Exhibit 10.73
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CONTRIBUTION AND SUBSCRIPTION AGREEMENT
AMONG
HEADWATERS INCORPORATED
AND
AVINTAQUIN CAPITAL, LLC
September 24, 2001
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CONTRIBUTION AND SUBSCRIPTION AGREEMENT
This CONTRIBUTION AND SUBSCRIPTION AGREEMENT, dated as of September 24,
2001, is made among Headwaters Incorporated, a Delaware corporation
("Headwaters") and Avintaquin Capital, LLC, a California limited liability
company (the "Company").
R E C I T A L S
WHEREAS Headwaters will contribute $400,000 in cash (the "Cash") and
transfer certain assets of Headwaters (the "Assets") as set forth in and
pursuant to the General Assignment and Bill of Sale (the "Bill of Sale") in the
form of Exhibit A hereto, in consideration for (i) 600 Class B Membership Units
of the Company (the "Class B Membership Units"), to be subscribed to by
Headwaters herein and (ii) a promissory note (the "Note") of the Company in the
principal amount of $4,000,000 substantially in the form attached hereto as
Exhibit B.
WHEREAS the Company is willing to accept the Assets and issue the Units
and the Note to Headwaters as provided herein.
NOW, THEREFORE, in consideration of the foregoing, the Company and
Headwaters hereby agree as follows:
ARTICLE I
TRANSFER OF ASSETS AND CASH
AND SUBSCRIPTION FOR SECURITIES
Section 1.1 Transfer of Assets. Headwaters hereby contributes the Cash
and transfers, assigns, conveys and sets over to and vests in the Company, and
the Company hereby accepts from Headwaters, as of the date hereof, all of the
right, title and interest of Headwaters in the Assets. Headwaters agrees to
execute and deliver to the Company on the Closing Date (as defined below) the
Bill of Sale.
Section 1.2 Delivery of Note and Units. The Company agrees to deliver
the Note, a pledge agreement with respect to the Assets in the form attached
hereto as Exhibit C (the "Pledge Agreement") and the Class B Membership Units to
Headwaters on the Closing Date.
Section 1.3 Closing. Upon the terms and subject to the conditions of
this Agreement, the closing of the transfer of the Assets, and the issuance of
the Class B Membership Units and the Note hereunder (the "Closing") shall take
place at the principal executive office of the Company within five (5) business
days following the execution and delivery of this Agreement by all of the
parties hereto (the date of the Closing hereunder being referred to as the
"Closing Date").
Section 1.4 Subscription to Securities. For the consideration set forth
in Article 2 hereof, Headwaters hereby subscribes to 600 Class B Membership
Units, with such rights and benefits as are set forth in the Operating Agreement
of the Company (the "Operating Agreement"), a copy of which is attached as
Exhibit D hereto.
Section 1.5 Deliveries at Closing. At the Closing:
(a) Headwaters will deliver to the Company:
(i) the Bill of Sale, duly executed, transferring the Assets,
together with the original copies of all promissory notes, agreements, stock
certificates, warrants, documents and other instruments representing or relating
to the Assets;
(ii) certified copies of the resolutions duly adopted by the
board of directors of Headwaters authorizing on behalf of Headwaters the
execution, delivery and performance of this Agreement and the other agreements
contemplated hereby;
(iii) the duly executed Pledge Agreement;
(iv) a copy of the Operating Agreement duly executed by
Headwaters;
(v) such other instruments of sale, transfer, conveyance and
assignment as reasonably requested by the Company in connection with transfer to
the Company of good title to the Assets; and
(vi) the Cash in immediately available U.S. funds.
(b) The Company will deliver to Headwaters:
(i) a duly executed certificate or certificates representing
the Class B Membership Units;
(ii) the duly executed Note;
(iii) the duly executed Pledge Agreement; and
(iv) a copy of the Operating Agreement duly executed by the
members and managers of the Company.
ARTICLE 2
CONSIDERATION
Section 2.1 Consideration. The Cash and the Assets transferred to and
accepted by the Company pursuant to Section 1.1 hereof shall be consideration
for the issuance by the Company to Headwaters, of the Class B Membership Units
and the Note.
