Stock Exchange Agreement

EXHIBIT 10(i)


STOCK EXCHANGE AGREEMENT


This Agreement ("Agreement") is made and entered into this the 20th day of February 2001 by and between American International Ventures, Inc. f/k/a American Precious Metals, Inc., a Delaware corporation whose address is 260 Garibaldi Avenue, Lodi, New Jersey 07644 (the "Purchaser"), and TLM Industries, Inc., a New Jersey corporation whose address is 30 Hillside Avenue, Springfield, New Jersey 07081 (the "Acquired Corporation") and those shareholders of the Acquired Corporation identified on the signatory page of this Agreement (the "Shareholders"), which Shareholders include Anthony Lauro and Dominic Taglialatella ("Controlling Shareholders").


* W I T N E S S E T H *


WHEREAS, Purchaser desires to acquire all of the issued and outstanding shares of capital stock of the Acquired Corporation from the Shareholders in exchange for certain shares of Purchaser, and, similarly, the Shareholders desire to acquire certain of the shares of common stock of Purchaser in exchange for all of their shares of common stock of the Acquired Corporation, all in a transaction that qualifies under Section 354 and 368(a)(1)(b) of the Internal Revenue Code of 1986, as amended,


NOW THEREFORE, in consideration of the mutual covenants, terms and conditions contained herein, the parties do hereby covenant, warrant and agree as follows:


ARTICLE I EXCHANGE OF STOCK


1.01. Capital Stock and Shareholders of Acquired Corporation. The issued and outstanding capital stock of the Acquired Corporation consists of common stock, no par value, and preferred stock, no par value. The Shareholders include holders of common stock and holders of preferred stock of the Acquired Corporation.


1.02. Purchaser Shares. In consideration of the mutual terms, covenants and conditions contained herein, Purchaser hereby assigns, transfers and conveys to each Shareholder that number of shares of common stock, $.00001 par value, of Purchaser set opposite each Shareholder's name on Exhibit 1.02 (the "Purchaser Shares"). The Purchaser Shares will be delivered to each Shareholder within ten (10) days from Closing (as defined herein). In addition, Purchaser agrees to issue shares of its common stock in fulfillment of the contractual responsibilities of the Acquired Corporation for two (2) of its employees as set forth on Exhibit 3.01(iii).


1.03. Share Ownership Rights of Acquired Corporation. The parties hereby acknowledged that share certificates of the Acquired Corporation have not been issued to each of the Shareholders. Each Shareholder, individually but not jointly, and the Acquired Corporation hereby represent and warrant to the Purchaser that the share ownership (which includes common stock and preferred stock) of the Acquired Corporation set opposite each Shareholder's name on Exhibit 1.03 (each a "Share Ownership Right") is true and correct. Each Shareholder further represents and warrants that, except for the respective Share Ownership Right, no warrants, options, or other rights to the capital stock of the Acquired Corporation are held by such Shareholder. Concurrent with the execution hereof and subject to the mutual terms, covenants and conditions hereof including the receipt by each Shareholder of his respective Acquired Shares, each Shareholder hereby assigns, transfers and conveys to Purchaser all of his right, title and interest in and to all capital stock or other rights to capital stock of the Acquired Corporation held by such Shareholder, which includes the respective Share Ownership Right. It is understood that the stock certificates representing each respective Share Ownership will not be provided to the Purchaser. Rather, this instrument effectively transfers and assigns the Share Ownership of each Shareholder to the Purchaser. The Controlling Shareholders are holders of rights to the preferred stock, no par value, of the Acquired Corporation. Concurrent with the execution hereof and subject to the mutual terms, covenants and conditions hereof, each Controlling Shareholders hereby waives and disclaims any and all rights and privileges to any and all unpaid and/or accrued dividends or other distributions under the preferred stock.


1.04. Additional Undertakings. Concurrent with the execution hereof and from time to time thereafter, the parties hereto shall execute such additional instruments and take such additional action as such other party(ies) make reasonably request in order to effectuate the purpose and intent of this Agreement.


