1
EXHIBIT 3(A)(1)
SHARE EXCHANGE AGREEMENT
3(a)(1)-1
2
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT dated April 7, 1997 is made
B E T W E E N:
OSGOODE HOLDINGS, INC.,
a corporation incorporated under the laws
of the Province of Ontario
(hereinafter referred to as "Osgoode")
OF THE FIRST PART
-and-
LASERMEDIA, INC.,
a corporation incorporated under the laws
of the province of Ontario
(hereinafter referred to as "Lasermedia")
OF THE SECOND PART
WHEREAS Osgoode desires to purchase from the Lasermedia Shareholders
and the Lasermedia Shareholders desire to sell to Osgoode the Lasermedia Shares;
AND WHEREAS Osgoode and the Lasermedia Shareholders desire to effect
the purchase and sale of the Lasermedia Shares pursuant to the Share Exchange in
accordance with the terms and conditions of this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT, in consideration of the mutual
covenants hereinafter contained and provided for and other good and valuable
consideration (the receipt and sufficiency of which is hereby acknowledged by
the Parties), the Parties agree as follows:
ARTICLE I
INTERPRETATION
3(a)(1)-2
3
1.1 DEFINITIONS. In this Agreement, unless the context otherwise requires, the
terms set forth in Schedule 1.1 shall have the meanings set forth therein.
1.2 ENTIRE AGREEMENT. This Agreement together with the agreements and other
documents to be delivered pursuant to this Agreement, constitute the entire
agreement between the Parties pertaining to the Share Exchange and supersedes
all prior agreements, understandings, negotiations and discussions, whether oral
or written, including, without limitation, the Merger Agreement dated April 7,
1997 between Osgoode and Lasermedia and there are no warranties, representations
and other agreements between the Parties in connection with the subject matter
hereof except as specifically set forth in this Agreement or any other agreement
or document to be delivered pursuant to this Agreement.
1.3 EXTENDED MEANINGS. In this Agreement, words importing the singular number
include the plural and vice versa; words importing the masculine gender include
the feminine and neuter genders.
1.4 HEADINGS. The division of this Agreement into articles, sections,
subsections and paragraphs and the insertion of headings are for convenience of
reference only and shall not affect the construction or interpretation of this
Agreement.
1.5 REFERENCES. References to an article, section, subsection, paragraph,
schedule or exhibit shall be construed as references to an article, section,
subsection, paragraph, schedule or exhibit to this Agreement, unless the context
otherwise requires.
1.6 GOVERNING LAW. This Agreement shall be governed and construed in accordance
with the laws of the Province of Ontario and the laws of Canada applicable in
that Province.
1.7 CURRENCY. Unless otherwise specified, the word "dollar", or the symbol "$"
refers to Canadian currency.
1.8 SCHEDULES. The following is a list of schedules attached to and incorporated
into this Agreement by reference and deemed as part of this Agreement.
SCHEDULE DESCRIPTION
1.1 Definitions
1.11 Shareholders of Lasermedia
2.2 Share Exchange
5.1 Osgoode Financial Statements
ARTICLE II
SHARE EXCHANGE
3(a)(1)-3
4
2.1 AGREEMENT TO PURCHASE. Upon the terms and subject to the conditions
contained in this Agreement, the Lasermedia Shareholders shall sell and Osgoode
shall purchase, as of and with effect from the opening of business on the
Closing Date, the Lasermedia Shares.
2.2 SHARE EXCHANGE. The purchase and sale of the Lasermedia Shares shall be
effected by the issue of Osgoode Shares to the Lasermedia Shareholders, pursuant
to the prospectus and registration exemptions contained in paragraphs 72(1)(j)
and 35(l)(16) of the Securities Act (Ontario), in exchange for the Lasermedia
Securities as set forth in Schedule 2.2 (the "Share Exchange").
2.3 VALUATION. Osgoode and the Lasermedia Shareholders have established, for the
purpose of this Agreement, that the Lasermedia Shares and the Osgoode Shares
have the respective value of $8,300,000, subject to a complete valuation report
including audited financial statements supplied by Lasermedia to the management
of Osgoode for approval.
2.4 NO SOLICITATION, ETC. Lasermedia and its subsidiaries will not, directly or
indirectly, through any officer, director, investment broker, agent or
otherwise, make, solicit, initiate or encourage inquiries from or submission or
proposals or offers from any person, corporation, partnership or other business
organization whatsoever (including any of its officers or employees) relating to
any liquidation, dissolution, recapitalization, merger, amalgamation,
acquisition or purchase of all or a material portion of the assets of, or any
equity interest in (including the Lasermedia Shares), Lasermedia or any of its
subsidiaries or other similar transaction or business combination involving
Lasermedia or any of its subsidiaries, or participate in any discussions or
negotiations regarding, or furnish to any other person any information with
respect to, otherwise co-operate in any way with, or assist or participate in,
or facilitate or encourage, any effort or attempt to by any other person to seek
any of the foregoing; provided, however, that the foregoing shall not prevent
the board of directors of Lasermedia or Lasermedia from responding to any bona
fide offer, proposal or inquiry made by a third party in relation to the
foregoing (including, without limitation, furnishing such third party
information of the type provided to Osgoode or where, in the opinion of the
board of directors acting in good faith, on the basis of written opinion of its
outside counsel, a failure to so respond would be inconsistent with its
fiduciary obligations under applicable law. Lasermedia shall promptly notify
Osgoode of any proposal or offer, or any inquiry or contact with any person with
respect thereto, has been or is made and shall promptly provide Osgoode with
such information regarding such proposal, inquiry or contact as Osgoode may
request.
ARTICLE III
REPRESENTATIONS AND WARRANTIES RE: THE LASERMEDIA SHAREHOLDERS
3.1 REPRESENTATIONS AND WARRANTIES OF THE LASERMEDIA SHAREHOLDERS. Lasermedia
represents and warrants to Osgoode as follows and acknowledges that Osgoode is
relying on these representations and warranties in connection with the
completion of the Share Exchange:
3(a)(1)-4
5
(a) CAPACITY TO OWN LASERMEDIA SHARES - The Lasermedia
Shareholders have all necessary power, authority and capacity
to own the Lasermedia Shares.
(b) CAPACITY TO ENTER AGREEMENT - The Lasermedia Shareholders have full
power, right and authority to enter into this Agreement and to perform
their obligations under it.
(c) ABSENCE OF CONFLICT - The Lasermedia Shareholders are not a party
to, bound or affected by any agreement which would be violated,
breached or terminated by, or which would result in creation or
imposition of any encumbrance upon any of the Lasermedia Shares as a
consequence of the execution and delivery of this Agreement or the
consummation of the transactions contemplated in this Agreement.
