STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made and
entered into as of August 19, 2000, by and between INTERNATIONAL
BUSINESS COMPANY, a California Corporation and its shareholders
DENNIS B. GINTHER, CLIFFORD J. ROEBUCK, JADWIGA L. GINTHER, and
BOGUMILA E. BASU, all individuals ( collectively "Sellers"), and
INTERNET BUSINESS'S INTERNATIONAL, INC., a Nevada Corporation
("Buyer")
RECITALS
A. The shareholder sellers own 100 percent of the outstanding
shares of INTERNATIONAL BUSINESS COMPANY.
B. Sellers desire to sell and transfer to Buyer and Buyer
desires to purchase and acquire from Seller, all the shares of
Sellers, both the outstanding and treasury shares (the "shares")
upon the terms and subject to the conditions set forth in this
Agreement.
TERMS AND CONDITIONS
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Purchase and Sale. Sellers hereby sell, assign, transfer
and deliver to Buyer, and Buyer hereby purchases and acquires from
Sellers, the Shares upon the terms and subject to the conditions
set forth in this agreement.
2. (a) Purchase Price; Payment Terms. The purchase price
for all the shares is that Buyer shall issue 2,000,000 shares of
IBUI restricted Rule 144 stock, at close of escrow. These shares
shall be restricted as follows: one-half of the shares of IBUI
(1,000,000) shall be released at the end of twelve (12) months and,
the other half (1,000,000) shall be released at the end of twenty-
four (24) months.
(b) It is expressly agreed that the number of shares
set forth in this Agreement is based on the fact that IBUI is
currently trading on the OTCBB. If the number of outstanding IBUI
shares is subject to reverse stock split or reverse merger or
otherwise reduced in proportion to the company's value then the
number of shares being actually transferred herein shall be
proportionately reduced as well.
The shares of IBUI stock shall be issued by Buyers to Sellers in
the following amounts:
Dennis B. Ginther........... 1,259,060 shares
Clifford J. Roebuck........... 540,940 shares
Jadwiga L. Ginther............ 100,000 shares
Bogumila E. Basu.............. 100,000 shares
(d) Warranty on Revenue. Seller warrants that a
minimum of $800,000 in revenue each fiscal year, will be produced
by Seller during the first and second years following the date of
acquisition and the following shall apply:
(i) If the revenue goal is met (plus or minus
$100,000), then the shares shall be released per paragraph 2(a)
above;
(ii) If the revenue goal is not met for the first
and second years, then the shares to be released will be reduced
proportionally, but not below 70% of the original number of shares
issued; and,
(iii) If the revenue goal is exceeded for the
first and second years, then the shares to be released will be
increased proportionally, but not to exceed 30% of the original
number of shares issued.
(e) Buyer will provide marketing capital for IBC, in an
amount not to exceed $160,000. Buyer will also provide marketing
for IBC through its telemarketing company, through its keyword
contract with Microsoft and its IBM marketing partners in Europe.
It is recognized that Buyer will also provide operational capital
for IBC until such time as revenues generated by IBC are sufficient
to cover on-going expenses, which are projected to be $25,300 per
month commencing July 1, 2000, separate and apart from marketing
expenditures.
3. Representations and Warranties of Sellers. Sellers hereby
represent and warrant to Buyer as follows:
3.1 Authority. Sellers have the right, power and authority
to enter into this Agreement and to perform all obligations
required to be performed by it hereunder. Sellers have the full
power to transfer the shares to Buyer without obtaining the consent
or approval of any other person or governmental authority.
3.2 Title to Shares. Sellers are the owners, beneficially
and of record, of all the shares free and clear of all liens,
encumbrances, security agreements, equities, options, claims,
charges, and restrictions.
3.3 Organization. Seller corporation is a corporation duly
organized, validly existing, and in good standing under the laws of
the State of California and has all necessary corporate powers to
own its properties and operate its business as now owned and
operated by it. Exhibit "A" contains the Articles of
Incorporation, Bylaws, Minutes and Stock Book of the corporation.
3.4 Authorization. This Agreement and all other agreements
and documents executed and delivered by Sellers constitute valid
and legally binding obligations of Sellers enforceable in
accordance with their respective terms, subject to laws of general
application relating to bankruptcy, insolvency and the relief of
debtors and subject to availability of equitable remedies.
