Insider filing report for Changes in Beneficial Ownership
- Schedule 13G & 13D forms are used to report a party's ownership of stock which exceeds 5% of a company's total stock issue.
- Schedule 13G is a shorter version of Schedule 13D with fewer reporting requirements.
"Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise"
- Peter Lynch
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- Peter Lynch
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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
13D
Under the
Securities Exchange Act of 1934
(Amendment
No. 4)*
Western
Capital Resources, Inc.
(Name of
Issuer)
Common
Stock, No Par Value
(Title of
Class of Securities)
957881 10
5
(CUSIP
Number)
WERCS
and
Robert W.
Moberly
400 East
First Street
P.O. Box
130
Casper,
WY 82602
Phone:
(307) 233-8300
With a
copy to:
Steven P.
Amen
Kutak
Rock LLP
1650
Farnam Street
Omaha,
NE 68102
Phone:
(402) 346-6000
(Name,
Address and Telephone Number of Person Authorized to Receive Notice and
Communications)
March 31,
2010
(Date of
Event which Requires Filing of this Statement)
If the
filing person has previously filed a statement on Schedule 13G to report the
acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
o.
Note: Schedules
filed in paper format shall include a signed original and five copies of the
schedule, including all exhibits. See Rule 13d-7(b) for other parties
to whom copies are to be sent.
*The
remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The
information required on the remainder of this cover page shall not be deemed to
be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934
(“Act”) or otherwise subject to the liabilities of that section of the Act but
shall be subject to all other provisions of the Act (however, see the
Notes).
| CUSIP NO. 957881 10 5 | |
|
1
|
NAMES
OF REPORTING PERSONS
|
|
(ENTITIES
ONLY)
|
|
|
WERCS
|
|
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
|
(See
Instructions)
|
|
|
(a) o
|
|
|
(b) o
|
|
|
3
|
SEC
USE ONLY
|
|
4
|
SOURCE
OF FUNDS (See Instructions)
|
|
SC
|
|
|
5
|
CHECK
IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
|
|
TO
ITEM 2(d) OR 2(e)
o
|
|
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
|
Wyoming
|
|
|
7
|
SOLE
VOTING POWER
|
|
|
NUMBER
OF
|
||
|
0
|
||
|
SHARES
|
||
|
8
|
SHARED
VOTING POWER
|
|
|
BENEFICIALLY
|
||
|
0
|
||
|
OWNED
BY EACH
|
||
|
9
|
SOLE
DISPOSITIVE POWER
|
|
|
REPORTING
|
||
|
0
|
||
|
PERSON
|
||
|
10
|
SHARED
DISPOSITIVE POWER
|
|
|
WITH
|
||
|
0
|
||
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
|
0
|
|
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN
SHARES (See
Instructions) o
|
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
|
0.0%
|
|
|
14
|
TYPE
OF REPORTING PERSON (See Instructions)
|
|
CO
|
|
Page 2 of
7 pages
| CUSIP NO. 957881 10 5 | |
|
1
|
NAMES
OF REPORTING PERSONS
|
|
(ENTITIES
ONLY)
|
|
|
Robert.
W. Moberly
|
|
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
|
(See
Instructions)
|
|
|
(a) o
|
|
|
(b) o
|
|
|
3
|
SEC
USE ONLY
|
|
4
|
SOURCE
OF FUNDS (See Instructions)
|
|
SC
|
|
|
5
|
CHECK
IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
|
|
TO
ITEM 2(d) OR 2(e)
o
|
|
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
|
Wyoming
|
|
|
7
|
SOLE
VOTING POWER
|
|
|
NUMBER
OF
|
||
|
0
|
||
|
SHARES
|
||
|
8
|
SHARED
VOTING POWER
|
|
|
BENEFICIALLY
|
||
|
0
|
||
|
OWNED
BY EACH
|
||
|
9
|
SOLE
DISPOSITIVE POWER
|
|
|
REPORTING
|
||
|
0
|
||
|
PERSON
|
||
|
10
|
SHARED
DISPOSITIVE POWER
|
|
|
WITH
|
||
|
0
|
||
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
|
0
|
|
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN
SHARES (See Instructions)
o
|
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
|
0.0%
|
|
|
14
|
TYPE
OF REPORTING PERSON (See Instructions)
|
|
IN
|
|
Page 3 of
7 pages
This
Amendment No. 4 to Schedule 13D (this “Amendment No. 4”) is filed by WERCS, a
Wyoming corporation, and Robert W. Moberly (collectively, the “Reporting
Persons”), to update and amend the Schedule 13D filed by WERCS and Mr. Moberly
on January 10, 2008, as amended by WERCS and Mr. Moberly on February 17, 2009,
as further amended by WERCS, MOKA, Inc., a Wyoming corporation, and Mr. Moberly
on June 15, 2009, and as further amended by WERCS and Mr. Moberly on February
25, 2009, with respect to their ownership of shares of Western Capital
Resources, Inc. (the “Issuer”). This Amendment No. 4 is filed in
order to report the closing of the sale of all shares of the Common Stock and
Series A Convertible Preferred Stock of the Issuer owned by WERCS to WCR, LLC
pursuant to that certain definitive Stock Purchase and Sale Agreement, dated
February 23, 2010, as amended on March 3, 2010, by and between WERCS, WCR, LLC,
a Delaware limited liability company, Blackstreet Capital Partners (AI) II,
L.P., a Delaware limited partnership, and Blackstreet Capital Partners (QP) II,
L.P., a Delaware limited partnership. See Items 4 and
6.
Item
1. Security and Issuer
State the
title of the class of equity securities to which this statement relates and the
name and address of the principal executive offices of the issuer of such
securities.
Common
Stock, no par value
The
issuer’s name and address is:
Western
Capital Resources, Inc. (the “Issuer”)
11550 “I”
Street, Suite 150
Omaha,
Nebraska 68137
Item
2. Identity and Background
|
(a)
|
Name:
|
WERCS, a
Wyoming corporation.
Robert W.
Moberly.
|
(b)
|
Business
address: The business address of WERCS and Mr. Moberly
is:
|
400 East
First Street
P.O. Box
130
Casper,
WY 82602.
|
(c)
|
Present
principal occupation or employment and the name, principal business and
address of any corporation or other organization in which such employment
is conducted:
|
Mr.
Moberly is the Chief Executive Officer and a director of WERCS.
WERCS is
a holding company. Its address is set forth in Item 2(b)
above.
|
(d)
|
Whether
or not, during the last five years, such person has been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors)
and, if so, give the dates, nature of conviction, name and location of
court, and penalty imposed, or other disposition of the
case:
|
None of
the Reporting Persons has ever been convicted in a criminal
proceeding.
|
(e)
|
Whether
or not, during the last five years, such person was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree
or final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any
violation with respect to such laws; and, if so, identify and describe
such proceedings and summarize the terms of such judgment, decree or final
order:
|
None of
the Reporting Persons have, during the last five years, been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and,
as a result of such proceeding, were, or are subject to, a judgment, decree or
final order enjoining future violations of, or prohibiting or maintaining
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
Page 4 of
7 pages
|
(f)
|
Citizenship:
|
WERCS is
a Wyoming corporation.