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ARTICLE 3
HEADWATERS' REPRESENTATIONS AND WARRANTIES
Headwaters represents and warrants to the Company as follows:
Section 3.1 Assets. (a) Headwaters is the owner of and has good and
marketable title to the Assets, has full legal right, power and authority to
deliver the Assets to the Company, and the Assets are free and clear of all
claims, security interests, mortgages, pledges, liens and other encumbrances of
every nature whatsoever. The transfer and delivery of the Assets by Headwaters
to the Company as contemplated by this Agreement will transfer good title to the
Assets to the Company free and clear of all claims, security interests,
mortgages, pledges, liens and other encumbrances of every nature whatsoever,
other than any such claims, security interests, mortgages, pledges, liens
granted by or arising out of action taken by the Company.
(b) As of the Closing, to the best of Headwaters' knowledge, each of
the Assets consisting of equity securities, debt securities, warrants or other
rights (the "Securities") shall constitute a legal, valid and binding obligation
of the issuer of such Securities enforceable by the Company in accordance with
its terms. With respect to each of the Securities, Schedule 1 attached hereto
sets forth, as applicable, the issuer, the aggregate outstanding principal,
interest and other amounts due and payable thereunder and the maturity date
thereof. Headwaters is the sole owner and holder of the each of the Securities
and, under the terms of each of the documents, agreements or other instruments
setting forth rights and obligations with respect to such Securities (the
"Security Documents"), has full right to transfer its interest in such
Securities on the terms and conditions set forth herein without the consent of
any third party, except consents that have been obtained and previously
delivered to the Company, and the transfer and assignment of the Securities
pursuant to this Agreement will not constitute a default under the terms of any
of the Securities. Concurrently herewith, Headwaters has delivered to the
Company true, correct and complete copies of the Security Documents.
Section 3.2 Organization and Power. Headwaters is a corporation duly
formed, validly existing and in good standing under the law of the State of
Delaware. Headwaters has full corporate power and authority to execute, deliver
and perform this Agreement and the other agreements contemplated hereby to which
it is a party.
Section 3.3 Authorization. The execution, delivery and performance by
Headwaters of this Agreement and the other agreements contemplated hereby to
which it is a party have been duly authorized by Headwaters. This Agreement and
the other agreements contemplated hereby to which it is a party constitute valid
and binding obligations of Headwaters, enforceable in accordance with their
respective terms, except to the extent such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting the enforcement of creditors' rights generally.
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Section 3.4 No Violation. The execution, delivery and performance of
this Agreement and the other agreements contemplated hereby to which it is a
party by Headwaters and the consummation of the transactions contemplated hereby
or thereby do not and will not (a) conflict with or result in any breach of, (b)
constitute a default under; (c) result in a violation of, (d) give any third
party the right to accelerate any obligation or (e) require any authorization,
consent, approval, exemption or other action by any court, other governmental
body, or other third party under the provisions of, (x) Headwaters' charter
documents or (y) any indenture, mortgage, lease, loan agreement or other
agreement or instrument to which Headwaters is bound, or any law, statute, rule,
regulation, judgment or decree to which Headwaters or any of its assets is
subject.
Section 3.5 Litigation. There are no actions, suits, proceedings,
orders or investigations pending or, to the best knowledge of Headwaters,
threatened against or affecting Headwaters at law or in equity, or before or by
any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, which might
adversely affect Headwaters' performance under this Agreement or the
consummation of the transactions contemplated hereby.
Section 3.6 Subscription for Investment. Headwaters is subscribing for
the Class B Membership Units to which it is subscribing pursuant to Article 1
for investment purposes only and not with a view to resale or in connection with
any distribution of such Class B Membership Units to the public. Headwaters is
an "accredited investor" within the meaning of Regulation D promulgated under
the Securities Act of 1933, as amended (the "Securities Act").
Section 3.7 Disclosure. Neither this Agreement, nor any schedules or
attachments hereto or incorporated herein, nor any other documents delivered
pursuant hereto, contains or will contain any untrue statement of material fact
or omits or will omit to state a material fact necessary to make the statements
contained herein or therein, in light of the circumstances in which they were
made, not misleading.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Headwaters as follows:
Section 4.1 Organization and Power. The Company is a limited liability
company duly formed, validly existing and in good standing under the law of the
State of California. The Company has full limited liability company power and
authority to execute, deliver and perform this Agreement and the other
agreements contemplated hereby to which it is a party.
Section 4.2 Authorization. The execution, delivery and performance by
the Company of this Agreement and the other agreements contemplated hereby to
which it is a party have been duly authorized by the Company. This Agreement and
the other agreements contemplated hereby to which it is a party constitute valid
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and binding obligations of the Company, enforceable in accordance with their
respective terms, except to the extent such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting the enforcement of creditors' rights generally.