3.5 Capitalization. The authorized capital stock of Seller
corporation consists of shares of Common Stock, of which 100% of
said shares are either issued to the individuals listed in 2(c)
above, and outstanding or held in the corporation's treasury. All
of the outstanding shares are validly issued, and paid, and
nonassessable, and such shares have been so issued in full
compliance with all federal and state securities laws. There are
no outstanding subscriptions, options, rights, warrants,
convertible securities, or other agreement or commitments
obligating Seller corporation to issue or to transfer from treasury
any additional shares of its capital stock of any class.
3.6 Financials. Exhibit "B," to this Agreement contains the
federal tax returns for Seller corporation for the years 1998 and
1999. There are no outstanding taxes owed. Exhibit "C," to this
Agreement sets forth the balance sheets of Seller corporation as of
December 31, 1998 and December 31, 1999, and the statements of
income and retained earnings for the two (2) years ending on those
dates. The financial statements attached hereto as Exhibit "C,"
have been prepared in accordance with generally accepted accounting
principles consistently followed by Seller corporation throughout
all periods indicated, and fairly present the financial position of
Seller corporation on the respective dates of the balance sheets
included in the financial statements, and the result of its
operations for the respective periods indicated. Exhibit "D"
contains the financial projections for Seller corporation for the
years 2000 and 2001. Since December 31, 1999, there has not been
any change in the financial condition or operations of Seller
corporation or its business, assets, properties or prospects,
except as set forth on Exhibit "E," which is attached hereto and
incorporated herein by this reference and lists all of the debts
and liabilities of Seller corporation.
3.7 Absence of Undisclosed Liabilities. Seller corporation
does not have any debt, liability or obligation of any nature,
whether accrued, absolute, contingent or otherwise, and whether due
or to become due, that is not reflected or reserved against in the
balance sheet, except as set forth on Exhibit "E,".
3.8 Tax Returns. Within the times and in the manner
prescribed by law, Seller corporation has filed all federal, state
and local tax returns required by law and has paid all taxes,
assessments and penalties due and payable. The provisions for
taxes reflected in the balance sheet are adequate for federal,
state, county and local taxes for the period ended December 31,
1999, and for all prior periods, whether disputed or undisputed.
There are no present disputes about taxes of any nature payable by
Seller corporation.
3.9 Personal Property. The books and records of Seller
corporation contain a complete and accurate description and specify
the location of all equipment, furniture, supplies and all other
tangible personal property owned by, in the possession of, or used
by Seller corporation in connection with its business. No personal
property is held under any lease, security agreement, conditional
sales contract or other title retention or security arrangement, or
is located other than in the possession and under the control of
Seller corporation. The tangible personal property reflected in
those books and records constitutes all such tangible personal
property necessary for the conduct by Seller corporation of its
business as now conducted. All of the tangible personal property
of Seller corporation is in good operating condition and repair,
reasonable wear and tear excepted.
3.10 Title. Seller corporation has good and marketable title
to all of its assets and interest in assets, whether real,
personal, mixed, tangible or intangible, which constitute all of
the assets and interests in assets that are used in the business of
Seller corporation. All of these assets are free and clear of
restrictions on or conditions to transfer or assignment and are
free and clear of mortgages, liens, pledges, charges, encumbrances,
equities and claims of third parties, except for (a) those
disclosed on Exhibit "E," and (b) the lien for current taxes not
yet due and payable. Exhibit "f," to this Agreement is a schedule
of all personal assets owned by Seller which are in the possession
of the Company.
3.11 Accounts Receivable. All accounts receivable of Seller
corporation shown on the balance sheets, and all accounts
receivable of Seller corporation created after December 31, 1999,
arose from valid sales in the ordinary course of business. These
amounts have been collected in full since that date as reflected in
the books and records of Seller corporation, or are collectible at
their full amounts and are not subject to valid defenses, setoffs
or counterclaims. Seller corporation agrees that as of July 1,
2000, all receivables shall be the property of Buyer. Exhibit "G,"
contains accounts receivable.
3.12 Accounts Payable. Exhibit "H," to this Agreement is a
complete and accurate list, with an accurate aging, of all trade
and other accounts, notes and contract payables of Seller
corporation as of the date hereof, all of which arose in the
ordinary course of business and are usual and normal in amount.
3.13 Contracts. Except as otherwise disclosed in and of the
exhibits to this Agreement, Seller corporation is not a party to,
nor is its properties or assets bound by, any contract, agreement,
understanding (whether written or verbal) of any nature whatsoever.
There is no default or event that, with notice, lapse of time, or
both, would constitute a default by any party to any agreement to
which Seller corporation is a party or by which it or its
properties or assets are bound.
