AMENDED AND RESTATED
STOCK ACQUISITION AGREEMENT
This Amended and Restated Stock Acquisition Agreement ("Agreement") is made and
entered effective as of the 19th day of February 2004 by and between Airtrax,
Inc., a New Jersey corporation, whose address is 200 Freeway Drive, Unit One,
Blackwood, New Jersey 08012 USA (the "Purchaser"); and Fil Filipov (the
"Seller") an individual, using the address: 5001 North King Highway, Suite 206
Myrtle Beach, South Carolina 29577 USA in reference to the sale of stock of
FiLCO GmbH., a German corporation, whose address is 19-23 Rheinstrasse, 45478
Mulheim a/d/ Ruhr, Germany.
* W I T N E S E T H *
WHEREAS, Filipov owns 100% of the shares of FiLCO Gmbh. FiLCO GmbH, is file
number HRB 16356 at the local court of Duisburg.
WHEREAS, Airtrax desires to acquire from Filipov, and Filipov desires to sell to
Airtrax, 75.1% of FiLCO GmbH, subject to the terms and conditions set forth
herein, and
NOW THEREFORE, in consideration of the mutual covenants, terms and conditions
contained herein, the parties do hereby covenant, warrant and agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following terms will have the meanings set forth
below:
"Action" means any action, suit, claim, complaint, demands, injunction, hearing,
investigation, arbitration or other proceeding, audits, arbitrations,
grievances, judicial proceedings, administrative proceedings, and tax consents
by or before any Governmental Authority.
"Assets shall mean all of the assets of FiLCO GmbH as of the date of this
Agreement, including without limitation; all goodwill, leasehold rights to
plants and real property, intellectual property, patents and similar rights;
licenses; technical drawings; technical documentation; machine assembly
instructions; all factory machines and equipment; computer hardware, software,
integrated systems, and organizations; production systems; financial systems;
administrative fixtures and equipment; which shall include but not be limited to
all assets of every kind and nature acquired FiLCO GmbH from Clark.
"Business" shall mean the business currently engaged in by FiLCO GmbH.
"Charter Documents" shall mean with respect to any Person, that Person's (i)
articles of incorporation or organization, certificate of incorporation,
certificate of formation or equivalent organizational documents, (ii) bylaws,
partnership agreement, operating agreement, limited liability company agreement
or equivalent document of a company or corporation, and (iii) all shareholder
and board of director resolutions, including all amendments or alterations
thereto.
"Clark" shall mean Clark Material Handling GmbH., including the bankruptcy or
insolvency estate of Clark Material Handling GmbH.
"Capital Stock" means shares of capital stock of FiLCO GmbH.
"Capital Stock Equivalents" means, without duplication with any Capital Stock or
Capital Stock Equivalents, any rights, warrants, options, convertible securities
or indebtedness, exchangeable securities or indebtedness, or other rights,
exercisable for or convertible or exchangeable, directly or indirectly, into
Capital Stock of FiLCO GmbH and any other securities convertible or exchangeable
into Capital Stock of FiLCO GmbH, whether at the time of issuance or upon the
passage of time or the occurrence of some future event.
"Holder" means any holder or owner of Capital Stock of FiLCO GmbH, including
Purchaser.
"Lease" shall mean that lease beginning August 1, 2003 and ending 18 months
later on January 31, 2005 by and between FiLCO GmbH and Lawyer Dr. Sebastian
Henneke acting as liquidator of the estate of Clark Material Handling GmbH which
relates to the plant and real property located at the address of FiLCO GmbH as
stated in the preamble above and attached hereto. (EXHIBIT 1)
"Leased Property" shall mean the property demised under the Lease, together with
all buildings, improvements and fixtures (other than such fixtures which are
leased) located thereon, and all of FiLCO's right, title and interest in and to
all hereditaments and rights appurtenant thereto as set forth in the Lease.
"Lien" means any mortgage, deed of trust, pledge, hypothecation, encumbrance,
security interest, claims, charges, encumbrances of any kind or nature, or other
lien of any kind.
"Person" shall mean any individual, firm, corporation, partnership, limited
liability company, incorporated or unincorporated association, joint venture,
joint stock company, governmental agency or instrumentality or other entity of
any kind.
"Purchaser" shall have the meaning specified in the preamble hereto.
"Securities" means the Capital Stock, the Capital Stock Equivalents, and any
other securities of FiLCO GmbH.
"Seller" shall have the meaning specified in the preamble hereto.
"Seller Shares" shall have the meaning set forth in Section 2.01
ARTICLE II
PURCHASE OF FILCO GMBH SHARES
Section 2.01. Purchase of Seller Shares. Subject to the terms and conditions
herein, including Section 2.02 below, at Closing, Airtrax hereby agrees to
purchase and Filipov hereby agrees to sell seventy five point one percent
(75.1%) of FiLCO GmbH. A notarized document will be issued from a German notary
for the sale to be completed.