Mr.
Moberly is a U.S. citizen.
Item
3. Source and Amount of Funds or Other Consideration
As a
former sole shareholder of Wyoming Financial Lenders, WERCS received an
aggregate of 1,125,000 shares of the Issuer’s Common Stock and 10,000,000 shares
of the Issuer’s Series A Convertible Preferred Stock in connection with a merger
transaction between the Issuer and Wyoming Financial Lenders that was completed
on December 31, 2007 (the “2007 Merger”).
Item
4. Purpose of Transaction
WERCS
acquired the shares of the Issuer’s Common Stock and Series A Convertible
Preferred Stock as merger consideration in connection with the 2007
Merger.
On
February 23, 2010, WERCS entered into a definitive Stock Purchase and Sale
Agreement (the “Agreement”) by and between WERCS, WCR Acquisition, Inc., a
Delaware corporation (“WCR, Inc.”), Blackstreet Capital Partners (AI) II, L.P.,
a Delaware limited partnership, and Blackstreet Capital Partners (QP) II, L.P.,
a Delaware limited partnership, pursuant to which WERCS agreed to sell to WCR
Inc. all shares of the Common Stock and Series A Convertible Preferred Stock of
the Issuer owned by WERCS (collectively, the “Shares”). On March 3,
2010, the parties amended the Agreement to replace WCR, Inc. with WCR, LLC as
the purchaser of the Shares. The sale of the Shares was subject to a
number of conditions including (a) a condition that up to three of the four
existing directors of the Company resign from the Issuer’s Board of Directors,
and (b) a condition that the Issuer’s Articles of Incorporation be amended to
provide that the provisions of the Minnesota Control Share Acquisition Act (the
“MCSA Act”) would not apply to the sale of the Shares to WCR, LLC. In
connection with the closing of the purchase and sale of the Shares, two
directors resigned and were replaced by persons nominated by WCR, LLC, and the
Issuer’s Articles of Incorporation were amended to provide that the provisions
of the MCSA Act would not apply to the sale as specified.
Other
than as set forth above, the Reporting Persons have no current plans or
proposals which would relate to or would result in any of the matters described
in subparagraphs (a) through (j) of Item 4 of Schedule 13D.
Item
5. Interest in Securities of the Issuer
|
(a)
|
Aggregate
number and percentage of the class of securities beneficially
owned:
|
None
|
(b)
|
Number
of shares as to which there is sole power to vote or to direct the vote,
shared power to vote or to direct the vote, sole power to dispose or to
direct the disposition, or shared power to dispose or to direct the
disposition:
|
None
Page 5 of
7 pages
|
(c)
|
Transactions
in the securities effected during the past sixty
days:
|
Effective
as of March 31, 2010, WERCS sold all of the 1,125,000 shares of the Issuer’s
Common Stock and 10,000,000 shares of the Issuer’s Series A Convertible
Preferred Stock previously owned by it to WCR, LLC in a privately negotiated
transaction for an aggregate purchase price of $4,781,580.57, and the entire
purchase price was allocated to the Series A Convertible Preferred
Stock.
|
(d)
|
No
other person has the right to receive or the power to direct the receipt
of dividends from, or the proceeds from the sale of, such
securities.
|
|
(e)
|
The
date on which the Reporting Persons ceased to be the beneficial owners of
more than five percent of the class of
securities:
|
Effective
as of March 31, 2010
Item
6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
Pursuant
to the Agreement, effective as of March 31, 2010, WERCS sold all of the
1,125,000 shares of the Issuer’s Common Stock and 10,000,000 shares of the
Issuer’s Series A Convertible Preferred Stock previously owned by it, whereupon
the Reporting Persons no longer own, beneficially or of record, any shares of
the Issuer’s Common Stock or any securities convertible into the Issuer’s Common
Stock.
Item
7. Material to Be Filed as Exhibits.
|
Exhibit
A
|
Agreement
as to joint filings pursuant to Regulation Section
240.13d-1(k)(1)(iii)
|
|
|
Exhibit
B
|
Stock
Purchase and Sale Agreement, dated February 23, 2010, by and between
WERCS, WCR Acquisition, Inc., Blackstreet Capital Partners (AI) II, L.P.
and Blackstreet Capital Partners (QP) II,
L.P.
|
|
|
Exhibit
C
|
First
Amendment to Stock Purchase and Sale Agreement, dated as of March 3, 2010,
by and among WERCS, WCR Acquisition, Inc., WCR, LLC, Blackstreet Capital
Partners (AI) II, L.P. and Blackstreet Capital Partners (QP) II,
L.P.
|
Page 6 of
7 pages
SCHEDULE
13D
SIGNATURE
The
undersigned, after reasonable inquiry and to the best of his/its knowledge and
belief, certifies that the information set forth in this statement is true,
complete and correct.
|
Dated:
April 5, 2010
|
WERCS
|
|||
|
By:
|
/s/ Robert W. Moberly | |||
|
Name:
|
Robert
W. Moberly
|
|||
|
Title:
|
Chief
Executive Officer
|
|||
|
ROBERT
W. MOBERLY
|
||||
|
/s/ Robert W. Moberly
|
||||
|
Robert
W. Moberly
|
||||
Page 7 of
7 pages
EXHIBIT
A
AGREEMENT
AS TO JOINT FILING
Pursuant to Regulation Section
240.13d-1(k)(1)(iii), the undersigned acknowledge and agree that the attached
Schedule 13D relating to Western Capital Resources, Inc. is being filed on
behalf of each of the undersigned.
|
Dated:
April 5, 2010
|
WERCS
|
|||
|
By:
|
/s/ Robert W. Moberly | |||
|
Name:
|
Robert
W. Moberly
|
|||
|
Title:
|
Chief
Executive Officer
|
|||
|
ROBERT
W. MOBERLY
|
||||
|
/s/ Robert W. Moberly
|
||||
|
Robert
W. Moberly
|
||||
EXHIBIT
B
STOCK
PURCHASE AND SALE AGREEMENT
THIS
STOCK PURCHASE AND SALE AGREEMENT (this “Agreement”), dated as
of February 23, 2010, is entered into by and between WERCS, a Wyoming
corporation (the “Seller”), WCR
ACQUISITION, INC., a Delaware corporation (“Buyer”), and solely
for the limited purposes set forth herein relating to Section
8(b)(i) of this Agreement BLACKSTREET CAPITAL PARTNERS (AI) II,
L.P., a Delaware limited partnership, and BLACKSTREET CAPITAL PARTNERS (QP) II,
L.P., a Delaware limited partnership (collectively, “BCP
II”).