(d) TITLE TO LASERMEDIA SHARES - The Lasermedia Shareholders are the
legal and beneficial owners of the Lasermedia Shares, as set forth in
Schedule "2.2", with good and marketable title, free and clear of any
Encumbrances.
(e) NO BANKRUPTCY - No proceedings have been taken or authorized by any
Lasermedia Shareholder or by any other person in respect of the
bankruptcy, insolvency, liquidation, dissolution or winding up as
applicable, of any Lasermedia Shareholder.
(f) NO OPTION - No Person, other than Osgoode under this Agreement, has
any agreement or any right capable of becoming an agreement or option
for the purchase from the Lasermedia Shareholders of any of the
Lasermedia Shares.
(g) DISCLOSURE - The representations and warranties of the Lasermedia
Shareholders in this Agreement are true, correct and do not contain any
untrue or misleading statement of a material fact or omit to state a
material fact necessary to make such representations and warranties not
misleading to Osgoode.
(h) NON-VIOLATION - The entering into of this Agreement and the
consummation of transactions contemplated herein do not and will not
conflict with, or result in a breach of, or constitute a default under
the terms or conditions or any constating document of Lasermedia, any
by-laws, any court or administrative order or process, any agreement or
instrument to which Lasermedia is party or by which it is bound.
ARTICLE IV
ADDITIONAL REPRESENTATION AND WARRANTIES OF LASERMEDIA
4.1 REPRESENTATIONS AND WARRANTIES OF LASERMEDIA. Lasermedia represents and
warrants to Osgoode as follows and acknowledges that Osgoode is relying on these
representations and warranties in connection with the Share Exchange:
3(a)(1)-5
6
(a) DUE INCORPORATION. Lasermedia is a corporation duly incorporated
and validly existing under the laws of the Province of Ontario.
(b) CAPACITY TO ENTER AGREEMENT. Lasermedia has full corporate power
and authority to enter into this Agreement and to perform its
obligations under it.
(c) DUE AUTHORIZATION. The executing and delivery of this Agreement and
the consummation of the transactions contemplated under it have been
duly authorized by all necessary corporation action on the part of
Lasermedia.
(d) BINDING OBLIGATION. This Agreement has been duly executed and
delivered by Lasermedia and constitutes a valid and binding obligation
of it.
(e) ABSENCE OF CONFLICT. Lasermedia is not a party to, bound or
affected by any agreement which would be violated, breached or
terminated by, or which would result in the creation or imposition of
any Encumbrance upon any of the Lasermedia Shares as a consequence of
the execution and delivery of this Agreement or the consummation of the
transactions contemplated in this Agreement.
(f) REGULATORY APPROVALS. Except for Shareholder Approval and
Regulatory Approval, no governmental or regulatory authorization,
approval, order, consent or filing is required on the part of
Lasermedia, in connection with the execution, delivery and performance
of this Agreement and the performance of Lasermedia's obligations under
this Agreement.
(g) NO BANKRUPTCY. No proceedings have been taken, are pending or
authorized by Lasermedia or by any person in respect of the bankruptcy,
insolvency, liquidation, dissolution or winding up of Lasermedia.
(h) AUTHORIZED AND ISSUED CAPITAL. As of the Closing Date, the
authorized capital of Lasermedia shall consist of an unlimited number
of common shares, of which not more than 13,500,000 common shares shall
be currently outstanding as fully paid and non-assessable shares of
Lasermedia. There shall also be issued and outstanding not more than
600,000 Series A common share purchase warrants, 200,000 Series B
common share purchase warrants, 200,000 Series C common share purchase
warrants, 100,000 Series D common share purchase warrants, 2,866,666
Series E common share purchase warrants and 258,000 Series F common
share purchase warrants. As of the Closing Date, there shall be no
other option or other right of any kind in existence, authorized or
agreed to which could result in any further shares or other securities
of Lasermedia being allotted or issued or becoming outstanding.
3(a)(1)-6
7
(i) MINUTE BOOKS. The minute books of Lasermedia contain accurate and
complete minutes of all meetings and resolutions of the directors and
the shareholders of Lasermedia held or passed by signature in writing,
respectively, since the date of its incorporation. All such meetings
have been duly called and held. Lasermedia share certificate books and
share registers are complete and accurate.
(j) LASERMEDIA'S CAPACITY AND POWER. Lasermedia has full corporate
right, power and authority to own or lease its assets as now owned or
leased and to carry on the Lasermedia Business.
(k) BUSINESS. The only business carried on by Lasermedia is the
Lasermedia Business.
(l) LASERMEDIA PRO FORMA FINANCIAL STATEMENT. Lasermedia will provide
to the management of Osgoode, Pro Forma Financial Statements subject to
the acceptance of the management of Osgoode and:
(i) to the knowledge of the management of Lasermedia,
have been prepared in accordance with Canadian
generally accepted accounting principles applied on a
consistent basis throughout the periods indicated;
and
(ii) fairly and accurately present, subject to immaterial
variation, the financial position, assets and
liabilities (whether absolute, contingent, accrued or
otherwise) of Lasermedia on the dates thereof and the
financial results of Lasermedia for the periods
referred to in the Lasermedia Financial Statements.
(m) NO GUARANTEES ETC. Lasermedia is not a party to or bound by any
agreement of guarantee, indemnification, assumption or endorsement or
any like commitment of the obligations, liabilities (contingent or
otherwise) or indebtedness of any Person.
(n) RECORDS.
(i) The Lasermedia Records are true and correct and
present fairly and disclose in all material respects
the actual results of the Lasermedia Business.
(ii) To the best of the knowledge of the officers and
directors of Lasermedia, all material financial
transactions of Lasermedia have been accurately
recorded in the Lasermedia Records. The Lasermedia
Records (of a financial nature) have been prepared in
accordance with Canadian generally accepted
accounting principles consistently applied.
3(a)(1)-7
8
(iii) The files, documentation and information in writing
provided by Lasermedia to Osgoode in connection with
the negotiation and completion of the transactions
contemplated in this Agreement are true and correct
in all material respects.
(o) BUSINESS AGREEMENTS.
(i) The Lasermedia normal course of business agreements
are the only material agreements relating to the
Lasermedia Business.
(ii) The Lasermedia normal course of business agreements
are in full force and effect unamended and under no
threat of cancellation by any party thereto.
No party is in material breach under any of the
Lasermedia normal course of business agreements.
(p) LITIGATION. To the best of the knowledge of the officers and
directors of Lasermedia there are no judgments, decrees, injunctions,
ruling or orders of any court, Governmental Authority or arbitration,
or any actions, suits, grievances or proceedings, (whether or not on
behalf of Lasermedia) are pending or threatened or involving
Lasermedia, or the Lasermedia Business which may materially adversely
affect the Lasermedia Business or Lasermedia's assets.