3.14 Employees and Employee Benefit Plans. Exhibit "I" to
this Agreement is a correct and complete list of all full-time and
part-time employees of Seller corporation, together with their
addresses, social security numbers and all current and promised
salary, wage and bonus information. All of the employees of Seller
corporation are at-will employees and may be terminated by Seller
corporation at any time without liability and without any
obligation to pay any severance of similar benefit. There are no
employment contracts, collective bargaining agreement, pension,
bonus, profit-sharing, stock option or other agreement or
arrangement providing for employee remuneration or benefits to
which Seller corporation is a party or by which it is bound.
Seller corporation has delivered to Buyer a copy of its most
current employee manual and description of all company policies and
practices, including no discrimination, overtime, vacation, holiday
and sick leave, if any. Seller corporation's relationship with all
of its employees is good. All unused vacation, holiday and sick
leave, and any other paid time off, for all of the employees has
been properly and accurately recorded in the books and records of
Seller corporation and are reflected on Exhibit "E," attached
hereto. All records of Seller corporation for each of its
employees are complete and accurate.
3.15 Litigation. There is no pending, or to Seller
corporation's knowledge, threatened suit, action, arbitration or
legal, administrative or other proceeding, or governmental
investigation against or affecting Seller corporation or its
business, assets or financial condition. Seller corporation is not
presently engaged in any legal action to recover money due to it or
damages sustained by it.
3.16 Compliance with Laws. Seller corporation has not
received notice of any violation of any applicable federal, state
or local statute, law or regulation of any kind or nature
whatsoever, including, without limitation, any applicable building,
zoning, environmental protection, health and safety, handicap
access, or other law, ordinance or regulation, affecting its
properties or the operation of its business and there are no such
violations. Seller corporation has all proper and valid licenses,
permits and other governmental authorities necessary to conduct its
business as now being conducted.
3.17 Agreement will not Cause a Breach or Violation. The
consummation of the transactions contemplated by this Agreement
will not result in nor constitute any of the following: (a) a
breach of any term or provision of the Agreement (b) a default or
an event that, with notice, lapse of time, or both, would be a
default, breach, or violation of the Articles of Incorporation or
Bylaws of Seller corporation or any lease, license, promissory
note, conditional sales contract, commitment, indenture, mortgage,
deed of trust, or other agreement, instrument, or arrangement to
which it is bound, (c) an event that would permit any party to
terminate any agreement or to accelerate the maturity of any
indebtedness or other obligation of Seller corporation; or (d) the
creation or imposition of any lien, charge, or encumbrance on any
of the properties of Seller corporation.
3.18 Corporate Records. All corporate records are in the
possession of Seller corporation and are complete and accurate in
all material respects. The minute book of Seller corporation
contains complete, accurate and current copies of the Articles of
Incorporation, Bylaws and all amendments thereto, and all records
required to be set forth of all proceedings, consents actions and
meetings of the shareholders and board of directors of Seller
corporation.
3.19 Persons with Authority. Exhibit "J," to this Agreement
contains a complete and accurate list of (a) all bank accounts of
Seller corporation and all other accounts at any financial
institutions, including the names and addresses thereof and the
account numbers, and the signatory or signatories thereon; (b) the
names and addresses of all persons holding a power of attorney on
behalf of Seller corporation; all safe deposit boxes and the names
of all persons authorized to have access thereto; and (d) the names
and addresses of all persons and entities which have guaranteed any
debts or obligation of Seller corporation or with respect to whom
Seller corporation has guaranteed any debts or obligation.
3.20 Full Disclosure. None of the warranties made by Seller
corporation will contain any untrue statement of a material fact,
or omit to state any material fact necessary to make the statements
made true and accurate in all material respects.
4. Buyer hereby represents and warrants to Seller as follows:
4.1 Authority. Buyer has the right, power and authority to
enter into this Agreement and to perform all obligations required
to be performed by it hereunder.
4.2 Authorization. This Agreement and all other agreements
and documents executed and delivered by Buyer constitute valid and
legally binding obligations of Buyer enforceable in accordance with
their respective terms, subject to laws of general application
relating to bankruptcy, insolvency and the relief of debtors and
subject to availability of equitable remedies.
5. Resignation of Officers and Directors. Concurrently with
the execution of this Agreement, Seller corporation shall obtain
and deliver to Buyer resignations from all its directors and
officers, together with general releases by such persons of all
claims that they may have, or claim to have against IBC.
