EXHIBIT 2.3
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MERGER AGREEMENT
by and among
ALPHA SPACECOM, INC.
a Nevada corporation
and
EAST GLORY INVESTMENTS GROUP LIMITED
a Cayman Islands Company
dated as of April 8, 2006
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MERGER AGREEMENT
THIS AGREEMENT (hereinafter referred to as the "Agreement"), dated this 7th
day of April, 2006, by and among Alpha Spacecom, Inc., a Nevada corporation
("ALPHA"), whose principal place of business is located at Xxxx 000, Xxxx Xx
Xxxxxxxx, Xx. 00 Ande Road, Dongcheng District, Beijing, 100011 China, and East
Glory Investments Group Limited, a Cayman Islands corporation ("EGIG"). with its
principal place of business located at 00/X, Xxxxxxx Xxxxxxxx, Xxxxxxx Xxxx,
Xxxxxx Xxxxxxxx, People's Republic of China.
Premises
A. Subject to the satisfaction of certain terms and conditions described
below, this Agreement provides for the merger of EGIG with and into ALPHA as the
surviving entity, and in connection therewith, the conversion of the issued and
outstanding securities of EGIG into shares of common voting stock of ALPHA, all
as set forth in the Articles of Merger provided herein as Article III (the
"Articles of Merger"), all for the purpose of effecting a tax-free
reorganization pursuant to sections 354 and 368(a) of the Internal Revenue Code
of 1986, as amended. As used herein the term "Constituent Corporation" shall
mean and refer to EGIG and the term "Surviving Corporation" shall mean and refer
to ALPHA.
B. The board of directors of EGIG and board of directors of ALPHA have
agreed, subject to the terms and conditions set forth in this Agreement, and by
these premises do hereby evidence the agreement, that it is desirable and in the
best interests of all of said entities and their stockholders that EGIG be
merged into ALPHA as the Surviving Corporation pursuant to the laws of the state
of Nevada and the laws of the Cayman Islands and EGIG shall cease to exist. This
Agreement is being entered into for the purposes of setting forth the terms and
conditions of the proposed merger.
Agreement
NOW, THEREFORE, on the stated premises and for and in consideration of the
mutual covenants and agreements hereinafter set forth and the mutual benefits to
the parties to be derived herefrom, it is hereby agreed as follows:
ARTICLE I
REPRESENTATIONS, COVENANTS AND WARRANTIES OF EGIG
As an inducement to, and to obtain the reliance of ALPHA, EGIG represents
and warrants as follows:
Section 1.1 Organization. EGIG is a corporation duly organized, validly
existing, and in good standing under the laws of the Cayman Islands and has the
power and is duly authorized, qualified, franchised and licensed under all
applicable laws, regulations, ordinances and orders of public authorities to own
all of its properties and assets and to carry on its business in all material
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respects as it is now being conducted, including qualification to do business as
a foreign corporation in the states in which the character and location of the
assets owned by it or the nature of the business transacted by it requires
qualification. Included in the EGIG Schedules (as hereinafter defined) are
complete and correct copies of the Certificate of Incorporation and Memorandum
and Articles of Association of EGIG as in effect on the date hereof. The
execution and delivery of this Agreement does not, and the consummation of the
transactions contemplated by this Agreement in accordance with the terms hereof
will not, violate any provision of EGIG's Certificate of Incorporation or
Memorandum and Articles of Association or Bylaws. EGIG has taken all required
action by law, its Articles of Incorporation, Bylaws or otherwise to authorize
the execution and delivery of this Agreement. EGIG has full power, authority and
legal right and has taken all action required by law, its Certificate of
Incorporation, Memorandum and Articles of Association or Bylaws and otherwise to
consummate the transactions herein contemplated.
Section 1.2 Capitalization. The authorized capitalization of EGIG consists
of Fifty Thousand (50,000) shares of Common Stock, par value $1.00 (US). As of
the Closing Date there will be 1,000 issued and outstanding. All issued and
outstanding securities are legally issued, fully paid and nonassessable, and are
not issued in violation of the preemptive or other rights of any person.
Section 1.3 Subsidiaries Other than as included in the EGIG Schedules, EGIG
does not have any subsidiaries and does not own, beneficially or of record, any
interests of any other entity.
Section 1.4 Financial Statements. Included in the EGIG Schedules are the
unaudited Financial Statements of EGIG as of December 31, 2005 and 2004 (the
"EGIG Financial Statements").
(a) the EGIG Financial Statements presents fairly as of its date the
financial condition of EGIG. EGIG does not have, as of the date of such
Financial Statements, except as noted and to the extent reflected or
reserved against therein, any liabilities or obligations (absolute or
contingent) that should be reflected in the Financial Statements or the
notes thereto.
(b) EGIG has no liabilities with respect to the payment of any
federal, state, county, local, provincial or other taxes (including any
deficiencies, interest or penalties), except for taxes accrued but not yet
due and payable or as noted;
(c) The books and records, financial and others, of EGIG are in all
material respects complete and correct and have been maintained in
accordance with good business accounting practices; and
(d) Except as and to the extent disclosed in the most recent EGIG
balance sheet and the EGIG Schedules, EGIG has no material contingent
liabilities, direct or indirect, matured or unmatured.
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Section 1.5 Information. The information concerning EGIG set forth in this
Agreement and in the EGIG Schedules is complete and accurate in all material
respects and does not contain any untrue statement of a material fact or omit to
state a material fact required to make the statements made, in light of the
circumstances under which they were made, not misleading.
Section 1.6 Options or Warrants. Except as set forth in the EGIG Schedules
or hereinbelow, there are no existing options, warrants, calls or commitments of
any character relating to the authorized and unissued EGIG securities or
options, warrants, calls or commitments, if any, to which EGIG is not a party
and by which it is not bound.
Section 1.7 Absence of Certain Changes or Events. Except as set forth in
this Agreement or the EGIG Schedules, or as in the normal course of business,
since December 31, 2005:
(a) there has not been: (i) any material adverse change in the
business, operations, properties, assets or condition of EGIG; or (ii) any
damage, destruction or loss to EGIG (whether or not covered by insurance)
materially and adversely affecting the business, operations, properties,
assets or condition of EGIG;
(b) EGIG has not: (i) amended its Certificate of Incorporation or
Memorandum and Articles of Association or Bylaws; (ii) declared or made, or
agreed to declare or make, any payment of dividends or distributions of any
assets of any kind whatsoever to its shareholders or purchased or redeemed
or agreed to purchase or redeem any of its securities; (iii) waived any
rights of value which in the aggregate are extraordinary or material
considering the business of EGIG; (iv) made any material change in its
method of management, operation or accounting; (v) entered into any other
material transaction; (vi) made any accrual or arrangement for or payment
of bonuses or special compensation of any kind or any severance or
termination pay to any present or former officer or employee; (vii)
increased the rate of compensation payable or to become payable by it to
any of its officers or directors or any of its employees whose monthly
compensation exceeds $5,000; or (viii) made any increase in any profit
sharing, bonus, deferred compensation, insurance, pension, retirement or
other employee benefit plan, payment or arrangement made to, for, or with
its directors, officers or employees;
(c) EGIG has not: (i) granted or agreed to grant any options, warrants
or other rights for its securities, bonds or other securities calling for
the issuance thereof; (ii) borrowed or agreed to borrow any funds or
incurred or become subject to, any material obligation or liability
(absolute or contingent) except liabilities incurred in the ordinary course
of business; (iii) paid any material obligation or liability (absolute or
contingent) other than current liabilities reflected in or shown on the
most recent EGIG balance sheet and current liabilities incurred since that
date in the ordinary course of business; (iv) sold or transferred, or
agreed to sell or transfer, any of its assets, properties or rights (except
assets, properties or rights not used or useful in its business which, in
the aggregate have a value of less than $10,000); (v) made or permitted any
amendment or termination of any contract, agreement or license to which it
is a party if such amendment or termination is material, considering the
business of EGIG; or (vi) issued, delivered or agreed to issue or deliver
any securities, including debentures (whether authorized and unissued); and
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(d) to the best knowledge of EGIG, it has not become subject to any
ongoing legal proceedings which materially and adversely affects, or in the
future may adversely affect, the business, operations, properties, assets
or condition of EGIG.