(q) SECURITIES DOCUMENTS. The Osgoode Information Circular (to the
extent that it sets forth facts or information about Lasermedia) does
not contain any untrue statement of a material fact or omit to state a
material fact that is required to be stated or omit to state a material
fact that is necessary to be stated in order to make a statement
contained in those documents not misleading in light of the
circumstances in which it was made.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF OSGOODE
5.1 REPRESENTATIONS AND WARRANTIES OF OSGOODE.
Osgoode hereby represents and warrants to Lasermedia as follows and
acknowledges that Lasermedia is relying on those representations and warranties
in connection with the Share Exchange:
(a) DUE INCORPORATION. Osgoode is a corporation duly incorporated and
validly existing under the laws of the Province of Ontario.
3(a)(1)-8
9
(b) CAPACITY TO ENTER AGREEMENT. Osgoode has full power, right and
authority to enter into this Agreement and to perform the obligations
under it.
(c) DUE CORPORATE AUTHORIZATION. The execution and delivery of this
Agreement and the consummation of the transactions contemplated under
it have been duly authorized by all necessary corporate action on the
part of Osgoode.
(d) BINDING OBLIGATION. This Agreement has been duly executed and
delivered by Osgoode and constitutes a valid and binding obligation of
Osgoode.
(e) ABSENCE OF CONFLICT. Osgoode is not a party to, bound or affected
by or subject to any agreement which would be violated, breached or
terminated by, or which would result in the creation or imposition of
any Encumbrance upon any of the Osgoode Shares as a consequence of, the
execution and delivery of this Agreement or the consummation of the
transactions contemplated in this Agreement.
(f) REGULATORY APPROVALS. Except for Shareholders Approval and
Regulatory Approval, no governmental or regulatory authorization
approval, order, consent or filing is required on the part of Osgoode,
in connection with the execution, delivery and performance of this
Agreement and the performance of Osgoode's obligations under this
Agreement.
(g) NO BANKRUPTCY. No proceedings have been taken, are pending or
authorized by Osgoode or by any other person in respect to the
bankruptcy, insolvency, liquidation, dissolution or winding up of
Osgoode.
(h) AUTHORIZED AND ISSUED CAPITAL. On the date of this Agreement, the
authorized capital of Osgoode consists of an unlimited number of common
shares and 2,000,000 preference shares, of which 125,830 common shares
are issued and outstanding.
Effective immediately after the Closing, the Osgoode Shares held by the
current shareholders of Osgoode shall be duly and validly issued and outstanding
as fully paid and non-assessable shares of Osgoode and shall represent
approximately 1.0% of the issued and outstanding common shares.
Except for the provisions of a debt repurchase agreement between
Osgoode and FMF Investment Group S.A. dated April 1, 1997, there is no option or
other right of any kind in existence, authorized or agreed to which could result
in any further shares or the securities of Osgoode being allotted or issued or
becoming outstanding.
(i) MINUTE BOOKS. The minute books of Osgoode contain accurate and
complete minutes of all meetings and resolutions of the directors and
the shareholders of Osgoode
3(a)(1)-9
10
held or passed by signature in writing, respectively, since the date
of its incorporation. All such meetings have been duly called and held.
(j) NO SUBSIDIARIES. Osgoode does not own any shares in or securities
of any corporate body.
(k) REPORTING ISSUER. Osgoode is and has been for a period of at least
1 year, a reporting issuer as defined in the Securities Act (Ontario)
and is currently on the list of defaulting reporting issuers maintained
by the OSC. Osgoode is the subject of a cease trading order imposed
by the OSC.
(l) COMPLIANCE WITH LAWS. Except where failure to comply will not have
a material adverse effect on Osgoode, Osgoode is in compliance with all
applicable laws, rules, regulations, notices, approvals and orders of
Canada and the Province of Ontario.
(m) ABSENCE OF MATERIAL CHANGES. Since December 31, 1996:
(i) no changes have been made in the accounting methods,
practices or policies followed by Osgoode;
(ii) Osgoode has not increased, incurred or guaranteed any
debt, obligation, or liability (whether absolute or
contingent and whether or not currently due and
payable);
(iii) there has been no damage, destruction or loss, labor
trouble, or other event, development or condition of
any character (whether or not covered by insurance)
which adversely affects, or, may adversely affect,
the properties or prospects of Osgoode; and
(iv) Osgoode has not paid any amount or dividend, or
otherwise made any distribution or the payment of any
kind or nature whatsoever to any non-arm's length
Person.
(n) OSGOODE FINANCIAL STATEMENTS. The Osgoode Financial Statements
attached hereto as Schedule 5.1:
(i) have been prepared in accordance with Canadian
generally accepted accounting principles; and
(ii) fairly and accurately present the financial position,
assets and liabilities (whether absolute, contingent,
accrued or otherwise) of Osgoode on the
3(a)(1)-10
11
dates thereof, the financial results of Osgoode for
the periods referred to in the Osgoode Financial
Statements.
(o) NO GUARANTEES ETC. Osgoode is not a party to or bound by any
agreement of guarantee, indemnification, assumption or endorsement or
any like commitment of the obligations, liabilities (contingent or
otherwise) or indebtedness of any Person.
(p) TITLE TO AND CONDITION OF ASSET. As of the date hereof, Osgoode has
no tangible assets of any kind.
(q) RECORDS.
(i) All material financial transactions of Osgoode have
been accurately recorded in the Osgoode Records. The
Osgoode Records (of a financial nature) have been
prepared in accordance with Canadian generally
accepted accounting principles consistently applied.
(ii) The files, documentation and information in writing
provided by Osgoode to Lasermedia Shareholders in
connection with the negotiation and completion of the
transactions contemplated in this Agreement are true
and correct in all material respects.
(r) EMPLOYEES. At present, Osgoode does not employ or engage any
employees.
(s) LITIGATION. There are no judgments, decrees, injunctions, ruling or
orders of any court, Governmental Authority or arbitration, or any
actions, suits, grievances or proceedings (whether or not on behalf of
Osgoode) pending or threatened or involving Osgoode which may
materially adversely affect Osgoode's assets.
(t) DISCLOSURE. The representations and warranties of Osgoode in this
Agreement are true, complete and correct and do not contain any untrue
or misleading statement of a material fact or omit to state a material
fact necessary to make such representations and warranties not
misleading to Lasermedia Shareholders.
ARTICLE VI
NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES
6.1 Subject to Section 6.2, all representations and warranties contained in this
Agreement on the part of each of the parties shall survive the Closing for a
period of (1) one year from the Closing Date, after which time, if no claim
shall have been made against a Party with respect to
3(a)(1)-11
12
any incorrectness or in breach of any representation or warranty, that
Party shall have no further liability under this Agreement with respect to
the representation or warranty.
