EXHIBIT 2.1
STOCK PURCHASE AGREEMENT
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STOCK PURCHASE AGREEMENT
This Agreement, dated this 11th day of December, 2000, by and between
Fred Keller, 6758 North Military Trail, Suite 303, West Palm Beach, Florida
33407 ("Keller"), majority shareholder of Fairfax Group, Inc., a Florida
corporation ("Company"); Fred Keller, Trustee, 6758 North Military Trail, Suite
303, West Palm Beach, Florida 33407 ("Keller Trust"); Charles Adams, 219
Almeria, West Palm Beach, Florida 33405 (the "Buyer"); is made for the purpose
of setting forth the terms and conditions upon which Keller will sell to the
Buyer, a total of 4,200,000 shares of the Company's common stock, $0.01 par
value.
In consideration of the mutual promises, covenants and representations
contained herein, the parties agree as follows:
ARTICLE 1
SALE OF SECURITIES AND ASSUMPTION AND DISCHARGE OF DEBT
Subject to the terms and conditions of this Agreement and the Escrow
Agreement, of even date hereof, attached hereto as Exhibit "A" and made a part
hereof, Keller agrees to sell and the Buyer agrees to purchase 4,200,000 shares
of the Company's common stock in exchange for the consideration described in
Schedule "1", attached hereto and made a part hereof. Additionally, pursuant to
the certain Substitution of Debtor Agreement, of even date hereof, attached
hereto as Exhibit "B", and made a part of this Agreement and the Escrow
Agreement, Buyer promises to assume and discharge all of the debts of the
Company owed to Keller Trust.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
As of the closing date as defined in Article 4 below, to Keller's best
knowledge and belief, Keller represents and warrants the following to the Buyer:
1. Organization. Fairfax Group, Inc. is a corporation duly organized,
validly existing, in good standing under the laws of the State of
Florida, has all the necessary corporate powers to own real
andpersonal property, and to carry on a business.
2. Capital. The authorized capital stock of the Company consists of
50,000,000 shares of common stock, $0.01par value, of which 6,150,000
shares are issued and outstanding. All outstanding shares are fully
paid and non assessable, free of liens, encumbrances, options,
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restrictions and legal or equitable rights of others not a party to
this Agreement. There are no outstanding subscriptions, options,
rights, warrants, convertible securities or other agreements or
commitments obligating the Company to issue or to transfer from
treasury any additional shares of its common stock.
3. Title. Keller has good and marketable title to all of the securities
to be sold to the Buyer pursuant to this Agreement. The securities to
be sold to the Buyer will be, at closing, free and clear of all liens,
security interest, pledges, charges, claims, encumbrances and
restrictions of any kind, other than affiliate "control share"
restrictions and other applicable state and federal securities law
restrictions.
None of such shares are or will be subject to any voting trust
or agreement. No person holds or has the right to receive any proxy or
similar instrument with respect to such shares. Except as provided in
this Agreement, Keller is not party to any agreement which offers or
grants to any person the right to purchase or acquire any of the
securities to be sold to the Buyer. So long as the Company's board of
directors approves this Agreement pursuant to applicable Florida
statutes, there is no applicable local, state or federal law, rule,
regulation, or decree which would, as a result of the purchase of the
shares by the Buyer, impair, restrict or delay the Buyer's voting
rights with respect to the shares.
4. Financial statements. Audited financial statements have been
submitted to the Buyer. These statements were prepared according to
generally accepted accounting principals. They fairly represent the
financial position of the Company as of the respective dates and the
results of its operations for the periods indicated.
5. Securities and Exchange Commission Reports. Except where failure to
do so did not and would not have a material adverse effect on the
Company, the Company has filed all reports, registrations and
statements, together with any required amendments thereto, that it was
required to file with the U.S. Securities and Exchange Commission (the
"SEC"). Buyer has been furnished copies of all such reports filed with
the Securities and Exchange Commission (the "SEC") since February 23,
1999.
6. Contracts and Leases. Other than in connection with its activities
as a "blank check" company, the Company has not carried on any business
within the past five years from the date of this Agreement. Other than
as disclosed in the Company's reports, registrations and statements,
together with any required amendments thereto, that it was required to
file with the U.S. Securities and Exchange Commission, the Company is
not a party to any contract, agreement or lease. No person holds a
power of attorney from the Company.