RECITALS:
WHEREAS, the Seller is the
record and beneficial owner of 10,000,000 shares of the Series A
Convertible Preferred Stock, par value $.01 per share (the “Series A Preferred”),
of Western Capital Resources, Inc., a Minnesota corporation (the “Company”), and
1,125,000 shares of the Company’s Common Stock, no par value per share (the
“Common Stock,”
and collectively with the shares of Series A Preferred, the “Shares”) which
represents approximately 61.8% of the outstanding voting shares of the Company;
and
WHEREAS, the Seller desires to
sell all of the Shares to the Buyer and the Buyer desires to purchase all of the
Shares from the Seller on the terms and conditions set forth
herein;
NOW, THEREFORE, in
consideration of the mutual covenants and agreements contained herein, and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Buyer and the Seller hereby covenant and agree as
follows:
1. Purchase and Sale of
Shares. Subject to the terms and conditions of this Agreement,
at the Closing (as defined below in Section 3) the Seller shall transfer and
sell to the Buyer and the Buyer shall purchase from the Seller, all of the
Shares free and clear of all liens, claims and other encumbrances, other than
restrictions on transfer arising under applicable state or federal securities
laws.
2. Purchase
Price.
(a) Amount of Purchase
Price. The aggregate purchase price for the Shares (the “Purchase Price”)
shall be calculated as follows:
(i) SEVEN
MILLION FOUR HUNDRED THOUSAND AND 00/100 DOLLARS ($7,400,000.00) (the “Gross Cash
Amount”);
LESS
(ii) the
amount of principal and accrued interest outstanding as of the Closing Date on
that certain $2,000,000 Promissory Note, dated October 29, 2008, between Western
Financial Lenders, Inc. (a wholly-owned subsidiary of the Company) and Banco
Popular North America (“BP”), as amended (the
“BP
Debt”);
LESS
(iii) the
amount, if any, by which the Working Capital of the Company (as defined below)
is less than $6,000,000 (the “Target Working
Capital”); or
PLUS
(iv) the
amount, if any, by which the Working Capital of the Company is greater than the
Target Working Capital.
(b) For
purposes hereof, “Working Capital”
shall mean (y) the sum of the Company’s cash, loans receivable, inventory,
prepaid expenses, prepaid taxes, current deferred taxes and other current
assets, less (z) the sum of the Company’s accounts payable, accrued liabilities
(excluding accrued interest due on the BP Debt), other current liabilities,
accrued income taxes and deferred revenue, in each case, determined in
accordance with United States generally accepted accounting principles, applied
on a consistent basis in accordance with the Company’s past
practice.
(c) Delivery of the Estimated
Closing Date Working Capital Amount. No later than two (2)
business days prior to the Closing Date, the Seller shall cause the Company to
prepare and deliver to the Buyer a good faith estimate of the Working Capital of
the Company as of the Closing Date (the “Estimated Closing Date
Working Capital”).
(d) The
Purchase Price shall be allocated 100% to the Series A Preferred with none of
the Purchase Price allocated to the Common Stock, and neither the Buyer nor the
Seller shall t
ake any position which is inconsistent with such
allocation.
(e) Payment of the Purchase
Price.
(i) At
Closing, the Buyer will pay to the Seller an amount equal to (A) the Gross
Cash Amount, (B) less the amount of the BP Debt, (C) (1) less the
amount by which the Target Working Capital exceeds the Estimated Closing Date
Working Capital, or (2) plus the amount by which the Estimated Closing Date
Working Capital exceeds the Target Working Capital (the “Closing Date
Consideration”). Payment shall be made by wire transfer of
immediately available funds in accordance with written instructions provided by
the Seller.
(ii) Within
forty-five (45) calendar days after the Closing Date, the Company shall deliver
to the Seller and the Buyer a statement (the “Final Closing Date Working
Capital”) setting forth the actual Working Capital of the Company as of
the Closing Date (the “Working Capital
Statement”). If the Final Closing Date Working Capital is less
than the Estimated Closing Date Working Capital, then the Purchase Price shall
be reduced by the amount by which the Final Closing Date Working Capital is less
than the Estimated Closing Date Working Capital, and the Seller shall remit to
the Buyer an amount equal to such difference, without interest, within two (2)
business days after receipt of the Working Capital Statement. If the Final
Closing Date Working Capital is greater than the Estimated Closing Date Working
Capital, then the Purchase Price shall be increased by the amount by which the
Final Closing Date Working Capital exceeds the Estimated Closing Date Working
Capital, and the Buyer shall remit to the Seller an amount equal to such excess,
without interest, within two (2) business days after receipt of the Working
Capital Statement. Such remittance shall be made by wire transfer of
immediately available funds in accordance with written instructions provided by
the party entitled to payment hereunder.
3. Closing. The
closing of the purchase and sale of the Shares (the “Closing”) shall occur
on the later of (a) March 31, 2010 at 10:00 a.m. Eastern Time, or (b) within two
(2) business days of such other date or other time upon which the conditions set
forth in Sections 6 and 7 of this Agreement are satisfied as determined
collectively by the Buyer and the Seller (the “Closing
Date”). The Closing shall be conducted by the delivery and
exchange of all required closing deliverables by FedEx or another recognized
overnight courier and/or by facsimile and/or by the electronic transmission of
deliverables in PDF or a comparable format. All actions to be taken
at the Closing pursuant to this Agreement shall be deemed to have occurred
simultaneously, and no act, document or transaction shall be deemed to have
been taken, delivered or effected until all such actions, documents and
transactions have been taken, delivered or effected. At the Closing,
and in addition to actions to be taken in order to satisfy the conditions set
forth in Sections 6 and 7 hereof:
(a) the
Buyer shall pay to the Seller, and the Seller shall receive from the Buyer, the
Closing Date Consideration in accordance with the provisions of
Section 2(e)(i) hereof; and
(b) the
Seller shall deliver to the Buyer the certificates representing the Shares,
together with duly executed stock assignments relating thereto transferring the
Shares to the Buyer (or its designee) free and clear of all liens, claims and
encumbrances of every kind, nature and description whatsoever other than
restrictions on transfer arising under applicable state or federal securities
laws.
4. Representations and
Warranties of the Seller. The Seller hereby represents and
warrants to the Buyer as follows:
(a) Due Organization and
Authority. The Seller (i) is duly organized, validly existing
and in good standing as a corporation under the laws of State of Wyoming; (ii)
has the right and power under its organizational instruments to execute, deliver
and perform its obligations hereunder; (iii) has taken all corporate actions
necessary to duly authorize the Seller to execute, deliver and perform its
obligations hereunder; and (iv) affirms that the individual executing and
delivering this Agreement on behalf of the Seller has the requisite right,
power, capacity and authority to do so on behalf of the Seller.
(b) No
Violation. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by the Seller do not
and will not (i) violate the Seller’s articles of incorporation or bylaws
or any order, judgment or injunction, or conflict with or result in a breach of
or default under any agreement, to which the Seller is a party or by which the
Seller is bound or subject; or (ii) result in or constitute the basis for
the creation of any claim, lien or encumbrance of any nature whatsoever on or in
respect of the Shares.