6.2 The representations, warranties, covenants and indemnities of the
Parties relating to the tax liability of Osgoode and Lasermedia shall:
(a) unless resulting from any misrepresentation made or fraud committed
in filing a return or supplying information for the purposes of the
Income Tax Act (Canada), applicable provincial corporation tax
legislation or any other legislation imposing tax on Osgoode and
Lasermedia, terminate at the expiration of the last of the limitation
periods contained in the Income Tax Act (Canada), applicable provincial
corporation tax legislation or any other legislation imposing tax on
Osgoode and Lasermedia, subsequent to the expiration of which an
assessment, or other form of recognized document assessing liability
for its year ended immediately prior to the Closing Date; and
(b) if based upon misrepresentation made or fraud committed in filing a
return or in supplying information for the purpose of the Income Tax
Act (Canada), applicable provincial corporation tax legislation or any
other legislation imposing tax on Osgoode and Lasermedia, survive
without limit as to time.
6.3 All statements contained in any certificate or any instrument delivered
by or on behalf of a Party pursuant to or in connection with the transactions
contemplated by this Agreement shall be deemed to be made by such Party under
this Agreement.
ARTICLE VII
COVENANTS
7.1 CONDUCT OF LASERMEDIA BUSINESS PRIOR TO CLOSING. During the Interim
Period, Lasermedia shall:
(a) CONDUCT BUSINESS IN ORDINARY COURSE. Except as otherwise
contemplated or permitted by this Agreement, conduct the Lasermedia
business diligently and prudently and shall not, without the prior
written consent of Osgoode, enter into any contracts, agreements,
commitments or leases, or undertake any activity (including allotment
or issuance of any further shares or securities of Lasermedia) except
in the ordinary course of the Lasermedia business;
(b) CONTINUE INSURANCE. Continue in full force all existing insurance
policies;
(c) COMPLY WITH LAWS. Comply with all laws applicable to the
Lasermedia Business;
3(a)(1)-12
13
(d) MAINTAIN PERMITS. Apply for, maintain in good standing and renew
all permits, licenses, registrations and permits necessary to enable it
to carry on the Lasermedia Business as now conducted; and
(e) DISTRIBUTIONS. Not pay any amount or dividend or otherwise make any
distribution to its shareholders or any non-arm's length Person out of
the normal course.
7.2 CONDUCT OF OSGOODE PRIOR TO CLOSING. During the Interim Period,
Osgoode shall:
(a) AGREEMENTS. Not enter into any contracts, agreements,
communications or leases or undertake any activity (including the
allotment or issuance of further shares or securities of Osgoode);
(b) NO BUSINESS. Not carry on any business;
(c) COMPLY WITH LAWS. Comply with all laws applicable to Osgoode; and
(d) DISTRIBUTIONS. Not pay any amount or dividend or otherwise make any
distribution to its shareholders or any non-arm's length Person.
7.3 ACCESS FOR INVESTIGATION.
(a) Osgoode and Lasermedia shall permit the other Party and its
Authorized Representatives, until the Closing Date, to have reasonable
access during normal business hours to their respective premises and
their respective Records to enable confirmation of the accuracy of the
Records and the matters represented and warranted in Articles III, IV
and V.
Until the Closing Date and, in the event the termination of this
Agreement without the completion of the transactions contemplated
hereby, each of the Parties shall thereafter, subject to subsection
7.3(b), use its best efforts to keep confidential and not use for its
own purpose (other than as contemplated by this Agreement) any
information obtained from any other Party with respect to the other
Party's affairs. If this Agreement is terminated, all documents,
working papers and other written material obtained by the Party from
the other party in connection with this Agreement and not previously
made public (and all copies thereof) shall be returned to the other
Party promptly after such termination.
(b) The obligation of each of the Parties under subsection 7.3(a) to
keep confidential and not use any information shall not apply to
information which:
(i) becomes generally available to the public other than
as a result of a disclosure by the Party or its
representative in violation of this Agreement;
3(a)(1)-13
14
(ii) was available to the Party on a non-confidential
basis prior to its disclosure by the other party or
their representatives;
(iii) becomes available to the party on a non-confidential
basis from a source other than the Party or its
representatives, provided that such source is not
bound by a confidential agreement with the other
Party; or
(iv) the Party is required by law to disclose.
7.4 CLOSING DOCUMENTS. The Ancillary Agreements and the Conveyance Documents
shall be executed and delivered by the Parties thereto at the Closing time.
7.5 CORPORATE PROCEEDINGS. On or before the Closing Date, each Party (which is a
corporation) shall provide to the other Parties certified copies of all
necessary proceedings and resolutions, corporate or otherwise, and all other
necessary actions, corporate or otherwise, authorizing the execution and
delivery of this Agreement and the matters contemplated in it.
7.6 ACTIONS TO SATISFY CLOSING CONDITIONS. Each Party shall take all such
actions as are within its power to control, and shall use its best efforts to
cause other actions to be taken which are not within its power to control, so as
to ensure compliance with any conditions set forth in this Agreement which are
for the benefit of itself or any other Party.
7.7 OSGOODE CORPORATE PROCEEDINGS. Osgoode shall use its best effort to
obtain or effect prior to the Closing Date the following:
(i) the Shareholder Approval;
(ii) the approval of the shareholders of Osgoode of the
Osgoode Stock Option Plan; and
(iii) the approval of the shareholders of Osgoode to change
the corporate name of Osgoode to Lasermedia
Communications Corp. or such other name as the board
of directors of the Corporation may decide.
ARTICLE VIII
CONDITIONS OF CLOSING
8.1 CONDITIONS FOR OSGOODE BENEFIT.
Osgoode shall not be obliged to complete the Share Exchange unless, on
the Closing Date, each of the following conditions shall have been satisfied:
3(a)(1)-14
15
(a) ACCURACY OF REPRESENTATIONS. The representations and warranties of
the Lasermedia Shareholders set forth in section 3.1 and 4.1 shall be
true and correct at the Closing, except as those representations and
warranties may be affected by the occurrence of events or transactions
expressly contemplated and permitted by this Agreement, including,
without limitation, those in the ordinary course of business;
(b) PERFORMANCE OF OBLIGATIONS. Lasermedia and the Lasermedia
Shareholders shall have performed all of the obligations hereunder to
be performed by them at or prior to the Closing. Lasermedia and the
Lasermedia Shareholders shall not be in breach of any agreement on its
part contained herein;
(c) DELIVERIES. Lasermedia and the Lasermedia Shareholders shall have
delivered or caused to be delivered to Osgoode the Conveyance
Documents, and shall deliver up to Osgoode possession of the Lasermedia
Shares, free and clear of any Encumbrances;
(d) SHAREHOLDER APPROVAL AND REGULATORY APPROVAL. The Shareholder
Approval and Regulatory Approval shall have been obtained or given, as
the case may be, on or before the Closing Time;
(e) COMPLETION OF INVESTIGATIONS. The investigations and assessments
contemplated in Section 7.3 shall have been completed and Osgoode shall
be satisfied with the result of such investigations and assessments
including, without limitation, the accuracy of the Records and matters
represented and warranted in Articles III and IV; and
(f) CONSENTS, AUTHORIZATIONS AND REGISTRATIONS. All consents,
approvals, orders and authorizations of, from or notifications to any
persons or Governmental Authorities required in connection with the
completion of any of the transactions contemplated by this Agreement,
the execution of this Agreement, the Closing or the performance of any
of the terms and conditions of this Agreement shall have been obtained
on or before the Closing Date.