7. Public Company Status. The Company is a reporting public company by
virtue of the fact that on February 23, 1999, the Company elected to
register the Company's common stock, $0.01 par value, pursuant to an
SEC Form 10-SB registration statement on a voluntary basis in order to
create a reporting "shell" company. The Company has a shareholder base
of approximately 500 shareholders and 6,150,000 shares of Common Stock
outstanding, 5,800,000 of which are "control" securities and therefore
deemed to be restricted as "control shares". The Company's shares of
common stock are not traded on any type of securities
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exchange, and there is no market for the shares of common stock.
8. Litigation. The Company is not and has not been a party to any suit,
action, arbitration, legal, administrative or other proceeding, or
pending governmental investigation. There is no basis for any such
action or proceeding and no such action or proceeding is threatened
against the Company. The Company is not subject to or in default of any
order, writ, injunction, or decree of any federal, state, local, or
foreign court, department, agency or instrumentality.
9. Documents. As soon as practical after the execution of this
Agreement, Keller or his representatives will provide to the Buyer or
its representatives all of the following documents currently in the
possession of the Company:
A. Articles of Incorporation, with amendments, if any, thereto.
B. Bylaws.
C. Minutes of shareholders meetings.
D. Minutes of Board of Directors meetings.
E. List of officers and directors.
F. Shareholder list.
G. Original audited financial statements
As of the closing date as defined in Article 4 below, Buyer represents
and warrants the following to Keller:
1. Shares not Registered. Buyer acknowledges that the shares offered
hereby have not been registered under the Act, nor pursuant to the
provisions of the securities act of any state. The shares offered
herein will be sold without benefit of registration under the federal
and state securities acts by reason of specific exemptions from
registration provided by such acts.
2. Restrictions on Transfer. Buyer acknowledges that there are
substantial restrictions on the transferability of Keller's shares of
common stock, as such securities are "restricted", and they constitute
"affiliate control shares". These securities may not be sold unless
such sale is exempt from registration under the Securities Act and
applicable state securities laws. Buyer shall be responsible for
compliance with all conditions on transfer imposed by any securities
administrator of any state and for any expenses incurred by the Company
for legal or accounting services in connection with reviewing such a
proposed transfer and/or issuing opinions in connection therewith.
3. Legends. The certificates representing Keller's shares of common
stock bear the following legend:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED UNLESS COMPLIANCE WITH THE REGISTRATION
PROVISIONS OF SAID ACT HAS BEEN MADE, OR UNLESS THE AVAILABILITY OF AN
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EXEMPTION FROM THE REGISTRATION PROVISIONS HAS BEEN ESTABLISHED, OR
UNLESS SOLD PURSUANT TO RULE 144 UNDER THE ACT.
4. Access to Information. The Buyer acknowledges that it has been
furnished with all materials relating to the Company and its business
activities that have been requested. The Buyer has been afforded full
opportunity to ask questions of and receive answers from Keller and the
Company's management concerning the Company and the Buyer's purchase of
the shares, and all such questions have been answered to the full
satisfaction of the Buyer. The Buyer has been afforded the full
opportunity to obtain any additional information necessary to verify
the accuracy of any representations of information provided to the
Buyer.
5. If the Buyer is other than an individual, the person signing on
behalf of the Buyer has full authority to sign on behalf of the Buyer
and bind the Buyer to the terms of this Agreement.
6. If the Buyer is an entity other than a natural person, it represents
that: (i) it is duly organized, validly existing and in good standing
under the laws of the state of organization and has all the requisite
power and authority to purchase the common stock as provided herein;
(ii) such purchase does not result in any violations of, or conflict
with, any term of the incorporation agreement or other documents
governing the entity; and (iii) this Agreement has been duly executed
and delivered on behalf of the Buyer and constitutes a legal, valid and
binding agreement of the Buyer.
