SHARE EXCHANGE AGREEMENT
Acquisition of Laser Show Systems (Canada), Ltd., by
Light Management Group, Inc.
This Agreement is made and entered into this ___ day of May,
1999, by and between Light Management Group, Inc. (hereinafter
Light), a Nevada corporation, with offices located at 000 Xxxx Xxxx,
Xxxxxxx, Xxxxx 00000 and Laser Show Systems (Canada), Ltd.
(hereinafter Laser) a Canadian corporation, with offices located at
0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxx, Xxxxxx X0X0X0;
both of whom hereby agree to the acquisition of Laser by Light as
described herein.
RECITALS
WHEREAS, It is understood by the Parties that Light is a
Nevada corporation, whose shares are traded over-the-counter (OTC BB
symbol: LMGI) and publicly held, stock information is attached
hereto as Exhibit A.
WHEREAS, It is understood by the Parties that Laser is a
Canadian corporation, whose shares are privately held.
WHEREAS, Light desires to acquire from Laser one hundred
percent (100%) of its ownership, rights, and interest in the entire
issued and outstanding share capital of Laser in exchange for three
million (3,000,000) shares of Light common stock issued from
treasury.
WHEREAS, Laser desires to sell Light one hundred percent
(100%) of its ownership, rights, and interest in the entire issued
and outstanding share capital of Laser its stock in exchange for
three million (3,000,000) shares of Light common stock issued from
treasury.
WHEREAS, the share exchange is intended to qualify as a
reorganization under section 368(a)(1)(b) of the Internal Revenue
Code (hereinafter the Code).
AGREEMENT
NOW THEREFORE, in consideration of the recitals, mutual
promises and covenants set forth herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
parties agree as follows:
1. Acquisition of Laser
Subject to the terms and conditions set forth herein, Laser
hereby exchanges and transfers to Light one hundred percent (100%)
of its ownership, rights and interest in its entire issued and
outstanding share capital for three million (3,000,000) shares of
Lights authorized but un-issued common stock from treasury in a non-
taxable, asset for asset exchange. It is hereby agreed that Light
shall honor and give full force and effect to any employee purchase
agreement of Laser in effect as of the date of this Agreement.
2. Issuance of Shares
Light hereby agrees to have issued three million (3,000,000)
shares of Light from its authorized but un-issued common stock from
treasury within five (5) business days from the date of this
Agreement.
3. Effective Date
The Effective Date of this share exchange shall be, and such term
as used herein shall mean, the exact day and time on which the
Articles of Share Exchange attached hereto as Exhibit B are
signed by the respective Board of Directors.
In exercising their rights under this Agreement each of the
Constituent Corporations may act by its Board of Directors, and
such rights may be so exercised, notwithstanding the prior
approval of this Agreement by the shareholders of a Constituent
Corporation.
4. Representations and Warranties of Laser
4.1 Light hereby makes the following representations and
warranties to Laser, each of which is true as of the date hereof and
as of the Effective Date:
The operations of Laser are validly licensed, organized, and
existing in good standing with all State and Federal appropriate
regulatory agencies, and Laser has taken all requisite corporate
actions required under the Certificates of Incorporation and the By-
Laws of Laser and its subsidiaries, and the laws of Canada, to the
extent necessary to enter into this Agreement and to carry out the
terms and conditions to be performed by Laser.
4.2 Laser represents that it is under no impediment or constraint,
legal or otherwise, which would prevent it from entering into this
Agreement and performing the exchange transaction described herein;
and further represents that it has taken any and all corporate
action required under its Certificate of Incorporation, By-Laws, and
the laws of Canada, to the extent necessary for the performance by
Laser of the promises and covenants contained herein.
4.3 Laser is not involved in any pending litigation or
governmental investigation or proceeding. To the best knowledge of
Laser, no material litigation, claim, assessment or governmental
investigation or proceeding is threatened, which could affect its
ability to enter into this Agreement or to carry out its purposes
and covenants, which has not been disclosed. Light acknowledges its
duty to exercise due diligence in ascertaining the existence of any
pending claims, which were not known to Laser prior to executing
this Agreement.