Section 4.3 No Violation. The execution, delivery and performance of
this Agreement and the other agreements contemplated hereby to which it is a
party by the Company and the consummation of the transactions contemplated
hereby or thereby do not and will not (a) conflict with or result in any breach
of, (b) constitute a default under; (c) result in a violation of, (d) give any
third party the right to accelerate any obligation or (e) require any
authorization, consent, approval, exemption or other action by any court, other
governmental body, or other third party under the provisions of, (x) the
Company's Articles of Organization or Operating Agreement or (y) any indenture,
mortgage, lease, loan agreement or other agreement or instrument to which the
Company is bound, or any law, statute, rule, regulation, judgment or decree to
which the Company or any of its assets is subject.
Section 4.4 Litigation. There are no actions, suits, proceedings,
orders or investigations pending or, to the best knowledge of the Company,
threatened against or affecting the Company at law or in equity, or before or by
any federal, state, municipal or other governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, which might
adversely affect the Company's performance under this Agreement or the
consummation of the transactions contemplated hereby.
Section 4.5 Securities. The Class B Membership Units to be issued to
Headwaters hereunder have been duly authorized by the Company and, when
subscribed to and paid for by Headwaters in accordance with this Agreement, will
be validly issued, fully paid and non-assessable. Except as specified in the
Operating Agreement, the Class B Membership Units are free of preemptive rights.
Section 4.6 Capitalization. The authorized, issued and outstanding
membership interests of the Company are set forth in the Operating Agreement.
Except as set forth in the Operating Agreement, no other person, firm,
corporation or other entity has any option with respect to, or any other right
to acquire or vote, any of the member interests or other securities of the
Company.
Section 4.7 Subscription for Investment. The Company is acquiring the
Assets for investment purposes only and not with a view to resale or in
connection with any distribution of the Assets to the public. The Company is an
"accredited investor" within the meaning of Regulation D promulgated under the
Securities Act.
ARTICLE 5
ADDITIONAL AGREEMENTS
Section 5.1 Survival. To the extent set forth below, the
representations, warranties, covenants and agreements set forth in this
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Agreement, or in any writing delivered in connection with this Agreement, will
survive the Closing Date and the consummation of the transactions contemplated
hereby, notwithstanding any examination made for or on behalf of any party
hereto, the knowledge of any party's officers, directors, managers,
shareholders, members, employees or agents, or the acceptance of any
certification or opinion:
(a) The representations and warranties of Headwaters contained in
Section 3.1 shall survive the Closing Date;
(b) The representations and warranties contained elsewhere in Article 3
and Article 4 shall survive only until the second anniversary of the Closing
Date.
Other than claims with respect to willful misrepresentation or fraud, no claim
for recovery of indemnifiable damages based upon the inaccuracy of such
representations and warranties may be asserted by a party after such
representations and warranties shall be thus extinguished; provided, however,
that the claims first asserted in writing within the applicable period shall not
thereafter be barred.
Section 5.2 Indemnification.
(a) Headwaters shall indemnify and hold harmless the Company and its
managers, members, affiliates, directors, officers and employees from and
against any and all losses, liabilities (including punitive or exemplary damages
and fines or penalties and any interest thereon), expenses (including, except as
set forth in Section 5.3(a), reasonable fees and disbursements of counsel and
expenses of investigation and defense), liens and other obligations (hereinafter
individually, a "Loss" and collectively, "Losses") that the Company or any of
its managers, members, affiliates (including, without limitations, Headwaters),
directors, officers or employees may suffer or incur which arise out of or
result from (i) any breach of any representation or warranty by Headwaters
contained in this Agreement and (ii) any breach of any covenant or agreement of
Headwaters contained in this Agreement (provided that in the case of (i) and
(ii), pursuant to the terms hereof, such representation or warranty or covenant
or agreement shall then be surviving).
(b) The Company shall indemnify and hold harmless Headwaters and its
shareholders, affiliates, directors, officers and employees from and against any
and all Losses that Headwaters or any of its shareholders, affiliates
(including, without limitations, the Company), directors, officers or employees
may suffer or incur which arise out of or result from (i) any breach of any
representation or warranty by the Company contained in this Agreement and (ii)
any breach of any covenant or agreement of the Company contained in this
Agreement (provided that in the case of (i) and (ii), pursuant to the terms
hereof, such representation or warranty or covenant or agreement shall then be
surviving).
