Exhibit 6.1
SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT (the "Agreement") is entered into and
effective as of December 31, 2000, by and between CVS TRAVELHOST S.A., a South
African closed corporation (the "SHAREHOLDER" or "CVS-S.A."), XXXX XXXXXXXX who
is the sole shareholder of CVS-S.A. ("ANDONIOU"), CVS TRAVELHOST INTERNATIONAL
(PTY) Ltd., a South African corporation ("CVS") and DIGITAL CONCEPTS
INTERNATIONAL, INC. a Florida corporation ("DCI" or the "COMPANY").
1. RECITALS
This Agreement is entered into with reference to and in contemplation of
the following facts, circumstances and representations:
1. The SHAREHOLDER is the owner of 100 shares of the common stock of CVS
and said shares represent all of the issued and outstanding shares of
CVS (the "CVS Shares").
2. DCI desires to purchase the CVS Shares via the issuance of a total of
850,000 restricted shares of DCI common stock (the "DCI Shares") and
the payment of additional consideration as more specifically set forth
herein in this Agreement.
3. The SHAREHOLDER desires to transfer the CVS Shares for the DCI Shares
and other consideration in accordance with the terms and conditions of
this Agreement.
4. CVS and ANDONIOU desires that this transaction be consummated.
2. PURCHASE OF CVS SHARES
2.1 DELIVERY OF DCI SHARES: DCI shall deliver to the Escrow Holder on
behalf of the SHAREHOLDER, a total of 850,000 restricted shares of DCI common
stock as a portion of the consideration for the purchase of the CVS Shares at a
price of $2.50 per share for a total of $2,125,000.
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2.2 ADDITIONAL CONSIDERATION: As additional consideration for the purchase
of the CVS Shares, DCI shall deliver to the SHAREHOLDER the following:
1. Cash in the amount of $50,000 U.S.
2. A Promissory Note payable to the SHAREHOLDER in the principal
amount of $200,000 (the "Note") and payable in accordance with the
terms and conditions as set forth below in Paragraph 2.3.
2.3 NOTE PAYMENT TERMS: The Note shall be payable from a portion of the
proceeds from the various stock offerings of DCI beginning on February 1, 2001
(the "Financings"). A total of twenty percent (20%) of the Financings shall be
paid on the Note up to March 1, 2002 at which time all of the unpaid principal
and interest shall be due and payable.
2.4 DELIVERY OF CVS SHARES: At the Closing, the SHAREHOLDER shall deliver
to the Escrow Holder on behalf of DCI the 100 CVS Shares which represent all of
the issued and outstanding shares of CVS.
2.5 NATURE OF DCI SHARES: The SHAREHOLDER shall be issued the DCI Shares
which unless otherwise contractually restricted, shall be subject to a one (1)
year holding period before the DCI Shares are eligible for sale in the U.S.
public market. The sale of the DCI Shares will be further limited by the resale
provisions of SEC Rule 144.
2.6 RESTRICTED NATURE OF DCI SHARES: Notwithstanding the one (1) year
holding period for the DCI Shares, if the SHAREHOLDER becomes an "affiliate" or
"control person" of DCI it will be subject to certain limitations with respect
to the sale of its DCI Shares. Accordingly, as a result of such a designation,
the sale of the DCI Shares will be limited by SEC Rule 144.
2.7 PRIVATE SALE ACKNOWLEDGMENT: The parties acknowledge and agree that the
issuance of the DCI Shares is being undertaken as a private sale pursuant to
Section 4(2) of the Securities Act of 1933, as amended and the Florida
Securities and Investor Protection Act, Section 517.061 and is not being
transacted via a broker-dealer and/or in the public market place.