ARTICLE 3
COVENANTS OF THE PARTIES
1. Conduct of Each of the Parties Prior to the Closing. Pending
consummation of this Agreement, each of the parties to this Agreement
agrees, without prior written consent of the other parties to this
Agreement, given in a letter which specifically refers to this Article
of the Agreement:
A. not to (i) perform any act or omit to take any act that would
make any of the representations made above, inaccurate in any material
respect or materially misleading as of the closing date, or (ii) make
any payment or distribution except for the payment of liabilities
incurred in the ordinary course of business.
B. to conduct its business in the ordinary and regular course, and
keep its books of account, records and files in substantially the same
manner as at present.
2. Notice. Pending the closing of the transactions contemplated in this
Agreement or prior to termination of this Agreement, each party agrees
that it will promptly advise the others of the occurrence of any
condition or event which would make any of its representations
contained in this Agreement inaccurate, incorrect, or materially
misleading.
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3. Access. Prior to the Closing, each party shall afford to the other
parties to this Agreement (and their respective officers, attorneys,
accountants and other authorized representatives), upon reasonable
notice, free and full access during usual business hours to its
relevant offices, personnel, books and records and other data,
financial or otherwise, so that each such party may have full
opportunity to make such investigation as it shall desire of the assets
and the business and operations of the other parties, provided that
such investigation shall not unreasonably interfere with such parties
operations. The scope of the investigation will include, but not be
limited to, verification of the accounts, books and records of each
party. Duly authorized representatives shall also be entitled to
discuss with officers of each party, its counsel, employees and
independent public accountants, all of its books, records and other
corporate documents, contracts, pricing and service policies,
commitments and future prospects. Representatives of each party will
furnish to the other parties to this Agreement and such other persons,
copies of all materials relating to the business affairs, operations,
assets and liabilities of each party which may be reasonably requested
from time to time and will cause representatives and employees of each
party to assist in such investigation. All information obtained in
connection with the transactions contemplated by this Agreement or in
the course of their investigations, whether obtained before or after
the date of this Agreement shall be used only in connection with this
Agreement and the subsequent operation of the combined entity and the
other parties to this Agreement shall assure that all such information
will be otherwise kept strictly confidential by each of them and their
respective representatives.
4. Additional Documents. At the request of any party, each party will
execute and deliver any additional documents and perform in good faith
such acts as reasonably may be required in order to consummate the
transactions contemplated by this Agreement and to perfect the
conveyance and transfer of any property or rights to be conveyed or
transferred or perfect the assumption of any liabilities assumed under
the terms of this Agreement.
5. Filing of Returns; Additional Information. Each party will file on a
timely basis all tax returns, notices of sale and other documentation
required by law in connection with the transactions provided for in
this Agreement or otherwise required by law, regulation or pursuant to
the terms of any agreement to which it is a party. Each party will
supplement any previous filing made by it in accordance with legitimate
requests made by applicable agencies or parties to the extent required
by the relevant law, regulation or agreement.
6. Compliance with Conditions to Closing. Subsequent to the execution
and delivery of this Agreement and prior to the closing, each of the
parties to this Agreement will execute such documents and take such
other actions as reasonably may be appropriate to fulfill the
conditions to the closing provided for in Article 4 of this Agreement.
7. Further Assurances. Consistent with the terms and conditions hereof,
each party hereto will execute and deliver such instruments and take
such other action as the other parties hereto may reasonably require in
order to carry out this Agreement and the transactions contemplated
hereby and thereby.
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ARTICLE 4
CLOSING
1. Time and Place; Effective Date. The closing of the transactions
provided for in this Agreement shall take place as soon as practicable
after (i) the date all notices have been sent by the Company as
required by applicable law in order to effectuate the change in control
contemplated by this Agreement and (ii) the date all notices have been
sent by the Buyer or its agents and representatives as required by
applicable law; all as described in Article 5 of this Agreement, but no
later than December 21, 2000, or such other date as the parties may
agree upon.
2. Delivery of Documents. As part of the closing, the following
documents in addition to those described in Article 2, Paragraph 9
above shall be delivered:
By Keller:
A. Original certificates in the name of Keller.
B. Stock powers, properly signed, in good transferable form.
C. A resolution of the Board of Directors, dated the closing
date, appointing the nominees of the Buyer as directors of the
Company.
D. The resignation of all officers and directors, time dated
subsequent to the resolution described in item 3 above.
E. All of the remaining business and corporate records of the
Company not already provided.