6. Employment. Concurrently with the execution of this
Agreement, Buyer will offer mutually acceptable employment
agreements to Mr. Dennis B. Ginther and Mr. Clifford J. Roebuck for
a period not less than two years.
7. Survival of All Warranties and Representations. All
representations, warranties, covenants and agreements of the
parties contained in this Agreement will survive the closing.
8. Indemnification by Dennis B. Ginther. Dennis B. Ginther,
individually, hereby agrees to indemnify, defend, protect and hold
Buyer, and/or its assigns, and IBC, harmless against and in respect
of all claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries and deficiencies, including
interest, penalties and reasonable attorneys' fees that IBC or
Buyer may incur or suffer, which arise, result from or relate to
any breach or failure by Dennis B. Ginther or Seller corporation to
perform any of the representations, warranties, covenants or
agreement in this Agreement. Dennis B. Ginther further agrees to
indemnify and hold Buyer and/or its assigns harmless from all
liabilities not disclosed to Buyer and accepted by Buyer, and
specifically, Buyer will not be responsible for any back taxes owed
by Dennis B. Ginther or Seller corporation to any taxing authority,
federal or state.
9. Attorneys' Fees and Costs. Each party shall be solely
responsible for the costs and fees of its own attorneys in
connection with the negotiation of this Agreement. If any suit,
legal proceeding, arbitration or other action is brought for the
enforcement of this Agreement, or because of an alleged dispute,
breach, default or misrepresentation in connection with any of the
provisions of this Agreement, the successful or prevailing party
shall be entitled to recover its reasonable attorneys' fees and
other costs incurred in such proceeding or action, in addition to
any other relief to which it may be entitled.
10. Governing Law. This Agreement will be construed in
accordance with, and governed by, the laws of the state of
California as applied to contracts that are executed and performed
entirely in California.
11. Disputes; Arbitration over Price. Any dispute arising
between the parties, their agents or employees, shall be submitted
to arbitration before JAMS/ENDISPUTE of Orange County, California.
12. Successors and Assigns. This Agreement shall be binding
upon and insure to the benefit of the parties hereto and there
respective successors and assigns.
13. Counterpart and Facsimile Transmission. This Agreement
may be executed in two or more counterparts, each of which shall be
deemed an original, and all of which when taken together shall
constitute one and the same document. The signature of any party
to any counterpart shall be deemed a signature to, and may be
appended to, any other counterpart. Any party may deliver its
signed counterpart of this Agreement to the other party by
facsimile transmission, and such delivery shall be deemed made and
completed upon receipt of such facsimile transmission by the other
party. Any party delivering a signed counterpart by facsimile
transmission agrees to promptly send the counterpart bearing its
original signature to the other party; provided that a delay or
failure to do so shall not negate the effectiveness of the delivery
made by the facsimile transmission.
14. Entire Agreement. This Agreement contains the entire
understanding between the parties hereto with respect to the
subject matter hereof and supersedes any and all prior or
contemporaneous written or oral negotiations or agreements between
them regarding the subject matter hereof. No addition,
modification or amendment of or to any term or provision of this
Agreement, or to this Agreement as a whole, shall be effective
unless set forth in writing and signed by all the parties hereto.
15. No Interpretation Against Draftsman. Both parties have
had an equal role in the preparation of this Agreement, such that
there shall be no interpretation or construction of terms against
the draftsman.
16. Attorneys. Sellers acknowledge that Buyer is represented
by counsel, David R. Flyer, of the Law Offices of DAVID R. FLYER,
A PROFESSIONAL LAW CORPORATION. Seller has not relied on any
statements or representations of Buyer's counsel. Sellers have had
an opportunity to retain their own attorneys.
17. Broker's Fees. Each side shall pay its own broker's and
accountant's fees, if any.
WHEREFORE, THE PARTIES AGREE:
SELLER:
INTERNATIONAL BUSINESS COMPANY
By: /s/ Dennis B. Ginther
Dennis B. Ginther, CEO
/s/ Dennis B. Ginther
Dennis B. Ginther
Shareholder
/s/ Clifford J. Roebuck
Clifford J. Roebuck
Shareholder
/s/ Jadwiga L. Ginther
Jadwiga L. Ginther
Shareholder
/s/ Bogumila E. Basu
Bogumila E. Basu
Shareholder
BUYER:
INTERNET BUSINESS'S INTERNATIONAL,INC.
/s/ Al Reda
Al Reda, CEO