2.8 STATUS OF PRESENT SHARE OWNERSHIP AND CONTEMPLATED SHARE ISSUANCE BY
DCI: The parties hereto acknowledge and agree that in addition to the issuance
of the 850,000 CVS Shares, that DCI.contemplates the issuance of still
additional shares of common stock of an undetermined amount in order to provide
working capital for the implementation of its
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Business Plan. However, at the present time and upon the Closing of the share
issuance as contemplated by this Agreement, that the following will be the
resulting share ownership of DCI:
NAME NO. SHARES % OWNERSHIP
---- ---------- -----------
1. Xxxxxxx X. Xxx, Esq. 4,867,000 62.62%
as Trustee for
Original principal
shareholders
2. Original Minority 75,000 .96%
Shareholder
3. Original Minority 58,000 .74%
Shareholder
4 Real Estate Acquisition 1,500,000 19.3%
Shareholder
5. Officers and Directors 212,000 2.73%
6. Regulation D, Rule 504 96,000 1.24%
7. CVS Shareholder 850,000 10.94%
8. Software Acquisition 75,000 .96%
Shareholders
9. Source Code Acquisition
Shareholders 40,000 .51%
---------- ----------
TOTALS 7,773,002 100%
========== ==========
2.9 FAIR MARKET VALUE OF CVS ASSETS: The parties hereby agree and
acknowledge that the following represents the fair market value of the assets
purchased from CVS by DCI:
ITEM AMOUNT
---- ------
1. Mitsubishi Auto $ 37,532
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2. Furniture 791
3. Office Equipment 31,683
4. Films/Movies (450 @ 1,485,000
3,330 each)
5. Note Payable - Auto (25,333)
6. Covenant Not to Compete 400,000
7. Video License and Agreement 400,000
8. Goodwill 45,327
----------
TOTAL PURCHASE PRICE $2,375,000
==========
2.10 COVENANT NOT TO COMPETE: In further consideration of the purchase of
the CVS Shares which are the subject of this Agreement, the SHAREHOLDER and
ANDONIOU agree that they will not for a period of five (5) years immediately
following the effective date of this Agreement, directly or indirectly engage
in, or have any interest in any person, firm, corporation, or business (whether
as an employee, officer, director, agent, security holder, creditor, consultant,
or otherwise) that engages in any activity in the entire world, which activity
is the same as, similar to, or competitive with any activity that was conducted
by CVS and to be now engaged in by DCI (or any successor or successors) so long
as CVS (or any successor) shall engage in this activity in any part of the
entire world.
3. REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The COMPANY represents and warrants to the SHAREHOLDER and CVS as follows:
3.1 ORGANIZATION: DCI is a corporation duly incorporated and validly
existing under the laws of the State of Florida and is in good standing with
respect to all of its regulatory filings.
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3.2 CAPITALIZATION: The authorized capital of DCI consists of 50,000,000
common shares with a par value $.001 and with the exception of the common shares
described in Paragraph 2.8, no common shares will have been validly authorized
and issued by the COMPANY prior to the Closing of the contemplated transaction.
3.3 FINANCIAL STATEMENTS: DCI has furnished to the SHAREHOLDER and CVS
unaudited financial statements for the period ending ____________. That at the
Closing the financial affairs of DCI will be materially the same as represented
in the financial statements for the period ending _____________.
3.4 BOOKS AND RECORDS: All material transactions of DCI have been promptly
and properly recorded or filed in or with its books and records and the Minute
Book of DCI contains records of all meetings and proceedings of the shareholders
and directors thereof.
3.5 LEGAL COMPLIANCE: To the best of its knowledge, DCI is not in breach of
any laws, ordinances, statutes, regulations, by-laws, orders or decrees to which
DCI is subject or which apply to it or any of its assets.
3.6 TAX RETURNS: All tax returns and reports of DCI required by law to be
filed prior to the date hereof have been filed and are substantially true,
complete and correct and all taxes and governmental charges have been paid.
3.7 ADVERSE FINANCIAL EVENTS: DCI has not experienced nor is it aware of
any occurrence or event which has had or might reasonably be expected to have a
material adverse effect on its financial condition.
3.8 DISPUTES, CLAIMS AND INVESTIGATIONS: There are no disputes, claims,
actions, suits, judgments, investigations or proceedings outstanding or pending
or to the knowledge of DCI threatened against or affecting DCI at law or in
equity or before or by any federal, state, municipal or other governmental
department, commission, board, bureau or agency.
3.9 EMPLOYEE LIABILITIES: DCI has no known liability to former employees or
any liability to any governmental authorities with respect to current or former
employees.