Section 1.8 Title and Related Matters. EGIG has good and marketable title
to all of its properties, inventory, interests in properties and assets, real
and personal, including the Patents and Technical Information (as defined
hereinafter), copyrights, trademarks, service marks and tradenames
(collectively, the "Assets") which are reflected in the most recent EGIG balance
sheet and the EGIG Schedules or acquired after that date (except properties,
interests in properties and assets sold or otherwise disposed of since such date
in the ordinary course of business), free and clear of all liens, pledges,
charges or encumbrances except: (a) statutory liens or claims not yet
delinquent; (b) such imperfections of title and easements as do not and will
not, materially detract from or interfere with the present or proposed use of
the properties subject thereto or affected thereby or otherwise materially
impair present business operations on such properties; and (c) as described in
the EGIG Schedules. Except as set forth in the EGIG Schedules, EGIG owns free
and clear of any liens, claims, encumbrances, royalty interests or other
restrictions or limitations of any nature whatsoever, any and all products it is
currently manufacturing, including the underlying technology and data, and all
procedures, techniques, marketing plans, business plans, methods of management
or other information utilized in connection with EGIG's business. Except as set
forth in the EGIG Schedules, no third party has any right to, and EGIG has not
received any notice of infringement of or conflict with asserted rights of
others with respect to any product, technology, data, trade secrets, know-how,
proprietary techniques, trademarks, service marks, trade names or copyrights
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a materially adverse affect on the business,
operations, financial conditions, income or business prospects of EGIG or any
material portion of its properties, assets or rights.
Section 1.9 Litigation and Proceedings. There are no actions, suits,
proceedings or investigations pending or threatened by or against EGIG, at law
or in equity, before any court or other governmental agency or instrumentality,
domestic or foreign, or before any arbitrator of any kind that would have a
material adverse affect on the business, operations, financial condition, income
or business prospects of EGIG. EGIG does not have any knowledge of any default
on its part with respect to any judgment, order, writ, injunction, decree,
award, rule or regulation of any court, arbitrator or governmental agency or
instrumentality or of any circumstances which, after reasonable investigation,
would result in the discovery of such a default.
Section 1.10 Contracts.
(a) Except as included or described in the EGIG Schedules, and except
further the contractual documents in its normal course of business, there
are no material contracts, agreements, franchises, license agreements or
other commitments to which EGIG is a party or by which it or any of its
assets, products, technology or properties are bound;
(b) EGIG is not a party to or bound by, and the properties of EGIG are
not subject to, any contract, agreement, other commitment or instrument;
any charter or other
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corporate restriction; or any judgment, order, writ, injunction, decree or
award which materially and adversely affects, or in the future may (as far
as EGIG can now foresee) materially and adversely affect, the business,
operations, properties, assets or conditions of EGIG;
(c) Except as included or described in the EGIG Schedules, reflected
in the most recent EGIG balance sheet, in the normal course of business, or
required by law, EGIG is not a party to any oral or written: (i) contract
for the employment of any director, officer or employee which is not
terminable with compensation provided in law; (ii) profit sharing, bonus,
deferred compensation, stock option, severance pay, pension benefit or
retirement plan, agreement or arrangement covered by Title IV of the
Employee Retirement Income Security Act, as amended; (iii) agreement,
contract or indenture relating to the borrowing of money; (iv) guaranty of
any obligation, other than one on which EGIG is a primary obligor, for
collection and other guaranties of obligations, which, in the aggregate do
not exceed more than one year or providing for payments in excess of
$10,000 in the aggregate; (v) consulting or other similar contracts with an
unexpired term of more than one year or providing for payments in excess of
$10,000 in the aggregate; (vi) collective bargaining agreements; or (vii)
agreement with any present or former officer or director of EGIG save for
employment agreement; and
(d) All contracts, agreements, franchises, license agreements and
other commitments to which EGIG is a party or by which its properties are
bound and which are material to the operations of EGIG taken as a whole,
are valid and enforceable by EGIG in all respects to the best belief of
EGIG, except as limited by bankruptcy and insolvency laws and by other laws
affecting the rights of creditors generally.
Section 1.11 Material Contract Defaults. To the best of EGIG's knowledge
and belief, EGIG is not in default in any material respect under the terms of
any outstanding contract, agreement, lease or other commitment which is material
to the business, operations, properties, assets or condition of EGIG, and there
is no event of default in any material respect under any such contract,
agreement, lease or other commitment in respect of which EGIG has not taken
adequate steps to prevent such a default from occurring.
Section 1.12 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument to which EGIG is a
party or to which any of its properties or operations are subject.
Section 1.13 Governmental Authorizations. To the best of EGIG's knowledge,
EGIG has made best effort to obtain and maintain all licenses, franchises,
permits or other governmental authorizations that EGIG is legally required to
enable EGIG to conduct its business in all material respects as conducted on the
date hereof.
Section 1.14 Compliance With Laws and Regulations. To the best of EGIG's
knowledge, EGIG has complied with all applicable statutes and regulations of any
federal, state, provincial
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or other governmental entity or agency thereof, except to the extent that
noncompliance would not materially and adversely affect the business,
operations, properties, assets or condition of EGIG or would not result in
EGIG's incurring any material liability.
Section 1.15 Insurance. EGIG has arranged most of the key properties of
EGIG insured for EGIG's benefit under valid and enforceable policies issued by
insurers of recognized responsibility. Such policy or policies containing
substantially equivalent coverage will be outstanding and in full force at the
Closing Date.
Section 1.16 Approval of Agreement. The board of directors of EGIG have
authorized the execution and delivery of this Agreement by EGIG, have approved
the transactions contemplated hereby, and approved the submission of this
Agreement and the transactions contemplated hereby to the shareholders of EGIG
for their approval with the recommendation that the merger be accepted.
Section 1.17 Material Transactions or Affiliations. Except as disclosed
herein and in the EGIG Schedules, there exists no material contract, agreement
or arrangement between EGIG and any predecessor and any person who was at the
time of such contract, agreement or arrangement an officer, director or person
owning of record, or known by EGIG to own beneficially, ten percent (10%) or
more of the securities of EGIG and which is to be performed in whole or in part
after the date hereof. In all of such transactions, the amount paid or received,
whether in cash, in services or in kind, has been during the full term thereof,
and is required to be during the unexpired portion of the term thereof, no less
favorable to EGIG than terms available from otherwise unrelated parties in arms
length transactions. There are no commitments by EGIG, whether written or oral,
to lend any funds to, borrow any money from or enter into any other material
transactions with, any such affiliated person.