There shall be no injunction or order issued preventing, and no pending
or threatened claim, action, litigation or proceeding, judicial or
administrative, or investigation against any Party by any Governmental Authority
or Person for the purpose of enjoining or preventing the consummation of this
Agreement, or otherwise claiming that this Agreement or the consummation thereof
is improper or would give rise to proceedings under any statue or rule of law.
(g) NO LOSS. During the Interim Period, there has been no material
damage to the assets of Lasermedia or the Lasermedia Business by fire
or other peril, whether or not such damage is covered by insurance;
3(a)(1)-15
16
(h) NO MATERIAL CHANGES. There shall have been no material adverse
changes in the Lasermedia Business, assets or financial condition of
Lasermedia during the Interim Period. For the purposes of this
subsection, the term "material adverse change" shall mean any change in
the assets, liabilities or financial condition of Lasermedia or the
Lasermedia Business that may:
(i) involve material reduction, damage, risk to or
destruction of the assets, whether or not the change
is covered by insurance; or
(ii) will result in a material reduction in the gross
sales or net profits before the taxes of Lasermedia
(whether or not the change occurred in the ordinary
course of business).
(i) CONFIDENTIALITY AGREEMENTS. Lasermedia shall have used all
reasonable best efforts to enter into confidentiality and intellectual
property transfer agreements, in form satisfactory to Osgoode, with
each of its employees involved in the development of intellectual
property rights of Lasermedia and having access to confidential
information of Lasermedia;
(j) OUTSTANDING CAPITAL. At the Closing Date there shall be no more
than 13,500,000 Lasermedia Common Shares, 600,000 Series A Warrants,
200,000 Series B Warrants, 200,000 Series C Warrants, 100,000 Series D
Warrants, 2,866,666 Series E Warrants and 258,000 Series F Warrants of
Lasermedia issued and outstanding, and there shall be no other
outstanding options, rights or warrants entitling the holders to
acquire Lasermedia Common Shares or any securities convertible into or
exchangeable for Lasermedia Common Shares;
(k) MATERIAL ADVERSE EFFECT. There shall not exist or have occurred any
fact, event or circumstance which constitutes or will result in a
material adverse effect on the business, assets, properties, condition
(financial or otherwise), results of operations or prospects of
Lasermedia which was not publicly disclosed at the date of the
announcement of the Share Exchange;
(l) EXTRAORDINARY ACTS. Without the prior written consent of Osgoode,
Lasermedia shall not have:
(i) declared or paid any dividends or distributed any of
its properties or assets to shareholders;
(ii) entered into any contract, other than in the ordinary
course of business;
(iii) amended its articles or by-laws; or
(iv) engaged in any business enterprise or other activity
different from that carried on as of the date hereof.
3(a)(1)-16
17
(m) FULFILLMENT OF CONDITIONS. The fulfillment or waiver of all of
the conditions set forth in Section 8.1 hereof;
(n) ACTIONS AND PROCEEDINGS. No act, action, suit or proceeding shall
have been threatened or taken before or by any domestic or foreign
court or tribunal or governmental agency or other regulatory authority
or administrative agency or commission by any elected or appointed
public official or private person (including, without limitation, any
individual, corporation, firm, group or other entity) in Canada or else
where, whether or not having the force of law;
(o) ISSUANCE AND REPURCHASE OF SHARES. Lasermedia will not have issued
or acquired or committed itself to acquire any share in its capital;
(p) OTHER ACTIONS. Osgoode shall have determined in its sole judgment
that (since the announcement by Osgoode of its intention to acquire
Lasermedia) Lasermedia has not taken or proposed to take any action, or
publicly disclosed that it intends to take any action, and Osgoode
shall not have otherwise learned of any previous action taken by
Lasermedia which had not been publicly disclosed prior to the
announcement by Osgoode of its intention to make the Share Exchange,
which, in the sole judgment of Osgoode, might make it inadvisable for
Osgoode to proceed with the Share Exchange, or that would be materially
adverse to the business of Lasermedia or to the value of the Lasermedia
Shares to Osgoode; including, without limiting the generality of the
foregoing, any action with respect to any agreement, proposal, offer or
understanding relating to any material sale, disposition or other
dealing with any of the assets or contracts of Lasermedia, any issue of
shares, options or other securities of Lasermedia to any person other
than a wholly-owned subsidiary of Lasermedia, any material acquisition
from a third party of assets or securities by Lasermedia, or
amalgamation, statutory arrangement, capital reorganization, merger,
business combination or similar transaction involving Lasermedia, or
any material capital expenditure by Lasermedia not in the ordinary
course of business;
(q) BUSINESS CONDITIONS. There shall not exist or have occurred, and
Osgoode shall not have otherwise learned of any previous occurrence
which had not been publicly disclosed prior to the announcement by
Osgoode of its intention to make the Share Exchange, any change (or any
condition, event or development involving a prospective change) in the
business, operation, assets, capitalization, financial condition,
licenses, permits, rights, privileges or liabilities whether
contractual or otherwise, of Lasermedia which, in the sole judgment of
Osgoode, is or would be materially adverse to the business of
Lasermedia;
(r) IMPAIRED RIGHTS; BREACHES OF COVENANTS. Osgoode shall have
determined in its sole judgment that: (i) no material right, franchise
or license of Lasermedia has been or may be impaired (which impairment
has not been cured or waived) or otherwise adversely
3(a)(1)-17
18
affected, whether as a result of the making of the Share Exchange or
otherwise which might make it inadvisable for Osgoode to proceed with
the Share, and (ii) no covenant, term or condition of any instruments
or agreements of Lasermedia exists which might make it inadvisable for
Osgoode to proceed with the Share Exchange (including without
limitation, any default, acceleration or other adverse event that may
ensue as a result of the Share Exchange);
(s) FORCE MAJEURE. There shall not have occurred, developed or come
into effect or existence any event, action, state, condition or major
financial occurrence of national or international consequence or any
law, regulation, action, government regulation, enquiry or other
occurrence of any nature whatsoever which, in the sole judgment of
Osgoode, materially adversely affects or involves, or may materially
adversely affect or involve, the financial markets in Canada or
elsewhere generally, or the financial condition, business, operations,
assets, affairs or prospects of Lasermedia to Osgoode.