3.10 NO CONFLICTS OR AGREEMENT VIOLATIONS: The execution, delivery and
performance of this Agreement will not conflict with or be in violation of the
articles or by-laws of DCI or of any agreement to which DCI is a party and will
not give any person or company a right to terminate or cancel any agreement or
right enjoyed by DCI and will not result in the creation or imposition of any
lien,
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encumbrance or restriction of any nature whatsoever in favor of a third party
upon or against the assets of DCI.
3.11 VALIDLY ISSUED AND AUTHORIZED DCI SHARES: That the DCI Shares will be
validly authorized and issued by the COMPANY, they will be fully paid and
non-assessable and they will be issued in full compliance with all federal and
state securities laws.
3.12 RESTRICTIVE LEGEND: That the DCI Shares will have a restrictive legend
imposed thereon identifying them as "Restricted Shares" which are subject to the
conditions and limitations of SEC Rule 144 with respect to their sale in the
U.S. public market place.
3.13 VALIDLY ISSUED AND AUTHORIZED OUTSTANDING SHARES OF DCI: That all of
the issued and outstanding common shares of DCI are validly issued, authorized
and issued, fully paid, and non-assessable, and that the outstanding shares have
been so issued in full compliance with all federal and state securities laws.
3.14 CORPORATE AUTHORITY: The officers or representatives of the COMPANY
executing this Agreement represent that they have been authorized to execute
this Agreement pursuant to a resolution of the Board of Directors of the
COMPANY.
4. REPRESENTATIONS OF SHAREHOLDER, ANDONIOU AND CVS
The SHAREHOLDER, ANDONIOU and CVS collectively and individually hereby
represent and warrant to DCI as follows:
4.1 SHARE OWNERSHIP: That the SHAREHOLDER is the owner, beneficially and of
record, of the CVS Shares and said shares are free and clear of all liens,
encumbrances, claims, charges and restrictions.
4.2 TRANSFERABILITY OF CVS SHARES: That the SHAREHOLDER has full power to
transfer the CVS Shares to DCI without obtaining the consent or approval of any
other person or governmental authority.
4.3 VALIDLY ISSUED AND AUTHORIZED SHARES: That the CVS Shares are validly
authorized and issued, fully paid, and nonassessable, and the CVS Shares have
been so issued in full compliance with all securities laws of South Africa.
4.4 ORGANIZATION: CVS is a corporation duly incorporated and validly
existing under the laws of South Africa and is in good standing with respect to
all of its regulatory filings.
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4.5 CAPITALIZATION: That the CVS Shares represent one hundred percent
(100%) issued and outstanding shares of CVS and that said shares were validly
issued and are fully paid and non-assessable shares.
4.6 FINANCIAL STATEMENTS: CVS has furnished to DCI unaudited financial
statements for the period ending ____________________. That at the Closing the
financial affairs of LLC will be materially the same as represented in these
same financial statements.
4.7 BOOKS AND RECORDS: All material transactions of CVS have been promptly
and properly recorded or filed in or with its books and records and the Minute
Book of CVS contains records of all meetings and proceedings of the shareholders
and directors thereof.
4.8 LEGAL COMPLIANCE: CVS is not in breach of any laws, ordinances,
statutes, regulations, by-laws, orders or decrees to which CVS is subject or
which apply to it or any of its assets.
4.9 TAX RETURNS: All tax returns and reports of CVS required by law to be
filed prior to the date hereof have been filed and are true, complete and
correct and all taxes and governmental charges have been paid.
4.10 ADVERSE FINANCIAL EVENTS: CVS has not experienced nor is it aware of
any occurrence or event which has had or might reasonably be expected to have a
material adverse effect on its financial condition.
4.11 DISPUTES, CLAIMS AND INVESTIGATIONS: There are no disputes, claims,
actions, suits, judgments, investigations or proceedings outstanding or pending
or to the knowledge of CVS threatened against or affecting CVS at law or in
equity or before or by any federal, municipal or other governmental department,
commission, board, bureau or agency.
4.12 EMPLOYEE LIABILITIES: CVS has no liability to former employees or any
liability to any government authorities with respect to current or former
employees.