Section 1.18 Labor Relations. EGIG has never had a work stoppage resulting
from labor problems.
Section 1.19 Previous Sales of Securities. Since inception, EGIG has sold
its securities to investors in reliance upon applicable exemptions from the
registration requirements under federal and state securities laws. All such
sales except for the issuance of the shares to its founding shareholder for the
first time (the "Sales") were made to a limited number of investors in reliance
on and in conformity with the exemptions from registration under the Securities
Act of 1933, as amended (the "Securities Act"), and in reliance and in
conformity with exemptions from registration in all states where offers and/or
sales occurred. Included in the EGIG Schedules are copies of all material
documentation and information relating to the Sales if applicable. With respect
to the Sales:
(a) all prospective investors were provided, prior to their
investment, all material information with respect to the investment,
including any information necessary to make the materials provided not
misleading;
(b) neither EGIG nor any person acting on its behalf offered or sold
securities of EGIG by any form of general solicitation or general
advertising;
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(c) immediately prior to making any Sale, EGIG reasonably believed
that each purchaser was an accredited investor; and
(d) the descriptive material and all other information, whether
written or oral, provided to prospective investors in the Sales did not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
Section 1.20 EGIG Schedules. At the Closing, except for those being waived
by Alpha, EGIG will deliver to ALPHA the following schedules, which are
collectively referred to as the "EGIG Schedules" and which consist of separate
schedules dated as of the Closing Date and instruments and data as of such date,
all certified by the chief executive officer or person holding equivalent
function of EGIG as complete, true and correct:
(a) a schedule containing complete and correct copies of the
Certificate of Incorporation, Memorandum and Articles of Association and
Bylaws of EGIG as in effect as of the date of this Agreement;
(b) a schedule containing copies of all Financial Statements of EGIG
identified in Section 1.4;
(c) a schedule setting forth the description of any material adverse
change in the business, operations, property, assets, or condition of EGIG
since December 31, 2005, required to be provided pursuant to Section 1.7
hereof; and
(d) a schedule setting forth any other information, together with any
required copies of documents, required to be disclosed in the EGIG
Schedules by Sections 1.1 through 1.19.
EGIG shall cause the EGIG Schedules and the instruments and data delivered
to ALPHA hereunder to be updated after the date hereof up to and including the
Effective Time, as hereinafter defined.
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES OF ALPHA
As an inducement to, and to obtain the reliance of EGIG, ALPHA represents
and warrants as follows:
Section 2.1 Organization. ALPHA is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada and has the
corporate power and is duly authorized, qualified, franchised and licensed under
all applicable laws, regulations, ordinances and orders of public authorities to
own all of its properties and assets and to carry on its business
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in all material respects as it are now being conducted, including qualification
to do business as a foreign corporation in the states in which the character and
location of the assets owned by it or the nature of the business transacted by
it requires qualification. Included in the ALPHA Schedules (as hereinafter
defined) are complete and correct copies of the Articles of Incorporation and
Bylaws of ALPHA as in effect on the date hereof. The execution and delivery of
this Agreement does not, and the consummation of the transactions contemplated
by this Agreement in accordance with the terms hereof will not, violate any
provision of ALPHA's Articles of Incorporation or Bylaws. ALPHA has taken all
action required by law, its Articles of Incorporation, its Bylaws or otherwise
to authorize the execution and delivery of this Agreement. ALPHA has full power,
authority and legal right and has taken all action required by law, its Articles
of Incorporation, Bylaws or otherwise to consummate the transactions herein
contemplated.
Section 2.2 Capitalization. The authorized capitalization of ALPHA consists
of Two Hundred Million (200,000,000) shares of Common Stock, par value $.001, of
which Ninety-Nine Million Eight Hundred Sixty Nine Thousand Three Hundred
(99,869,300) shares are issued and are outstanding (the "Alpha Common Shares")
and Fifty Million (50,000,000) shares of Preferred Stock, par value $.001 per
share, of which Twenty Three Thousand Series "A" (23,000) shares are issued and
are outstanding, each convertible into one (1) share of Alpha's Common Stock
(the "Alpha Preferred Shares") (collectively, the "Shares"). All of the Alpha
issued and outstanding Shares have been duly authorized, validly issued, are
fully paid and non-assessable with no personal liability attaching to the
ownership thereof and were offered, issued, sold and delivered by ALPHA in
compliance with all applicable state and federal laws.
Section 2.3 Subsidiaries. Other than as disclosed in the ALPHA Schedules or
in the ALPHA SEC Reports (as defined herein), ALPHA does not have any
subsidiaries and does not own, beneficially or of record, any other corporation.
Section 2.4 Financial Statements.
(a) Included in the ALPHA Schedules are the audited Financial
Statements for the years ended December 31, 2005 and 2004, which are
included in the schedules identified in Section 2.18(b).
(b) All such Financial Statements have been prepared in accordance
with generally accepted accounting principles consistently applied
throughout the periods involved. The ALPHA Financial Statements present
fairly as of their respective dates the financial condition of ALPHA. ALPHA
did not have as of the date of any of such ALPHA balance sheets, any
liabilities or obligations (absolute or contingent) which should be
reflected in a balance sheet or the notes thereto prepared in accordance
with generally accepted accounting principles, and all assets reflected
therein are properly reported and present fairly the value of the assets of
ALPHA, in accordance with generally accepted accounting principles. The
statements of operations, stockholders' equity and changes in financial
position reflect fairly the information required to be set forth therein by
generally accepted accounting principles.
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(c) The books and records, financial and others, of ALPHA are in all
material respects complete and correct and have been maintained in
accordance with good business accounting practices.
(d) ALPHA has no liabilities with respect to the payment of any
federal, state, county, local or other taxes (including any deficiencies,
interest or penalties), except for taxes accrued but not yet due and
payable.
(e) ALPHA has filed all state, federal or local income tax returns
required to be filed by it from inception to the date hereof.
