Exhibit 10.1
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT (together with all schedules, exhibits and
all ancillary agreements contemplated herein are hereinafter referred to as this
"Agreement"), is entered into as of the ____ day of July, 2003, by and between
Napoli Enterprises, Inc., a corporation organized under the laws of the State of
Colorado (the "Napoli") and all of the shareholders (collectively, the "Novotech
Shareholders") of Novotech Holdings, Inc., ("Novotech"), a company organized
under the laws of the British Virgin Islands ("BVI"). Napoli and the Novotech
Shareholders are referred to collectively as the "Parties".
WHEREAS, the Novotech Shareholders own 90% percent of the issued and
outstanding capital stock of Novotech (the "Novotech Shares");
WHEREAS, Novotech owns an approximate 99% ownership interest in Lion Gri,
S.R.L. ( "Lion Gri"), a company organized under the laws of the Republic of
Moldova;
WHEREAS, the Novotech Shareholders desire to sell and Napoli desires to
acquire the Novotech Shares, and thereby a controlling indirect ownership
interest in Lion Gri, in consideration for 34,474,451 newly-issued shares of
common stock of Napoli constituting approximately 87% of Napoli's outstanding
capital stock after such issuance on a fully-diluted basis, on the terms and
conditions hereinafter provided;
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 AND WARRANTIES
OF THE NOVOTECH SHAREHOLDERS
The Novotech Shareholders, jointly and severally, represent and warrant as
follows:
Section 1.01 - Organization of Novotech. Novotech is a company duly
organized and validly existing under the laws of BVI and has the corporate power
and is duly authorized, qualified, and licensed under all applicable laws,
regulations, ordinances, and orders of public authorities to undertake the
transactions contemplated by this Agreement, to own all of its properties and
assets to carry on its business. The execution and delivery of this Agreement
does not, and the consummation of the transactions contemplated hereby will not,
violate any provision of Novotech's articles of incorporation or bylaws (or the
foreign equivalent thereof). Novotech has taken, or will have taken prior to
Closing (as described in Article III herein), all actions required by law, its
articles of incorporation, or otherwise, to authorize the execution and delivery
of this Agreement. Novotech has, or will have prior to Closing (as described in
Article III herein), full power, authority, and legal right and has, or will
have prior to Closing (as described in Article III herein), taken all action
required by law, its bylaws, articles of incorporation (or the foreign
equivalent thereof) and otherwise to consummate the transactions herein
contemplated.
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Section 1.02 - Capitalization and Outstanding Shares. All outstanding
shares of Novotech are validly issued, fully paid, and non-assessable and not
issued in violation of the pre-emptive or other rights of any person.
Section 1.03 - Options or Warrants or Subscriptions. There are no existing
options, warrants, calls, subscriptions or commitments of any character relating
to any authorized and unissued stock of any class of Novotech.
Section 1.04 - Ownership of Novotech Shares. Each of the Novotech
Shareholders is the legal and beneficial owner of that number of Novotech shares
set forth opposite his, her or its name in the attached Schedule 1.04 , free and
clear of any claims, charges, equities, liens, security interests, and
encumbrances whatsoever.
Section 1.05 - Shares Validly Issued. With respect to the Novotech Shares
issued to him, her or it, the Novotech Shares have been validly issued to each
Shareholder and are fully paid, fully vested, non-assessable and not issued in
violation of the pre-emptive or other rights of any person.
Section 1.06 - Valid Transfer of Fully Vested Shares. With respect to
himself, herself or itself, each of the Novotech Shareholders has full right,
power, and authority to transfer, assign, convey, and deliver its Novotech
Shares. With respect to himself, herself or itself, delivery by each Novotech
Shareholder of such shares at the Closing (as described in Article III herein)
will convey to Napoli good and marketable title to such Novotech Shares, free
and clear of any claims, charges, equities, liens, security interests, and
encumbrances whatsoever.
Section 1.07 - Underlying Transaction Lawful. All transactions
contemplated by this Agreement are lawful under the laws of BVI.
Section 1.08 - Enforceable Obligation. The transactions contemplated by
this Agreement are the valid and binding obligations of each Novotech
Shareholder, enforceable against each respective Novotech Shareholder, jointly
and severally, by Napoli in accordance with the terms of this Agreement.