4.4 Laser has full power, authority, and legal right to enter into
this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby, and the
compliance by Laser with the provisions hereof will not (1) conflict
with or result in a breach of any provisions of, or constitute a
material default (or an event which, with notice or lapse of time or
both, would constitute a material default) under, or result in the
creation of any material lien, security interest, charge, or
encumbrance upon the Laser property(ies) or any of the material
property, business operations, licenses, or other assets of Laser
under any of the terms, conditions, or provisions of the Certificate
of Incorporation or By-Laws, if applicable, or any material note,
bond, mortgage, indenture, license, agreement, or other instrument
or obligation to which Laser is a party, or by which it is bound; or
(2) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Laser or any of its respective properties,
business operations, or assets.
4.5 Laser has, to the best of its knowledge, disclosed to Light
all events, conditions, and facts materially affecting their
business and properties of Laser. Laser has neither withheld
information nor knowledge of any such events, conditions, or facts,
which he knows, or have reasonable grounds to know, may materially
affect the business of Laser or future prospects.
4.6 Laser warrants and represents that, before entering into this
transaction, it has investigated the business and financial
condition of Light and has relied upon his own independent
investigation and his own legal and accounting counsel before
executing this Agreement.
4.7 Laser understands that Light has exercised the necessary due
diligence to verify the accuracy of all representations made to it
herein by Laser and to satisfy itself of the condition of Laser and
Laser enters into the Agreement with that understanding.
5. Representations and Warranties of Light
5.1 Light hereby makes the following representations and
warranties to Laser, each of which is true as of the date hereof and
as of the Effective Date:
5.2 Light is a corporation duly organized and existing by virtue
of the laws of the State of Nevada, USA.
5.3 Light has an authorized capitalization of 100,000,000 shares
of common stock, no par value per share, of which approximately
10,000,000 shares are currently issued and outstanding.
5.4 All filings required to be made by Light pursuant to any
federal or state securities laws have been or are being made and are
current, and contain no material misstatement or omit any facts
required so as not to be misleading. The shares of Light to be
transferred to Laser hereby will, upon the issuance hereof, be duly
and validly issued, fully paid, and non-assessable under the
Securities Act of 1933 and shall bear no restrictive legend. All of
the Lights shares transferred to Laser will carry full voting rights
and, when delivered, shall be free and clear of all liens, and all
other encumbrances, claims, equities, and liabilities of every
nature, and Light, having duly taken all corporate action required
thereto, has the unqualified right to issue the Lights shares and to
deliver a clear and unencumbered title thereto to Laser. Light is
under no obligation, legal or otherwise, to establish any other
class of common or preferred stock, or any other type of security.
5.5 The execution of this Agreement by Light, and the performance
by Light of its covenants and undertakings hereunder, have been duly
authorized by all requisite corporate action and approved by the
Board of Directors. Light has the corporate power and authority to
enter into this Agreement and perform the covenants and undertakings
to be performed by it hereunder, and is under no impediment, which
would affect or prohibit this transaction.
5.6 All documents of Light heretofore delivered to Laser are true
and correct copies thereof.
5.7 Light asserts that it is not involved in any pending
litigation or governmental investigation or proceeding and, to the
best knowledge of Light, no material litigation, claim, assessment,
or governmental investigation or proceeding is pending or threatened
which might result in any change in the business or condition,
financial or otherwise, of the Light, or in any of its properties or
assets, or which might result in any liability on the part of Light
or which questions the validity of this Agreement, or might
otherwise adversely affect Light, or of any action taken or to be
taken pursuant to or in connection with the provisions of this
Agreement, and to the best of the Lights knowledge, there is no
basis for any such litigation, claim, assessment or governmental
investigation or proceeding.
5.8 All Light shares to be issued to Laser will be validly issued,
non-assessable, and fully paid, with full voting rights, and will be
issued in a non-public offering pursuant to exemptions from
registration under federal and state securities laws.
5.9 Light has not breached, nor is there any pending or threatened
claim or any legal basis for a claim that Light has breached, any of
the terms or conditions of any agreement, contract, or commitment to
which it is a party or is bound, and the execution and performance
hereof will not violate any law or any provisions of any agreement
to which Light is subject.
5.10 Light has disclosed all events, conditions, and facts
materially affecting the business and prospects of Light. Light has
not withheld disclosure of any such events, conditions, and fact
which it, through management, has knowledge of, or has reasonable
grounds to know, that may materially affect the business and
prospects of Light.