Section 2.5 Information. The information concerning ALPHA as set forth in
this Agreement and in the ALPHA Schedules is complete and accurate in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
Section 2.6 Absence of Certain Changes or Events. Except as described
herein or in the ALPHA Schedules, since December 31, 2005:
(a) there has not been: (i) any material adverse change in the
business, operations, properties, assets or condition, of ALPHA or any
damage, destruction or loss to ALPHA (whether or not covered by insurance)
materially and adversely affecting the business, operations, properties,
assets or condition of ALPHA;
(b) ALPHA has not: (i) amended its Articles of Incorporation or
Bylaws; (ii) declared or made, or agreed to declare or make, any payment of
dividends or distributions of any assets of any kind whatsoever to
stockholders or purchased or redeemed or agreed to purchase or redeem any
of its capital stock; (iii) waived any rights of value which in the
aggregate are extraordinary or material considering the business of ALPHA;
(iv) made any material change in its method of management, operation or
accounting; (v) entered into any other material transaction; (vi) made any
accrual or arrangement for or payment of bonuses or special compensation of
any kind or any severance or termination pay to any present or former
officer or employee; (vii) paid or agreed to pay any compensation payable
or to become payable by it to any of its officers or directors or any
employee; or (viii) made any payment to any profit sharing, bonus, deferred
compensation, insurance, pension, retirement or other employee benefit
plan, payment or arrangement made to, for, or with its officers, directors
or employees;
(c) ALPHA has not: (i) granted or agreed to grant any options,
warrants or other rights for its stocks, bonds or other corporate
securities calling for the issuance thereof; (ii) borrowed or agreed to
borrow any funds or incurred or become subject to, any material obligation
or liability (absolute or contingent) except liabilities incurred in the
ordinary course of business; (iii) paid any material obligation or
liability (absolute or contingent) other than current liabilities reflected
in or shown on the most recent ALPHA balance sheet and current liabilities
incurred since that date in the ordinary course of
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business; (iv) sold or transferred, or agreed to sell or transfer, any of
its assets, properties or rights; (v) made or permitted any amendment or
termination of any contract, agreement or license to which it is a party if
such amendment or termination is material, considering the business of
ALPHA; or (vi) issued, delivered or agreed to issue or deliver any stock,
bonds, or other corporate securities including debentures (whether
authorized and unissued or held as treasury stock); and
(d) to the best knowledge of ALPHA, it has not become subject to any
law or regulation which materially and adversely affects, or in the future
may adversely affect, the business, operations, properties, assets or
condition of ALPHA.
Section 2.7 Title and Related Matters. ALPHA owns no real property. ALPHA
has good title to all of the assets which are reflected in the ALPHA balance
sheet, if any, or acquired after that date (except assets sold or otherwise
disposed of since such date in the ordinary course of business), free and clear
of all liens, pledges, charges or encumbrances except statutory liens or claims
not yet delinquent or as described in the ALPHA Schedules.
Section 2.8 Litigation and Proceedings. Other than as disclosed in the
ALPHA Schedules, the ALPHA SEC Reports or in the Notes to the ALPHA Financial
Statements, there are no actions, suits or proceedings pending or, to the best
of ALPHA's knowledge and belief, threatened by or against or affecting ALPHA, at
law or in equity, before any court or other governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind that
would have a material adverse affect on the business, operations, financial
condition, income or business prospects of ALPHA. ALPHA does not have any
knowledge of any default on its part with respect to any judgment, order, writ,
injunction, decree, award, rule or regulation of any court, arbitrator or
governmental agency or instrumentality.
Section 2.9 Contracts.
(a) Except as included or described in the ALPHA Schedules, there are
no material contracts, agreements, franchises, license agreements, or other
commitments to which ALPHA is a party or by which it or any of its
properties are bound;
(b) ALPHA is not a party to any contract, agreement, commitment or
instrument or subject to any charter or other corporate restriction or any
judgment, order, writ, injunction, decree or award which materially and
adversely affects, or in the future may (as far as ALPHA can now foresee)
materially and adversely affect, the business, operations, properties,
assets or conditions of ALPHA;
(c) ALPHA is not a party to any material oral or written: (i) contract
for the employment of any officer or employee; (ii) profit sharing, bonus,
deferred compensation, stock option, severance pay, pension, benefit or
retirement plan, agreement or arrangement covered by Title IV of the
Employee Retirement Income Security Act, as amended; (iii) agreement,
contract or indenture relating to the borrowing of money; (iv) guaranty of
any obligation for the borrowing of money or otherwise, excluding
endorsements made for collection and other guaranties of obligations,
which, in the
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aggregate exceeds $1,000; (v) consulting or other similar contract with an
unexpired term of more than one year or providing for payments in excess of
$1,000 in the aggregate; (vi) collective bargaining agreement; (vii)
agreement with any present or former officer or director of ALPHA; or
(viii) contract, agreement, or other commitment involving payments by it of
more than $1,000 in the aggregate; and
(d) All contracts, agreements, franchises, license agreements and
other commitments to which ALPHA is a party or by which its properties are
bound and which are material to the operations of ALPHA taken as a whole,
are valid and enforceable by ALPHA in all respects, except as limited by
bankruptcy and insolvency laws and by other laws affecting the rights of
creditors generally.
Section 2.10 No Conflict With Other Instruments. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument to which ALPHA is a
party or to which any of its properties or operations are subject.
Section 2.11 Material Contract Defaults. To the best of ALPHA's knowledge
and belief, ALPHA is, except as disclosed in the ALPHA Schedules, not in default
in any material respect under the terms of any outstanding contract, agreement,
lease or other commitment which is material to the business, operations,
properties, assets or condition of ALPHA, and there is no event of default in
any material respect under any such contract, agreement, lease or other
commitment in respect of which ALPHA has not taken adequate steps to prevent
such a default from occurring.
Section 2.12 Governmental Authorizations. To the best of ALPHA's knowledge,
ALPHA has all licenses, franchises, permits and other governmental
authorizations that are legally required to enable it to conduct its business
operations in all material respects as conducted on the date hereof. Except for
compliance with federal and state securities or corporation laws, no
authorization, approval, consent or order of, or registration, declaration or
filing with, any court or other governmental body is required in connection with
the execution and delivery by ALPHA of the transactions contemplated hereby.
Section 2.13 Compliance With Laws and Regulations. To the best of ALPHA's
knowledge and belief, ALPHA has complied with all applicable statutes and
regulations of any federal, state or other governmental entity or agency
thereof, except to the extent that noncompliance would not materially and
adversely affect the business, operations, properties, assets or condition of
ALPHA or would not result in ALPHA's incurring any material liability.
Section 2.14 Insurance. All of the insurable properties of ALPHA, if any,
are insured for ALPHA's benefit in accordance with the insurance policies
disclosed in the ALPHA Schedules under valid and enforceable policies issued by
insurers of recognized responsibility. Such policy or policies containing
substantially equivalent coverage will be outstanding and in full force at the
Closing Date, as hereinafter defined.
11
Section 2.15 Approval of Agreement. The board of directors of ALPHA has
authorized the execution and delivery of this Agreement by ALPHA and has
approved the transactions contemplated hereby.
Section 2.16 Material Transactions or Affiliations. Other than as disclosed
in the ALPHA SEC Reports, there exists no material contract, agreement or
arrangement between ALPHA and any person who was at the time of such contract,
agreement or arrangement an officer, director or person owning of record, or
known by ALPHA to own beneficially, ten percent (10%) or more of the issued and
outstanding Common Stock of ALPHA and which is to be performed in whole or in
part after the date hereof. ALPHA has no commitment, whether written or oral, to
lend any funds to, borrow any money from or enter into any other material
transactions with, any such affiliated person.
Section 2.17 Labor Relations. ALPHA has never had a work stoppage resulting
from labor problems. ALPHA has no employees other than its officers and
directors.
Section 2.18 ALPHA Schedules. At the Closing, except for those being waived
by EGIG, ALPHA will deliver to EGIG the following schedules, which are
collectively referred to as the "ALPHA Schedules" which are dated the date of
this Agreement, all certified by an officer of ALPHA to be complete, true and
accurate:
(a) a schedule containing complete and correct copies of the Articles
of Incorporation and Bylaws of ALPHA as in effect as of the date of this
Agreement;
(b) a schedule containing copies of all Financial Statements of ALPHA
identified in Section 2.4(a);
(c) a schedule setting forth the description of any material adverse
change in the business, operations, property, assets, or condition of ALPHA
since December 31, 2005. required to be provided pursuant to Section 2.6
hereof; and
(d) a schedule setting forth any other information, together with any
required copies of documents, required to be disclosed in the ALPHA
Schedules by Sections 2.1 through 2.17.