(c) The
Shares. To the Knowledge of the Seller (as defined below), all
of the Shares (i) have been duly authorized, (ii) are validly issued,
fully paid and nonassessable, (iii) are not subject to any preemptive
rights, and (iv) have been acquired by the Seller in compliance with all
applicable state and federal securities laws. There are no (A)
outstanding or authorized options, warrants, rights, contracts, calls, puts,
rights to subscribe, conversion rights (other than the right to convert each
share of the Series A Preferred into one share of Common Stock, and the
Company’s right to redeem each share of Series A Preferred at a per-share price
of $3.50 plus accrued but unpaid dividends) or other agreements or commitments
to which the Seller is a party or which are binding upon the Seller providing
for the disposition or acquisition of any of the Shares (other than this
Agreement); (B) voting trusts, proxies or any other agreements or
understandings with respect to the Seller’s Shares to which the Seller is a
party; or (C) obligations (contingent or otherwise) to which the Seller is
subject pursuant to which the Seller is prohibited in any way from transferring
the Shares to the Buyer. The Seller is the sole record and beneficial
owner of the Shares, and upon delivery by the Buyer to the Seller of the
Purchase Price, valid and marketable title to the Shares will pass to the Buyer
free and clear of any lien, claim, encumbrance or restriction on transfer other
than those under applicable state or federal securities laws. The
Shares represent all of the capital stock of, and economic interests in, the
Company held by the Seller, and upon consummation of the transactions
contemplated hereby, the Seller will no longer have any interest in the Shares
or the Company. For purposes of this Agreement “Knowledge” as it
relates to the Seller shall mean the actual knowledge or awareness of such fact
or matter by Mr. Robert Moberly or Mr. John Quandahl.
(d) No Broker or
Finder. Except for services provided to the Company and/or the
Seller by B&L Capital, LLC, payment for which the Seller shall be solely
responsible, no broker, finder or other financial consultant has acted on behalf
of the Seller in connection with this Agreement or the transactions contemplated
hereby in such a way as to create any liability on the part of the
Buyer. The Seller agrees to indemnify and save the Buyer harmless
from any claim or demand for commission or other compensation by any broker,
finder, financial consultant or similar agent claiming to have been employed by
or on behalf of the Seller and to bear the cost of legal expenses incurred in
defending against any such claim.
(e) Accurate SEC
Filings. To the Knowledge of the Seller, (i) during the period
from January 1, 2009 through the Closing Date, the Company has filed or will
file timely all reports, schedules, forms, statements and other documents
required to be filed by it with the Securities and Exchange Commission (the
“SEC”) pursuant
to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the “1934
Act”), except for the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2008, which was filed on May 4, 2009 and was not timely
(all of the foregoing filings and all exhibits included therein and financial
statements, notes and schedules thereto, and documents incorporated by reference
therein being hereinafter referred to as the “SEC Documents”); (ii)
as of their respective dates, the SEC Documents do not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; and (iii)
as of their respective dates, the financial statements of the Company included
in the SEC Documents (except for the financial statements for the fiscal year
ended December 31, 2007 and for each of the fiscal quarters ended March 31,
2008, June 30, 2008 and September 30, 2008, all of which were restated and
reflected or included in the Form 10-K for the fiscal year ended December 31,
2008 and which restated financial statements supersede any related previous
filings and are in compliance with this Section 4(e)), fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments which will not be material, either individually or in the
aggregate). In connection with making the representations herein, the
Seller understands that the Company has provided the Buy
er with access to a copy
of a report to the Company’s Board of Directors, dated April 9, 2009, relating
to a confidential internal investigation (the “Confidential
Investigation”) conducted primarily by Maslon Edelman Borman & Brand,
LLP, counsel to the Company. The Seller understands that the Company
reviewed the findings of the Confidential Investigation and, in consultation
with its counsel, made the related disclosures that were required in its
applicable periodic reports under the 1934 Act and in satisfaction of its other
applicable disclosure obligations. In making its representations
herein as they relate to the matters covered by the Confidential Investigation,
the Seller is relying solely upon the Company’s determination as to the
disclosures that were required to be made with respect to the Confidential
Investigation, provided that to the Knowledge of the Seller, the Company’s Board
of Directors has taken all actions that it has determined to be necessary and
appropriate in light of its fiduciary duties to address the issues identified in
the Confidential Investigation.
(f) Absence of
Changes. To the Knowledge of the Seller, (i) there is no
action, suit, proceeding, inquiry or investigation before or by the
Over-the-Counter Bulletin Board, any court, public board, government agency,
self-regulatory organization or body pending or threatened against or affecting
the Company, the Seller, the Shares, the Company’s common stock or any of the
Seller’s or the Company’s officers or directors which is outside of the ordinary
course of business or individually or in the aggregate material to the Seller or
the Company; (ii) there has not been, and there is not pending, any
investigation by the SEC involving the Seller or the Company or any current or
former director or officer of the Seller or the Company; and (iii) the SEC has
not issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company under the Securities Act of 1933, as
amended (the “1933
Act”), or the 1934 Act.
(g) Ability to Vote the
Shares. The Seller has the ability, power and authority to
vote the Shares in favor of the amendment of the Company's Articles of
Incorporation as described in Sections 6(d) and 8(b) of this Agreement, and
the Seller is not aware of any matter that would prevent, impair or impede the
Seller's ability to vote in favor of such amendment.
5. Representations and
Warranties of the Buyer. The Buyer hereby represents and
warrants to the Seller as follows:
(a) Due Organization and
Authority. The Buyer is duly organized, validly existing and
in good standing as a corporation under the laws of the State of
Delaware. The Buyer (i) has the right and power under its
organizational instruments to execute, deliver and perform its obligations
hereunder; (ii) has taken all corporate or other actions necessary to duly
authorize the Buyer to execute, deliver and perform its obligations hereunder;
and (iii) affirms that the individual(s) executing and delivering this
Agreement on behalf of the Buyer has the requisite right, power, capacity and
authority to do so on behalf of the Buyer.
(b) No
Violation. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by the Buyer do not and
will not violate the Buyer’s certificate of incorporation or bylaws or any of
its other organizational documents, or any order, judgment or injunction, or
conflict with or result in a breach of or default under any agreement, to which
the Buyer is a party or by which the Buyer is bound or subject.
(c) Ability to Make
Payment. The Buyer is an affiliate of BCP II, which
comprise two funds with approximately $105 million in capital and/or firm
capital commitments and a $15 million credit facility, and, as a result, the
Buyer currently has access to sufficient funds with which to pay the Purchase
Price in accordance with the terms hereof.
(d) Independent Investigation;
Seller’s Representations. The Buyer has conducted its own
independent investigation, review and analysis of the business, operations,
assets, liabilities, results of operations, financial condition, software,
technology and prospects of the Company, which investigation, review and
analysis was done by the Buyer and its representatives. The Buyer
acknowledges that it and its representatives have been provided adequate access
to the personnel, properties, premises and records of the Company for such
purpose. The Buyer acknowledges that, except for the specific
representations and warranties of the Seller set forth herein and in any
schedules, agreements or certificates delivered by the Seller to the Buyer
pursuant to this Agreement, the Seller has not made to the Buyer any other
representations or warranties.
(e) Accredited
Investor. The Buyer is an accredited investor as defined in
Rule 501(a) of Regulation D promulgated under the 1933
Act.
