Exhibit 10.19
ACQUISITION AGREEMENT
July 6, 2005
POCKETSPEC TECHNOLOGIES INC.
ACQUISITION OF
SPANISH TRAILS, LLC
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TABLE OF CONTENTS
Page
----
Recitals
................................................................
1
Agreement
..............................................................
1
1. Plan of Acquisition
....................................... 1
2. Exchange of Equity
......................................... 1
3. Delivery of Shares
........................................ 1
4. Representations of
Acquiree
............................... 1
5. Representations of
Acquiring Corporation
.................. 3
6. Closing and
Delivery Date
................................. 5
7. Conditions
Precedent to the Obligations of Acquiree ....... 5
8. Conditions
Precedent to the Obligations of Acquiror ....... 6
9. Indemnification
........................................... 6
10. Nature and Survival of Representations .................... 7
11. Documents at Closing
...................................... 7
12. Miscellaneous
............................................. 7
Signature Page
.........................................................
9
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ACQUISITION AGREEMENT
THIS ACQUISITION
AGREEMENT is entered into this 6th day of July, 2005, by
and between POCKETSPEC TECHNOLOGIES INC., a
Colorado corporation, (hereinafter
"Acquiror"); and SPANISH TRAILS, LLC, a New
Mexico limited liability company;
(hereinafter referred to as "Acquiree");
and the undersigned Members of
Acquiree, (hereinafter referred to as
"Members").
RECITALS
Members of
Acquiree own or control all of the issued and outstanding
memberships of Acquiree. Acquiror desires
to acquire all of the issued and
outstanding memberships of Acquiree, making
Acquiree a wholly-owned subsidiary
of Acquiror, and Members desire to make a
tax-free exchange solely of their
memberships in Acquiree for shares of
Acquiror's common stock to be exchanged as
set out herein with said Members.
NOW, THEREFORE,
for the mutual consideration set out herein, the parties
agree as follows:
AGREEMENT
1. Plan of Acquisition. Members
of Acquiree are the owners of all the
issued and outstanding memberships of said Acquiree. It is the
intention of the parties hereto that all of the issued and
outstanding
memberships of Acquiree shall be acquired by Acquiror in
exchange
solely for newly issued Acquiror voting stock. It is the intention
of
the parties hereto that this transaction qualify as a tax-free
reorganization under Section 368 of the Internal Revenue Code of
1986,
as amended, as an exchange of equity.
2. Exchange of Equity. Acquiror
and Members agree that all of the issued
and outstanding memberships of Acquiree shall be exchanged with
Acquiror for an aggregate total of 614,882,069 shares of
restricted
common stock of Acquiror. The Acquiror shares will, on the date
of
delivery to the Members, (which is hereafter defined as the
Delivery
Date), be delivered to the Members in exchange for their
memberships
in Acquiree. Members represent and warrant that they will hold
such
shares of common stock of Acquiror for investment purposes and not
for
further public distribution and agree that the shares shall be
appropriately restricted.
3. Delivery of Shares. On the
Delivery Date (which is defined as the date
in Paragraph 6 herein), Members will deliver certificates for
the
memberships of Acquiree duly endorsed so as to make Acquiror the
sole
holder thereof free and clear of all claims and encumbrances. On
the
Delivery Date, delivery of the Acquiror shares, which will be
appropriately restricted as to transfer, will be made to the
Members
as set forth herein. A list of the memberships of Acquiree and
shares
of Acquiror to be received by said Members is attached hereto
as
Exhibit "A" and by this reference is incorporated herein.
4. Representations of Acquiree.
The Acquiree, hereby represents and
warrants that, with respect to the Acquiree, effective this date,
the
Closing Date (which is defined as the date in Paragraph 6 herein),
and
the Delivery Date, the representations listed below are true
and
correct to the best of their knowledge, information, and belief.
Said
representations are meant and intended by all parties to apply to
the
Acquiree:
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(a) The listed Members
on Exhibit "A" are the sole owners of all of
the issued and outstanding memberships of Acquiree; such
memberships are free from claims, liens, or other encumbrances
except as disclosed in any Exhibit hereto; and Members have the
unqualified right to transfer and dispose of such memberships.
(b) The issued
memberships of Acquiree constitute validly issued
memberships of Acquiree, fully-paid and nonassessable.