Section 2.02. Consideration by Airtrax. At Closing, Airtrax will pay to Filipov
the sum of (i) 12,750 Euro (Twelve Thousand Seven Hundred and Fifty Euros) for
75.1% of the FiLCO GmbH shares, and (ii) the balance remaining after deducting
the 12,750 Euros from the $1.5 million (U.S. Dollars) (minus brokerage
commissions due to First Montauk Security Corp.) will be disbursed to FiLCO GmbH
as a shareholder loan from Airtrax - (A) $100,000 (U.S. Dollars) immediately
upon closing of the offering by and between Airtrax and First Montauk; (B) an
additional $200,000 (U.S. Dollars) payable on March 2, 2004; (C) $300,000 (U.S.
Dollars) will be paid by March 15, 2004; and (D) $300,000 (U.S. Dollars) will be
paid by May 2, 2004, with any balance thereafter due by June 2, 2004 - which
will be allocated and recorded at a later date as capital of FiLCO GmbH. Filipov
currently has a shareholder loan to FiLCO GmbH. in the amount of 1,266,177.84
Euros. Said Filipov shareholder loan in an amount equivalent to the Airtrax
loan, will be converted to capital in FiLCO GmbH as well as the loan from
Airtrax.
If further capitalization of FiLCO GmbH becomes necessary, Airtrax agrees to
advance funds for this, as a loan. The purpose thereof is that Filipov's
percentage of ownership in FiLCO GmbH. All such loans will be payable to Airtrax
from dividends earned by Filipov from FiLCO GmbH. Said loans will be
collateralized and guaranteed by Filipov's shares or ownership in FiLCO GmbH.
This section terminates in three years from the date of acceptance of this
agreement, however, all and any loans or guarantees in place at that time shall
remain in full force and effect until properly disposed.
Section 2.03. Board Seat for Purchaser Designee. At all times while Airtrax is
the owner of 75.1% of FiLCO GmbH, an Airtrax designee will be a member of FiLCO
GmbH Management Board.
Section 2.04. United States Dollars. Unless the context indicates otherwise, all
dollar amounts stated herein or in the exhibits attached to this agreement shall
mean United States Dollars.
ARTICLE III
PURCHASER COMMON STOCK;
AND RELATED AGREEMENTS
Section 3.01. Airtrax Stock Options. Subject to the other terms and conditions
Airtrax will issue to Filipov or any Filipov designee options at $0.01 per
share, for 900,000 shares of common stock of Airtrax (the "Airtrax Shares")
representing 10.422 % of the issued and outstanding shares of Airtrax as of
December 31, 2003. Airtrax will include the stock options issued to the Seller
in an SB2 registration providing for the resale of said stock options in
conformance with rules and regulations promulgated by the Securities and
Exchange Commission. The common stock options issued above, will be
included/piggy backed with the SB2 registration that is stated in the PPM dated
January 13, 2004 which is placed with First Montauk Securities Corp. The common
stock options will be issued concurrent with the funding of the agreement
between the parties. No more that twelve and one/half percent (12,5%) of the
options may be exercised during any 12 month period. This restriction may be
altered only with Board approval. If Filipov or his designated option holder
does not exercise any or all of the 12.5% option in a twelve month period, then
he or said designee, as the case may be, shall have the right to exercise the
unexercised part of said option within the next twenty-four (24) month period.
If he or said designee does not exercise said option within said additional
period, such option shall lapse. In case of said lapse, the unexercised part of
said option shall be valued, if such is necessary, at the average price of
Airtrax stock, as adjusted, during the last month of the additional 24 month
period. The right to exercise a previously unexercised option in the additional
period shall be in addition to, and not replace or reduce, the right hereunder
to exercise the option to purchase the stated amount of Airtrax stock in a
twelve month period
Section 3.02. Filipov will continue with an active involvement of FiLCO GmbH for
no less than 3 years or as otherwise agreed with the Purchaser.
Section 3.03. Board Seat for Seller: Filipov shall be appointed a member of the
Board of Directors of Airtrax for a two year term and will be issued 100,000
shares as Stock Options valued at 0.01 for said services. These stock options
will be subject to the same SB2 registration as noted in 3.01 above.
Airtrax will provide appropriate Director's personal insurance coverage and will
hold Filipov harmless and whole for any lawsuits related to this transaction.
Section 3.04. Airtrax will participate with Seller with a set aside to be
allocated to FiLCO GmbH management as employee benefits, 100,000 Shares of
restricted stock and 100,000 stock options.
ARTICLE IV
TRANSFER OF SECURITIES
Section 4.01. Preemptive Rights. Rights to Participate in Future Sales by
Seller. At all times while Purchaser is an owner of Capital Stock of FiLCO GmbH,
Seller hereby grants to Purchaser preemptive rights to purchase any shares of
Capital Stock or Capital Stock Equivalents proposed to be sold by the Seller.