(f) Purchase Entirely for Own
Account. The Buyer is acquiring the Shares for its own
account, not as a nominee or agent, for investment purposes only and not with a
view to the resale or distribution of any part thereof. The Buyer has
no present intention of selling, granting any participation in, or otherwise
distributing any of the Shares and does not have any contract, undertaking,
agreement or arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with respect to any of the
Shares.
(g) Restricted
Securities. The Buyer understands that (i) the Shares are
characterized as “restricted securities” under the federal securities laws
inasmuch as they were issued to the Seller in a transaction not involving a
public offering and the Shares will retain such characterization in the hands of
the Buyer, and (ii) the Shares may not be resold by the Buyer without
registration under the 1933 Act and applicable state securities laws, unless
such sale is made pursuant to an available exemption thereto. In
connection therewith, the Buyer understands that any certificate for the Shares
issued in its name by the Company will bear a legend pertaining to such
restrictions on the transferability of the Shares.
(h) No Broker or
Finder. No broker, finder or other financial consultant has
acted on behalf of the Buyer in connection with this Agreement or the
transactions contemplated hereby in such a way as to create any liability on the
part of the Seller. The Buyer agrees to indemnify and save the Seller
harmless from any claim or demand for commission or other compensation by any
broker, finder, financial consultant or similar agent claiming to have been
employed by or on behalf of the Buyer and to bear the cost of legal expenses
incurred in defending against any such claim.
6. Conditions to the Buyer’s
Obligations at Closing. The obligations of the Buyer to the
Seller under this Agreement are subject to the fulfillment, on or before the
Closing, of each of the following conditions, unless otherwise waived by the
Buyer in its sole discretion:
(a) Representations and
Warranties. The Seller shall have certified, in a form
reasonably acceptable to the Buyer, that the representations and warranties of
the Seller contained in Section 4 remain true and correct in all material
respects on and as of the Closing Date.
(b) Performance. The
Seller shall have performed and complied with all covenants, agreements,
obligations and conditions contained in this Agreement that are required to be
performed or complied with by it on or before the Closing Date.
(c) No Actions, Suits or
Proceedings. No order of any court or governmental authority
shall have been issued restraining, prohibiting, restricting or delaying, the
consummation of the transactions contemplated by this Agreement. No
litigation shall be pending or, to the knowledge of the parties to this
Agreement, threatened, before any court or governmental authority to restrain,
prohibit, restrict or delay, or to obtain damages or a discovery order in
respect of this Agreement or the consummation of the transactions contemplated
hereby.
(d) Minnesota Control Share
Acquisition Act. The Company’s Articles of Incorporation shall
have been duly amended so that the provisions of the Minnesota Control Share
Acquisition Act (Minn. Stat. § 302A.671) shall no longer apply to the
Company and to the sale and purchase of the Shares pursuant to this
Agreement.
(e) Resignation of
Directors. Each of Robert W. Moberly, Mark Houlton and James
Mandel shall have submitted his written resignation from the Company’s Board of
Directors effective as of the Closing Date.
(f) Quandahl Employment
Agreement. The Company and John Quandahl shall have entered
into an employment agreement on terms substantially similar to the current
employment arrangements between the Company and Mr. Quandahl and on terms
otherwise reasonably satisfactory to the Buyer.
(g) Due
Diligence. The Buyer shall have completed all of its due
diligence with respect to the Company and shall be reasonably satisfied with the
results thereof.
(h) 2009 Annual
Report. The Company shall have filed its annual report on Form
10-K for the fiscal year ended December 31, 2009 with the SEC on or before the
Closing Date.
7. Conditions to the Seller’s
Obligations at Closing. The obligations of the Seller to the
Buyer under this Agreement are subject to the fulfillment, on or before the
Closing, of each of the following conditions, unless otherwise waived by the
Seller in its sole discretion:
(a) Representations and
Warranties. The Buyer shall have certified, in a form
reasonably acceptable to the Seller, that the representations and warranties of
the Buyer contained in Section 5 remain true and correct in all material
respects on and as of the Closing Date.
(b) Performance. The
Buyer and BCP II shall have performed and complied with all covenants,
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by them on or before the Closing
Date.
(c) No Actions, Suits or
Proceedings. No order of any court or governmental authority
shall have been issued restraining, prohibiting, restricting or delaying, the
consummation of the transactions contemplated by this Agreement. No
litigation shall be pending or, to the knowledge of the parties to this
Agreement, threatened, before any court or governmental authority to restrain,
prohibit, restrict or delay, or to obtain damages or a discovery order in
respect of this Agreement or the consummation of the transactions contemplated
hereby.
(d) Guarantees. Banco
Popular North America shall have unconditionally released the Seller and Robert
W. Moberly from their respective guarantees of the BP Debt (collectively, the
“BP
Guarantees”).
(e) Directors’ Liability
Coverage. The Company shall have provided reasonable assurance
to the Seller that the Company shall continue to provide a policy of directors
and officers insurance for the directors resigning from the Board pursuant to
Section 6(e) hereof with respect to claims relating to periods prior to the
Closing Date through the applicable statute of limitation periods, provided
however that the Company shall have no obligation under this Section 7(e) so
long as the Company maintains a “Claims-Made” policy of directors and officers
insurance at a price and coverage that is substantially similar to the price and
coverage that the Company currently pays and has for its directors and officers
insurance policy.
8. Additional
Covenants.
(a) No Negotiations with Third
Parties. From the date of this Agreement until the Closing or
such time as this Agreement is terminated pursuant to Section 10 hereof,
the Seller shall not directly or indirectly, through any representative or
otherwise, provide information to, solicit or entertain offers from, negotiate
with or in any manner encourage, discuss, accept or consider any proposal of any
other person relating to the acquisition of the Shares, in whole or in
part. The Seller will immediately notify the Buyer regarding any
contact between the Seller or any of its representatives and any other person
regarding any such offer or proposal or any related inquiry.
(b) Efforts to
Consummate. Except as set forth below, each of the parties
hereto agrees to use commercially reasonable efforts to take, or cause to be
taken, all action and to do, or cause to be done, all things necessary to
satisfy the conditions set forth herein as soon as practicable, including,
without limitation, using commercially reasonable efforts to obtain all waivers,
consents, approvals and authorizations which are necessary or desirable in
connection with the transactions contemplated by this Agreement. In
that regard, the Seller shall promptly make a proposal for an amendment to the
Company’s Articles of Incorporation (in a form reasonably satisfactory to the
Buyer) for the purpose of satisfying the condition set forth in Section 6(d)
hereof and make a demand on the Company to hold a special meeting of the
shareholders of the Company as soon as practicable for the purpose of obtaining
the necessary consent of the shareholders of the Company to said
amendment. In connection therewith, the Seller shall cooperate with
the Company in connection with the preparation and delivery of a proxy statement
relating to such special meeting, and shall use its best efforts to vote the
Shares in favor of the amendment proposed at the special
meeting. Further in that regard, (i) BCP II shall use its best
efforts to capitalize the Buyer in order to timely fund the payment of the
Closing Date Consideration on the Closing Date as set forth in Section 2, and
(ii) the Buyer shall use its commercially reasonable efforts to effect the
unconditional release of the BP Guarantees for the purpose of satisfying the
condition set forth in Section 7(d) hereof, and, to the extent necessary in
connection with any such release, the Buyer shall cooperate with BP in
connection with the replacement or substitution of guarantors for the BP
Guarantees. No party hereto will take any action for the purpose of
delaying, impairing or impeding the receipt of any required waiver, consent,
approval or authorization. In case at any time before or after the
Closing any further action is necessary or desirable to carry out the purposes
of this Agreement, each of the parties will cooperate with the other and take
such further action (including the execution and delivery of such further
instruments and documents) as the other party may reasonably
request.
