EXHIBIT 10.1
SHARE PURCHASE AGREEMENT
This Share Purchase Agreement ("Agreement"), dated as of May 15, 2003,
among, Nordstrom Forbes & Lincoln, Incorporated, a Colorado corporation, J.R.
Nelson, John Brasher and Lisa K. Brasher (collectively, the "Sellers"), and
Azonic Corporation, a Nevada corporation ("AZN"), and Carriage House Capital
Corp. a Arizona Corporation (the "Buyer").
W I T N E S S E T H:
A. WHEREAS, AZN is a corporation duly organized under the laws of the State of
Nevada.
B. WHEREAS, the Sellers own in the aggregate 5,937,000 shares of common stock
of AZN in the aggregate.
C. WHEREAS, Buyer wishes to purchase an aggregate of 5,700,000 shares of
common stock, the Sellers (collectively, the "Purchase Shares"), and the
Sellers desire to sell the Purchase Shares to Buyer free and clear of liens
and encumbrances.
D. AZN is joining in this agreement to provide certain covenants warranties
and representations.
NOW, THEREFORE, it is agreed among the parties as follows:
ARTICLE I
The Consideration
1.1 Subject to the conditions set forth herein, Sellers shall sell to Buyer and
Buyer shall purchase an aggregate of 5,700,000 shares of common stock of
AZN from Sellers. The purchase price for the shares to be paid by Buyer to
Sellers is $100,000 (the "Consideration") of which is herewith paid by wire
transfer to Sellers through escrow agent, Business Financial Systems Inc.
Escrow Account, and is deemed non-refundable consideration for the Purchase
Shares, specified.
ARTICLE II
Closing and Conveyance of Shares
2.1 The Purchase Shares shall be conveyed by Sellers to Buyer with duly
executed stock powers by depositing with escrow agent for delivery to
buyer, upon receipt of the Consideration by Sellers, and satisfaction of a)
the conditions precedent in Article VI, and b) procedures in Article V. The
Purchase Shares being purchased herein shall be issued and delivered to
escrow agent for delivery to Buyer upon receipt of purchase consideration.
2.2 Closing hereunder shall be completed by delivery in escrow to Business
Financial Systems, Inc. Escrow Account, of the requisite closing documents,
cash consideration and share certificates on or before May 15, 2003 at 5:00
p.m. PST ("Closing Date") subject to satisfaction of the terms and
conditions set forth herein. Consideration may be delivered by Federal
Express or wire transfers, and any closing documents may be delivered by
facsimile, Federal Express or other appropriate means.
ARTICLE III
Representations, Warranties and Covenants of Sellers and AZN as to AZN
Sellers and AZN each hereby, represent, warrant and covenant to Buyer
as follows:
3.1 AZN is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada, and has the corporate power and
authority to own or lease its properties and to carry on its business as it
is now being conducted. The Articles of Incorporation and Amendments and
Bylaws of AZN, are complete and accurate, and the minute books of AZN,
copies of which have also been made available to Buyer, contain a record,
which is complete and accurate in all material respects, of all meetings,
and all corporate actions of the shareholders and Board of Directors of
AZN.
3.2 (a) The authorized capital stock of AZN consists of 50,000,000 shares of
common stock; and 5 million shares of preferred is authorized but none are
oustanding. There are 6,000,000 shares of Common Stock of AZN issued and
outstanding. All such shares of capital stock of AZN are free and were
originally issued free of preemptive rights. AZN has no outstanding
options, warrants, or other rights to purchase, or subscribe to, or other
securities convertible into or exchangeable for any shares of capital stock
of AZN, or contracts or arrangements of any kind relating to the issuance,
sale or transfer of any capital stock or other equity securities of AZN.
(b) The Sellers own the Purchase Shares and are conveying them to Buyer
hereunder free and clear of any lien, pledge, security interest or other
encumbrance, and, upon payment for the Purchase Shares as provided in this
Agreement, the Buyer will acquire good and valid title to the Purchase
Shares, free and clear of any lien, pledge, security interest or other
encumbrance. None of the Purchase Shares are the subject of any voting
trust agreement or other agreement relating to the voting thereof or
restricting in any way the sale or transfer thereof except for this
Agreement. Each Seller has full right and authority to transfer such
Purchase Shares pursuant to the terms of this Agreement.
3.3 AZN does not own nor has it owned, in the last five years, any outstanding
shares of capital stock or other equity interests of any partnership, joint
venture, trust, corporation, limited liability company or other entity and
there are no obligations of AZN to repurchase, redeem or otherwise acquire
any capital stock or equity interest of another entity.