F. Such other minutes of a special meeting of the Company's
directors as may reasonably be required by the Buyer.
G. A duly executed copy of the Substitution of Debtor Agreement.
By Keller Trust:
A. A duly executed copy of the Substitution of Debtor Agreement.
By the Buyer:
A. On the date described in the Escrow Agreement, a cashiers or
certified check(s) or Federal Reserve wire transfer instructions and
receipt therefore from the bank effecting the wire transfer in U.S.
dollars drawn on or wired from a United States Bank located within the
contiguous 48 states in the amount of $2,000.00. Said check or wire
transfer will be made payable to David M. Bovi, P.A. Attorney Trust
Account.
B. On the date described in the Escrow Agreement, a cashiers or
certified check(s) or Federal Reserve wire transfer instructions and
receipt therefore from the bank effecting the wire transfer in U.S.
dollars drawn on or wired from a United States Bank located within the
contiguous 48 states in the amount of $323,000.00. Said check or wire
transfer will be made payable to David M. Bovi, P.A. Attorney Trust
Account.
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C. A duly executed copy of the Substitution of Debtor Agreement.
ARTICLE 5
FILINGS
Keller shall cause the Company to comply with its obligations pursuant
to Florida law and the Securities Exchange Act of 1934, including compliance
with Exchange Act Rule 14f-1 regarding a change in the majority of the Company's
directors whereby an Information Statement is required to be delivered to the
SEC and all shareholders not less than 10 days prior to the date of such change
in control of the Company's board of directors.
ARTICLE 6
NOTICES
Any notice, request, demand, or communication required or permitted to
be given by any provision of this Agreement shall be deemed to have been
delivered, given, and received for all purposes if written and (i) if delivered
personally, by facsimile, or by courier or delivery service, at the time of such
delivery; or (ii) if directed by registered or certified United States mail,
postage and charges prepaid, addressed to the intended recipient, at the address
specified below, two business days after such delivery to the United States
Postal Service.
If to Keller or Keller Trust:
6758 North Military Trail,
Suite 303
West Palm Beach, Florida 33407
With a copy to:
David M. Bovi, Esq.
David M. Bovi, P.A.
319 Clematis Street, Suite 812
West Palm Beach, Florida 33401
If to Buyer:
Charles Adams
222 Lakeview Avenue, Suite 409
West Palm Beach, Florida 33401
With a copy to:
Donald F. Minmire, Esq.
265 Sunrise Avenue, Suite 204
Palm Beach, Florida 33480
Any party may change the address to which notices are to be mailed by
giving notice as provided herein to all other parties.
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ARTICLE 7
MISCELLANEOUS
1. Entire Agreement. This Agreement, including the Exhibits and
Schedules, contain all of the terms and conditions agreed upon by the
parties with reference to the subject matter and supersede any and all
previous agreements, representations, and communications between the
parties, whether written or oral. This Agreement, including its
Exhibits and Schedules, may not be modified or changed except by
written instrument signed by all of the parties, or their respective
successors or assigns.
2. Assignment. This Agreement shall not be assigned or assignable by
any of the parties without the express written consent of the other
parties. This Agreement shall inure to the benefit of and be binding
on the parties and their respective successors and assigns.
3. Captions. All headings are inserted for the convenience of the
parties and shall not be used in any way to modify, limit, construe,
or otherwise affect this Agreement.
4. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original and
which together shall constitute one and the same instrument.
5. Waiver. Each of the parties may, by written notice to the other,
(i) extend the time for the performance of any of the obligations or
other actions of the other party; (ii) waive any inaccuracies in the
representations or warranties of the other party contained in this
Agreement or in any document delivered pursuant to this Agreement;
(iii) waive compliance with any of the covenants of the other party
contained in this Agreement; or (iv) waive, in whole or in part,
performance of any of the obligations of the other party. No action
taken pursuant to this Agreement, including, but not limited to, the
consummation of the closing or any knowledge of or investigation by or
on behalf of any party, shall be deemed to constitute a waiver by the
party taking such action, possessing such knowledge, or performing
such investigation of compliance with the representations, warranties,
covenants, and agreements contained herein. The waiver by any party of
a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent or similar breach.