(c) Confidentiality. For
purposes of that certain Confidentiality Agreement by and between the Company
and Blackstreet Capital Management, LLC (“BCM”), dated as of
January 29, 2010 (the “Confidentiality
Agreement”), the Buyer acknowledges that it shall be deemed to be a
“Representative” (as defined in the Confidentiality Agreement) of BCM and the
Seller acknowledges that it shall be deemed to be a Representative of the
Company and that, as a result, they agree that they are each bound by the terms,
conditions and other provisions of the Confidentiality Agreement.
(d) Publicity. Except
to the extent otherwise required by law, none of the parties shall issue or
authorize to be issued any press release or similar announcement concerning this
Agreement or any of the transactions contemplated hereby without the prior
written approval of the other party, which approval shall not be unreasonably
withheld. The parties agree that they will consult with each other
concerning any such proposed press release or other announcement and shall use
reasonable commercial efforts to agree upon the text of any such press release
or the making of any such announcement.
(e) Access to
Information. The Seller shall use its commercially reasonable
efforts to make available to the Buyer all information that is not publicly
available concerning the business, assets, liabilities, operations, financial
condition and prospects of the Company which the Buyer reasonably requests and
which is in the Seller’s possession or to which the Seller has
access. The Seller shall promptly advise the Buyer regarding any
material developments or matters which occur before the Closing Date relating to
the Company or which may otherwise affect the transactions contemplated herein
to the extent that the Seller has or obtains Knowledge of any such developments
or matters.
(f) Restrictive
Covenants. The Seller agrees that, for a period of three
(3) years following the Closing Date, it shall not engage in any payday
lending, check cashing or prepaid cellular distribution business or any other
business activities that the Company is currently engaged in, has been engaged
in within the past two (2) years, or has plans to engage in as of the Closing
Date. In addition to the foregoing, the Seller agrees that it shall
not (through itself or any affiliate of the Seller) employ, hire, engage or
otherwise retain (as an employee, consultant or in any other capacity) any
employee who is employed by the Company at the Closing Date, and who
subsequently ceases working for the Company after the Closing Date, for a period
of three years after the date that such employee ceases to be employed by the
Company, without the prior written consent of the Buyer; pro
vided, however, that
the Seller shall be able to hire any terminated employees without prior consent
of the Buyer following a dissolution or liquidation of the Company.
(g) Retention of
Shares. Until such time as the Final Closing Date Working
Capital is determined and any payments that may be required under Section
2(e)(ii) have been made in full, the Buyer shall retain control of the Shares
(whether directly or indirectly in a subsidiary of the Buyer that is wholly
owned except for any interest held by John Quandahl), free and clear of all
liens, claims or other encumbrances of any type or nature.
9. Indemnification.
(a) Survival of Representations,
Warranties and Covenants. The representations and warranties
contained in this Agreement shall survive the Closing for a period of one (1)
year; provided however that the representations and warranties set forth in
Sections 4(a) through 4(c), 5(a), 5(b) and 5(d) through 5(g) shall survive
the Closing and continue in full force and effect indefinitely. Any
claims for indemnification asserted in writing as provided for in this
Section 9 prior to the expiration date applicable to the representation or
warranty with respect to which such claim for indemnification is made shall
survive until finally resolved and satisfied in full. For convenience
of reference, the date upon which any representation and warranty contained
herein shall terminate is referred to herein as the “Survival
Date.” No third party other than the Indemnified Persons (as
defined below), shall be a third party or other beneficiary of such
representations and warranties. All covenants and agreements
contained in this Agreement and to be performed in whole or in part after the
Closing shall survive the Closing and continue in full force until fully
performed in accordance with their terms.
(b) Definitions. As
used in this Agreement, the following terms shall have the following
meanings:
(i) “Event of
Indemnification” shall mean the following: (A) the untruth, inaccuracy or
breach by the Seller, on the one hand, or the Buyer, on the other hand, of any
representation or warranty by such party contained in this Agreement; or
(B) the breach by the Seller, on the one hand, or the Buyer, on the other
hand, of any agreement or covenant by such party contained in this
Agreement.
(ii) “Indemnified Persons”
shall mean and include, on the one hand, the Buyer and its affiliates,
successors and assigns, and the respective officers, directors, partners, agents
and employees of each of the foregoing and, on the other hand, the Seller, and
its successors, assigns and the respective officers, directors, agents and
employees of each of the foregoing.
(iii) “Indemnifying Persons”
shall mean and include, on the one hand, each of the Seller and its successors
and assigns, and, on the other hand, the Buyer and its successors and
assigns.
(iv) “Losses” shall mean
any and all losses, claims, shortages, damages, liabilities, and expenses
(including reasonable attorneys’ and accountants’ fees) sustained, suffered or
incurred by any Indemnified Person arising from or in connection with any such
matter that is the subject of indemnification under this Section 9.
(c) Indemnification Generally;
Limitations. The Indemnifying Persons shall indemnify the
Indemnified Persons from and against any and all Losses arising from or in
connection with any Event of Indemnification with respect to the Indemnified
Persons, which shall be paid promptly by the Indemnifying Persons, provided,
that the maximum aggregate liability of any group of Indemnifying Persons shall
not exceed the amount of the final Purchase Price.
(d) Assertion of
Claims. No claim shall be brought under this Section 9 unless
the Indemnified Persons, or any of them, at any time prior to the applicable
Survival Date, give the Indemnifying Persons written notice of the existence of
any such claim, specifying the nature and basis of such claim and the amount
thereof, to the extent known, but the failure so to provide such notice to the
Indemnifying Persons will not relieve the Indemnifying Persons from any
liability which they may have to the Indemnified Persons under this Agreement or
otherwise (unless and only to the extent that such failure results in the loss
or compromise of any rights or defenses of the Indemnifying Persons and they
were not otherwise aware of such action or claim).