Section 1.09 - No Conflicts. The execution and delivery by each Novotech
Shareholder of this Agreement, the performance by each Novotech Shareholder of
his, her or its obligations under this Agreement and the consummation of the
transactions contemplated hereby do not and will not: (i) conflict with or
result in a violation or breach of, (ii) constitute (with or without notice or
lapse of time or both) a default under, (iii) require any Novotech Shareholder
to obtain any consent, approval or action of, make any filing with or give any
notice to any person as a result or under the terms of, (iv) result in or give
to any person any right of termination, cancellation, acceleration or
modification in or with respect to, (v) result in or give to any person any
additional rights or entitlement to increased, additional, accelerated or
guaranteed payments under, or (vi) result in the creation or imposition of any
lien upon any Novotech Shareholder or any of their respective assets and
properties under any contract to which any Novotech Shareholders is bound.
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Section 1.10 - Voting Trusts. The Novotech Shares are not subject to any
voting trust agreement or other contract restricting or otherwise relating to
the voting or disposition of the Novotech Shares.
Section 1.11 - Governmental Authorizations and Licenses. Each Novotech
Shareholder has, or will have upon Closing (as described in Article III herein),
all licenses, franchises, permits, and other governmental authorizations that
are legally required to enable it to conduct its business in all material
respects as conducted. 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 the Novotech
Shareholders of this Agreement and consummation by the Novotech Shareholders of
the transaction contemplated hereby.
Section 1.12 - Compliance With Laws and Regulations. Each Novotech
Shareholder has complied with all applicable statutes and regulations of any
applicable laws except to the extent that noncompliance would not result in the
occurrence of any material liability for any Novotech Shareholder.
Section 1.13 - Power of Stock Transfer. Each Novotech Shareholder has duly
executed a stock transfer power in the substantial form as set forth in Schedule
1.13.
Section 1.14 - Ownership of Lion Gri. Each Novotech Shareholders hereby
represents and warrants that Novotech is the legal and beneficial owner of an
approximate 99% ownership interest in Lion Gri. Attached hereto as Schedule 1.14
is a duly notarized copy of the certificate of registration issued by the office
of registration of Republic of Moldova which evidences Novotech's ownership of
Lion Gri.
ARTICLE II
REPRESENTATIONS, COVENANTS AND
WARRANTIES OF NAPOLI
The Napoli represent and warrant as follows:
Section 2.01 - Organization and Due Authorization. Napoli is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of Colorado and has the corporate power and is duly authorized, qualified,
and licensed under all applicable laws, regulations, ordinances, and orders of
public authorities to own all of its properties and assets. The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby will not, violate any provision of Napoli's articles of
incorporation or bylaws. Napoli has taken all action required by all applicable
laws, including, without limitation, the laws of the State of Colorado and the
U.S. securities laws and regulations, and under Napoli's articles of
incorporation, its bylaws, or otherwise to authorize the execution and delivery
of this Agreement. Napoli has full power, authority, and legal right and has
taken all action required by all applicable laws, including, without limitation,
the laws of the State of Colorado and the U.S. securities laws and regulations,
its articles of incorporation, bylaws, or otherwise to consummate the
transactions herein contemplated.
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Section 2.02 - Capitalization and Outstanding Shares. Napoli's authorized
capitalization currently consists of 500,000,000 shares of common stock, par
value $.001, of which 5,525,549 shares of common stock are issued and
outstanding as of the date hereof and 50,000 shares of preferred stock of which
no shares are outstanding as of the date hereof. All issued and outstanding
shares are legally issued, fully paid, non-assessable and not issued in
violation of the pre-emptive or other rights of any person.
Section 2.03 - Options or Warrants or Subscriptions. There are no existing
options, warrants, calls, subscriptions or commitments of any character relating
to the authorized and unissued stock of Napoli.
Section 2.04 - Approval of Agreement. The board of directors of Napoli has
approved this Agreement and the transactions contemplated hereby.
Section 2.05 - Underlying Transaction Lawful. All transactions
contemplated by this Agreement and this Agreement are lawful under all
applicable laws of the Untied States and under all applicable laws of the State
of Colorado.
Section 2.06 - Enforceable Obligation. The transactions contemplated by
this Agreement are the valid and binding obligations of Napoli enforceable
against Napoli by the other Parities in accordance with the terms of this
Agreement.