6. Controlling Law. This Agreement has been entered into in the state
of Florida and shall be governed by, construed, and enforced in
accordance with the laws of Florida.
7. Gender. Whenever in this Agreement the context so requires,
references to the masculine shall be deemed to include the feminine
and the neuter, references to the neuter shall be deemed to include
the masculine and the feminine, and references to the plural shall be
deemed to include the singular and the singular to include the plural.
8. Further Assurances. Each of the parties shall use all reasonable
efforts to bring about the transactions contemplated by this Agreement
as soon as practicable, including the execution and delivery of all
instruments, assignments, and assurances, and shall take or cause to
be
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taken such reasonable further or other actions necessary or desirable
to carry out the intent and purposes of this Agreement.
9. Attorneys' Fees. In the event a lawsuit is brought to enforce or
interpret any part of this Agreement or the rights or obligations of
any party to this Agreement, the prevailing party shall be entitled to
recover such party's costs of suit and reasonable attorneys' fees,
through all appeals.
10. References to Agreement. The words "hereof," "herein,"
"hereunder," and other similar compounds of the word "here" shall mean
and refer to the entire Agreement and not to any particular section,
article, provision, annex, exhibit, schedule, or paragraph unless so
required by the context.
11. Schedules and Exhibits. Schedules and Exhibits to this Agreement
(and any references to any part or parts of them) shall, in each
instance, include the Schedules or Exhibits (as the case may be)
attached to this Agreement as well as any amendments to such Schedules
or Exhibits (in each such case). All such Schedules and Exhibits shall
be deemed an integral part of this Agreement, and are incorporated
into this Agreement by reference.
12. Venue. Any litigation arising under this Agreement shall be
instituted only in Palm Beach County, Florida, the place where this
Agreement was executed. All parties agree that venue shall be proper
in that county for all such legal or equitable proceedings.
13. Severability. Each section, subsection, and lesser section of this
Agreement constitutes a separate and distinct undertaking, covenant,
and/or provision. If any provision of this Agreement shall be
determined to be unlawful, such provision shall be deemed severed from
this Agreement, but every other provision of this Agreement shall
remain in full force and effect. The Parties hereto agree to provide
an agreed upon provision which shall have the same force and effect in
the event any provision herein is severed pursuant to the terms
hereof.
14. Rights in Third Parties. Except as otherwise specifically
provided, nothing expressed or implied in this Agreement is intended,
or shall be construed, to confer on or give any person, firm, or
corporation, other than the parties and their respective shareholders,
any rights or remedies under or by reason of this Agreement.
15. Expenses. Each party shall pay its own expenses in connection with
the negotiation and consummation of the transactions contemplated by
this Agreement, except as otherwise provided herein.
16. No Oral Change. This Agreement and any provision hereof, may not
be waived, changed, modified, or discharged orally but only by an
agreement of the parties in writing.
17. Time of Essence. Time is of the essence of this Agreement and of
each and every provision hereof.
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18. Binding Effect. This Agreement shall inure to and be binding upon
the heirs, executors, personal representatives, successors and assigns
of each of the parties to this Agreement.
19. Effect of Closing. All representations, warranties, covenants, and
agreements of the parties contained in this Agreement, or in any
instrument, certificate, opinion, or other writing provided for in it,
shall be true and correct as of the date of the closing and shall
survive the closing of this Agreement.
20. Mutual Cooperation. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement, and shall execute such
other and further documents and take such other and further actions as
may be necessary or convenient to effect the transaction described
herein.
21. Ambiguities. Ambiguous terms shall not be interpreted against the
drafting party.
ARTICLE 8
TERMINATION
This Agreement may be terminated at any time prior to the closing date
solely by the mutual written consent of all parties hereto.