3.4 This Agreement has been duly authorized, validly executed and delivered on
behalf of the Sellers and AZN and is a valid and binding agreement and
obligation of AZN and Sellers enforceable against the parties in accordance
with its terms, subject to limitations on enforcement by general principles
of equity and by bankruptcy or other laws affecting the enforcement of
creditors' rights.
3.5 Neither the making of nor the compliance with the terms and provisions of
this Agreement and consummation of the transactions contemplated herein by
Sellers or AZN will conflict with or result in a breach or violation of the
Articles of Incorporation or Bylaws of AZN, or of any material provisions
of any indenture, mortgage, deed of trust or other material agreement or
instrument to which AZN or Sellers are a party, nor will result in the
creation or imposition of any material lien, charge or encumbrance upon any
material property or assets of AZN pursuant to the terms of any agreement
or instrument to which AZN is a party or by which AZN may be bound or to
which any of AZN property is subject, and no event has occurred with which
lapse of time or action by a third party could result in a material breach
or violation of or default by AZN or Sellers.
3.6 There is no claim, legal action, arbitration, governmental investigation or
other legal or administrative proceeding, nor any order, decree or judgment
in progress, pending or in effect, or to the best knowledge of the Sellers
threatened against or relating to AZN or affecting any of its assets,
properties, business or capital stock. There is no continuing order,
injunction or decree of any court, arbitrator or governmental authority to
which AZN is a party or by which AZN or its assets, properties, business or
capital stock are bound.
3.7 AZN has never had income or operations, nor paid wages or other
compensation, and has never been required to file and has not filed any
federal or state income tax or other tax returns. AZN has no knowledge of
any additional assessments, adjustments or contingent tax liability
(whether federal or state) pending or threatened against AZN for any
period, nor of any basis for any such assessment, adjustment or
contingency.
3.8 AZN has delivered to Buyer audited financial statements dated March 31,
2002 and 2001, and all unaudited financial statement prepared subsequent to
March 31, 2002, which have been filed with the SEC as part of quarterly
reports on Form 10-QSB. All such statements, herein sometimes called "AZN
Financial Statements" are complete and correct in all material respects
and, together with the notes to these financial statements, present fairly
the financial position and results of operations of AZN for the periods
indicated. All financial statements of AZN have been prepared in accordance
with generally accepted accounting principles.
3.9 As of the date hereof, AZN, represents and warrants that all outstanding
indebtedness of AZN is as shown on the financial statements (except for
legal and accounting services related to this transaction) and all such
scheduled indebtedness, if any, which will be the sole responsibility of
the Sellers and shall be paid by the Sellers at the Closing hereunder.
3.10 Since the dates of the AZN Financial Statements, there have not been any
material adverse changes in the business or condition, financial or
otherwise, of AZN. AZN does not have any liabilities, commitments or
obligations, secured or unsecured except as shown on updated financials
(whether accrued, absolute, contingent or otherwise).
3.11 AZN is not a party to any contract performable in the future.
3.12 The representations and warranties of the AZN shall be true and correct as
of the date hereof.
3.13 AZN will have delivered to Buyer, all of its corporate books and records
for review.
3.14 AZN has no employee benefit plan in effect at this time.
3.15 No representation or warranty by AZN or the Sellers in this Agreement, or
any certificate delivered pursuant hereto contains any untrue statement of
a material fact.
3.16 Buyer has received copies of Form 10-KSB as filed with the Securities and
Exchange Commission ("SEC") which included audits for the year ended March
31, 2002 and each of its other reports to shareholders filed with the SEC
through the period ended March 28, 2003. AZN is a registered company under
the Securities Exchange Act of 1934, as amended.
3.17 AZN has filed reports required to be filed by it under the Securities
Exchange Act of 1934, as amended (the "Federal Securities Laws").
3.18 The Sellers have not made any general solicitation or general advertising
regarding the Purchase Shares.
3.19 AZN has conducted no business whatsoever since March 31, 2002, has incurred
no liabilities except as shown on the financial statements and fees in
conjunction with this transaction, which fees incurred in conjunction with
this transaction shall be paid at closing by the Sellers.
3.20 There have been no material changes, debts, or liabilities incurred by AZN
since the date of 10KSB for March 31, 2002 or the 10QSB for period ended
December 31, 2002.
3.21 Sellers have ordered the March 31, 2003 Audit and will pay the costs
thereof.