Section 2.07 - No Conflicts. The execution and delivery by Napoli of this
Agreement, the performance by Napoli of its obligations under this Agreement and
the consummation of the transactions contemplated hereby do not and will not:
(i) conflict with or result in a violation or breach of, (ii) constitute (with
or without notice or lapse of time or both) a default under, (iii) require
Napoli to obtain any consent, approval or action of, make any filing with or
give any notice to any person as a result or under the terms of, (iv) result in
or give to any person any right of termination, cancellation, acceleration or
modification in or with respect to, (v) result in or give to any person any
additional rights or entitlement to increased, additional, accelerated or
guaranteed payments under, or (vi) result in the creation or imposition of any
lien upon Napoli or any of its assets and properties under, any contract to
which Napoli, or by which any of its respective assets and properties is bound.
Section 2.08 - Governmental Authorizations and Licenses. Napoli has, or
will have upon Closing (as described below), all licenses, franchises, permits,
and other governmental authorizations that are legally required to enable it to
conduct its business in all material respects as conducted. 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 Napoli of this Agreement and consummation by Napoli of
the transaction contemplated hereby.
Section 2.09 - Compliance With Laws and Regulations. In connection with
all matters directly and indirectly related to this Agreement or the
transactions contemplated hereunder Napoli has complied with all applicable
statutes and regulations of any applicable laws except to
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the extent that noncompliance would not result in the occurrence of any material
liability for Napoli
Section 2.10 - No Shareholder Approval Required. Under to the laws of the
State of Colorado, in combination with all applicable laws of the United States,
Napoli is not legally required to file an information statement on Schedule 14C
in connection with the transactions contemplated by this Agreement.
ARTICLE III
PLAN OF PURCHASE AND SALE OF NOVOTECH SHARES
Section 3.01 - The Purchase and Sale of Novotech Shares.
(a) The Novotech Shareholders agree to assign, transfer, and deliver to
Napoli, free and clear of all liens, pledges, encumbrances, charges,
restrictions or known claims of any kind, nature, or description constituting
90% of the issued and outstanding capital stock of Novotech as of July 16, 2003.
(b) Napoli agrees to issue and deliver to the Novotech Shareholders
34,747,451 newly-issued shares of Napoli's common stock, par value $.001, to the
Novotech Shareholders and their designated recipients in the amounts set forth
opposite the name of each Shareholder and their designated recipients in the
list attached hereto as Schedule 3.01(b) and incorporated herein. The shares
issued by Napoli under this Section 3.01(b) shall be issued with the rights of
registration contained in that certain registration rights agreement between the
Novotech Shareholders and their designees and Napoli attached hereto as Schedule
3.01(b) - 2.
Section 3.02 - Closing. The closing ("Closing") of the transactions
contemplated by this Agreement shall occur after the signing of this Agreement,
after the fulfillment of all conditions precedent set forth in Article V hereof
and at such time and place as the parties may mutually agree ("Closing Date").
Section 3.03 - Closing Events. At the Closing, each of the respective
Parties hereto shall execute, acknowledge, and deliver (or shall ensure to be
executed, acknowledged, and delivered), as applicable, the following:
(a) In the case of the Novotech Shareholders: (i) a stock transfer power
and authorization of designee executed by each Novotech Shareholder listed on
Schedule 1.04 in the substantial form set forth in Schedule 1.13;
(b) In the case of Napoli: to each person set forth on Schedule 3.01(B)
that number of newly-issued Napoli Shares set forth beside each person's name on
Schedule 3.01(B).
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ARTICLE IV
SPECIAL REPRESENTATIONS AND COVENANTS WITH RESPECT TO COMMON
SHARES ISSUED BY THE COMPANY TO THE NOVOTECH SHAREHOLDERS
Section 4.01 - Shares Issued by Napoli to Novotech Shareholders Not
Registered. The consummation of this Agreement and the transactions herein
contemplated, including the issuance of common shares by Napoli to the Novotech
Shareholders as set forth in Article III, constitute the offer and sale of
securities under the Securities Act of 1933, as amended (the "Securities Act")
and applicable state statutes. The Novotech Shareholders acknowledge that the
shares of Napoli to be delivered to each Shareholder pursuant to this Agreement
have not been registered under the Securities Act or the laws of any other
jurisdiction, and that therefore the stock is not fully transferable except as
permitted under various exemptions, if any, contained in the Securities Act and
the rules of the Securities and Exchange Commission interpreting the Securities
Act. Under US law, Napoli's common stock cannot be sold or transferred by the
Novotech Shareholders unless they are registered under applicable law or an
exemption from registration is available. The provisions contained in this
paragraph are intended to ensure compliance with the Securities Act.