ALPHA shall cause the ALPHA Schedules and the instruments to be delivered
to EGIG hereunder to be updated after the date hereof up to and including the
Effective Time.
12
ARTICLE III
ARTICLES OF MERGER
Section 3.1 The Merger. On the Effective Time (as defined hereinbelow),
EGIG will be merged with and into ALPHA, the latter of which shall survive the
merger as the Surviving Corporation. ALPHA shall do or, as of the Closing, has
done the following
(a) ALPHA's Board of Directors and the holders of a majority of the
ALPHA's issued and outstanding Common Stock shall take all action necessary
to adopt an amendment to the ALPHA Articles of Incorporation, changing the
name of Alpha to "Beicang Iron & Steel Inc.", as well as increasing the
number of authorized common shares to 1,000,000,000, par value $0.001 per
share (the "Amendment").
(b) Upon the filing of the Amendment with the Nevada Secretary of
State ALPHA shall issue and deliver 898,823,700 shares of ALPHA's Common
Stock (the "ALPHA Stock"), representing 90% interest in Alpha following the
Effective Time, to EGIG's shareholders in exchange for all of EGIG's issued
and outstanding Common Stock. At the Closing, the ALPHA's Stock shall be
issued to the holders of common stock of EGIG immediately prior to the
Closing on a pro rata basis to each holder's ownership of EGIG. ALPHA shall
not issue or exchange any fractional shares or interests in connection with
the foregoing conversion. If any of EGIG's Shareholders would otherwise be
entitled to a fractional share on exchange of such shares, ALPHA shall
round the number of shares of the ALPHA Stock to be issued to such
stockholder to the nearest whole share.
(c) After the Effective Time of the Merger, each of EGIG's
Shareholders shall surrender his or her certificate or certificates
representing such EGIG shares, together with an investment letter in a form
acceptable to ALPHA's counsel, to the ALPHA's registrar and transfer agent
and thereafter, such holder shall be entitled to receive a certificate or
certificates evidencing shares of the ALPHA Stock as provided herein. In
addition, each of EGIG's shareholders shall execute and deliver to ALPHA
that certain Investment Letter attached hereto as Exhibit "A."
Section 3.2 Effective Time. (a) The Effective Time of the Merger
contemplated by this Agreement shall be the first business day following:
(i) the approval of the shareholders of both EGIG and ALPHA as more fully
described in Section 4.1 and 4,2, below; (ii) the filing and acceptance of
the Amendment; (iii) the filing and acceptance of Articles of Merger, as
required under Nevada law (the "Articles of Merger"); (iv) the receipt by
ALPHA of EGIG's audited Financial Statements for its fiscal year ended
December 31, 2005, which shall be prepared in accordance with Generally
Accepted Accounting Principles; and (v) receipt by Alpha of all information
required to be included to allow ALPHA to file a Form 8-K12G3 (or such
other form as may be prescribed by the Securities and Exchange Commission)
with the US Securities and Exchange Commission, advising of the Merger and
change in control of ALPHA, unless a different date is mutually agreed to
in writing by the parties hereto (the "Effective Time"). At the Effective
Time, EGIG shall be merged with and into the ALPHA in
13
accordance with Nevada law, whereupon the separate existence of EGIG shall
cease, and ALPHA shall be the surviving corporation (the "Surviving
Corporation").
(b) From and after the Effective Time, the Surviving Corporation
shall possess all the rights, powers, privileges and franchises and be
subject to all of the obligations, liabilities, restrictions and
disabilities of EGIG, all as provided under Nevada Law.
Section 3.3 Conversion of Shares. At the Effective Time, each share of
common stock of EGIG outstanding immediately prior to the Effective Time shall,
without any action on the part of any party hereto, be converted into and become
898,823,700 shares of Common Stock (the "ALPHA Shares") of the Surviving
Corporation. All of the shares of EGIG's common stock outstanding immediately
prior to the Effective Time shall no longer be outstanding and shall
automatically be canceled and shall cease to exist as of the Effective Time, and
each certificate previously representing any such share of EGIG's common stock
shall be converted into the right to receive a new certificate of ALPHA Shares.
Section 3.4 Exchange of Shares. Corporate Stock Transfer, Inc., ALPHA's
duly appointed transfer agent, shall act as the exchange agent (the "Exchange
Agent") for the purpose of exchanging certificates representing the ALPHA Shares
(the "New Certificates".) On the Closing Date or promptly thereafter, EGIG's
shareholders (the "Shareholders") will surrender the certificates representing
EGIG's common stock to the Exchange Agent for cancellation together with a
letter of transmittal and instructions (which shall specify that the delivery
shall be effected, and risk of loss and title shall pass, only upon proper
delivery of such certificates to the Exchange Agent) for use in such exchange.
Section 3.5. Dissenting Shares. Notwithstanding Sections 3.2 and 3.3, ALPHA
Shares outstanding immediately prior to the Effective Time and held by a holder
who has not voted in favor of the Merger or consented thereto in writing and who
has demanded appraisal for such ALPHA Shares in accordance with Nevada Law shall
only be entitled to such rights as are provided by Nevada Law, unless such
holder fails to perfect, withdraws or otherwise loses his, her or its right to
appraisal.
Section 3.6 Adjustments. If, during the period between the date of this
Agreement and the Effective Time, any change in the outstanding ALPHA Shares
shall occur, including by reason of any reclassification, recapitalization,
stock split or combination, exchange or readjustment of ALPHA Shares, or stock
dividend thereon with a record date during such period, the number of ALPHA
Shares into which a Shareholder is entitled pursuant to this Agreement shall be
appropriately adjusted.
Section 3.7 Lost Certificates. If any EGIG certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
person claiming such certificate to be lost, stolen or destroyed and, if
required by the Surviving Corporation, the posting by such person of a bond, in
such reasonable amount as the Surviving Corporation may direct as indemnity
against any claim that may be made against it with respect to such certificate,
the Exchange Agent will issue the ALPHA Shares represented by such certificate
to such person, as contemplated by this Article III.
14
Section 3.8 Termination. This Agreement may be terminated by the board of
directors of ALPHA or the board of directors of EGIG at any time prior to the
Effective Time if any of the transactions contemplated hereby are disapproved by
any regulatory authority whose approval is required to consummate such
transactions. In the event of termination pursuant to this Section 3.8, no
obligation, right, or liability shall arise hereunder, and each party shall bear
all of the expenses incurred by it in connection with the negotiation, drafting
and execution of this Agreement and the transactions herein contemplated.
Section 3.9 Directors of Surviving Corporation. Following the Effective
Time, the Board of Directors of the Surviving Corporation shall consist of two
(2) directors, including Hou Beicang and Xxx Xxxxxxxx, who shall be appointed in
accordance with procedures set forth in the ALPHA bylaws. Each of the current
directors of ALPHA shall hold office until his successors shall have been duly
elected and shall have qualified or until his or her earlier death, resignation
or removal.