(e) Third Party
Claims. If the claim of an Indemnified Person arises out of,
or is a result of, any claim made by a third party against the Indemnified
Person, then the Indemnifying Person will be entitled to assume the defense of
any lawsuit, action, claim, litigation or other proceeding (each, an “Proceeding”) relating
thereto with counsel reasonably satisfactory to the Indemnified Person unless
(i) the Indemnifying Person is also a party to such Proceeding and the
Indemnified Person determines in good faith that a conflict of interest exists
which makes it inappropriate for the Indemnifying Person to assume such defense
or (ii) the Indemnifying Person fails to provide prompt reasonable
assurance in writing to the Indemnified Person of its intent to defend such
Proceeding. Upon its assumption of the defense of a Proceeding, the
Indemnifying Person will not, as long as it diligently conducts such defense, be
liable to the Indemnified Person under this Section 9 for the fees of other
counsel or any other expenses with respect to the defense of such Proceeding
subsequently incurred by the Indemnified Person in connection with the defense
thereof. Notwithstanding the assumption of the defense of a
Proceeding by the Indemnifying Person, each Indemnified Person shall reasonably
cooperate with the Indemnifying Person in connection with the defense
thereof. An Indemnified Person may participate in, but not control,
any defense or settlement of a Proceeding at its own expense. If the
Indemnifying Person assumes the defense of a Proceeding, (i) no compromise
or settlement of such claims may be effected by the Indemnifying Person without
the Indemnified Person’s consent unless (A) there is no finding or
admission establishing a violation of law by the Indemnified Person or having a
material adverse effect on any other claims of or against the Indemnified
Person, (B) the terms thereof provide for a full release for the
Indemnified Person and (C) the sole relief provided is monetary damages
that are paid in full by the Indemnifying Person; and (ii) the Indemnified
Person will have no liability with respect to any compromise or settlement of
such claims effected without its consent.
(f) Exclusive
Remedy. Each party hereto hereby agrees that the exclusive
remedy available to it with respect to any and all claims which are subject to
indemnification under this Agreement shall be to seek indemnification against
another party hereto pursuant to the terms and conditions of this Section 9;
provided, however, that nothing
in this Section 9(f) shall be deemed to preclude a party from pursuing any
remedy available to it at law or in equity to enforce another party’s
obligations under this Section 9.
10. Termination. This
Agreement may be terminated, and the transactions contemplated hereby may be
abandoned, at any time prior to the Closing Date:
(a) by
mutual written agreement of the Seller and the Buyer;
(b) by
either the Seller or the Buyer, if the Closing shall not have occurred on or
before June 1, 2010 (the “Termination Date”);
provided that the party seeking to terminate this Agreement pursuant to this
Section 10(b) (or its affiliates) shall not have breached in any material
respect its (or their) obligations under this Agreement in any manner that shall
have proximately contributed to the failure to consummate the transactions
contemplated herein on or before the Termination Date;
(c) by
the Seller, if there has been a material breach of any of the representations or
warranties, covenants or agreements of the Buyer set forth in this Agreement,
which breach is not curable or, if curable, is not cured within thirty (30) days
after written notice of such breach is given by the Seller to the Buyer;
and
(d) by
the Buyer, if there has been a material breach of any of the representations or
warranties, covenants or agreements of the Seller set forth in this Agreement,
which breach is not curable or,
if curable, is not cured within thirty (30) days
after written notice of such breach is given by the Buyer to the
Seller.
In the
event of termination of this Agreement pursuant to this Section 10, the
transactions contemplated hereby shall be deemed abandoned and this Agreement
shall forthwith become void, except that the provisions of this paragraph and
all of Section 11 shall survive any termination of this Agreement; provided,
however, that a termination pursuant to Section 10(b), 10(c) or 10(d) shall not
relieve the non-terminating party from liability for any breach of this
Agreement occurring prior to such termination (or any liability for intentional
acts, willful misconduct or fraud, with respect to which the terminating party
may pursue all remedies available at law or in equity).
11. Miscellaneous.
(a) Notices. All
notices, requests, consents and other communications hereunder shall be in
writing, shall be addressed to the receiving party’s address set forth below or
to such other address as a party may designate by notice hereunder, and shall be
either (i) delivered by hand, (ii) made by facsimile transmission, (iii)
sent by recognized overnight courier, or (iv) sent by certified mail, return
receipt requested, postage prepaid:
|
If
to the Buyer
|
WCR
Acquisition, Inc.
|
|
or
BCP II to:
|
c/o
Blackstreet Capital Management, LLC
|
|
5425
Wisconsin Avenue, Suite 701
|
|
|
Chevy
Chase, MD 20815
|
|
|
Attn:
Mr. Murry N. Gunty
|
|
|
Fax
No.: (240) 223-1331
|
|
|
With a copy
to:*
|
Patton
Boggs LLP
|
|
8484
Westpark Drive, Ninth Floor
|
|
|
McLean,
VA 22102
|
|
|
Attn:
Douglas C. Boggs, Esq.
|
|
|
|
Fax
No.: (703) 744-8001
|
|
If
to the Seller to:
|
WERCS
|
|
400
East 1st
Street
|
|
|
P.O.
Box 130
|
|
|
Casper,
WY 82601
|
|
|
Attn:
Mr. Lee Karavitis
|
|
|
Fax
No.: (307) 473-5585
|
|
|
With a copy
to:*
|
Kutak
Rock LLP
|
|
1650
Farnam Street
|
|
|
Omaha,
NE 68102
|
|
|
Attn:
Steven P. Amen, Esq.
|
|
|
Fax
No.: (402) 346-1148
|
*Such
copy shall not constitute notice.
All
notices, requests, consents and other communications hereunder shall be deemed
to have been given (a) if by hand, at the time of the delivery thereof to the
receiving party at the address of such party set forth above, (b) if sent by
facsimile transmission, at the time receipt has been acknowledged by electronic
confirmation or otherwise, (c) if sent by overnight courier, on the next
business day following the day such notice is delivered to the courier service,
or (d) if sent by certified mail, on the third (3rd)
business day following the day such mailing is made.
(b) Entire
Agreement. This Agreement, together with the Confidentiality
Agreement, embodies the entire agreement and understanding between the parties
hereto with respect to the subject matter hereof and supersede all prior
agreements and understandings relating to such subject matter.
(c) Assignment. Neither
this Agreement nor any interest herein shall be assignable (voluntarily,
involuntarily, by judicial process, operation of law, or otherwise), in whole or
in part, by any party without the prior written consent of the other party,
except that the Buyer may, without the consent of the Seller, assign all of its
rights under this Agreement to an affiliate of the Buyer, provided that the
Buyer remains liable for all of its obligations hereunder.
(d) Successors and
Assigns. Each of the terms, provisions, and obligations of
this Agreement shall be binding upon, shall inure to the benefit of, and shall
be enforceable by the parties and their respective legal representatives,
successors and permitted assigns.
(e) Amendments and
Waivers. Except as otherwise expressly set forth in this
Agreement, any term of this Agreement may be amended and the observance of any
term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), with the written consent of
the parties hereto. No waivers of or exceptions to any term,
condition or provision of this Agreement, in any one or more instances, shall be
deemed to be, or construed as, a further or continuing waiver of any such term,
condition or provision.
(f) Section
Headings. The section headings are for the convenience of the
parties and in no way alter, modify, amend, limit, or restrict the contractual
obligations of the parties.
(g) Severability. The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.