ARTICLE IV
Indemnification
4.1 The waiver of any condition to a party's obligation to consummate the
transactions contemplated hereunder, where such condition is based on the
accuracy of any representation or warranty, or on the performance of or
compliance with any covenant or obligation, will not affect the right to
indemnification, or payment of Damages, or other remedy based on such
representation, warranty, covenant or obligation.
4.2 Sellers and AZN, jointly and severally, shall indemnify and hold harmless
the Buyer and its respective officers, directors and affiliates (the "Buyer
Indemnified Persons") for, and will pay to the Buyer Indemnified Persons,
the amount of, any loss, liability, claim, damage (including, without
limitation, incidental and consequential damages), cost, expense
(including, without limitation, interest, penalties, costs of investigation
and defense and the reasonable fees and expenses of attorneys and other
professional experts) or diminution of value, whether or not involving a
third-party claim (collectively, "Damages"), directly or indirectly arising
from, attributable to or in connection with any breach by any of the
Sellers or AZN of any covenant, agreement or obligation of AZN or Sellers
contained in this agreement or with any liability or debt of Azonic not set
forth in the Financial Statements or paid in full by Sellers.
4.3 Promptly after receipt by an indemnified party of written notice (the
"Notice of Claim") of the commencement of any action, suit or proceeding
against it, or written threat thereof, such indemnified party will, if a
claim is to be made against an indemnifying party under either of said
sections, as applicable, give notice to the indemnifying party of the
commencement of such action, suit or proceeding. The indemnified party
shall furnish to the indemnifying party in reasonable detail such
information as the indemnified party may have with respect to such
indemnification claims (including copies of any summons, complaint or other
pleading which may have been served on it and any written claim, demand,
invoice, billing or other document evidencing or assenting the same).
Subject to the limitations set forth in this section, no failure or delay
by the indemnified party in the performance of the foregoing shall reduce
or otherwise affect the obligation of the indemnifying party to indemnify
and hold the indemnified party harmless except to the extent that such
failure or delay shall have materially and adversely affected the
indemnifying party's ability to defend against, settle or satisfy any
action, suit or proceeding the claim for which the indemnified party is
entitled to indemnification hereunder. The foregoing shall not apply to the
extent inconsistent with the provisions of section 4.8 relating to
Proceedings.
4.4 If the claim or demand set forth in the Notice of Claim given by the
indemnified party is a claim or demand asserted by a third party, the
indemnifying party shall have 30 days after the Date of Notice of Claim to
notify the indemnified party in writing of its election to defend such
third party claim or demand on behalf of the indemnified party (the "Notice
Period"); provided, however, that the indemnified party is authorized to
file any motion, answer or other pleading which it deems necessary or
appropriate to protect its interests during the Notice Period. If the
indemnifying party elects to defend such third party claim or demand, the
indemnified party shall make available to the indemnifying party and its
agents and representatives all records and other materials which are
reasonably required in the defense of such third party claim or demand and
shall otherwise cooperate (at the sole cost and expense of the indemnifying
party) with, and assist (at the sole cost and expense of the indemnifying
party) the indemnifying party in the defense of, such third party claim or
demand, and so long as the indemnifying party is diligently defending such
third party claim in good faith, the indemnified party shall not pay,
settle or compromise such third party claim or demand. If the indemnifying
party elects to defend such third party claim or demand, the indemnified
party shall have the right to control the defense of such third party claim
or demand, at the indemnified party's own expense. If the indemnifying
party does not elect to defend such third party claim or demand or does not
defend such third party claim or demand in good faith, the indemnified
party shall have the right, in addition to any other right or remedy it may
have hereunder at the indemnifying party's expense, to defend such third
party claim or demand.
4.5 The term "Date of Notice of Claim" shall mean the date the Notice of Claim
is effective pursuant to section 4.6 of this Agreement.
4.6 A claim for indemnification for any matter not involving a third-party
claim may be asserted by notice to the party from whom indemnification is
sought.
4.7 Any legal action or proceeding with respect to this Agreement or any
matters arising out of or in connection with this Agreement or the
transactions contemplated hereby or the documents executed and delivered in
connection herewith, and any action for enforcement of any judgment in
respect thereof may be brought in the courts of the State of Colorado or of
the United States of America for the District of Colorado, and, by
execution and delivery of this Agreement, the parties each hereby accepts
for itself and in respect of its property, generally and unconditionally,
the jurisdiction of the aforesaid courts and appellate courts thereof. The
parties irrevocably consent to service of process out of any of the
aforementioned courts in any such action or proceeding in accordance with
the notice provisions set forth in Section 8.5. The parties each hereby
irrevocably waive any objection that it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement or the transactions contemplated
hereby or the documents execute and delivered in connection herewith
brought in the courts referred to above and hereby further irrevocably
waive and agree, to the extent permitted by applicable law, not to plead or
claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum. Nothing herein shall
affect the right of any party hereto to serve process in any other manner
permitted by law.