Section 3.10 Officers of the Surviving Corporation. The names of the
Officers of the Surviving Corporation who shall hold office subject to the
Bylaws of the Surviving Corporation are as follows:
NAME OFFICE
---- ------
Hou Beicang Chief Executive Officer and Chief Financial
Officer, Secretary, Treasurer
Section 3.11 Effect of Merger. On the Effective Time of the merger, EGIG
shall cease to exist and shall be merged with and into the Surviving
Corporation, in accordance with the provisions of this Agreement and in
accordance with the provisions of, and with the effect provided in the
corporation laws of the State of Nevada. The Surviving Corporation shall possess
all the rights, privileges, powers, franchises, trust and fiduciary duties,
powers and obligations, and be subject to all the restrictions, obligations and
duties of each ALPHA and EGIG, and all the rights, privileges, powers,
franchises, trust and fiduciary rights, powers, duties and obligations of ALPHA
and EGIG; and all property, real, personal and mixed, and all debts due to ALPHA
and EGIG on whatever account, and all other things belonging to each ALPHA and
EGIG shall be vested in the Surviving Corporation; and all property, rights,
privileges, powers and franchises, and all and every other interest shall
thereafter be the property of the Surviving Corporation as they were of ALPHA
and EGIG; and the title to any real estate, whether vested by deed or otherwise,
in either ALPHA or EGIG shall not revert or be in any way impaired by reason of
the merger; provided, however, that all rights of creditors and all liens upon
any property of either ALPHA or EGIG shall be preserved unimpaired, and all
debts, liabilities and duties of ALPHA and EGIG shall thenceforth attach to the
Surviving Corporation, and may be enforced against it to the same extent as if
such debts, liabilities and duties had been incurred or contracted by the
Surviving Corporation. The Articles of Incorporation and Bylaws of ALPHA shall
remain those of the Surviving Corporation.
ARTICLE IV
15
SPECIAL COVENANTS
Section 4.1 Stockholder Meeting of EGIG. EGIG shall, at a meeting of its
shareholders duly called by the board of directors of EGIG, to be held as soon
as practicable following execution of this Agreement, or pursuant to a unanimous
consent of the shareholders of EGIG, present for the authorization and approval
of the shareholders of EGIG, in accordance with the applicable provisions of the
laws of the Cayman Islands, this Agreement and the consummation of the
transactions contemplated with ALPHA as set forth herein.
Section 4.2 Stockholder Meeting of ALPHA. ALPHA shall, at a meeting of its
stockholders duly called by the board of directors of ALPHA, to be held as soon
as practicable following execution of this Agreement, or pursuant to a consent
of the stockholders present for the authorization and approval of the
stockholders of ALPHA in accordance with the applicable provisions of the laws
of the State of Nevada, this Agreement, the Amendment and the consummation of
the transactions contemplated with EGIG as set forth herein
Section 4.3 Access to Properties and Records. ALPHA and EGIG will each
afford to the Chief Executive Officer, or equivalent officer, of the other full
access to the properties, books and records of ALPHA and EGIG, as the case may
be, in order that each may have full opportunity to make such reasonable
investigation as it shall desire to make of the affairs of the other, and each
will furnish the other with such additional financial and operating data and
other information as to the business and properties of ALPHA and EGIG, as the
case may be, as the other shall from time to time reasonably request.
Section 4.4 Availability of Rule 144. Each of the parties acknowledge that
the stock of ALPHA to be issued pursuant to this Agreement will be "restricted
securities," as that term is defined in Rule 144 promulgated pursuant to the
Securities Act. ALPHA is under no obligation, except as set forth herein, to
register such shares under the Securities Act. Notwithstanding the foregoing,
however, ALPHA will use its best efforts to: (a) make publicly available on a
regular basis not less than semi-annually, business and financial information
regarding ALPHA so as to make available to the shareholders of ALPHA the
provisions of Rule 144 pursuant to subparagraph (c)(2) thereof; and (b) within
ten (10) days of any written request of any stockholder of ALPHA, ALPHA will
provide to such stockholder written confirmation of compliance with such of the
foregoing subparagraph as may then be applicable. The stockholders of ALPHA
holding restricted securities of ALPHA as of the date of this Agreement, and
their respective heirs, administrators, personal representatives, successors and
assigns, are intended third party beneficiaries of the provisions set forth
herein. The covenants set forth in this Section 4.4 shall survive the Closing
and the consummation of the transactions herein contemplated.
Section 4.5 Information for ALPHA Public Reports. EGIG and the EGIG
Shareholders will furnish ALPHA with all information concerning EGIG and the
EGIG Shareholders, including all Financial Statements, required for inclusion in
any public report intended to be filed by ALPHA pursuant to the Securities Act,
the Securities Exchange Act of 1934 (the "Exchange Act"), or any other
applicable federal or state law (the "SEC Reports"). EGIG represents and
warrants to ALPHA that, to the best of its knowledge and belief, all information
so furnished for either such registration statement or other public release by
ALPHA, including the Financial Statements
16
described in Section 1.4, shall be true and correct in all material respects
without omission of any material fact required to make the information stated
not misleading.
Section 4.6 Special Covenants and Representations Regarding the ALPHA
Shares. The consummation of this Agreement and the transactions herein
contemplated, including the issuance of the ALPHA Shares to the shareholders of
EGIG as contemplated hereby, constitutes the offer and sale of securities under
the Securities Act, and applicable state statutes. Such transaction shall be
consummated in reliance on exemptions from the registration and prospectus
delivery requirements of such statutes that depend, inter alia, upon the
circumstances under which the EGIG Shareholders acquire such securities. In
connection with reliance upon exemptions from the registration and prospectus
delivery requirements for such transactions, at the Closing, EGIG shall cause to
be delivered, and the EGIG Shareholders shall deliver to ALPHA, letters of
representation in the form attached hereto as Exhibit "A."
Section 4.7 Third Party Consents. ALPHA and EGIG agree to cooperate with
each other in order to obtain any required third party consents to this
Agreement and the transactions herein and therein contemplated.
Section 4.8 Actions Prior to Effective Time.
(a) From and after the date of this Agreement until the Effective Time
and except as set forth in the ALPHA or EGIG Schedules or as permitted or
contemplated by this Agreement, ALPHA and EGIG, respectively, will each:
(i) carry on its business in substantially the same manner as it
has heretofore;
(ii) maintain and keep its properties in states of good repair
and condition as at present, except for depreciation due to ordinary
wear and tear and damage due to casualty;
(iii) maintain in full force and effect insurance comparable in
amount and in scope of coverage to that now maintained by it;
(iv) perform in all material respects all of its obligations
under material contracts, leases and instruments relating to or
affecting its assets, properties and business;
(v) use its best efforts to maintain and preserve its business
organization intact, to retain its key employees and to maintain its
relationship with its material suppliers and customers; and
(vi) use its best effort to comply with and perform in all
material respects all obligations and duties imposed on it by all
federal and state and provincial laws and all rules, regulations and
orders imposed by federal or state or provincial governmental
authorities.
17
(b) From and after the date of this Agreement until the Effective
Time, neither ALPHA nor EGIG will:
(i) except as otherwise specifically set forth herein, make any
change in their respective Articles of Incorporation or Certificate of
Incorporation or Memorandum and Articles of Association or Bylaws;
(ii) take any action described in Section 1.7 in the case of
EGIG, or in Section 2.6, in the case of ALPHA (all except as permitted
therein or as disclosed in the applicable party's schedules); or
(iii) enter into or amend any contract, agreement or other
instrument of any of the types described in such party's schedules,
except that a party may enter into or amend any contract, agreement or
other instrument in the ordinary course of business involving the sale
of goods or services.