[remainder of page intentionally left blank - see signature page attached]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
ATTEST:
By: /s/ Fred Keller
-----------------------------
Fred Keller
BUYER:
By: /s/ Charles Adams
---------------------------
Charles Adams
and, for limited purposes as applicable herein:
By: /s/ Fred Keller
-----------------------------
Fred Keller, Trustee
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Schedule 1
to
Stock Purchase Agreement
Dated December 11, 2000
Keller, as defined in the Agreement, agrees to transfer to each Adams,
as defined in the Agreement, share certificates representing an aggregate of
4,200,000 shares of the Company's common stock, as defined in the Agreement, in
exchange for the consideration set forth next to his name below:
Name No. of Shares Consideration
---------- ------------- -------------
Charles Adams 4,200,000 $2,000
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Escrow Agreement
Exhibit "A"
to
Stock Purchase Agreement
Dated December 11, 2000
ESCROW AGREEMENT
THIS ESCROW AGREEMENT, dated this 11th day of December, by and between
Fred Keller, 6758 North Military Trail, Suite 303, West Palm Beach, Florida
33407 ("Keller"), majority shareholder of Fairfax Group, Inc., a Florida
corporation ("Company"); Fred Keller, Trustee, 6758 North Military Trail, Suite
303, West Palm Beach, Florida 33407 ("Keller Trust"); Charles Adams, 222
Lakeview Avenue, Suite 409, West Palm Beach, Florida 33401 (the "Buyer"); and
David M. Bovi, P.A., (the "Escrow Agent").
WITNESSETH:
WHEREAS, subject to the terms and conditions of the Stock Purchase
Agreement and Substitution of Debtor Agreement, both of even date hereof, Keller
agrees to sell and the Buyer agrees to (i) purchase 4,200,000 shares of the
Company's common stock ("Common Stock") in exchange for consideration equal to
$2,000 (the "Purchase Price") described in Schedule "1" of the Stock Purchase
Agreement; and (ii) assume and discharge all of the debts of the Company equal
to $323,000 (the "Debt Amount") which is owed to Keller Trust.
WHEREAS, the Escrow Agent shall hold in escrow the stock certificates
representing the Common Stock, their properly executed stock power, the Purchase
Price and the Debt Amount pending closing of the transactions contemplated by
the Stock Purchase Agreement and the Substitution of Debtor Agreement (both
collectively referred to as the "Agreements") .
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Recitals. The recitals above are hereby incorporated by
reference and made a part hereof.
2. Appointment as Escrow Agent. David M. Bovi, P.A. is hereby
appointed and it hereby agrees to serve as the Escrow Agent on the
terms and conditions hereinafter set forth.
3. Duties of Escrow Agent. The Escrow Agent shall perform the
following duties on the dates described below, as defined in the Stock
Purchase Agreement:
A. On the date of execution of this Escrow Agreement, the Escrow Agent
shall accept into its Attorney Trust Account from the Buyer $100,000 towards the
Purchase Price and the Debt Amount, which will deemed to be non- refundable in
the event the Buyer refuses to close on the Closing date in violation of the
Stock Purchase Agreement and Substitution of Debtor Agreement.
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Additionally, prior to the close of business on the seventh (7th) day following
the date of execution of this Escrow Agreement, the Escrow Agent shall accept
into its Attorney Trust Account from the Buyer the remaining $225,000 towards
the Purchase Price and the Debt Amount. Upon the Escrow Agent's receipt of the
aforementioned, the Escrow Agent shall acknowledge in writing the receipt
thereof and shall hold such in accordance with the terms of this Escrow
Agreement.
B. On the Closing date, the Escrow Agent shall accept from Keller the
stock certificates representing the Common Stock along with their properly
executed stock power.
C. On the Closing date, upon Keller's and the Buyer's written
satisfaction of all conditions of Closing, or upon the written waiver thereof,
the Escrow Agent shall:
(a) deliver to Buyer and Buyer shall accept the stock
certificates representing the Common Stock along with their properly executed
stock power; and
(b) upon receipt by the Escrow Agent of Keller's and/or
Keller Trust's written instruction, deliver to Keller and/or Keller Trust, or
their assigns, the Purchase Price and Debt Amount, less $12,500 which shall be
delivered to David M. Bovi, P.A. for fees.
D. Upon the performance of the duties described above, the Escrow
Agent shall, without further action by any party, be released from all duties
hereunder. The Escrow Agent shall have no responsibility under this Agreement
except for the performance of its express duties hereunder.
4. Reliance by Escrow Agent. The Escrow Agent shall not be responsible for
the genuineness of any certificate or signature, and may rely exclusively upon
and shall not incur any liability by acting in reliance upon any notice,
affidavit, request, consent, or other instrument believed by the Escrow Agent,
in good faith, to be genuine and otherwise duly authorized and properly made.