Section 4.02. Right of First Refusal. At all times while Purchaser is an owner
of Capital Stock of FiLCO GmbH, each Holder hereby grants to the other Holder a
right of first refusal to purchase any shares of Capital Stock or any Capital
Stock Equivalents proposed to be sold by such Holder, as provided herein. The
selling Holder must give the other Holder, no later than twenty (20) days prior
to the consummation of such transaction, notice in writing of the proposed
transaction. The notice shall describe the proposed transaction, identify the
proposed purchaser, and contain an offer to sell to the other Holder all of the
Securities proposed to be sold by the selling Holder at the same price and for
the same consideration to be paid by the proposed purchaser. If non-selling
Holder fails to accept such offer by written notice fifteen (15) days after its
receipt of the original notice, the selling Holder may proceed with the proposed
issue or sale of the offered Securities, free of any right on the part of
non-selling Holder under this Section 4.02 in respect thereof.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
of Airtrax
Section 5.01. Representations And Warranties of Airtrax. As of the date hereof
and as of the Closing Date, Airtrax (to the best of its knowledge after diligent
inquiry) does hereby represent and warrant to Filipov as follows:
(a). Corporate Organization of Seller. Airtrax has been duly organized and is
validly existing as a corporation, in good standing under the laws of its
jurisdiction of organization and has the corporate power and authority. The
copies of the Charter Documents of the Purchaser previously delivered by the
Purchaser to Seller are true, correct, and complete.
(b). Due Authorization. Airtrax has the requisite corporate authority, as
applicable, to execute and deliver this Agreement and to perform all obligations
to be performed by it hereunder; the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized and approved, and no other proceeding on its part is
necessary to authorize this Agreement and the consummation of the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by the Purchaser, and constitutes a legally valid and binding
obligation of each of them, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights
generally and subject, as to enforceability, to general principles of equity. No
material consent, approval or authorization of, or material designation,
declaration or filing with, any Governmental Authority is required under
applicable laws on the part of the Purchaser with respect to its execution or
delivery of this Agreement or consummation of the transactions contemplated
hereby.
(c). No Conflict. The execution and delivery of this Agreement by the Purchaser,
and the consummation of the transactions contemplated hereby, does not and will
not violate any provision of or result in the breach of, or terminate any
material rights or accelerate any material obligations of the Purchaser under,
or result in the creation of, any Lien on the assets or the business of
Purchaser, other than as set forth in this Agreement, pursuant to, (i) its
Charter Documents, (ii) any contract of the Purchaser, or (iii) any order,
judgment, decree, law, rule or regulation of any governmental authority, except,
in the case of items referenced in clauses (ii) and (iii), to the extent that
the occurrence of any of the foregoing would not, either individually or in the
aggregate reasonably be expected to, (x) have a material adverse effect upon
same or (y) materially impair the ability of the Purchaser to perform their
respective obligations under this Agreement.
(d). Investment Intent. Purchaser is acquiring the Seller Shares for investment
purposes and not with a view to any resale or distribution thereof. Purchaser
represents that the Seller Shares are being acquired in a transaction which is
exempt from the registration requirements of the Securities Act of 1933, as
amended (the "Act"), and that it understands that the Seller Shares are
restricted securities under the Act and must be held indefinitely, unless
subsequently registered under the Act or unless an exemption from registration
is available, including Rule 144 under the Act, and that it must, accordingly,
bear the economic risk of its investment for an indefinite period of time.
(e). Capital Stock. Upon consummation of the transactions contemplated in this
Agreement, Seller will acquire good and valid stock options. The Stock Options
are not subject to any contract, agreement, or understanding, written or
otherwise, which would adversely affect or otherwise prohibit or limit the
acquisition of these Stock Options. No more that twelve and one/half percent
(12,5%) of the options may be exercised during any 12 month period. This
restriction may be altered only with Board approval. If Filipov or his
designated option holder does not exercise any or all of the 12.5% option in a
twelve month period, then he or said designee, as the case may be, shall have
the right to exercise the unexercised part of said option within the next
twenty-four (24) month period. If he or said designee does not exercise said
option within said additional period, such option shall lapse. In case of said
lapse, the unexercised part of said option shall be valued, if such is
necessary, at the average price of Airtrax stock, as adjusted, during the last
month of the additional 24 month period.
The right to exercise a previously unexercised option in the additional period
shall be in addition to, and not replace or reduce, the right hereunder to
exercise the option to purchase the stated amount of Airtrax stock in a twelve
month period
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF
SELLER and FiLCO GmbH Management
Section 6.01. Representations And Warranties Of Seller and FiLCO Management. As
of the date hereof and as of Closing Date, Seller and Management (to the best of
their knowledge after diligent inquiry), jointly and severally, do hereby
represent and warrant to Purchaser as follows:
(a). Corporate Organization of FiLCO GmbH. FiLCO GmbH has been duly organized
and is validly existing as a corporation, in good standing under the laws of its
jurisdiction of organization and has the corporate power and authority, as
applicable, to conduct the Business as it is now being conducted. The copies of
the Charter Documents of FiLCO GmbH to be delivered to Purchaser are true,
correct, and complete. There are no subsidiaries of FiLCO GmbH.