Section 4.9 Indemnification.
(a) EGIG hereby agree to indemnify ALPHA and each of the officers,
agents and directors of ALPHA as of the date of execution of this Agreement
against any loss, liability, claim, damage or expense (including, but not
limited to, any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any litigation, commenced or
threatened or any claim whatsoever), to which it or they may become subject
arising out of or based on any inaccuracy appearing in or misrepresentation
made in this Agreement. The indemnification provided for in this paragraph
shall survive the Closing and consummation of the transactions contemplated
hereby and termination of this Agreement.
(b) ALPHA hereby agree to indemnify EGIG and each of its directors,
agents and current shareholders as of the Closing Date against any loss,
liability, claim, damage or expense (including, but not limited to, any and
all expense whatsoever reasonably incurred in investigating, preparing or
defending against any litigation, commenced or threatened or any claim
whatsoever), to which it or they may become subject arising out of or based
on any inaccuracy appearing in or misrepresentation made in this Agreement
and particularly the representation regarding no liabilities referred to in
Section 2.4 (d) and with regard to the representation set forth in Section
7.1 hereof regarding finders fees. The indemnification provided for in this
Paragraph shall survive the Closing and consummation of the transactions
contemplated hereby and termination of this Agreement.
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ARTICLE V
CONDITIONS PRECEDENT TO OBLIGATIONS OF ALPHA
The obligations of ALPHA under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
Section 5.1 Conditions Subsequent. All of those matters described in
Article III, above, shall have been satisfied or waived by the parties hereto.
Section 5.2 Accuracy of Representations. The representations and warranties
made by EGIG in this Agreement were true when made and shall be true at the
Effective Time with the same force and effect as if such representations and
warranties were made at the Closing Date (except for changes therein permitted
by this Agreement), and EGIG shall have performed or complied with all covenants
and conditions required by this Agreement to be performed or complied with by
EGIG prior to or at the Closing.
Section 5.3 No Material Adverse Change. Prior to the Closing Date, there
shall not have occurred any material adverse change in the financial condition,
business or operations of nor shall any event have occurred which, with the
lapse of time or the giving of notice, may cause or create any material adverse
change in the financial condition, business or operations of EGIG.
ARTICLE VI
CONDITIONS PRECEDENT TO OBLIGATIONS OF EGIG
The obligations of EGIG under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
Section 6.1 Conditions Subsequent. All of those matters described in
Article III, above, shall have been satisfied or waived by the parties hereto.
Section 6.2 Accuracy of Representations. The representations and warranties
made by ALPHA in this Agreement were true when made and shall be true as of the
Effective Time (except for changes therein permitted by this Agreement) with the
same force and effect as if such representations and warranties were made at and
as of the Closing Date, and ALPHA shall have performed and complied with all
covenants and conditions required by this Agreement to be performed or complied
with by ALPHA prior to or at the Closing.
Section 6.3 No Material Adverse Change. Prior to the Closing Date, there
shall not have occurred any material adverse change in the financial condition,
business or operations of nor shall any event have occurred which, with the
lapse of time or the giving of notice, may cause or create any material adverse
change in the financial condition, business or operations of ALPHA.
19
ARTICLE VII
MISCELLANEOUS
Section 7.1 Brokers and Finders. Each party represents to every other party
that all brokers or finders who have acted for it in connection with this
Agreement have been satisfied in full and that no other obligations need to be
satisfied as of the date of this Agreement. In the event it is determined that
any party is obligated to any other party to pay a broker or finder relevant to
the transaction described herein, ALPHA agrees to indemnify EGIG for any such
obligation, including reasonable attorneys fees.
Section 7.2 Law, Forum and Jurisdiction. This Agreement shall be construed
and interpreted in accordance with the laws of the State of Nevada. The parties
agree that any dispute arising under this Agreement, whether during the term of
the Agreement or at any subsequent time, shall be submitted to China Economic
and Trade Arbitration Commission for arbitration with then applicable rules of
that Commission. The award of the arbitration shall be binding and enforceable
against each party hereto.
Section 7.3 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if personally delivered to it or
sent by registered mail or certified mail, postage prepaid, addressed to the
other party at the address indicated hereinabove or such other address as a
party may so indicate to the other in the future.
Section 7.4 Attorneys' Fees. In the event that any party institutes any
action or suit to enforce this Agreement or to secure relief from any default
hereunder or breach hereof, the breaching party or parties shall reimburse the
non-breaching party or parties for all costs, including reasonable attorneys'
fees, incurred in connection therewith and in enforcing or collecting any
judgment rendered therein.
Section 7.5 Confidentiality. Each party hereto agrees with the other
parties that, unless and until the merger contemplated by this Agreement has
been consummated, they and their representatives will hold in strict confidence
all data and information obtained with respect to another party or any
subsidiary thereof from any representative, officer, director, shareholder or
employee, or from any books or records or from personal inspection, of such
other party, and shall not use such data or information or disclose the same to
others, except: (i) to the extent such data is a matter of public knowledge or
is required by law to be published, and (ii) to the extent that such data or
information must be used or disclosed in order to consummate the transactions
contemplated by this Agreement.
Section 7.6 Schedules; Knowledge. Each party is presumed to have full
knowledge of all information set forth in the other party's schedules delivered
pursuant to this Agreement.
Section 7.7 Third Party Beneficiaries. This contract is solely among ALPHA
and EGIG and, except as specifically provided, no director, officer,
stockholder, employee, agent, independent contractor or any other person or
entity shall be deemed to be a third party beneficiary of this Agreement.
20
Section 7.8 Entire Agreement. This Agreement represents the entire
agreement between the parties relating to the subject matter hereof. This
Agreement alone fully and completely expresses the agreement of the parties
relating to the subject matter hereof. There are no other courses of dealing,
understandings, agreements, representations or warranties, written or oral,
except as set forth herein. This Agreement may not be amended or modified,
except by a written agreement signed by all parties hereto.
Section 7.9 Survival; Termination. The representations, warranties and
covenants of the respective parties shall survive the Closing Date of the merger
and the consummation of the transactions herein contemplated.
Section 7.10 Counterparts; Facsimile Execution. For purposes of this
Agreement, a document (or signature page thereto) signed and transmitted by
facsimile machine is to be treated as an original document. The signature of any
party thereon, for purposes hereof, is to be considered as an original
signature, and the document transmitted is to be considered to have the same
binding effect as an original signature on an original document. At the request
of any party, a facsimile or telecopy document is to be re-executed in original
form by the parties who executed the facsimile or telecopy document. No party
may raise the use of a facsimile machine as a defense to the enforcement of the
Agreement or any amendment or other document executed in compliance with this
Section.
Section 7.11 Amendment or Waiver. Every right and remedy provided herein
shall be cumulative with every other right and remedy, whether conferred herein,
at law, or in equity, and may be enforced concurrently herewith, and no waiver
by any party of the performance of any obligation by the other shall be
construed as a waiver of the same or any other default then, theretofore, or
thereafter occurring or existing. At any time prior to the Closing Date, this
Agreement may be amended by a writing signed by all parties hereto, with respect
to any of the terms contained herein, and any term or condition of this
Agreement may be waived or the time for performance hereof may be extended by a
writing signed by the party or parties for whose benefit the provision is
intended.