ARTICLE V
Procedure for Closing
5.1 At the Closing Date, the purchase and sale shall be consummated after
satisfaction of all conditions precedent set forth in Article VI, by
Sellers' common stock certificates for the Purchase Shares being delivered,
duly executed, for 5,700,000 shares of common stock to escrow agent, and
the delivery of the Consideration for share purchase to escrow agent from
the Buyer, together with delivery of all other items, agreements, stock
powers, warranties, and representations set forth in this Agreement.
5.2 Escrow Agent is Business Financial Systems, Inc. and the escrow account is
Business Financial Systems. Inc. Escrow Account @ Compass Bank, 7355
Ralston Road, Arvada CO 80002, (303) 423-7200. ABA #107005319, Account #
2500075662.
ARTICLE VI
Conditions Precedent to the
Consummation of the Purchase
The following are conditions precedent to the consummation of the
Agreement on or before the Closing Date:
6.1 Sellers and AZN shall have performed and complied with all of their
respective obligations hereunder which are to be complied with or performed
on or before the Closing Date.
6.2 No action, suit or proceeding shall have been instituted or shall have been
threatened before any court or other governmental body or by any public
authority to restrain, enjoin or prohibit the transactions contemplated
herein, or which might subject any of the parties hereto or their directors
or officers to any material liability, fine, forfeiture or penalty on the
grounds that the transactions contemplated hereby, the parties hereto or
their directors or officers, have violated any applicable law or regulation
or have otherwise acted improperly in connection with the transactions
contemplated hereby, and the parties hereto have been advised by counsel
that, in the opinion of such counsel, such action, suit or proceeding
raises substantial questions of law or fact which could reasonably be
decided adversely to any party hereto or its directors or officers.
6.3 The representations and warranties made by Sellers and AZN in this
Agreement shall be true as though such representations and warranties had
been made or given on and as of the Closing Date, except to the extent that
such representations and warranties may be untrue on and as of the Closing
Date because of changes caused by transactions suggested or approved in
writing by the Buyer.
ARTICLE VII
Termination and Abandonment
7.1 Anything contained in this Agreement to the contrary notwithstanding, the
Agreement may be terminated and abandoned at any time prior to or on the
Closing Date:
(a) By mutual consent of parties;
(b) By Sellers or Buyer, if any condition set forth in Article VI
relating to the other party has not been met or has not been
waived;
(c) By Sellers or Buyer, if any suit, action, or other proceeding
shall be pending or threatened by the federal or a state
government before any court or governmental agency, in which
it is sought to restrain, prohibit, or otherwise affect the
consummation of the transactions contemplated hereby;
(d) By Sellers or Buyer, if there is discovered any material
error, misstatement or omission in the representations and
warranties of another party; or
(e) By the Sellers, if the Closing does not occur, through no
failure to act by Sellers, on May 15, 2003, or if Buyer fails
to deliver the consideration required herein.
7.2 Any of the terms or conditions of this Agreement may be waived at any time
by the party which is entitled to the benefit thereof, by action taken by
its Board of Directors provided; however, that such action shall be taken
only if, in the judgment of the Board of Directors taking the action, such
waiver will not have a materially adverse effect on the benefits intended
under this Agreement to the party waiving such term or condition.
ARTICLE VIII
Continuing Representations and
Warranties and Covenants
8.1 The respective representations, warranties, and covenants of the parties
hereto and the covenants and agreements of the parties hereto shall survive
after the closing under this Agreement in accordance with the terms
thereof.
8.2 There are no representations whatsoever about any matter relating to AZN,
Sellers, or any item contained in this Agreement, except as is contained in
the express language of this Agreement.
8.3 Buyer warrants that it has performed its own due diligence
regarding AZN and Sellers and their agents and attorneys shall have no liability
whatsoever for any matter, omission or representation not specifically disclosed
herein. Buyer, as a specific inducement to Sellers hereby waives and releases
any claim whatsoever against Sellers and their agents and attorneys forever and
covenant not to sue Sellers, their agents and attorneys under any circumstances
for any matter not specifically and expressly represented within this document.