Section 4.02 - Regulation S Representations. For purposes of this Section
4.02, "United States" includes the United States, its territories and
possessions, any state, and the District of Columbia. Each Shareholder is not a
"U.S. Person", defined in Rule 902(k) of the Securities Act as any one of the
following: (i) any natural person resident in the United States; (ii) any
partnership or corporation organized under the laws of the United States; (iii)
any estate of which any executor or administrator is a U.S. person; (iv) any
trust of which any trustee is a U.S. person; (v) any agency or branch of a
foreign entity located in the United States; (vi) any non-discretionary account
or similar account (other than an estate or trust) held by a dealer or other
fiduciary for the benefit or the account of a U.S. person; (vii) any
discretionary account or similar account (other than an estate or trust) held by
a dealer or other fiduciary organized, incorporated or (if an individual)
resident in the United States; (viii) any partnership or corporation, if such
entity was formed under the laws of a foreign jurisdiction by a U.S. person
principally for the purpose of investing in securities not registered under the
Securities Act, unless it is organized or incorporated, and owned, by accredited
investors. Each Novotech Shareholder did not receive offering materials with
respect to the transactions contemplated by the Agreement. At the time of this
Agreement, each Novotech Shareholder is outside of the United States. Therefore
the Novotech Shareholders agree not to sell or otherwise dispose of any of the
common shares of Napoli received pursuant to this agreement unless such Novotech
Shareholder:
(a) has delivered to Napoli a written legal opinion in form and
substance satisfactory to counsel for Napoli to the effect that the
disposition is permissible under the terms of the Securities Act and
the rules and regulations promulgated thereunder;
(b) has complied with the registration and prospectus requirements of
the Securities Act relating to such disposition; or
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(c) has presented Napoli satisfactory evidence that such a disposition
is exempt from registration under the Securities Act. Napoli shall
place a stop transfer order against transfers of shares until the
conditions set forth in this paragraph have been met. Furthermore,
the Novotech Shareholders agree that the certificates evidencing the
common shares that each will receive under this Agreement will
contain the following legend or one substantially similar:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
FEDERAL SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE AND
MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED (1)
ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER THE ACT; OR (2)
ABSENT AN OPINION OF COUNSEL, WHICH OPINION IS REASONABLY
SATISFACTORY IN FORM AND SUBSTANCE TO THE COMPANY AND ITS COUNSEL,
TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT
OR SUCH STATES OR THAT SUCH TRANSACTION COMPLIES WITH THE RULES
PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION UNDER SAID ACT
OR SUCH STATES.
Section 4.03 - Third Party Consents and Certificates. The Parties 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 4.04 - Indemnification.
(a) The Novotech Shareholders hereby agree to indemnify Napoli, its
respective officers, agents and directors 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 expenses 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 misrepresentations
made under Article I of 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) Napoli hereby agrees to indemnify the Novotech Shareholders 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 expenses whatsoever
reasonably incurred in investigating, preparing, or defending against any
litigation, commenced or threatened, or any claim whatsoever), to which they may
become subject arising out of or based on any inaccuracy appearing in or
misrepresentations made by Napoli under 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.
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(c) Napoli hereby agrees that if for whatever reason the shares issued to
the Novotech Shareholders pursuant to this Agreement can not be or are not
validly issued, then this Agreement may be rescinded by the Novotech
Shareholders. In such event, Napoli will immediately return the Novotech Shares
to the Novotech Shareholders.
ARTICLE V
CONDITIONS PRECEDENT TO CLOSING
The obligations of the Parties at Closing under this Agreement are subject
to the satisfaction, at or before the Closing Date, of the following conditions:
Section 5.01 - Accuracy of Representations. The respective representations
and warranties made by the Parties in this Agreement shall be true at the
Closing Date with the same force and effect as if such representations and
warranties were made at and as of the Closing Date (except for changes therein
permitted by this Agreement), and the respective Parties shall have performed or
complied with all pre-closing covenants and conditions required by this
Agreement to be performed or complied with by them prior to or at the Closing.
