successors in interest.
26. Attorney's Fees.
In the event that either party must resort to legal action
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in order to enforce the provisions of this Agreement or to defend such action,
the prevailing party shall be entitled to receive reimbursement from the
nonprevailing party for all reasonable attorney's fees and all other costs
incurred in commencing or defending such action, or in enforcing this Agreement,
including but not limited to post judgment costs.
27. Entire and Sole Agreement.
This Agreement constitutes the entire agreement between the parties and
supersedes all agreements, representations, warranties, statements, promises and
undertakings, whether oral or written, with respect to the subject matter of
this Agreement. This Agreement may be modified only by a written agreement
signed by all parties.
28. Severability.
The provisions of this Agreement are meant to be enforced severally so
that the determination that one or more provisions are enforceable or invalid
shall not affect or render invalid any other provision of this Agreement, and
such other provisions shall continue to be in full forced in accordance with
their terms.
29. Rights Cumulative.
All rights and remedies under this Agreement are cumulative, and none is
intended to be exclusive of another. No delay or omission in insisting upon the
strict observance of performance of any provision of this Agreement, or in
exercising any right or remedy, shall be construed as a waiver or relinquishment
of such provision, nor shall it impair such right or remedy. Every right and
remedy may be exercised from time to time and as often as deemed expedient.
30. Captions.
The paragraph and other headings contained in this Agreement are for
reference purposes only, and shall not limit or otherwise affect the meaning
hereof.
31. Legal Holidays.
In the case where the date on which any action required to be taken,
document required to be delivered or payment required to
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be made is not a business day in Los Angeles, California, such action, delivery
or payment need not be made on that date, but may be made on the next succeeding
business day.
32. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and
such counterparts shall constitute but one and the same instrument.
33. Parties.
This Agreement shall inure solely to the benefit of and shall be binding
upon the parties hereto and their respective successors, legal representatives
and assigns, and no other person shall have or be construed to have any
equitable right, remedy or claim under or in respect of or by virtue of this
Agreement or any provision contained herein.
34. Authority.
All signatories to this Agreement do hereby declare that they have the
authority to execute this Agreement on behalf of the parties to this Agreement.
PURCHASER:
Raymond B. Wedel, Jr. 1,420,000
Renee L. Wedel 316,666
Raymond B. Wedel III 316,666
Terry Wedel 316,668
Dana Wedel 400,000
Jordan T. Wedel 400,000
Connie S. Wedel 400,000
Richard Wedel 740,000
Wanda G. Pride 10,000
Blanche L. Wedel 10,000
Donald Christensen 10,000
I. Paul Arcuri 100,000
Trans AmericanEnergy Corporation 400,000
TOTAL 4,870,000
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SELLER: ??
QTSN PURCHASE AGREEMENT
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