ARTICLE II REPRESENTATIONS AND WARRANTIES OF PURCHASER


As of the date hereof and at Closing, Purchaser does hereby represent and warrant to the Acquired Corporation as follows:


(i) Purchaser is a corporation duly organized, validly existing and is in good standing under the laws of the Delaware and in other jurisdictions where it conducts business, has full corporate power and authority to execute and deliver this Agreement and has no subsidiaries,


(ii) the authorized capital stock of Purchaser consists of 50,000,000 shares of common stock, $.00001 par value,


(iii) the issued and outstanding shares of capital stock of Purchaser are set forth on Exhibit 2.01 (iii). In addition, (a) there are no warrants, rights, options, conversion privileges, stock purchase plans or other agreements or undertakings which obligates Purchaser now or upon the occurrence of some future event to issue additional shares of capital stock, (b) there are no restrictions on the transfer of shares of capital stock of Purchaser other than those imposed by relevant state and federal securities laws, and (c) no holder of any security of Purchaser is entitled to any preemptive or similar statutory or contractual rights, either arising pursuant to an agreement or instrument to which Purchaser is a party or which are otherwise binding on Purchaser. The Purchaser Shares are free and clear of any mortgage, lien, pledge, or other encumbrance and are duly authorized, validly issued, fully paid and non-assessable shares of capital stock of Purchaser,


(iv) the financial statements of Purchaser, which consists of an audited balance sheet as of May 31, 2000 and the unaudited statements for the six month period ending November 30, 2000 and related statements of income for the periods then ended as filed with the Securities and Exchange Commission which have been delivered to the Acquired Corporation, are correct and fairly present the financial condition of Purchaser for the periods involved, and such statements were prepared in accordance with generally accepted accounting standards consistently applied; except in connection with this transaction, Purchaser has no material liabilities, whether due or to become due, and whether accrued or contingent, not reflected as part of the financial statements of Purchaser, other than liabilities incurred in the ordinary course of business since November 30, 2000 and other liabilities which, in the aggregate, are not material to the business or financial condition of Purchaser,


(v) Except as reflected or reserved against the balance sheet of Purchaser, as set forth on Exhibit 2.01 (iv) or as set forth on Exhibit 2.01 (v), Purchaser has no liabilities of any nature, whether accrued, absolute, contingent or otherwise, including, without limitation, tax liabilities and interest due or to become due. Purchaser's accounts receivable are collectable in accordance with the terms of such accounts, except to the extent of the reserve therefore in Purchaser's balance sheet set forth on Exhibit 2.01 (iv),


(vi) Since the date of the financial statements set forth on Exhibit 2.01 (iv) to the present, there have not been;


(a) any changes in the condition (financial or otherwise), assets, liabilities, capitalization, business or business prospects of Purchaser which, individually or in the aggregate, have been materially adverse,


(b) any declaration or payment of any dividend or other distribution with respect to Purchaser's capital stock,


(c) any direct or indirect redemption, purchase or other acquisition of stock of Purchaser,


(d) any increases paid or agreed to be paid in the compensation, retirement benefits or other commitments to officers, directors, employees, consultants, or agents,


(e) any damage or destruction (whether or not covered by insurance) adversely affecting, in any material respects, any properties, business or business prospects of Purchaser, and,


(f) any acquisition or disposition of assets or properties in any transaction with any officer, director, shareholder or monthly salaried employee of Purchaser or any relative by blood or marriage or any Affiliate or Associate (as such terms are defined in Rule 405 promulgated under the Securities Act of 1933, as amended) of any of them, or, except in the ordinary course of business, any other acquisition or disposition of any assets or properties of material value,


(vii) the assets reflected on the balance sheet of Purchaser as of May 31, 2000 are owned free and clear of all liens, claims, charges and encumbrances of any kind or nature, except to the extent disposed of in the ordinary course of business since May 31, 2000; all such assets, if any, characterized as inventory are stated at no more than the lower of cost or market value and are, in all material respects, usable and salable in the ordinary course of business,