If any one or more of the following conditions shall not have been
fulfilled on or before the Closing Date, Osgoode may terminate this Agreement by
notice in writing to the other Parties in which event Osgoode shall be released
from all obligations under this Agreement and (unless Osgoode can show that the
condition relied upon could reasonably have been performed by the other parties)
the other Parties shall also be released from all obligations hereunder;
provided, however, that Osgoode shall be entitled to waive compliance with any
one or more of such conditions in whole or in part if it shall see fit to do so,
without prejudice to its rights of termination in the event of the
non-fulfillment of any other condition in whole or in part.
8.2 CONDITIONS FOR THE BENEFIT OF THE LASERMEDIA SHAREHOLDERS. The Lasermedia
Shareholders shall not be obliged to complete the Share Exchange unless, on the
Closing Date, each of the following conditions shall have been satisfied:
(a) ACCURACY OF REPRESENTATIONS. The representations and warranties of
Osgoode set forth in Section 5.1 shall be true and correct at the
Closing, except as those representations and warranties may be affected
by the occurrence of events or transactions expressly contemplated and
permitted by this Agreement and the Lasermedia Shareholders shall have
received a certificate from Osgoode confirming the foregoing.
(b) PERFORMANCE OF OBLIGATIONS. Osgoode shall have performed all of the
obligations hereunder to be performed by it at or prior to the Closing
and Osgoode shall not be in breach of any agreement on its part
contained herein.
(c) DELIVERIES. Osgoode shall have delivered or caused to be delivered
to Lasermedia Shareholders possession of the Osgoode Shares, free and
clear of any Encumbrances.
3(a)(1)-18
19
(d) SHAREHOLDERS APPROVAL AND REGULATORY APPROVAL. The Shareholders
Approval, the matters contemplated in Section 7.7 and the Regulatory
Approval shall have been obtained, completed or given, as the case may
be, on or before the Closing Time.
(e) COMPLETION OF INVESTIGATIONS. The investigations and assessments
contemplated in Section 7.3 shall have been completed and the
Lasermedia Shareholders shall be satisfied with the results of such
investigations and assessments including, without limitation, the
accuracy of the Records and matters represented and warranted in
Article 5.
(f) CONSENTS, AUTHORIZATIONS AND REGISTRATIONS. All consents,
approvals, orders and authorizations of, from or notifications to any
Persons or Governmental Authorities required in connection with the
completion of any of the transactions contemplated by this Agreement,
the execution of this Agreement, the Closing or the performance of any
of the terms and conditions of this Agreement shall have been obtained
on or before the Closing Date.
There shall be no injunction or order issued preventing, and no pending
or threatened claim, action, litigation or proceeding, judicial or
administrative, or investigation against any Party by any Governmental Authority
or Person for the purpose of enjoining or preventing the consummation of this
agreement, or otherwise claiming that this Agreement or the consummation thereof
is improper or would give rise to proceedings under any statute or rule of law.
(g) NO LOSS. During the Interim Period, there has been no material
damage to the assets of Osgoode by fire or other peril, whether or not
such damage is covered by insurance.
(h) NO MATERIAL CHANGES. There shall have been, in the reasonable
opinion of Lasermedia, no material adverse changes in the assets or
financial condition of Osgoode during the Interim Period. For the
purposes of this subsection, the term "material adverse change" shall
mean any change in the assets, liabilities or financial condition of
Osgoode that may, in the reasonable opinion of Osgoode involve material
reduction, damage, risk to or destruction of the assets whether or not
the change is covered by insurance.
(i) OSGOODE FINANCIAL STATEMENTS. Osgoode shall make available to
Lasermedia unaudited interim financial statements for the period ending
March 31, 1997.
(j) REMOVAL OF CEASE TRADE ORDER. Osgoode will ensure that as of the
Closing Date, Osgoode shall be a "reporting issuer" in good standing
under the provisions of the Securities Act (Ontario) and Regulations
thereto and shall be up-to-date with all filings and mailings required
by the Business Corporations Act (Ontario) and the Canadian Dealing
Network and to this end, Osgoode shall make an application to the
Ontario Securities Commission ("OSC") to remove the cease trade order
issued June 10, 1987, to file the
3(a)(1)-19
20
December 31, 1996 year end audited financial statements, the quarterly
statements as of March 31, 1997 together with such other disclosure as
may be required by the OSC.
If any one or more of the foregoing conditions shall not have been
fulfilled on or before the Closing Date, Lasermedia may terminate this Agreement
by notice in writing to Osgoode in which event Lasermedia shall be released from
all obligations under this Agreement and (unless Lasermedia can show that the
condition relied upon could reasonably have been performed by Osgoode) Osgoode
shall also be released from all obligations hereunder; provided, however, that
Lasermedia shall be entitled to waive compliance with any one or more of such
conditions in whole or in part if it shall see fit to do so, without prejudice
to its rights to termination in the event of the non-fulfillment of any other
condition in whole or in part.
ARTICLE IX
INDEMNIFICATION
9.1 MUTUAL INDEMNIFICATIONS FOR BREACHES OF WARRANTY, ETC. Subject to Section
9.3, Osgoode hereby covenants and agrees with Lasermedia and Lasermedia hereby
covenants and agrees with Osgoode (the parties covenanting and agreeing to
indemnify another party under this Article 9 are hereinafter individually
referred to as "Indemnifying Party" and the parties that are being indemnified
by another Party under this Article 9 are hereinafter individually referred to
as the "Indemnified Party") to indemnify and save harmless the Indemnified
Party, effective as and from the Closing Time, from and against any Claims which
may be made or brought against the Indemnified Party and/or which it may suffer
or incur as a result of, or arising out of any non-fulfillment of any covenant
or agreement on the part of the Indemnifying Party under this Agreement or any
Ancillary Agreement or any incorrectness in or breach of any representation or
warranty of the Indemnifying Party contained in this Agreement or any Ancillary
Agreement.
9.2 UNDISCLOSED LIABILITIES INDEMNITY. Notwithstanding Section 9.1 and without
limiting the generality of Section 9.1:
(a) Lasermedia shall indemnify Osgoode from all Claims arising from
liabilities or obligations to Persons that arise from the act or
failure to act of Lasermedia prior to the Closing Date that are not
disclosed to Osgoode pursuant to Article 4; and
(b) Osgoode shall indemnify Lasermedia from all Claims arising from
liabilities or obligations to Persons that arise from the act or
failure to act of Osgoode prior to the Closing Date that are not
disclosed to Lasermedia pursuant to Article 5.
