AGREEMENT OF PURCHASE AND SALE
This agreement of purchase and sale is made in two original copies between:
(1) Xxxx Whorely and Xxxxxxx Xxxxxxx (the "Vendors")
and
(2) Civic Equities Corporation and 595493 B.C. Ltd. (the "Purchaser").
Whereas the Vendor owns all the issued shares of TRG Systems Ltd. (the
"Corporation");
It is agreed as follows:
SUBJECT-MATTER
1.01 The Purchaser agrees to buy and the Vendor agrees to sell to the
Purchaser all of the shares owned by the Vendor in the Corporation (the
"Shares").
PURCHASE PRICE
2.01 The purchase price payable for the Shares is the total of the amounts
allocated among the Shares as follows:
a) for all the Common shares - $1,500,000.00 U.S.
TERMS OF PAYMENT
3.01 The Vendor acknowledges receiving a cheque for $50,000.00 U.S. from
the Purchaser on execution of this agreement to be held by the Vendor as a non
refundable deposit on account of the purchase price of the Shares and as
security for the Purchaser's due performance of this agreement.
3.02 The Purchaser shall pay the balance of the purchase price of the
Shares by certified cheque on closing.
3.03 It is understood and agreed that the purchase price of the Shares is
based on the financial position of the Corporation shown in the balance sheet
produced by the Vendor
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for the Corporation and appended as Schedule A. If the net book value of the
Corporation as of the date of closing is less than 10% of the net book value of
the Corporation shown in Schedule A, the Vendor shall refund the Purchaser the
dollar value difference within a reasonable time of receipt of written notice of
the difference. For the purposes of this paragraph, the net book value of the
Corporation means the dollar book value of the assets of the Corporation minus
the dollar book value of the liabilities, other than for shareholder equity, of
the Corporation determined in accordance with generally accepted accounting
principles.
CONDITIONS, REPRESENTATIONS AND WARRANTIES
4.01 In addition to anything else in this agreement, the following are
conditions of completing this agreement in favour of the Purchaser:
a) that the Vendor owns all the issued shares of the Corporation;
b) that the Shares are fully paid-up and non-assessable;
c) that no agreement or option exists pursuant to which the Corporation is or
may be obliged to issue further shares of its authorized capital;
d) that the Shares are sold free and clear of all liens, encumbrances and
charges;
e) that any consent required for the transfer of the Shares in accordance with
the Purchaser's direction is given;
f) that the Corporation is duly incorporated, validly subsisting and in good
standing under the laws of its jurisdiction of incorporation;
g) that the Corporation is not party to any collective agreement with a labour
union;
h) that the Vendor give the Purchaser and all duly authorized representatives
of the Purchaser full and complete access during normal business hours to
the business premises and corporate, business, accounting, tax and
employment records of the Corporation for the purpose of investigating the
business and affairs of the Corporation;
i) that the Purchaser obtain financing on terms satisfactory to the Purchaser
to complete the purchase;
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j) that the Vendor supply or deliver on closing all of the closing documents.
4.02 The Purchaser agrees that, unless and until the purchase of the Shares
contemplated in this agreement is completed, the Purchaser shall keep
confidential all confidential information obtained by the Purchaser from the
Vendor or the Corporation about the Vendor and the business and affairs of the
Corporation.
4.02 The following representatives and warranties are made and given by the
Vendor to the Purchaser and expressly survive the closing of this agreement. The
representations are true as of the date of this agreement and will be true as of
the date of closing when they shall continue as warranties according to their
terms. At the option of the Purchaser, the representations and warranties may be
treated as conditions of the closing of this agreement in favour of the
Purchaser. However, the closing of this agreement shall not operate as a waiver
or otherwise result in a merger to deprive the Purchaser of the right to xxx the
Vendor for breach of warranty in respect of any matter warranted, whether or not
ascertained by the Purchaser prior to closing:
a) the Vendor is a resident of Canada within the meaning of the Income Tax Act
of Canada;
b) the Articles of Incorporation and all amendments to the Articles of
Incorporation of the Corporation are as stated in Schedule B;
c) the issued share capital of the Corporation is as stated in Schedule C;
d) the balance sheet appended in Schedule A and the financial statements for
the last three complete fiscal years of the Corporation produced by the
Vendor appended in Schedule D have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis and
are fair and accurate;
e) the Corporation owns the assets recorded in the balance sheet appended in
Schedule A free and clear of liens, charges and encumbrances except as
noted in Schedule E;
f) the Corporation has properly reported and is not in arrears of payment of
any direct or indirect taxes or of any employee-related statutory
deductions or remittances;
g) the corporate, business, accounting, tax and employment
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records of the Corporation are complete in all material respects;
h) the business of the Corporation will not be adversely affected in any
material respect in any way, whether by the Vendor or by any other person
or cause whatsoever, up to closing and the Vendor will not do anything
before or after closing to prejudice the goodwill of the Corporation;
i) the Corporation will carry on business as usual until closing except that
it will not declare any dividends or make any other distributions of
capital or retained liabilities without the express written consent of the
Purchaser;
j) there are no outstanding legal actions or judgments against the
Corporation and the Corporation is not in default of any agreement to which
the Corporation is a party and that all such agreements are in good
standing and the Corporation is entitled to all stated benefits in such
agreements;
k) the Vendor has made full and fair disclosure in all material respects of
any matter that could reasonably be expected to affect the Purchaser's
decision to purchase the Shares on the terms set out in this agreement;
l) the Vendor will execute such assignments, consents, clearances or
assurances after closing, prepared at the Purchaser's expense, as the
Purchaser considers necessary or desirable to assure the Purchaser of the
proper and effective completion of this agreement.