7.12 Incorporation of Recitals. All of the recitals hereof are incorporated
by this reference and are made a part hereof as though set forth at length
herein.
7.13 Expenses. Each of the parties to this Agreement shall bear all of its
own expenses incurred by it in connection with the negotiation of this Agreement
and in the consummation of the transactions provided for herein and the
preparation therefor.
7.14 Headings; Context. The headings of the sections and paragraphs
contained in this Agreement are for convenience of reference only and do not
form a part hereof and in no way modify, interpret or construe the meaning of
this Agreement.
7.15 Benefit. This Agreement shall be binding upon and shall inure only to
the benefit of the parties hereto, and their permitted assigns hereunder. This
Agreement shall not be assigned by any party without the prior written consent
of the other party.
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7.16 Public Announcements. Except as may be required by law, neither party
shall make any public announcement or filing with respect to the transactions
provided for herein without the prior consent of the other party hereto.
7.17 Severability. In the event that any particular provision or provisions
of this Agreement or the other agreements contained herein shall for any reason
hereafter be determined to be unenforceable, or in violation of any law,
governmental order or regulation, such unenforceability or violation shall not
affect the remaining provisions of such agreements, which shall continue in full
force and effect and be binding upon the respective parties hereto.
7.18 Failure of Conditions; Termination. In the event any of the conditions
specified in this Agreement shall not be fulfilled on or before the Closing
Date, either of the parties have the right to terminate this Agreement. The
election to terminate shall not affect the right of such electing party
reasonably to require the other party to continue to use its efforts to fulfill
the unmet conditions.
7.19 No Strict Construction. The language of this Agreement shall be
construed as a whole, according to its fair meaning and intendment, and not
strictly for or against either party hereto, regardless of who drafted or was
principally responsible for drafting the Agreement or terms or conditions
hereof.
7.20 Execution Knowing and Voluntary. In executing this Agreement, the
parties severally acknowledge and represent that each: (a) has fully and
carefully read and considered this Agreement; (b) has been or has had the
opportunity to be fully apprised by its attorneys of the legal effect and
meaning of this document and all terms and conditions hereof; (c) has been
afforded the opportunity to negotiate as to any and all terms hereof; and (d) is
executing this Agreement voluntarily, free from any influence, coercion or
duress of any kind.
7.21 Litigation by Third Parties. In the event that suit is brought by a
third party to enjoin or otherwise interfere with the consummation of the
transactions contemplated herein, the parties agree that the bringing of such
litigation shall not entitle any party hereto to terminate the Agreement, but
that the parties shall bring an action for declaratory relief before a court of
competent jurisdiction and shall terminate this Agreement if such court adjudges
termination to be required by the rights of such third party.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers, hereunto duly authorized, as of the date
first above written.
ALPHA SPACECOM, INC.
By: S/HU Xuedong
------------------------------------
Its: President
EAST GLORY INVESTMENTS GROUP LIMITED
By: s/HOU Beicang
------------------------------------
Its: Chairman
-----------------------------------
EXHIBIT "A"
INVESTMENT LETTER
, 2006
--------------------
Board of Directors
Alpha Spacecom, Inc.
Room 710
Zhou Ji Building
No. 16 Ande Road
Xxxxxxxxx Xxxxxxxx
Xxxxxxx, 000000 Xxxxx
Gentlemen:
The undersigned herewith deposits certificate(s) for shares of common stock of
EAST GLORY INVESTMENTS GROUP LIMITED, a Cayman Island corporation, ("EGIG"), as
described below (endorsed, or having executed stock powers attached) in
acceptance of and subject to the terms and conditions of that certain Merger
Agreement (the "Agreement"), between Alpha Spacecom, Inc. (the "Company") and
EGIG, dated April 7, 2006, receipt of which is hereby acknowledged, in exchange
for shares of Common Stock of the Company (the "Securities"). If any condition
precedent to the Agreement is not satisfied within the relevant time parameters
established in the Agreement (or any extension thereof), the certificate(s) are
to be returned to the undersigned.
The undersigned hereby represents, warrants, covenants and agrees with you that,
in connection with the undersigned's acceptance of the Securities and as of the
date of this letter:
1. The undersigned is aware that his acceptance of the Securities is
irrevocable, absent an extension of the Expiration Date of any material change
to any of the terms and conditions of the Agreement.
2. The undersigned warrants full authority to deposit all shares referred
to above and the Company will acquire good and unencumbered title thereto.
3. The undersigned has full power and authority to enter into this
Agreement and that this Agreement constitutes a valid and legally binding
obligation of the undersigned.
4. By execution hereof, the undersigned hereby confirms that the Company's
Common Stock to be received in exchange for EGIG common stock, will be acquired
for investment for the undersigned's own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof, and that the
undersigned has no present intention of selling, granting any participation in,
or otherwise distributing the same. By execution hereof, the
undersigned further represents the undersigned does not have any contract,
undertaking, agreement or arrangement with any third party, with respect to any
of the Securities.
5. The undersigned understands that the Securities are being issued
pursuant to available exemption thereto and have not been registered under the
Securities Act of 1933, as amended (the "1933 Act"), or under any state
securities laws. I understand that no registration statement has been filed with
the United States Securities and Exchange Commission nor with any other
regulatory authority and that, as a result, any benefit which might normally
accrue to a holder such as me by an impartial review of such a registration
statement by the Securities and Exchange Commission or other regulatory
authority will not be forthcoming. I understand that I cannot sell the
Securities unless such sale is registered under the 1933 Act and applicable
state securities laws or exemptions from such registration become available. In
this connection I understand that the Company has advised the Transfer Agent for
the Common Shares that the Securities are "restricted securities" under the 1933
Act and that they may not be transferred by me to any person without the prior
consent of the Company, which consent of the Company will require an opinion of
my counsel to the effect that, in the event the Securities are not registered
under the 1933 Act, any transfer as may be proposed by me must be entitled to an
exemption from the registration provisions of the 1933 Act. To this end, I
acknowledge that a legend to the following effect will be placed upon the
certificate representing the Securities and that the Transfer Agent has been
advised of such facts:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, AND MAY BE OFFERED AND SOLD ONLY IF
REGISTERED PURSUANT TO THE PROVISIONS OF THE ACT OR IF AN
EXEMPTION FROM REGISTRATION THEREUNDER IS AVAILABLE, THE
AVAILABILITY OF WHICH MUST BE ESTABLISHED TO THE SATISFACTION
OF THE COMPANY.
I understand that the foregoing legend on my certificate for the Common
Shares limits their value, including their value as collateral.
6. The undersigned represents that he is experienced in evaluation and
investing in securities of companies in the development stage and acknowledges
that it is able to fend for himself, can bear the economic risk of this
investment and has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of the investment
in the Securities.
IN WITNESS WHEREOF, the undersigned has duly executed this Investment
Letter as of the date indicated hereon.
Dated: , 2006
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Very truly yours,
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(signature)
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(print name in full)
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(city, state, zip)
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(social security number or
employer identification no.)