5.11 Light has full power, authority and legal right to enter into
this Agreement and to consummate the transactions contemplated
hereby. The execution of delivery of this Agreement, the
consummation of the transactions contemplated hereby, and the
compliance by Light with the provisions hereof will not: (1)
conflict with or result in a breach of any provisions of, or
constitute a material conflict (or an event which, with notice or
lapse of time or both, would constitute a material default) under,
or result in the creation of any material lien, security interest,
charge, or encumbrance upon the Light under any of the terms,
conditions, or provisions of the Articles of Incorporation or By-
Laws of Light or any material note, bond, mortgage, indenture,
license, agreement, or the instrument or obligation to which Light
is a party, or by which it is bound; or (2) violate any order, writ,
injunction, decree, statute, rule, or regulation applicable to Light
or any of its properties or assets.
5.12 This Agreement has been duly authorized by all requisite
corporate action of the Light, duly approved by the vote of Lights
Board of Directors, duly executed and delivered by the Light, and
constitutes the valid and legally binding obligation of the Light
enforceable against the Light in accordance with its terms.
5.13 Light is not, nor immediately following the Effective Date
will be, in violation or breach of or in default under its
Certificate of Incorporation or By-Laws. The execution, delivery,
and performance by the Light of this Agreement will not conflict
with, result in a breach or violation of, constitute a default
under, or result in the create of any lien on the properties or
assets of the Light pursuant to the Certificate of Incorporation or
By-Laws of the Light, or violate any law, rule, or regulation or, to
the best knowledge of its counsel, breach any material agreement or
instrument, order, judgment, or decree to which the Light is subject
or by which its assets are bound.
5.14 Light shall be responsible for filing all reports or making
any disclosures regarding this transaction that are required by any
federal securities statutes and shall indemnify and hold harmless
Laser and its shareholders from its failure to comply therewith,
including any attorneys fees incurred relative thereto.
6. Nature and Survival of Representations.
All representations, warranties, promises, and covenants made
by a party to this Agreement and set forth herein, or in any Exhibit
hereto, shall survive the execution of this Agreement and its
closing as set forth herein.
7. Miscellaneous Provisions.
7.1 Counterparts.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. All
parties hereto shall be provided with duplicate originals of the
signature pages evidencing the execution of this Agreement by all
parties hereto within seven (7) days from the date each party
affixes his or her signature to this Agreement. It shall be the
responsibility of each signing party to forward duplicate originals
of his or her signature to the other parties to this Agreement in
accordance with this provision.
7.2 Entire Agreement.
This Agreement constitutes the entire Agreement among the
parties pertaining to the subject matter hereof, and supersedes all
prior and contemporaneous agreements and understandings of the
parties in connection herewith. There are no oral promises,
conditions, representations, understandings, interpretations, or
terms of any kind as conditions or inducements to the execution of
the Agreement, which are not set forth herein.
7.3 Further Assurances.
At any time, and from time to time after the date hereof, each
party will execute such additional instruments, and take such
action, as may be reasonably requested by the other party to confirm
or perfect title to any shares, or other asset transferred
hereunder, or to otherwise carry out the intent and purposes of this
Agreement.
7.4 Waiver.
Any failure on the part of either party hereto to comply with
any of the obligations, agreements, or conditions hereunder may be
waived in writing by the party to whom such compliance is owned.
7.5 Notices.
All notices and communications hereunder shall be made in
writing and shall be deemed to have been given if delivered in
person or sent by prepaid, first class, registered or certified
mail, return receipt requested to each party.
7.6 Severability.
The parties to the Agreement hereby agree and affirm that none
of the above provisions is dependent upon the validity of all of the
provisions, and if any part of this Agreement is deemed to be
unenforceable, the balance of the Agreement shall remain in full
force and effect.
7.7 Default Cost.
In the event any party hereto has to result to legal action to
enforce any of the terms hereof, such party shall be entitled to
collect attorneys fees and all other costs from the party at fault.
7.8 Amendment.
This Agreement or any provision hereof, may not be changed,
waived, terminated, or discharged except by means of a written
supplemental instrument signed by the arty or parties against whom
enforcement of the change, waiver, termination, or discharge is
sought.
7.9 Governing Law.
This Agreement shall be governed by the laws of the State of
Nevada.
7.10 Inurement.
This Agreement shall be binding upon the parties hereto, and
inure to the benefit of the parties, and, where applicable, their
heirs, personal representatives, successors in interest, and
assigns.
Light Management Group, Inc.
Date: May 19, 1999 By:/s/Barrington X. Xxxxx
Barrington X. Xxxxx, Chairman
Laser Show Systems (Canada) Ltd. Date: May 19, 1999
By:/s/Barrington X. Xxxxx
Barrington X. Xxxxx
President