(b). Issued and Outstanding Stock. Filipov's Shares have been duly authorized
and validly issued and constitute 100% of the total issued and outstanding
shares of Capital Stock of FiLCO GmbH on a fully diluted basis, and are fully
paid and non-assessable and were not issued in violation of any preemptive
rights. Except for Filipov's Shares and Purchaser Shares, there are outstanding
(i) no shares of Capital Stock, or other voting securities of FiLCO GmbH; (ii)
no securities of FiLCO GmbH convertible into or exchangeable for shares of
capital stock, equity interests or other voting securities of FiLCO GmbH; (iii)
no subscription rights, options, warrants, calls, commitments, preemptive rights
or other rights of any kind to acquire from FiLCO GmbH; and no obligation of
FiLCO GmbH to issue or sell, any shares of capital stock, equity interests or
other voting securities or any securities of FiLCO GmbH convertible into or
exchangeable for such capital stock, equity interests or voting securities, and
(iv) no equity equivalents, interests in the ownership or earnings of, or stock
appreciation, phantom stock or other similar rights of or with respect to FiLCO
GmbH. Upon consummation of the transactions contemplated in this Agreement,
Purchaser will acquire good and valid title to the Seller Shares, free and clear
of all Liens, and the Seller Shares will be fully paid and non-assessable.
Filipov's Shares are not subject to any contract, agreement, or understanding,
written or otherwise, which would adversely affect or otherwise prohibit or
limit the acquisition of the Seller Shares by the Purchaser. If they are, the
agreement(s) providing for the same are attached as Exhibit 2.
(c). Due Authorization. The Seller has the requisite authority, as applicable,
to execute and deliver this Agreement and to perform all obligations to be
performed by it hereunder; the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized and approved by Seller and Filco Management, and no other proceeding
on its part is necessary to authorize this Agreement and the consummation of the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by, and constitutes a legally valid and binding
obligation of Seller and/or FiLCO GmbH, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors'
rights generally and subject, as to enforceability, to general principles of
equity. No material consent, approval or authorization of, or material
designation, declaration or filing with, any Governmental Authority is required
under applicable laws on the part of Seller and/or FiLCO GmbH with respect to
its execution or delivery of this Agreement or consummation of the transactions
contemplated hereby.
(d). No Conflict. The execution and delivery of this Agreement by the Seller
and/or FiLCO GmbH and the consummation of the transactions contemplated hereby
by Seller and/or FiLCO GmbH, does not and will not violate any provision of or
result in the breach of, or terminate any material rights or accelerate any
material obligations of the Seller and/or FiLCO GmbH under, or result in the
creation of, any Lien on the Assets or the Business pursuant to, (i) the Charter
Documents of FiLCO GmbH, (ii) any contract of Seller and/or FiLCO GmbH, or (iii)
any order, judgment, decree, law, rule or regulation of any governmental
authority, except, in the case of items referenced in clauses (ii) and (iii), to
the extent that the occurrence of any of the foregoing would not, either
individually or in the aggregate reasonably be expected to, (x) have a Material
Adverse Effect or (y) materially impair the ability of Seller and/or FiLCO GmbH
to perform its respective obligations under this Agreement.
(e). Contracts. Schedule 6.01(e) hereto ("Disclosed Contracts") is a true and
correct list of all agreements, contracts, and understandings, written or oral,
which FiLCO GmbH is a party, which includes those relating to the Lease, product
warranties, and past, present and future employee obligations. None of the
Disclosed Contracts are in material default by FiLCO GmbH or by a third party
which default has not been heretofore been disclosed in writing to the
purchaser, which default could reasonably be expected to have a Material Adverse
Effect and all of the Disclosed Contracts are in full force and effect. True and
complete copies of which have been delivered to Purchaser concurrently herewith,
or a summary of which is described on Schedule 6.01(e).
(f). Title; Assets. Schedule 6.01(f) identifies all of the Assets. The Assets
are owned free and clear of all Liens, excepting as otherwise stated and
attached hereto this agreement. The Assets represent and constitute all of the
assets and properties required and necessary to conduct the Business as they are
currently being conducted, and includes all assets acquired from Clark except as
sold or otherwise disposed and shown on FiLCO GmbH accounting records from May
2003 to present. Any exceptions are stated hereto and included as an addendum to
this agreement.
(g). Permits; Licenses. Schedule 6.01(g) identifies all permits other material
operating licenses or permits necessary to own the Assets or operate the
Business in accordance with all applicable laws, rules, regulations, codes,
orders, and decrees ("Permits"). No material default has occurred in the due
observance or condition of any permit or license or permit.
(h). Leased Property. With respect to Leased Property; See EXHIBIT 1)
(i). the lease is valid, legal, binding, enforceable and in full force
and effect and will continue to be legal, binding, enforceable and in
full force and effect following the consummation of the transactions
described herein,
(ii) no party to the Lease is in breach, in default, or has repudiated
any provision thereof, and to the best of Seller's and Management's
knowledge, the Leased Property is free and clear of all Liens,
(iii) there are no disputes, oral agreement, forbearance programs in
effect as to the Lease,
(iv) the legal description for the parcel of the Lease Property
contained in the Lease describes such parcels fully and adequately,
the buildings and improvements are located within boundary lines of
the described parcels, are not in violation of applicable setback
requirements, zoning laws, and ordinances and do not encroach upon any
easement which may burden the land, and the land does not serve any
adjoining land for any purpose inconsistent with the use of the land,
(v) Seller has not assigned, transferred, conveyed, mortgaged, deeded
in trust, or encumbered any interest in the leasehold estate,
(vi) there are no pending or threatened condemnations proceedings,
lawsuits or administrative actions relating to the Leased Property, or
other matters that would have a Material Adverse Effect,
(vii) all facilities relating to the Business have received all
approvals from governmental authorities (including licenses and
permits) required in connection with the ownership or operation
thereof and have been operated and maintained in accordance with
applicable laws, and,
(viii) all facilities relating to the Business are supplied with
utilities and other services necessary for the operation of such
facilities, including gas, electric, water, telephone, sanitary sewer
and storm sewer, all of such services are adequate for the operation
of the business, and in accordance with applicable laws and
regulations and are provided via public roads, or via permanent,
irrevocable, appurtenants easements benefiting the leasehold estate,
(ix). The lease contains an option wherein the Tenant is given the
right to make a notarized purchasing offer to the Landlord to buy the
real estate described in ss. 1; of the Lease Agreement, this offer
must be minimum EUR 4.7 million plus VAT if applicable, under the
condition that any rights and responsibilities are transferred
effective February 1, 2005. For this case, Deutsche Bank AG Cologne as
encumbrance creditor and the Landlord already have stated their
consent. It is warranted by the Seller and Filco GmbH that they will
not jointly, severally or by any means or through any other entities
or individuals, whatsoever, attempt to purchase, during the period of
the lease or in the future, the leased real estate without written
consent of the Purchaser.
(i). Litigation; Judgments. Except as described on Schedule 6.01(i), there are
no material Actions, pending or threatened against FiLCO GmbH or affecting FiLCO
GmbH's rights with respect to the Business or the Assets, or against the
Business or the Assets generally, at law or in equity, or before any
governmental authority, nor are the Seller and Management aware of any
investigation with respect to any of the foregoing or any facts which are
reasonably likely to result in any such action, investigation, suit or
proceedings affecting FiLCO GmbH, the Assets or the Business, which items could
reasonably be expected to have a Material Adverse Effect except as provided in
Schedule 6.01(l). In addition, except as described on Schedule 6.01(i), there
are no material judgments, orders, awards or decrees currently in effect against
FiLCO GmbH with respect to the ownership, marketing, development or operation of
any part of the Assets or the Business.
(j). Commitments. Except as set forth in Schedule 6.01(j), FiLCO GmbH has not
entered into nor are the Assets or Business bound by, whether or not in writing,
any (i) partnership or joint venture agreement, (ii) deed of trust, mortgage or
other security agreement, (iii) guaranty or surityship, indemnification or
contribution agreement or performance bond, (iv) employment, consulting,
compensation, termination, or severance agreement or arrangement, including the
election or retention of any officer or director, (v) labor or collective
bargaining agreement, (vi) debt instrument, loan agreement or other obligation
relating to indebtedness for borrowed money or money lent to another, (vii)
agreement with dealers or sales or commission agents, public relations or
advertising agencies, accountants or attorneys, (viii) lease of real or personal
property, whether as a lessor, lessee, sub-lessor or sub-lessee, (ix) agreement
relating to any material matter or transaction in which an interest is held by a
person or entity which is an affiliate of FiLCO GmbH, (x) agreement for the
acquisition of services, supplies, equipment or other personal property entered
into other than in the ordinary course of business and not involving more than
$5,000 in the aggregate, (xi) powers of attorney, (xii) contracts containing
non-competition agreements or covenants, (xiii) any other contract or agreement
that either involves the unperformed commitment in excess of $5,000 or that
terminates more than one year from the date hereof, or (xiv) any other agreement
of commitment that is material to the business or financial condition of FiLCO
GmbH (all of the foregoing are hereinafter collectively referred to as, the
"Commitments"). Except and noted in Schedule 6.01(j).
(k). Employee Matters.
(i) Schedule 6.01(k) is a true, correct and complete list of all
employees, consultants, agents or other compensated persons of FiLCO
GmbH as of the date of hereof (and updated at Closing if different),
together with their positions, annual salaries, and other
compensation, including accruals for vacation through such date(s).