5. Return of Escrowed Items. In the event the Escrow Agent cannot carry out
its duties as contemplated in Paragraph 3 above, the Escrow Agent shall promptly
return: (i) to the Buyer, the Purchase Price and the Debt Amount; and (ii) to
Keller, the stock certificates representing the Common Stock, along with their
properly executed stock power.
6. Expenses. The expenses and charges of the Escrow Agent in performance
of its duties hereunder shall be borne by Keller.
7. No Additional Duties of the Escrow Agent.
(a) The Escrow Agent undertakes to perform such duties and only such
duties as are specifically set forth in this Escrow Agreement, and no implied
covenants or obligations shall be deemed a part of this Escrow Agreement. The
duties of the Escrow Agent hereunder shall be entirely administrative and not
discretionary. The Escrow Agent shall be obligated to act only in accordance
with written instructions received by it as provided in this Escrow Agreement
and it is hereby authorized to comply with any orders, judgments or decrees of
any court having jurisdiction over it, and shall not have any liability as a
result of its compliance with the same.
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(b) In performing any of its duties hereunder, the Escrow Agent shall
not incur any liability to anyone for any damages, losses or expenses, except
for willful default or negligence, and it shall, accordingly, not incur any such
liability with respect to any action taken or omitted in good faith upon advice
of its counsel or counsel for the Buyer given with respect to any questions
relating to the duties and responsibilities of the Escrow Agent under this
Agreement.
(c) If at any time a dispute shall exist as to the duties of the
Escrow Agent and the terms hereof, the Escrow Agent may deposit the Purchase
Price and the Debt Amount with the Clerk of the Palm Beach County Court, State
of Florida, and may interplead the parties hereto. Upon so depositing such the
Purchase Price and the Debt Amount and filing its complaint in interpleader, the
Escrow Agent shall be completely discharged and released from all further
liability or responsibility under the terms hereof. The parties hereto, for
themselves, their heirs, successors and assigns, do hereby submit themselves to
the jurisdiction of said Court and do hereby appoint the Clerk of said Court as
their agent for service of all process in connection with the proceedings
mentioned in this paragraph.
(d) The parties hereto hereby agree to indemnify and hold harmless the
Escrow Agent against any and all losses, claims, damages, liabilities and
expenses, including reasonable costs of investigation and counsel fees and
disbursements, which may be imposed upon the Escrow Agent or incurred by the
Escrow Agent in connection with its acceptance of appointment as Escrow Agent
hereunder or the proper performance of its duties hereunder, including any
litigation arising from this Agreement or involving the subject matter hereof.
(e) The Escrow Agent may rely absolutely upon the genuineness and
authorization of any signature or purported signature appearing to be that of
the parties hereto, as the case may be, and upon any instruction, notice,
releases, receipt or other document delivered to it pursuant to this Escrow
Agreement.
(f) The Escrow Agent may, as a condition to the return of the Purchase
Price and the Debt Amount, require from the parties an acknowledgment of such
return, and, upon such return, a release of the Escrow Agent from any liability
arising out of the execution or performance of this Escrow Agreement.
8. Entire Agreement. No supplement, modification or amendment of this
Escrow Agreement shall be binding unless executed in writing by each of the
parties hereto. No waiver of any of the provisions of this Escrow Agreement
shall be deemed to constitute a waiver of any other provision hereof, whether or
not similar, nor shall any such waiver constitute a waiver of any other or
subsequent breach. No waiver shall be binding unless executed in writing by the
party sought to be charged thereby. Any waiver shall be validly and sufficiently
authorized for the purposes of this Escrow Agreement if, as to any party hereto,
it is executed by the individual who executed this Escrow Agreement on behalf of
such party.
9. Counterparts. This Escrow Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, and
this Escrow Agreement shall become a binding agreement when one or more
counterparts hereof shall have been signed by each of the parties and delivered
to each of the other parties hereto.
<PAGE>
10. Governing Law. This Escrow Agreement shall be governed by and
construed in accordance with the laws of the State of Florida, venue Palm Beach
County, without regard to its rules on conflicts of laws.