Neither Sellers nor their agents shall be liable under any circumstances for any
act of omission or interpretation and Buyers hereby specifically release Sellers
and their agents from any claims therefore in order to induce the Sellers to
enter into and perform under this agreement.
ARTICLE IX
Miscellaneous
9.1 This Agreement embodies the entire agreement between the parties, and there
have been and are no agreements, representations or warranties among the
parties other than those set forth herein.
9.2 To facilitate the execution of this Agreement, any number of counterparts
hereof may be executed, and each such counterpart shall be deemed to be an
original instrument, but all such counterparts together shall constitute
but one instrument.
9.3 All parties to this Agreement agree that if it becomes necessary or
desirable to execute further instruments or to make such other assurances
as are deemed necessary, the party requested to do so will use its best
efforts to provide such executed instruments or do all things necessary or
proper to carry out the purpose of this Agreement.
9.4 This Agreement may not be amended except by written consent of both
parties.
9.5 Any notices, requests, or other communications required or permitted
hereunder shall be delivered personally or sent by overnight courier
service, prepaid, addressed as follows:
To Sellers: Nordstrom Forbes & Lincoln Incorporated
J.R. Nelson, John Brasher and Lisa K. Brasher
11145 W. Rockland Dr.
Littleton, CO 80127
To AZN: J.R. Nelson
11145 W. Rockland Dr.
Littleton, CO 80127
To Buyer: HRBAER@AOL
Copy to: Escrow Agent: Business Financial Systems, Inc.,
2000 Wadsworth Blvd., Suite 179
Lakewood, CO 80214 (303) 232-1926
or such other addresses as shall be furnished in writing by any party, and any
such notice or communication shall be deemed to have been given as of the date
received.
9.6 No press release or public statement will be issued relating to the
transactions contemplated by this Agreement without prior approval of the
Buyer and Sellers. However, AZN may issue at any time any press release or
other public statement it believes on the advice of its counsel it is
obligated to issue to avoid liability under the law relating to
disclosures, but the party issuing such press release or public statement
shall make a reasonable effort to give the other party prior notice of and
opportunity to participate in such release or statement.
9.7 This Agreement shall be governed by and construed in accordance with and
enforced under the laws of the state of Colorado applicable to all
agreements made hereunder. Venue and jurisdiction for any legal actions
hereunder shall be District Court in and for Jefferson County, Colorado.
9.8 In connection with this Agreement the parties have appointed the escrow
agent, Business Financial Systems, Inc. which shall be authorized by this
agreement to do the following:
1) Accept the purchase price of $100,000 from buyers, and disburse it in
accordance with Sellers written instructions, upon receipt of a copy
of this agreement signed by Sellers and AZN.
2) Accept the common stock certificates of AZN with duly signed and
guaranteed signatures for 5,700,000 common shares from Sellers and,
3) Upon receipt of the certificates for the purchase shares disburse the
proceeds received at closing from the escrow in accordance with
Sellers separate written instructions
4) Transmit by Federal Express the stock certificates to buyers at:
Tempe, Arizona.
5) In the event of default in delivery of cash or certificates by a party
under this agreement, any cash or certificates received from the other
party shall be returned to the remitting party 3 business days after
default.
6) Escrow Agent is specifically indemnified and held harmless hereby for
its actions or inactions in following these instructions as contained
in this contract. Escrow Agent shall have no liability for any
warranties or representations contained within the provisions of this
contract, except as to the performance of its duties under this
provision 8.8. In the event of a dispute involving the escrow
instructions or the consideration to be delivered in escrow, the
escrow agent is authorized to implead the consideration received into
the District Court of Jefferson County, Colorado upon ten days written
notice, and be relieved of any further escrow duties thereupon. Any
and all costs of attorneys fees and legal actions of escrow agent for
any dispute resolution or impleader action shall be paid in equal
shares by the parties to this agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first written above.
Sellers: Azonic Corporation
/s/J.R. Nelson By:/s/J.R. Nelson
J.R. Nelson Name: J.R. Nelson
Title:President
__________________________ BUYER: Carriage House Capital Corp.
John Brasher
/s/Carriage House Capital Corp.
_________________________
Lisa K. Brasher
By:/s/Howard R. Baer
Name: Howard R. Baer
Nordstrom Forbes & Lincoln Title:President
Incorporated
Business Financial Systems, Inc.
By:/s/J.R. Nelson
J.R. Nelson, President
By:_________________________
Name:
Title: