Exhibit 10(ii)
This letter agreement signed for reference the14th day of February, 2000
Between;
Growth Works Capital Ltd. (WOF) Fax: 000 0000
(Managers of Working Opportunity Fund (EVCC) Ltd.
Attention: Xxxx Xxxxxxxx
and
MDS Ventures Pacific Inc. (MDS) Fax: 000 0000
Attention: Xxxxx Xxxxx
and
Service Systems International Ltd. (SSI)
and
UV Systems Technology Inc. (UVST)
The purpose of this letter agreement is to purchase from WOF and MDS, all Class
B common shares and Class A Preferred shares of UVST owed by WOF and MDS., by
issue of common shares of Service Systems International Ltd.
Accrued interest up to the date of completing the purchase of the UVST shares
held by WOF and MDS will be cancelled. These amounts currently are C$182,361
owing to WOF and C$39,222 owing to MDS.
The principal amount of loans owing to WOF, C$1,301,098 and MDS, C$275,000 will
be converted into common shares of SSI at US$0.50 per share. Using an exchange
rate of 1.46, the value per share is C$0.73 per share. This equates to 1,782,326
shares of SSI for WOF ($1,301,098/.073) and 376,712 shares for MDS
($275,000/0.73).
With respect to the UVST Class A preferred shares held by WOF and MDS we will
convert the full C$2,000,000 into SSI shares and would provide 1,027,397 shares
to WOF and 1,027,397 to MDS.
All Class B common shares of UVST held by WOF and MDS will be transferred to
SSI.
Currently there are a total of 14,981,090 shares of SSI issued and outstanding.
Under this purchase for all UVST shares held by WOF and MDS to SSI we would
issue additional shares totaling 4,213,832 bringing the total outstanding share
of SSI to 19,194,922. WOF and MDS or the assigns agree to vote their respective
shares as directed by the current Managing Directors, KF and JG until August 31,
2001.
A summary of this share transactions follows.
CURRENT SHARES OUTSTANDING IS SSI 14,981,090
WOF
Conversion of loan principal 1,782,326
Conversion of Class A shares 1.027,397 2,809,723
MDS
Conversion of loan principal 376,712
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Conversion of Class A shares 1.027,397 1,404,109
--------- ---------
Total Shares issued and outstanding (post transaction) 19,194,922
==========
Xxx Xxxxxxxx (KF) and Xxxx Xxxxx (JG) will agree to a restriction on the sale of
their shareholdings. This restriction will remain in force until WOF has sold or
had an offer to sell at market price, 1,274,000 shares, thereafter the
opportunity to sell shall be on the basis of 50% WOF and 50% MDS until a further
1,000,000 shares have been sold at market prices, and thereafter the opportunity
to sell shall be on the basis of, 25% WOF, 25% MDS, 25% KF and 25% JG. If for
purposes of financing the needs of UVST, KF and JG wish to sell shares prior to
the completion of sales by WOF and MDS (in priority to KF and JG) than KF and JG
may apply to WOF and MDS for permission to do so; which permission will not be
unreasonably withheld.
The shares issued in this transaction are issued under Regulation S and are
restricted under US law, are being acquired for investment, may be transferred
under Regulation S requirements or an exemption from registration acceptable to
SSI. Thereafter, SSI will assist WOF and MDS to sell their position as and if
opportunities present themselves
Except for existing warrants or convertible debt instruments, SSI will restrict
the issues of additional shares. The issue of new shares will be tied to the
sale of WOF and MDS shares. In this regard, we will accept a restriction that no
more then 5.0 million shares will be issued until 50% of the total stock issued
to WOF and MDS has sold or had an offer to sell at market price and that no more
than 10.0 million shares will be issued until all of the shares of WOF and MDS
have been sold.
SSI will convert its loans into equity of UVST unless bonding agents or lenders
agree it is not necessary to do so.
The above is subject to internal approval of the parties and regulatory
advise/approval if and as needed. SSI will present this to its US legal counsel
for confirmation of any regulatory requirements.
This agreement may be executed by facsimile and by counterpart.
SERVICE SYSTEMS INTERNATIONAL LTD. GROWTH WORKS CAPITAL
(As Managers of Working Opportunity Fund (EVCC) Ltd.)
-----------------------------------
Xxx Xxxxxxxx, President ----------------------------------------------------
M. E. Xxxxxxxx, Senior VP, Investments
-----------------------------------
J R Xxxxx, Vice President MDS VENTURES PACIFIC INC.
UV SYSTEMS TECHNOLOGY INC ---------------------------------------
-----------------------------------
Xxx Xxxxxxxx, President
-----------------------------------
J R Xxxxx, Executive Vice President
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