9.3 LIMITATION ON MUTUAL INDEMNIFICATION. The indemnification obligations of
each of the Parties pursuant to Section 9.1 and 9.2 shall be subject to the
following:
3(a)(1)-20
21
(a) the applicable limitation mentioned in Article 6 respecting the
survival of the representations and warranties of the Parties;
(b) the indemnity obligations under Section 9.2 shall survive for a
period of 5 years from the Closing Date;
(c) there shall be no limit as to amount in respect of breaches of the
representations and warranties of the Parties other than as
specifically limited by the provisions of the section; and
(d) an Indemnifying Party shall not be required to indemnify an
Indemnified Party until the aggregate Claims sustained by the
Indemnified Party exceeds a value of $5,000, in which case the
Indemnifying Party shall be obligated to the Indemnified Party for all
Claims without limit as to amount.
9.4 PROCEDURE FOR INDEMNIFICATION. The following provisions shall apply to any
Claims for which an Indemnifying Party may be obligated to indemnify an
Indemnified Party pursuant to this Agreement:
(a) upon receipt from a third party by the Indemnified Party of notice
of a Claim or the Indemnified Party becoming aware of a Claim in
respect of which the Indemnified Party proposes to demand
indemnification from the Indemnifying Party, the Indemnified Party
shall give notice to that effect to the Indemnifying Party with
reasonable promptness, provided that failure to give such notice shall
not relieve an Indemnifying Party from any liability it may have to the
Indemnified Party except to the extent that the Indemnifying Party is
prejudiced thereby;
(b) in the case of Claims arising from third parties, the Indemnifying
Party shall have the right by notice to the Indemnifying Party not
later than 300 days after receipt of the notice described in paragraph
(1) above to assume the control of the defense, compromise or
settlement of the Claims, provided that such assumption shall, by its
terms, be without costs to the Indemnified Party and the Indemnifying
Party shall at the Indemnifying Party's request furnish it with
reasonable security against any costs or other liabilities to which it
may be or become exposed by reason of such defense, compromise or
settlement;
(c) upon the assumption of control by the Indemnifying Party as
aforesaid, the Indemnifying Party shall diligently proceed with the
defense, compromise or settlement of the Claims at its sole expense,
including employment of counsel reasonably satisfactory to the
Indemnified Party and, in connection therewith, the Indemnified Party
shall co-operate fully, but at the expense of the Indemnifying Party,
to make available to the Indemnifying Party all pertinent information
and witnesses under the Indemnified Party's control, make such
assignments and take such other steps as in the opinion of the counsel
for the
3(a)(1)-21
22
Indemnifying Party are necessary to enable the Indemnifying
Party to conduct such defense; provided always that the Indemnified
Party shall be entitled to reasonable security from the Indemnifying
Party for the expense, costs of other liabilities to which it may be or
may become exposed by reason of such co-operation;
(d) the final determination of any such Claims arising from third
parties, including all related costs and expenses, will be binding and
conclusive upon the Parties as to the validity or invalidity, as the
case may be of such Claims against the Indemnifying Party hereunder;
(e) should the Indemnifying Party fail to give notice to the
Indemnified Party as provided in paragraph (b) above, the Indemnified
Party shall be entitled to make such settlement of the Claims as in its
sole discretion may appear advisable, and such settlement or any other
final determination of the Claims shall be binding upon the
Indemnifying Party.
ARTICLE X
CLOSING ARRANGEMENTS
10.1 CLOSING. The Closing shall take place at the offices of Silver Gold Xxxxx &
Xxxxxxx, Chartered Accountants, 00 Xx. Xxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxx, Xxxxxx at the Closing Time on the Closing Date.
10.2 CLOSING PROCEDURES. At the Closing Time:
(a) Osgoode shall issue and deliver to the Lasermedia Shareholders
possession of the Osgoode Shares;
(b) the Lasermedia Shareholders shall deliver up to Osgoode the
Lasermedia Shares; and
(c) the Parties shall take or shall have taken, as the case may be, the
other actions contemplated to be taken by them at or before the Closing
contemplated in this Agreement.
10.3 NO BROKER. Each of the Parties represents and warrants to the other that
all negotiations relating to this Agreement and the transactions contemplated by
this Agreement shall have been carried on between them directly, without the
intervention of any other party in such manner as to give rise to any valid
claim against any of the Parties for a brokerage commission, finder's fee or
other like payment.
10.4 NON-WAIVER. No investigations made by or on behalf of Osgoode and
Lasermedia at any time shall have the effect of waiving or diminishing the scope
of or otherwise affecting any
3(a)(1)-22
23
representation, warranty or indemnity made by or imposed upon the Parties
pursuant to this Agreement.
ARTICLE XI
GENERAL
11.1 TERMINATION.
This Agreement may be terminated at any time prior to the Closing Date:
(a) by the mutual agreement of the Parties;
(b) by the Parties if:
(i) the Share Exchange shall not have been completed by
May 31, 1997 (or such other date, if any, as the
Parties shall have agreed in writing), if the
failure to complete such purchase and sale on or
before such date is not caused by any breach of this
Agreement by the Party electing to terminate; or
(ii) the Share Exchange would violate any non-appealable
final order, decree or judgment of any court or
governmental body having competent jurisdiction.
If this Agreement is terminated by a Party under Subsection 11.1(1), such
termination shall be without liability of either Party to the other parties, or
to any of their shareholders, directors, officers, employees, agents,
consultants or representatives provided that if such termination shall result
from the willful failure of the Party to fulfill a condition to the performance
of the other Parties or to perform a covenant of this agreement or from a
willful breach by the party to this Agreement, the Party shall be fully liable
for any and all damages, costs and expenses (including, but not limited to,
reasonable counsel fees and disbursements) sustained or incurred by the other
Parties.
11.2 EXPENSES. Except as otherwise specified herein, all costs and expenses
(including the fees and disbursements of accountants and legal counsel) incurred
in connection with this Agreement and completion of the transactions
contemplated by this Agreement shall be paid by the Party incurring those
expenses.
11.3 TIME OF ESSENCE. Time shall be of the essence in all respects of this
Agreement.
11.4 NOTICES. Any notice or other communication which is required or permitted
to be given or made by one Party to the others hereunder shall be in writing and
shall be either:
3(a)(1)-23
24
(a) personally delivered to such Parties; or
(b) sent by facsimile.
Any notice shall be sent to the intended recipient at its address as follows:
(i) to Osgoode at:
Xxxxx 000
000 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile No.: (000) 000-0000
(ii) to Lasermedia at:
000 Xxxxxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile No.: (000) 000-0000
or at such other address as any Party may from time to time advise the others by
notice in writing. Any notice given by personal delivery shall be deemed to be
received on the date of delivery. Any notice sent by facsimile or similar method
of recorded communication shall be deemed to have been received on the next
Business Day following the date of its transmission.