Except as set forth on Schedule 6.01(k), FiLCO GmbH has not granted or
become obligated to grant any increases in the wages or salary of, or
paid or become obligated to pay any bonus or made or become obligated
to make any similar payment or grant any benefit to or on behalf of,
any officer, employee, consultant or agent. Except as set forth on
Schedule 6.01(k), FiLCO GmbH has no direct or indirect, express or
implied, obligation to pay severance or termination pay to any
officer, employee or other party or to pay any amounts to any
consultant, agent or similar person or entity. Seller and Management
have no knowledge that any current employee would not continue with
his/her employment relationship with FiLCO GmbH notwithstanding the
change of control contemplated by this Agreement, Except as noted in
(i) Schedule 6.01(k).
(ii) Except as noted in (i) Schedule 6.01(k), no trade union, council
of trade unions, employee bargaining agency, employee association or
affiliated bargaining agent or similar Person:
(A) holds bargaining rights with respect to the Assets or
Business by way of certification, interim certification,
voluntary recognition, designation or successor rights; except as
noted in (i) Schedule 6.01(k).
(B) has applied to be certified as the bargaining agent of any of
the employees of FiLCO GmH; Excepting as set forth on Schedule
6.01(k).
(iii) FiLCO GmbH has complied with all laws relating to employment in
the governing jurisdiction where FiLCO GmbH has employees, and
provincial and federal human rights legislation in connection with the
Business except for non-compliances which would not, in the aggregate,
cause a Material Adverse Effect. There are no unfair labor practice
charges, complaints or proceedings pending, threatened or involving
Seller. Excepting as set forth on Schedule 6.01(k).
(iv) All levies, assessments and penalties under relevant workers'
compensation legislation in respect of the employees have been paid
or, are reflected and accrued.
(v) All vacation pay and accrued bonuses for the employees of FiLCO
GmbH is properly reflected and accrued.
(vi) Seller and Management have delivered or made available to the
Purchaser, true, complete and up-to-date copies of all of FiLCO GmbH's
benefit plans and related employee booklets and compensation policies
and all amendments thereto together with the most recent actuarial
reports.
(vii) No registered pension benefits are payable to any employee of
the Business(s).
(viii) With regard to the issues stated in the LOI dated December 30,
2003, stating that FiLCO GmbH will have secured a revision of the
current agreement to hire 210 people reduced to a level that is
suitable to good business practices and agreeable to Airtrax; and a
resolution of current employee cases:
a. The Seller and FiLCO GmbH state that FiLCO GmbH may be
required to pay approximately 243K Euro regarding the issue
of 32 People older than 59 years by Feb. 29, 2004
b. the total exposure to FiLCO GmbH for 148 cases scheduled for
court hearings in March 2004 is 750K Euro.
c. there are no other substantial (over 5k Euro) open issues
regarding union contracts or employee issues.
d. It is believed these issues can be further compromised, but
that is not certain.
(l). Taxes.
(i) Filing of Tax Returns. All material Tax Returns required to be filed by
FiLCO GmbH which relates to the Business, on or prior to the date hereof, have
been properly completed and filed on a timely basis and in correct form or
appropriate extensions have been timely requested or granted, and all such
returns are true and correct in all material respects as filed.
(ii) Payment of Taxes. All Taxes and governmental charges of any kind or
character levied or assessed against the property, asset, income, receipts,
payrolls, employee benefits, transactions, capital, net worth or franchises of
the Sellers have been paid, other than taxes or charges the payment of which is
not yet due, or if due, is not yet delinquent, except as set forth on Schedule
6.01(l)
(m). Insurance. Schedule 6.01(m) is a true, correct, and complete summary
description of all insurance policies maintained by FiLCO GmbH, and Seller and
Management have delivered to Purchaser complete and correct copies of all of
such policies, together with all amendments and riders thereto. All of such
polices are in full force and effect, and FiLCO GmbH has complied with all of
such policies. All of the insurable properties of FiLCO GmbH are insured for
their respective benefit under valid and enforceable polices, issued by issuers
of recognized responsibility in amount and against such risks and losses. All
insurance policies insuring liabilities of FiLCO GmbH (including products
liability claims) are written to insure on a "claims made" basis.
(n). Non Arms-Length Transactions. No officer, director, employee, or consultant
of FiLCO GmbH or any relative by blood or marriage, affiliates, or associates of
any of the foregoing, are currently a party to any transaction, whether oral or
in writing, with Company other than for services as an employee, officer or
director and the terms of which are set forth on an Schedule 6.01(f).
(o). Disclosure. This Agreement and Schedules hereto, and all other documents
delivered by FiLCO GmbH management to the Airtrax or their attorneys in
connection herewith or therewith or with the transactions contemplated hereby or
thereby, when taken as a whole, do not contain any untrue statement of a
material fact nor, do they omit to state a material fact necessary in order to
make the statements contained herein or therein not misleading.
Management and Filipov are personally released from any future liabilities with
regard to the purchase of FiLCO GmbH by Airtrax, Inc. providing they have
provided all information requested without any screening or purposely
withholding any information. Management and Filipov warrant that all agreements
requested are attached to this document.