(c) A party making a claim under this Section 5.2 is referred to as an
"Indemnified Party" and a party against whom such a claim is asserted under this
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Section 5.2 is referred to as an "Indemnifying Party." Any Indemnified Party
shall promptly notify the Indemnifying Party(ies) of any claim hereunder and
shall provide to the Indemnifying Party(ies) as soon as practicable thereafter
all information and documentation within its knowledge or possession, as the
case may be, which is reasonably necessary to support and verify such claim, and
the Indemnifying Party(ies) shall be given access to all books and records in
possession or control of the Indemnified Party which the Indemnifying Party(ies)
reasonably determines to be related to such claim.
Section 5.3 Claims.
(a) If any legal proceedings are instituted or demand or other claim is
asserted by a third party in respect of which an Indemnified Party may seek
indemnification from an Indemnifying Party pursuant to the provisions hereof,
the Indemnified Party shall promptly cause written notice (the "Claim Notice")
of the assertion of any such claim to be made to the Indemnifying Party(ies).
The failure to give such Claim Notice with respect to any claim within sixty
(60) days after an Indemnified Party has received notice thereof shall be deemed
a waiver of an Indemnified Party's rights under Section 5.2 and Section 5.3 of
this Agreement with respect to such claim to the extent that the Indemnifying
Party's(ies') rights are prejudiced by such failure. The Indemnifying
Party(ies), shall, at their expense, defend against, negotiate and settle any
such claim and shall retain counsel (who shall be reasonably acceptable to the
Indemnified Party and any other Indemnifying Party) and in such case the
Indemnifying Party(ies) shall not be liable for the fees and expenses of any
counsel employed by the Indemnified Party, unless (x) each Indemnifying Party
and the Indemnified Party shall have mutually agreed to the retention of such
counsel or (y) the named parties of any such proceeding (including any impleaded
parties) include both the Indemnifying Party(ies) and the Indemnified Party and
the representation of both or all parties by the same counsel would be
inappropriate due to actual or potential differing interest between them;
provided, however, that the Indemnifying Party(ies) shall not be obligated to
pay any expenses of an Indemnified Party (including fees and disbursements of
counsel and expense of investigation and defense) to the extent such expenses
are incurred in respect of any period commencing sixty (60) days after receipt
by such Indemnified Party of actual notice of the institution of a proceeding or
assertion of any demand or other claim and ending on the date the applicable
Claim Notice is given in accordance with this Agreement. The parties agree to
cooperate fully with each other in connection with the defense, negotiation and
settlement of any such claim; provided, however, that notwithstanding anything
contained herein to the contrary, a claim shall not be settled (i) by an
Indemnifying Party if such settlement might have a material adverse effect on
the business, operations or condition (financial or otherwise) of the
Indemnified Party or (ii) by the Indemnified Party without the written consent
of each Indemnifying Party which consent shall not be unreasonably withheld. An
Indemnifying Party shall be subrogated to all rights and remedies of an
Indemnified Party and Indemnifying Parties shall have rights of contribution as
such parties' interests may appear.
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(b) In the event any Indemnified Party shall have a claim against any
Indemnifying Party hereunder which does not involve a claim or demand being
asserted against or sought to be collected from it by a third party, the
Indemnified Party shall send a Claim Notice with respect to such claim to the
Indemnifying Party(ies). If the Indemnifying Party(ies) notifies the Indemnified
Party within sixty (60) days of receipt of the Claim Notice that it does not
dispute such claim, the amount of such claim shall be conclusively deemed a
liability of such non-disputing Indemnifying Party hereunder.
(c) So long as any right to indemnification exists pursuant to Section
5.2, the affected parties each agree to retain all books, records, accounts,
instruments and documents reasonably related to the Claim Notice. In each
instance the Indemnified Party shall have the right to be kept fully informed by
the Indemnifying Party(ies) and its (their) legal counsel with respect to any
legal proceedings, and vice versa. Any information or documents made available
to any party hereunder which information is designated as confidential by the
party providing such information and which is not otherwise generally available
to the public and not already within the knowledge of the party to whom the
information is provided (unless within the knowledge of such party on a
confidential basis or otherwise covered by the confidentiality provisions of any
other agreement among the parties hereto, or any of them) and, except as may be
required by applicable law, shall not be disclosed to any third person (except
for the representatives of the party being provided with the information, in
which event the party being provided with the information shall request its
representative not to disclose any such information which is otherwise required
hereunder to be kept confidential).