Section 5.02 - 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 any Party, 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 the Parties.
Section 5.03 - Deliverables. Each deliverable required to be delivered by
each respective Party under Articles I and II of this Agreement has been
delivered.
ARTICLE VI
MISCELLANEOUS
Section 6.01 - Governing Law. This Agreement shall be governed by,
enforced, and construed under and in accordance with the laws of the United
States of America and, with respect to the matters of state law, with the laws
of the State of New York.
Section 6.02 - Resolution of Disputes.
(a) Any dispute, controversy or claim arising out of or relating
to this Agreement, or the interpretation, breach, termination
or validity hereof, shall first be resolved through friendly
consultation, if possible. Such consultation shall begin
immediately after one party has delivered to the other party a
written request for such consultation (the "Consultation
Date"). If the dispute cannot be resolved within 30 days
following the Consultation Date, the dispute shall be
submitted to arbitration upon the request of either party,
with written notice to the other party.
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(b) Arbitration. The arbitration shall be conducted in New York,
New York under the auspices of the American Arbitration
Association ("AAA") in accordance with the commercial
arbitration rules and supplementary procedures for
international commercial arbitration of the AAA. There shall
be three arbitrators--one arbitrator shall be chosen by each
party to the dispute and those two arbitrators shall choose
the third arbitrator. All arbitration proceedings shall be
conducted in English. Each party shall cooperate with the
other in making full disclosure of and providing complete
access to all information and documents requested by the other
party in connection with the arbitration proceedings.
Arbitration shall be the sole, binding, exclusive and final
remedy for resolving any dispute between the parties; either
party may apply to any court of competent jurisdiction in the
State of New York for enforcement of any award granted by the
arbitrators.
(c) During the period when a dispute is being resolved, except for
the matter being disputed, the parties shall in all other
respects continue to abide by the terms of this Agreement.
Section 6.03 - Notices. Any notice 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, or by prepaid
telegram addressed as follows:
(a) If to Napoli addressed as follows:
Napoli Enterprises, Inc.
Suite 566 - 0000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
Xxxxxx X0X 0X0
Fax: 000-000-0000
With a copy to:
Xxxxx Law Group
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
ph: 000-000-0000
fax: 000-000-0000
Attn: Xxxxxx X. Xxxxx, Xx.
and,
c/o Davies Xxxx Xxxxxxxx & Xxxxxxxx LLP
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
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Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
(b) If to each of the Novotech Shareholders, addressed as follows:
c/o Davies Xxxx Xxxxxxxx & Xxxxxxxx LLP
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier: (000) 000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
or such other addresses as shall be furnished in writing by any party in the
manner for giving notices hereunder, and any such notice or communication shall
be deemed to have been given as of the date so delivered, mailed or telegraphed.
Section 6.04 - Attorney's 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
nonbreaching party or parties for all costs, including reasonable attorney's
fees, incurred in connection therewith and in enforcing or collecting any
judgment rendered therein.
Section 6.05 - 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 6.06 - Entire Agreement. This Agreement represents the entire
agreement between the parties relating to the subject matter thereof.
Section 6.07 - Survival; Termination. The representations, warranties, and
covenants of the respective parties shall survive the Closing Date and the
consummation of the transactions herein contemplated for a period of three
months. All rights and obligations under this entire Agreement shall be binding
upon and inure to the benefit of the heirs, executors, administrators and
assigns of the parties.
Section 6.08 - Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which taken
together shall be but a single instrument. For purposes of this Agreement,
facsimile signatures may be deemed originals.
Section 6.09 - 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 of 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
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for performance may be extended by a writing signed by the party or parties for
whose benefit the provision is intended.
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IN WITNESS WHEREOF, the parties hereto have caused this Share Purchase
Agreement to be duly executed as of July 16, 2003.
NAPOLI ENTERPRISES, INC. NOVOTECH SHAREHOLDERS
/s/ Xxxx Sonic /s/ Xxxxxx Sonic
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Xxxx Sonic Name: Xxxxxx Sonic
President and Chairman of the Board Authorized Signatory
pursuant to power-of-attorney