11.5 FURTHER ASSURANCES. The Parties shall with reasonable diligence do all
things and provide all reasonable assurances as may be required to complete the
transactions contemplated by this Agreement, and each Party shall provide such
further documents or instruments required by any other Party as may be
reasonably necessary or desirable to give effect to this Agreement and carry out
its provisions, whether before or after the Closing.
11.6 PUBLIC NOTICE. All public notices to third parties and all other publicity
concerning the transactions contemplated by this Agreement shall be jointly
planned and coordinated by the Parties and no Party shall act unilaterally in
this regard without the prior written approval of the other Parties, such
approval not to be unreasonably withheld.
11.7 AMENDMENT AND WAIVER. No supplement, modification, waiver or termination of
this Agreement shall be binding unless executed in writing by the party to be
bound. No waiver of any of the Provisions of this Agreement shall constitute a
waiver of any other provision (whether or not similar) nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
3(a)(1)-24
25
11.8 ASSIGNMENT. This Agreement and the rights or obligations hereunder or
thereunder are not assignable by any Party without the prior written consent of
the other Parties, which consent shall not be unreasonably withheld. This
Agreement shall enure to the benefit of and be binding upon the Parties and
their respective successors and permitted assigns.
11.9 SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
hereof. Any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
11.10 COUNTERPARTS. This Agreement may be executed by the Parties in one or more
counterparts, each of which when so executed and delivered shall be an original
and such counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF this agreement has been executed by the Parties each
as of the day and year first before written.
Dated as of the 7th day of April, 1997.
OSGOODE HOLDINGS INC.
By:
------------------------
Xxxxxx Xxxx
LASERMEDIA INC.
By:
------------------------
Xxxx Xxxxxxxx
By:
------------------------
Xxxxx Xxxxxxx
3(a)(1)-25
26
SCHEDULE 1.1
DEFINITIONS
"Accounts Receivables" means any and all accounts receivable and other amounts
due, owing or accruing due.
"Affiliate and Associate" means an "affiliate" and "associate", respectively, as
those terms are defined in the Business Corporation Act (Ontario), as amended on
the date hereof.
"Agreement" means the Agreement and any instrument supplement or ancillary to
it.
"Ancillary Agreements" means all documents, agreements, certificates and
instruments to be executed or delivered by any Person under this Agreement
including the Conveyance Documents.
"Authorized Representatives" means employees, agents, counsel, accountants and
other representatives.
"Business Day" means any day other than a Saturday, Sunday or statutory holiday
in the Province of Ontario.
"Capital Expenditures" means expenditures which, in accordance with Canadian
generally accepted accounting principles consistently applied, are chargeable to
capital or fixed assets accounts and includes expenditures in connection with
the acquisition by, purchase, erection or construction of lands, fixed assets,
plant, machinery and/or equipment, whether fixed or moveable.
"CDN" means the Canadian Dealing Network Inc., a trading, reporting and
quotation system for over-the-counter trading in Ontario.
"Claims" means claims, demands, actions, causes of action, damages, losses,
costs, fines, penalties, interest, liabilities and expenses, including, without
limitation, reasonable legal fees.
"Closing" means the completion of the Share Exchange pursuant to this Agreement.
"Closing Date" means May 31, 1997 or such other later date as may be agreed to
by the Parties.
"Closing Time" means 11:00 a.m. (Toronto time) on the Closing Date or such other
time on the Closing Date as may be agreed to by the Parties.
"Conveyance Documents" means all bills of sale, assignments, instruments of
transfer, assurances, consents and other documents as shall be necessary to
effectively transfer to Osgoode the Lasermedia Shares.
27
"Encumbrances" means any mortgage, charge, pledge, hypothecate, lien,
encumbrance, restriction, option, right of others or security interest of any
kind.
"Governmental Authorities" means any applicable Canadian or non-Canadian
federal, provincial and municipal agency, ministry, crown corporation,
department, inspector and official.
"Interim Period" means the period commencing on the date of this Agreement and
ending immediately before the opening of business on the Closing Date.
"OSC" means the Ontario Securities Commission.
"Parties" means the parties to the Agreement and "Party" means any one of them.
"Permits" means authorizations, registrations, permits, approvals or licenses
that can be issued or granted by Governmental Authorities.
"Person" means an individual, body corporate, partnership, trustee, trust,
unincorporated association, executor, administrator or legal representative.
"Records" means the Lasermedia Records and Osgoode Records.
"Regulatory Approval" means the approvals and consents of the applicable
regulatory authorities and CDN which are required to complete the Share
Exchange.
"Share Exchange" has the meaning attributed to it in Section 2.2
"Share Approval" means approval by the holders of the common shares in Osgoode
in respect to the Share Exchange.
"Lasermedia Business" means Lasermedia's Business of the production, acquisition
and publication of multimedia software on CD-ROM and the Internet.
"Lasermedia Business Agreements" means the business agreements undertaken in the
normal course of business.
"Lasermedia Financial Statements" means the financial statements of Lasermedia
attached as Schedule 4.1.
"Lasermedia Leased Premises" means the leased premises used by Lasermedia to
carry on the Lasermedia Business.
3(a)(1)-2
28
"Lasermedia Records" means Lasermedia's books, records, files, including
business and financial records, documentation and information, whether in
writing or stored in any retrieval system or data base.
"Lasermedia Shareholders" means the registered shareholders and warrantholders,
respectively, as of the Closing Date.
"Lasermedia Shares" means up to Thirteen Million Five Hundred Thousand
(13,500,000) common shares of Lasermedia; Six Hundred Thousand (600,000) Series
A common share purchase warrants; Two Hundred Thousand (200,000) Series B common
share purchase warrants, Two Hundred Thousand (200,000) Series C common share
purchase warrants; One Hundred Thousand (100,000) Series D common shares; Two
Million, Eight Hundred and Sixty-Six Thousand Six Hundred and Sixty-Six
(2,866,666) Series E common share purchase warrants; and Two Hundred and
Fifty-Eight Thousand (258,000) Series F common share purchase warrants.
"Osgoode Financial Statements" means the financial statements of Osgoode
attached on Schedule 5.1.
"Osgoode Information Circular" means the management information circular of
Osgoode to be used at the annual and special meeting of the shareholders of the
Corporation relating to, amongst other things, the Share Exchange.
"Osgoode Records" means Osgoode books, records, files including business and
financial records, documentation and information, whether in writing or stored
in any retrieval system or data base.
"Osgoode Stock Option Plan" means the stock option plan granted by Osgoode in
favor of certain officers, directors and key employees effective on the day
after the closing in a form mutually acceptable to Osgoode and Lasermedia.
3(a)(1)-3