(h) Further
Assurances. At any time and from time to time after the
Closing, the parties agree to perform and execute all further acts, deeds,
conveyances and transfers, and deliver all further documents and assurances
reasonably necessary or desirable to effectuate the transactions contemplated in
this Agreement.
(i) Governing
Law. This Agreement (i) shall be governed by and construed in
accordance with the Minnesota Business Corporation Act as to matters relating to
the transfer of shares of capital stock by the Seller that are within the scope
thereof, and (ii) as to all other matters, shall be governed by and construed in
accordance with the laws of the State of Delaware, in each case without giving
effect to any applicable conflicts of laws provisions.
(j) Expenses. Each
of the parties shall pay all costs and expenses incurred by it or on its behalf
in connection with this Agreement and the transactions contemplated hereby,
including without limitation the fees and expenses of its own legal
counsel.
(k) Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and the
same document.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK.]
IN
WITNESS WHEREOF, the parties hereto have executed this Stock Purchase and Sale
Agreement as of the date first set forth above.
|
BUYER:
|
||||
|
WCR
ACQUISITION, INC.
|
||||
|
By:
|
/s/ Angel Donchev
|
|||
|
Name:
|
Angel
Donchev
|
|||
|
Its:
|
Vice
President
|
|||
|
SELLER:
|
||||
|
WERCS
|
||||
|
By:
|
/s/ Lee Karavitis
|
|||
|
Name:
|
Lee
Karavitis
|
|||
|
Its:
|
Vice
President
|
|||
|
Solely with respect to
the provisions
|
||||
|
of Sections 8(b)(i)
hereto:
|
||||
|
BLACKSTREET
CAPITAL PARTNERS (AI) II, L.P.
|
||||
|
By:
Blackstreet Capital Advisors II, LLC
|
||||
|
Its: General
Partner
|
||||
|
By:
|
/s/ Murry N. Gunty
|
|||
|
Name:
|
Murry
N. Gunty
|
|||
|
Its:
|
Manager
|
|||
|
BLACKSTREET
CAPITAL PARTNERS (QP) II, L.P.
|
||||
|
By:
Blackstreet Capital Advisors II, LLC
|
||||
|
Its: General
Partner
|
||||
|
By:
|
/s/ Murry N. Gunty
|
|||
|
Name:
|
Murry
N. Gunty
|
|||
|
Its:
|
Manager
|
|||
EXHIBIT
C
FIRST
AMENDMENT TO STOCK PURCHASE AND SALE AGREEMENT
THIS
FIRST AMENDMENT TO STOCK PURCHASE AND SALE AGREEMENT (this “Amendment”), dated as
of March 3, 2010, is entered into by and among WERCS, a Wyoming corporation (the
“Seller”), WCR
ACQUISITION, INC., a Delaware corporation (“Original Buyer”),
WCR, LLC, a Delaware limited liability company (“Buyer”), and, solely
for the limited purposes set forth in Section 8(b)(i) of the Agreement (as
defined below), BLACKSTREET CAPITAL PARTNERS (AI) II, L.P., a Delaware limited
partnership, and BLACKSTREET CAPITAL PARTNERS (QP) II, L.P., a Delaware limited
partnership (collectively, “BCP
II”). All capitalized terms used herein and not otherwise
defined shall have the meanings assigned to them in the Agreement.
RECITALS:
WHEREAS, the Seller, Original
Buyer and BCP II entered into a certain Stock Purchase and Sale Agreement, dated
February 23, 2010 (the “Agreement”), pursuant
to which, among other things, the Seller agreed to sell and Original Buyer
agreed to purchase the Shares;
WHEREAS, Original Buyer
desires to transfer and assign all of its rights and obligations under the
Agreement to Buyer;
NOW, THEREFORE, in
consideration of the mutual covenants and agreements contained herein, and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Buyer and the Seller hereby covenant and agree as
follows:
1. Substitution of Original
Buyer. Original Buyer hereby transfers and assigns to Buyer
all of its rights and obligations under the Agreement, including without
limitation its obligation to pay the Purchase Price to the Seller and its right
to receive the Shares, in each case subject to the satisfaction of the
conditions set forth in the Agreement. All references in the
Agreement to the term “Buyer” shall be deemed amended to refer to WCR, LLC and
all references to “WCR Acquisition, Inc.” shall be replaced with “WCR,
LLC”.
2. Amendment to Section
5(a). The word “corporation” in the first sentence of Section
5(a) of the Agreement is hereby deleted and replaced with “limited liability
company”.
3. Amendment to Sect
ion
5(b). The phrase “certificate of incorporation or bylaws” in
the first sentence of Section 5(b) of the Agreement is hereby deleted and
replaced with “certificate of formation or operating agreement”.
4. Miscellaneous.
(a) No Other
Amendments. Except as modified by the terms of this Amendment,
the Agreement is hereby ratified and confirmed in its entirety, and shall remain
in full force and effect in accordance with its terms.
(b) Reference to
Agreement. On and after the date hereof, each reference in the
Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like
import referring to the Agreement shall mean and be a reference to the Agreement
as amended hereby.
(c) Governing
Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Delaware, in each case without giving
effect to any applicable conflicts of laws provisions.
(d) Counterparts. This
Amendment may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and the
same document.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK.]
IN
WITNESS WHEREOF, the parties hereto have executed this First Amendment to Stock
Purchase and Sale Agreement as of the date first set forth above.
|
SELLER:
|
||||
|
WERCS
|
||||
|
By:
|
/s/ Lee Karavitis
|
|||
|
Name:
|
Lee
Karavitis
|
|||
|
Its:
|
Vice
President
|
|||
|
BUYER:
|
||||
|
WCR,
LLC
|
||||
|
By:
|
Blackstreet Capital Advisors II, LLC | |||
|
Its:
|
Manager | |||
|
By:
|
/s/ Murry N. Gunty
|
|||
|
Name:
|
Murry
N. Gunty
|
|||
|
Its:
|
Manager
|
|||
|
ORIGINAL
BUYER:
|
||||
|
WCR
ACQUISITION, INC.
|
||||
|
By:
|
/s/ Angel Donchev
|
|||
|
Name:
|
Angel
Donchev
|
|||
|
Its:
|
Vice
President
|
|||
Signature page
to First Amendment to Stock Purchase and Sale Agreement
ACKNOWLEDGED
AND AGREED:
|
BCP
II:
|
|||
|
BLACKSTREET
CAPITAL PARTNERS (AI) II, L.P
|
|||
|
By:
|
Blackstreet
Capital Advisors II, LLC
|
||
|
Its:
|
General
Partner
|
||
|
/s/
Murry N. Gunty
|
|||
|
Name:
|
Murry
N. Gunty
|
||
|
Its:
|
Manager
|
||
|
BLACKSTREET
CAPITAL PARTNERS (QP) II, L.P
|
|||
|
By:
|
Blackstreet Capital Advisors II, LLC | ||
|
Its:
|
General Partner | ||
|
/s/ Murry N. Gunty
|
|||
|
Name:
|
Murry
N. Gunty
|
||
|
Its:
|
Manager
|
||
Signature
page to First Amendment to Stock Purchase and Sale Agreement