(viii) there are no collective bargaining agreements and other labor agreements to which Purchaser is a party or by which it is legally bound, and there are no employment, profit sharing, deferred compensation, bonus, stock option, stock purchase, pension, retainer, consulting, retirement, welfare or incentive plans, labor contract agreements, labor arrangements or labor practices to which Purchaser is a party or is legally bound,


(ix) Exhibit 2.01 (ix) is a true and correct list of any and all material contacts, agreements, leases, arrangements or understandings, written or oral, which Purchaser is a party, or by which any of its assets or properties are legally bound,


(x) there are no judicial or administrative actions, suits or proceedings pending or threatened, that might result in a material adverse change in the condition (financial or otherwise), properties, assets, business or operations of Purchaser or that question the validity of this Agreement,


(xi) neither the execution and delivery of this Agreement by Purchaser, nor the consummation of the transactions set forth herein or contemplated hereby will conflict with or result in any violation of or constitute a breach of or a default under the Certificate of Incorporation or By Laws of Purchaser or under any contract, instrument, agreement, understanding, mortgage, indenture, lease, insurance policy, permit, concession, grant, franchise, license, judgment, order, decree, statute, law, ordinance, rule or regulation applicable to or to which Purchaser is a party, nor will it give rise to any right of acceleration in the time for performance or any obligation of Purchaser under any contract or instrument, nor will it result in the creation of any lien, charge, encumbrance of any asset of Purchaser,


(xii) Purchaser has filed all federal, state, local and foreign tax returns which are due or has obtained appropriate extensions with respect thereto and all such returns are true and correct in all material respects as filed; Purchaser has not received any notice of deficiency for assessment of additional taxes and Purchaser is not a party to any action or proceeding by any governmental authority for assessment or collection of taxes with respect to its business; no deficiency assessment or proposed adjustment of Purchaser's federal, state, or local or foreign taxes is pending, except for taxes incurred by Purchaser in the ordinary course of business allocable to the most recent taxable quarter; the Purchaser has no knowledge of any proposed liability for any tax to be imposed upon its properties, assets, or business for which there is no adequate reserve reflected in the balance sheet of Purchaser, as set forth on Exhibit 2.01 (iv),


(xiii) Purchaser is acquiring the Share Ownership for investment purposes and not with a view to any resale or distribution thereof. Purchaser represents that the Share Ownership is being acquired in a transaction which is exempt from the registration requirements of the Securities Act of 1933, as amended (the "Act"), and that it understands that the Share Ownership must be held indefinitely, unless subsequently registered under the Act or unless an exemption from registration is available, including Rule 144 under the Act, and that it must, accordingly, bear the economic risk of its investment for an indefinite period of time,


(xiv) none of the stockholder's, directors, employees, officers of Purchaser or any relative by blood or marriage, Affiliates, or Associates (as defined in 2.01 (vii) (f)) of any of the foregoing, is currently a party to any material transaction with Purchaser,


(xv) none of the warranties and representations made by Purchaser herein or in the Exhibits or other documents related hereto, nor the financial statements furnished by Purchaser nor any certificate or memorandum furnished or to be furnished by Purchaser, contains or will contain any untrue statement of material fact or omits or will omit to state any material fact necessary in order to make the statements contained herein or therein not misleading, and all representations and warranties of Purchaser contained herein are true and correct,


(xvi) the Purchaser Shares are free and clear of all liens, claims, pledges, and other encumbrances of any nature; the Purchaser Shares are not subject to any contact, agreement, arrangement or understanding, written or otherwise, which would adversely affect or otherwise prohibit or limit the acquisition of the Purchaser Shares by the Shareholders, and


(xvii) Purchaser has timely filed all required reports and filings with the Securities and Exchange Commission as required under the Securities Exchange Act of 1934.


ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED CORPORATION AND THE SHAREHOLDERS


As of the date hereof and at Closing, the Acquired Corporation and each Shareholder (limited to sub-paragraphs (xiv), (xvi), (xvii) and (xviii) below only) do hereby represent and warrant to Purchaser as follows:


(i) the Acquired Corporation is a corporation duly organized, validly existing and is good standing under the laws of the State of New Jersey and in other jurisdictions where it conducts business, has full corporate power and authority to execute and deliver this Agreement and h ...