11. Notices. All notices, instructions, releases, payments, deliveries and
other communications required or permitted hereunder shall be in writing and
shall be given by confirmed facsimile or registered mail addressed, if to the
Buyer, to: Charles Adams, 222 Lakeview Avenue, Suite 409, West Palm Beach,
Florida 33401, with a copy to: Donald F. Mintmire, Esq., 265 Sunrise Avenue,
Suite 204, Palm Beach, Florida 33480; and if to Keller or Keller Trust, to: Fred
Keller, 6758 North Military Trail, Suite 303, West Palm Beach, Florida 33407,
with a copy to: David M. Bovi, Esq. 319 Clematis Street, Suite 812, West Palm
Beach, Florida 33401 and, if to the Escrow Agent, to: David M. Bovi, Esq., 319
Clematis Street, Suite 812, West Palm Beach, Florida 33401.
[remainder of page intentionally left blank - see signature page attached]
IN WITNESS WHEREOF, the undersigned have executed this Escrow Agreement
as of the day and year first above written.
ATTEST: BUYER:
By: /s/ Charles Adams
----------------------
Charles Adams
By: /s/ Fred Keller
----------------------
Fred Keller
By: /s/ Fred Keller
----------------------
Fred Keller, Trustee
DAVID M. BOVI, P.A.
By: /s/ David M. Bovi
----------------------
David M. Bovi, President
<PAGE>
Substitution of Debtor Agreement
Exhibit "B"
to
Stock Purchase Agreement
Dated December 11, 2000
SUBSTITUTION OF DEBTOR AGREEMENT
This Agreement, dated this 11th day of December, 2000, by and between
Fairfax Group, Inc., a Florida corporation ("Company"); Fred Keller, Trustee
("Keller Trust"); and Charles Adams ( the "Buyer"), is made for the purpose of
setting forth the terms and conditions upon which Buyer promises to assume and
discharge all of the debts of the Company owed to Keller Trust.
In consideration of the mutual promises, covenants and representations
contained herein, the parties agree as follows:
4. Subject to the terms and conditions of the Stock Purchase Agreement,
of even date hereof (the "Stock Purchase Agreement"), Buyer promises
to assume and discharge all of the debts of the Company owed to Keller
Trust.
5. The Company is indebted to Keller Trust as a result of various
promissory notes made by the Company to Keller Trust, all totaling
with applicable interest thereon the sum of $323,000.
6. Pursuant to the Stock Purchase Agreement, Keller, as defined therein,
agrees to sell and the Buyer, as defined therein, agrees to purchase
4,200,000 shares of the Company's common stock on the promise of Buyer
to assume and discharge all of the debts of the Company owed to Keller
Trust, pursuant to this Substitution of Debtor Agreement.
7. The Company desires to be released and discharged from all liability
it owes to Keller Trust, and Keller Trust is willing to release and
discharge the Company from all liability.
8. Pursuant to the terms and procedures described in the Escrow Agreement
attached as Exhibit "A" to the Stock Purchase Agreement, Buyer agrees
to pay to Keller Trust at the time of the Closing, as defined in the
Stock Purchase Agreement, the sum of $323,000 now due from the Company
to Keller Trust, and in consideration of this payment being duly made,
Keller Trust releases and discharges the Company from all liability
for the debt.
<PAGE>
9. Upon Buyer's payment of the abovementioned $323,000 to Keller Trust,
the Company shall no longer be indebted to Keller Trust in any amount.
10. Further, at the time of the Closing, Keller Trust agrees to cancel any
and all written lease agreements between the Company and Keller Trust,
and the Company represents and warrants that it is not a party to any
other lease agreement with any other person. Further, the Company
represents and warrants that if any written compensation or payment
obligation agreement between the Company and any officer, director,
affiliate, consultant or any other third party is in force on the date
hereof, that such written compensation or payment obligation agreement
shall be canceled as of the time of Closing.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
ATTEST: BUYER:
By: /s/ Charles Adams
----------------------
Charles Adams
By: /s/ Fred Keller
----------------------
Fred Keller
By: /s/ Fred Keller
----------------------
Fred Keller, Trustee
FAIRFAX GROUP, INC.
By: /s/ Ernest Porter
----------------------
Ernest Porter, President