(p). Trademarks and Copyrights. FiLCO GmbH owns all patents, designs, logos,
insignia, trademarks, service marks and copyrights as purchased from the
administrator and set forth in the purchase documents necessary to conduct the
Business as presently operated, or possesses licenses or other rights, if any,
without conflict with the rights of any other party. Schedule v is a true,
correct and complete description of the following ("Proprietary Rights"), if
such list exists.
ARTICLE VII
CLOSING OF TRANSACTION
7.01. Closing of Transaction. Subject to the fulfillment of the conditions
precedent described Article VIII, the closing of the transactions contemplated
by this Agreement ("Closing") will occur on such date as agreed to in writing by
the parties ("Closing Date"), at a mutually agreeable location.
7.02. Closing Deliveries and Closing Agreements.
At Closing, (i) At Closing, Airtrax will deliver to Filipov the sum of (i)
12,750 Euro (Twelve Thousand Seven Hundred and Fifty Euros) for 75.1% of the
FiLCO GmbH shares and the balance remaining after deducting the 12,750 Euros
from the $1.5 million (minus brokerage commissions due to First Montauk Security
Corp.) will be disbursed to FiLCO GmbH as a shareholder loan - 5 working days
after the signing of this document. Said funds will be allocated and recorded at
a later date as capital of FiLCO GmbH. Filipov will also leave in FiLCO GmbH as
a shareholder loan the equivalent amount, to be converted to capital in FiLCO
GmbH as well as the loan from Airtrax. (ii) Seller will deliver to Purchaser a
Notarized contract representing the transfer of 75.1% ownership of FiLCO GmbH,
FiLCO GmbH will deliver proper shareholder loan agreement for $1.5 million -
(less commissions due to First Montauk Securities and the 12,750 Euros paid to
Filipov).
ARTICLE VIII
CONDITIONS PRECEDENT
8.01 Conditions to Obligations of Airtrax. The obligations of Airtrax to perform
this Agreement are subject to the satisfaction of the following conditions
unless waived (to the extent such conditions can be waived) by Airtrax at the
Closing.
(a) REPRESENTATIONS AND WARRANTIES OF THE SELLER AND FILCO MANAGEMENT. The
representations and warranties of the Seller and FiLCO Management set forth in
Sections 6.01 hereof shall be true and correct as of the Closing Date (except to
the extent any such representation or warranty expressly speaks as of an earlier
date, which representations and warranties shall be true and correct as of such
date in the same manner as specified above), except for failures to be true and
correct that individually or in the aggregate would not reasonably be likely to
have a Material Adverse Effect.
(b) PERFORMANCE OF OBLIGATIONS OF THE SELLER AND FILCO MANAGEMENT. The
Seller and FiLCO Management shall have performed in all material respects the
obligations required to be performed by each of them under this Agreement prior
to or as of the Closing Date, and Airtrax shall have received a certificate
signed by the Seller to that effect.
(c) DELIVERY OF CERTIFICATES. The Seller's Shares shall have been delivered
to Airtrax. In addition, the Seller shall have made all other closing deliveries
as set forth in Section 7.02 of this Agreement.
(d) EMPLOYEE CONFIDENTIALITY AGREEMENTS. The Seller shall have delivered to
Airtrax executed Employee Confidentiality Agreements from the Seller and each of
the employees of FiLCO GmbH, effective as of the Closing Date, providing for,
among other things, non-disclosure of confidential information and restrictions
upon such person from competing with Airtrax and as provided therein.
(e) OPINION OF THE FILCO GMBH'S AND THE SELLER'S COUNSEL. A favorable
opinion dated the Closing Date shall have been delivered by counsel to the
Seller and FiLCO GmbH, in favor of Airtrax, in a form satisfactory to Airtrax.
(f) CONSENTS AND APPROVALS. Duly executed copies of all consents and
approvals contemplated by this Agreement or the Schedules, in form and substance
satisfactory to Airtrax, shall have been delivered by the Seller.
(g) GOVERNMENT CONSENTS, AUTHORIZATIONS, ETC. Copies of all consents,
authorizations, orders or approvals of, and filings or registrations with, any
governmental authority which are required for or in connection with the
execution and delivery by the Seller and FiLCO GmbH of this Agreement and the
related agreements and the consummation by the Seller and FiLCO GmbH of the
transactions contemplated hereby, shall have been delivered by the Seller.
[h) AUDITED FINANCIAL STATEMENTS OF FILCO GMBH. The obligations of Airtrax
to perform this Agreement are subject to the completion and preparation of the
audited financial statements of FiLCO GmbH.
[i] PROCUREMENT OF ADEQUATE FINANCING BY AIRTRAX FOR FILCO GMBH. Airtrax
shall have procured adequate financing for the working capital needs of FiLCO
GmbH.
8.02 Conditions to Obligations of the Seller and FiLCO GmbH. The obligations of
the Seller and FiLCO GmbH to perform this Agreement are subject to the
satisfaction of the following conditions unless waived (to the extent such
conditions can be waived) by the Seller and FiLCO GmbH at the Closing.