4.04 The following warranty is made and given by the Purchaser to the
Vendor in consideration of the closing of this agreement: the Purchaser will
personally indemnify and save the Vendor harmless from claims on any outstanding
personal guarantees given by the Vendor for the contractual obligations of the
Corporation.
NON-COMPETITION
5.01 The vendor covenants with the Purchaser that, in consideration of the
closing of this agreement, the Vendor will not operate a Communications business
or in any way aid and assist any other person to operate such a business in
Canada for a period of ten years from the date of closing.
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CLOSING DOCUMENTS
6.01 The Vendor shall deliver to the Purchaser, in registerable form where
applicable, the following closing documents (the "closing documents"), prepared
or obtained at the Vendor's expense, on or before closing:-
a) certificates of the Shares duly assigned in accordance with the direction
of the Purchaser together with satisfactory proof of the giving of any
consent required for the assignment;
b) all the corporate, business, accounting, tax and employment records of the
Corporation;
c) the written resignation of each director and officer of the Corporation
effective as of the date of closing together with each director's and
officer's personal release of all contracts with and claims against the
Corporation;
d) a duly certified record of a resolution passed by the shareholders of the
Corporation electing Xxxx Xxxxxx and Xxxxxxx Aitzetmeuller to the Board of
Directors of the Corporation effective as of the date of closing;
e) a statutory declaration that the Vendor is a resident of Canada within the
meaning of the Income Tax Act of Canada as of the date of closing;
f) such other assignments, consents, clearances or assurances as the Purchaser
reasonably considers necessary or desirable to assure the Purchaser of the
proper and effective completion of this agreement.
CLOSING DATE
7.01 The purchase and sale in this agreement shall close on July 31, 2000.
MISCELLANEOUS
8.01 In this agreement, the singular includes the plural and the masculine
includes the feminine and neuter and vice versa unless the context otherwise
requires.
8.02 The capitalized headings in this agreement are only for convenience of
reference and do not form part of or affect the interpretation of this
agreement.
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8.03 If any provision or part of any provision in this agreement is void
for any reason, it shall be severed without affecting the validity of the
balance of the agreement.
8.04 Time is of the essence of this agreement.
8.05 There are no representations, warranties, conditions, terms or
collateral contracts affecting the transaction contemplated in this agreement
except as set out in this agreement.
8.06 This agreement binds and benefits the parties and their respective
heirs, executors, administrators, personal representatives, successors and
assigns.
8.07 This agreement is governed by the laws of the Province of British
Columbia.
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ACCEPTANCE
9.01 This agreement executed on behalf of the Purchaser constitutes an
offer to purchase which can only be accepted by the Vendor by return of at least
on originally accepted copy of agreement to the Purchaser on or before March 30,
2000 failing which the offer becomes null and void. If this offer becomes null
and void or is validly revoked before acceptance or this agreement is not
completed by the Purchaser for any valid reason, any deposit tendered with it on
behalf of the Purchaser shall be returned without penalty or interest.
Executed under seal on March 30, 2000.
Signed, Sealed and Delivered in the Presence of:
[SEAL]
/s/ Xxxxxx Xxxx /s/ XXXX XXXXXX
---------------------------------- ----------------------------------
CIVIC EQUITIES CORPORATION Xxxx Xxxxxx
for-------------------------------
/s/ Xxxxxx Xxxx /s/ XXXX XXXXXXX
---------------------------------- ----------------------------------
Xxxx Xxxxxxx
for-------------------------------
/s/ Xxxxxx Xxxx /s/ XXXXXXX XXXXXXX
---------------------------------- ----------------------------------
Xxxxxxx Xxxxxxx
for-------------------------------
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ACKNOWLEDGMENT
BETWEEN:
CIVIC EQUITIES CORPORATION
AND
595493 B.C. LTD.
AND
XXX XXXXXXX
AND
XXXXXXX XXXXXXX
IT IS HEREBY ACKNOWLEDGED by the parties named, that pursuant to the
agreement of March 30, 2000, wherein Xxxx Xxxxxxx and Xxxxxxx Xxxxxxx sold their
shares in TRG Systems Ltd. to Civic Equities Corporation and 59493 B.C. Ltd.,
that all Intellectual rights to the technology known as "VIP Satnet" is the sole
property of TRG Systems Ltd. Subject to distribution agreements in place with
Alantra Ventures and Intercontinental Communication Systems Inc.
DATED THIS 30TH DAY OF MARCH, 2000.
/s/ XXXX XXXXXX
[SEAL] ----------------------------------
Xxxx Xxxxxx
/s/ XXXXXXX XXXXXXX
----------------------------------
Xxxxxxx Xxxxxxx
/s/ XXXX XXXXXXX
----------------------------------
Xxxx Xxxxxxx
Per
595493 B.C. LTD.
CIVIC EQUITIES CORPORATION
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