(d) Notwithstanding anything to the contrary in Section 5.2 above, the
parties agree that any Losses arising out of a breach of Headwaters'
representations and warranties set forth in Section 3.1(a) shall be satisfied
first by offsetting such amounts from amounts payable to Headwaters or its
assigns pursuant to the Note, and then, if such proceeds or offset amounts shall
be insufficient to satisfy such claim or if claims shall arise subsequent to the
satisfaction of the Note such claims shall be satisfied by Headwaters.
(e) NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT, AND EXCEPT FOR
LOSSES ARISING OUR OF FRAUD OR WILLFUL MISREPRESENTATION, NO PARTY WILL BE
LIABLE OR OBLIGATED WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT OR
UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE
THEORY FOR ANY AMOUNTS IN EXCESS IN THE AGGREGATE CONSIDERATION RECEIVED BY SUCH
PARTY PURSUANT TO THIS AGREEMENT OR FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES.
Section 5.4 Tax Liability. Headwaters shall be responsible for and pay
all transfer and sales taxes imposed on Headwaters or the Company as a result of
the transfer of the Assets to the Company or the Class B Membership Units to
Headwaters. Headwaters agrees and acknowledges that it may be subject to tax
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withholding by the United States Internal Revenue Services, the California
Franchise Tax Board or other taxing authority with respect to distributions, or
deemed distributions, from the Company pursuant to the Operating Agreement.
Headwaters hereby expressly authorizes the Company to report and withhold such
taxes in accordance with applicable law.
Section 5.5 Continuing Assistance. At any time and from time to time
after the Closing, at the Company's request and without further reconsideration
or compensation whatsoever, Headwaters will execute and deliver such other
instruments of sale, transfer, conveyance, assignment and confirmation and take
such action as the Company may reasonably deem necessary or desirable in order
to more effectively transfer, convey and assign to the Company, and to confirm
the Company's title to, the Assets to put the Company in actual possession and
operating control of the Assets and to assist the Company in exercising all
rights with respect thereto. Subsequent to the Closing, Headwaters will refer
all inquiries relating to the Assets to the Company.
Section 5.6 Expenses. Except as otherwise expressly provided herein,
each party will pay all of its expense, including attorneys' and accountants'
fees, in connection with the negotiation of this Agreement, the performance of
its obligations hereunder, and the consummation of the transactions contemplated
by this Agreement.
Section 5.7 Press Releases and Announcements. No press releases or
public announcements related to this Agreement or the transactions contemplated
herein will be issued or made without the joint approval of the Company and
Headwaters, except for any public disclosure which the Company and Headwaters in
good faith believes is required by law (in which case the disclosing party will
consult with the other party prior to making such disclosure).
Section 5.8 Confidentiality. Each party will hold and will cause their
respective affiliates, employees, consultants and advisors to hold in strict
confidence, unless compelled to disclose by judicial or administrative process
or, in the opinion of their respective counsel, by other requirements of law,
all documents and information, in the case of each party, concerning the other
parties, furnished to them in connection with the transactions contemplated by
this Agreement, except to the extent that such information can be shown to have
been (i) previously known by the party or parties to which it was furnished
(provided that such information is not subject to another confidentiality
agreement or other obligation of secrecy owed to the party or parties providing
such information), (ii) in the public domain through no fault of the party or
parties to whom it was furnished, or (iii) later lawfully acquired from other
sources by the party or parties to whom it was furnished (provided that such
sources are not known by such party or parties to be bound by a confidentiality
agreement with or other obligation of secrecy to the disclosing party or parties
or another party). No party will release or disclose information referred to
herein to any other person, except their respective auditors, attorneys,
financial advisors, bankers, lenders and other consultants and advisors in
connection with this Agreement and the transactions contemplated hereby. Each
party's respective covenants contained in this Section 5.8 shall continue until
the day following the fifth anniversary of the Closing Date, except to the
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extent of the information referred to herein comes into the public domain
through no fault of the party or parties required to hold it in confidence, and
all documents referred to herein (including copies thereof) shall be returned to
a party immediately upon the written request of such party.
ARTICLE 6
MISCELLANEOUS
Section 6.1 Amendment and Waiver.
(a) This Agreement may be amended, or any provisions of this Agreement
may be waived, provided that any such amendment or waiver will be binding upon a
party only if set forth in writing executed by such party.
(b) No course of dealing between or among any persons having any
interest in this Agreement will be deemed effective to modify, amend or
discharge any part of this Agreement or any rights or obligations of any person
under or arising out of this Agreement.