(a) REPRESENTATIONS AND WARRANTIES OF AIRTRAX. The representations and
warranties of Airtrax set forth in Sections 5.01 hereof shall be true and
correct as of the Closing Date (except to the extent any such representation or
warranty expressly speaks as of an earlier date, which representations and
warranties shall be true and correct as of such date in the same manner as
specified above), except for failures to be true and correct that individually
or in the aggregate would not reasonably be likely to have a Material Adverse
Effect.
(b) PERFORMANCE OF OBLIGATIONS OF AIRTRAX. Airtrax shall have performed in
all material respects the obligations required to be performed by it under this
Agreement prior to or as of the Closing Date.
(c) PURCHASE PRICE. The delivery of the purchase price as set forth in
Section 7.02 of this Agreement shall have been made by Airtrax to the Seller.
(d) CONSENTS AND APPROVALS. Duly executed copies of all consents and
approvals contemplated by this Agreement or the Schedules, in form and substance
satisfactory to the Seller, shall have been delivered by Airtrax.
(e) GOVERNMENT CONSENTS, AUTHORIZATIONS, ETC. Copies of all consents,
authorizations, orders or approvals of, and filings or registrations with, any
governmental authority which are required for or in connection with the
execution and delivery by Airtrax of this Agreement and the related agreements
and the consummation by Airtrax of the transactions contemplated hereby, shall
have been delivered by Airtrax.
ARTICLE IX
NOTICES
Any notices or other communications required or permitted hereunder shall be
given in writing and shall be delivered personally, sent by certified or
registered mail, return receipt requested and postage prepaid, or sent by
nationally recognized overnight delivery service to the address set forth below:
Purchaser: Airtrax, Inc.
Attn: Peter Amico, President
200 Freeway Drive, Unit One
Blackwood, New Jersey 08012
With copy to:
Richard Friedman, Esq.
Sichenzia Ross Friedman Ference LLP
1065 Avenue of the Americas, 21st Floor
New York, New York 10021
Seller: FiLCO GmbH.
19-23 Rheinstrasse
45478 Mulheim
a/d/ Ruhr, Germany
With copy to:
Fil Filipov
5001 North King Highway, Suite 206
Myrtle Beach, South Carolina
29577 USA
Seller:
or at such other address as shall be furnished in writing by such party, and any
such notice or communications shall be effective and be deemed to have been
given only upon its delivery in accordance with this Section. Notice shall be
deemed given, received, and effective on: (i) if given by courier service, the
date of actual receipt by the receiving party, or if delivery is refused on the
date delivery was first attempted; or (ii) if given by certified mail, the
earlier of; the date received, or the third day after being posted with the
United States Postal Service. Any person entitled to notice or a copy of notice
may change any address to which notice or a copy of notice is to be given to it
by giving notice of such change of address as provided in this Section. The
inability to deliver notice because of changed address for which no notice was
given shall be deemed to be receipt of the notice as of the date such attempt
was first made.
ARTICLE X
ENTIRE AGREEMENT, MODIFICATION, WAIVER AND HEADINGS
10.01. Entire Agreement; Modification. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter herein and
supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions among the parties, written or otherwise. No
supplement, modification or waiver or termination of this Agreement shall be
binding unless executed in writing by the party to be bound thereby. No waiver
of any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provision hereof (whether or not similar), nor shall such
waiver constitute a continuing waiver unless otherwise expressly provided.
10.02. Incorporation by Reference. All exhibits, schedules, and documents
referred to in this Agreement and recitals stated herein are incorporated in
this Agreement for all purposes.
10.03. Multiple Counterpart Execution; Governing Law. This Agreement may be
executed in multiple counterparts, which each counterpart constituting a binding
agreement between the signatory parties, and with all such counterparts
constituting an integrated document. This Agreement shall be construed and
governed by the laws of the New Jersey, with jurisdiction resting in the state
or federal courts located in the State of New Jersey in the USA.
10.04. Binding Effect. The terms and provisions herein shall be binding on and
inure to the benefit or the parties hereto, and their respective transferees,
successors and assigns.
10.05. Severability. If any provision of this Agreement is invalid, illegal or
enforceable, the balance of this Agreement shall remain in effect, and if any
provision is inapplicable to any person or circumstance, it shall nevertheless
remain applicable to all other persons and circumstances.
10.06. Expenses Of Transaction. Each party hereby acknowledges and agrees that
such party shall bear and be responsible for their respective professional fees
(including attorney fees) and other costs incurred in connection with the
preparation, execution and delivery of the Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be effective all
as of the date set forth below.
PURCHASER
Airtrax, Inc.
/s/ Peter Amico
- ---------------
Peter Amico
President
SELLER
/s/ Fil Filipov
- ---------------
Fil Filipov
/s/ Werner Faenger
- ------------------
Werner Faenger, General Manager, FiLCO GmbH
/s/ Stephan Schmitz
- -------------------
Stephan Schmitz , General Manager, FiLCO GmbH