(c) Reserved.
(d) Prior to and as of
the Closing Date and the Delivery Date, there
will not be any negative material changes in the financial
position of Acquiree, except changes arising in the ordinary
course of business, which changes will in no event adversely
affect the financial position of said Acquiree.
(e) To the best of
Acquiree's knowledge, information and belief, it
is not involved in, and has not received judicial notice of any
pending litigation or governmental investigation or proceeding
not reflected in such financial statement, or otherwise
disclosed
in writing to Acquiror and, to the best knowledge of Acquiree,
no
material litigation, claims, or assessments, or governmental
investigation or proceeding is threatened against Acquiree, its
principal Members or properties.
(f) As of the Closing
Date and the Delivery Date, Acquiree will be in
good standing in its jurisdiction of incorporation, and will be
in good standing and in the process of becoming duly qualified
to
do business in each jurisdiction where required to be so
qualified.
(g) Acquiree has
complied with all applicable laws in connection with
its formation, issuance of securities, organization,
capitalization and operations, and to the best of Acquiree's
knowledge, information and belief, no contingent liabilities
have
been threatened or claims made, and no basis for the same
exists
with respect to said operations, formation or capitalization,
including claims for violation of any state or federal
securities
laws.
(h) Acquiree has filed
all governmental, tax or related returns and
reports due or required to be filed and has paid all taxes or
assessments which have or which shall become due as of the
Closing Date and the Delivery Date.
(i) Except as
disclosed in this Agreement or on any Exhibit, Acquiree
has not breached any material agreement to which it
individually
or collectively may be a party.
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(j) Acquiree has no
subsidiary corporations.
(k) The corporate
financial records, minute books, and other
documents and records of Acquiree are to be available to
present
management of Acquiror prior to the Closing Date and turned
over
to new management of Acquiror in their entirety on the Delivery
Date.
(l) The execution of
this Agreement will not violate or breach any
agreement, contract, or commitment to which Acquiree or Members
are a party, except as has been disclosed to Acquiror, and has
been duly authorized by all appropriate and necessary action.
(m) The authorized and
issued capitalization of Acquiree is 100
Units. Acquiree has only one class of memberhip. As of the
Closing Date, all outstanding memberships will have been duly
authorized, validly issued and will be fully paid and
nonassessable with no personal liability attaching to the
ownership thereof. There will be no outstanding convertible
securities, warrants, options or commitments of any nature
which
may cause authorized but unissued securities to be issued to
any
person.
(n) To the best
knowledge of Members and Acquiree, Acquiree is not
subject to any material labor disputes or disagreements, either
actual or contingent. Further, as of the Closing Date, there
will
not be any employee or consultant contracts issued and
outstanding which have not been disclosed in Exhibit D hereto.
(o) To the best
knowledge of Members and Acquiree, Acquiree's
products, materials and brochures do not infringe the patent or
copyright rights of any other person or entity.
(p) At the date of
this Agreement, Members have, and at the Closing
Date and the Delivery Date, they will have to the best of their
knowledge, disclosed all events, conditions and facts
materially
affecting the business and prospects of Acquiree and its
assets.
Members have not now and will not have, at the Closing Date or
the Delivery Date, withheld knowledge of any such events,
conditions, and facts which they know, or have reasonable
grounds
to know, may materially affect the business and prospects of
Acquiree or its assets.
5. Representations of Acquiring
Corporation. Acquiror hereby represents and
warrants as
follows, effective this date, the Closing Date, and the
Delivery Date,
the representations listed below are true and correct to the
best of its
knowledge, information, and belief:
(a) As of the Delivery Date, the
Acquiror shares to be delivered to the
Members will constitute valid and legally issued shares of
Acquiror,
fully-paid and nonassessable, and will be legally equivalent in
all
respects to the common stock of Acquiror issued and outstanding as
of
the date thereof.
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(b) The officers of Acquiror are duly
authorized to execute this Agreement
and have taken all actions required by law and agreements,
charters,
and bylaws, to properly and legally execute this Agreement.
(c) Acquiror has made available to
Acquiree combined audited financial
statements for the past two fiscal years, which shall be true,
complete and accurate; there are and shall be no substantial
liabilities, either fixed or contingent, not reflected in such
financial statements and records or t