Section 6.2 Notices. Except as otherwise expressly set forth in this
Agreement, all notices, demands and other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when delivered personally, or by
documented overnight delivery service, or sent by telecopy, telefax, or other
electronic transmission service, provided a confirmation copy is also sent no
later than the next business day by first class mail, return receipt requested.
Notices, demands and communications to each respective party will, unless
another address is specified in a notice delivered to all other parties hereto,
be sent to the address indicated in the books and records of the company from
time to time.
Section 6.3 Assignment. This Agreement and all of the provisions hereof
will be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, except that neither this Agreement
nor any of the rights, interests or obligations hereunder may be assigned by
Headwaters without prior written consent of the Company.
Section 6.4 Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provisions will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provision or the remaining provisions of this Agreement.
Section 6.5 No Strict Construction. The language used in this Agreement
will be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction will be applied against any
party.
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Section 6.6 Captions. The captions used in this Agreement are for
convenience of reference only and do not constitute a part of this Agreement and
will not be deemed to limit, characterize or in any way affect any provision of
this Agreement, and all provisions of this Agreement will be enforced and
construed as if no caption had been used in this Agreement.
Section 6.7 Complete Agreement. This Agreement and the documents
referred to herein contain the complete agreement between the parties and
supersede any prior understandings, agreements or representations by or between
the parties, written or oral, which may have related to the subject matter
hereof in any way.
Section 6.8 Governing Law. The substantive law (and not the law of
conflicts) of the State of California will govern all questions concerning the
construction, validity and interpretation of this Agreement and the performance
of the obligations imposed by this Agreement.
Section 6.9 Counterparts. This Agreement may be executed in one or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together will constitute one and the same
instrument.
Section 6.10 Brokers. No party has retained any broker or finder in
connection with the transactions contemplated by this Agreement, and there are
no claims for brokerage commissions, finders' fees or similar compensation in
connection with the transactions contemplated by this Agreement based on any
arrangement or agreement by or on behalf of any party. Each party will indemnify
each other party for any breach of the indemnifying party's representations in
this Section.
[Signature page follows.]
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IN WITNESS WHEREOF, each of the Company and Headwaters has duly
executed or caused this Agreement to be duly executed by its officer thereunto
duly authorized as of the date first above written.
AVINTAQUIN CAPITAL, LLC
a California limited liability company
/s/ Eric Richardson
----------------------------------
Eric Richardson
Manager
HEADWATERS INCORPORATED
a Delaware corporation
/s/ Kirk A. Benson
----------------------------------
Name: Kirk A. Benson
Title: CEO
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Schedule 1
Securities
The "Securities" shall include all of Headwaters' right, title and interest in.
to and under the following:
1. Common stock and all other debt and equity securities of
InterviewNow.com, LLC and any related entities, totaling
821,168 membership units (7.5% of the total units).
2. Common stock and all other debt and equity securities of
e-Perception Technologies, Inc. and any related entities,
totaling 800,000 shares of common stock or 13.5% of the
company.
3. Common stock and all other debt and equity securities of
NextStep Broadband Corporation, formerly known as Style
U4EA.com, Inc., and any related entities, consisting of
2,957,000 shares of common stock or about 33% of the company.
Note that NextStep Broadband currently owes approximately
$70,000 to Headwaters for accounting services rendered, and
this obligation will continue to be an ongoing debt owed by
NextStep Broadband to Headwaters.
4. All right, title and interest in Kwai Financial, Inc.
("Kwai"), represented by 100,000 shares of outstanding common
stock, and (A) all of the loans (and related interest,
warrants, rights and other dividends relating thereto) made by
Kwai, including without limitation, the loans made to the
following borrowers:
a. Kore Partners, in the original principal amount of
$300,000 (in addition to the principal and accrued
interest there are warrants representing 165% of the
original loan amount of $300,000). b. Voxxy, Inc., in
the original principal amount of $250,000 (in
addition to principal and accrued interest, Kwai has
150% warrant coverage on the origianal loan amount of
$250,000). c. Enlink GeoThermal, Inc., in the
original principal amount of $200,000 (in addition to
the principal and accrued interest there are warrants
to purchase $165,000 shares of common stock). d.
Earthnoise, Inc., in the original principal amount of
$200,000 (in addition to the principal and accrued
interest there are warrants which represent 75%
coverage of the loan amount); and
(B) Kwai's investment of $65,530 in Venture Bridge, LP,
consisting of 1.3 Limited Partnership units.
The Securities also includes all of the instruments, documents, promissory
notes, stock certificates, warrants, chattel paper, and agreements of every kind
evidencing or related to the forgoing.
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