4.13 NO CONFLICTS OR AGREEMENT VIOLATIONS: The execution, delivery and
performance of this Agreement will not conflict with or be in violation of the
Articles of Incorporation of CVS or of any agreement to which CVS is a party and
will not give any person or company a right to terminate or cancel any agreement
or right enjoyed by CVS and will not result in the creation or imposition of any
lien, encumbrance or restriction of any nature whatsoever in favor of a third
party upon or against the assets of CVS.
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4.14 NO LIENS: That CVS has not received a notice of any assignment, lien,
encumbrance, claim or charge against the CVS Shares.
4.15 CORPORATE AUTHORITY: The officers or representatives of CVS-S.A. and
CVS executing this Agreement represent that they have been authorized to execute
this Agreement pursuant to a resolution of their respective Boards of Directors.
5. REPRESENTATIONS AND WARRANTIES
OF SHAREHOLDER AND ANDONIOU ALONE
The SHAREHOLDER and ANDONIOU alone further represent and warrant to DCI as
follows with respect to the DCI Shares:
5.1 FINANCIALLY RESPONSIBLE: That they are financially responsible, able to
meet their obligations and acknowledge that this investment will be speculative.
5.2 INVESTMENT EXPERIENCE: That they have had experience in the business of
investments in one or more of the following: (i) investment experience with
securities such as stocks and bonds; (ii) ownership of interests in
partnerships, new ventures and start-up companies; (iii) experience in business
and financial dealings; and that they can protect their own interests in an
investment of this nature and they do not have an "Investor Representative", as
that term is defined in Regulation D of the Securities Act of 1933 and do not
need such an Investor Representative.
5.3 INVESTMENT RISK: That they are capable of bearing the high degree of
economic risks and burdens of this investment, including but not limited to the
possibility of complete loss of all their investment capital and the lack of a
liquid market, such that they may not be able to liquidate readily the
investment whenever desired or at the then current asking price.
5.4 ACCESS TO INFORMATION: That they have had access to the information
regarding the financial condition of the COMPANY and they were able to request
copies of such information, ask questions of and receive answers from the
COMPANY regarding such information and any other information he desires
concerning the DCI Shares, and all such questions have been answered to his full
satisfaction.
5.5 PRIVATE TRANSACTION: That at no time was he presented with or solicited
by any leaflet, public promotional meeting, circular, newspaper or magazine
article, radio or television advertisement or any other form of general
advertising.
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5.6 INVESTMENT INTENT: The DCI Shares are not being purchased with a view
to or for the resale or distribution thereof and they have no present plans to
enter into any contract, undertaking, agreement or arrangement for such resale
or distribution.
5.7 DUE DILIGENCE: That the SHAREHOLDER and ANDONIOU shall have completed a
due diligence review of the affairs of DCI and are satisfied with the results of
that review.
6. CLOSING, ESCROW HOLDER AND
CONDITIONS TO CLOSING
6.1 EXCHANGE CLOSING: The closing of the share exchange as contemplated by
this Agreement (the "Closing") shall take place in San Diego, California, at
such time and place as may be agreed among by the parties, but in no event later
than December 31, 2000, unless otherwise extended in writing by the parties.
6.2 APPOINTMENT OF ESCROW HOLDER: The parties hereby appoint XXXXXXX X.
XXX, III, ESQ. of San Diego, California as the Escrow Holder pursuant to this
Agreement.
6.3 OPINION OF COUNSEL FOR DCI: The SHAREHOLDER, ANDONIOU and CVS shall
have received an opinion from the legal counsel for DCI, in form and substance
reasonably satisfactory to the SHAREHOLDER, ANDONIOU and CVS to the effect that:
2. DCI is a corporation duly organized and legally existing under
the laws of the State of Florida and is in good standing with
respect to all of its regulatory filings, and
3. This Agreement when duly executed and delivered by DCI,
constitutes a legal, valid and binding obligation of DCI
enforceable against it in accordance with its terms, and
4. The DCI Shares delivered pursuant to the Agreement have been
validly issued are fully paid and non-assessable, and
5. The DCI Shares have been legally and validly issued and are in
compliance with all federal and state securities laws including
but not limited to Section 4(2) of the Securities Act
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of 1933, as amended, and the Florida Securities and Investor
Protection Act, Section 517.061.
6.4 OPINION OF COUNSEL FOR SHAREHOLDER, ANDONIOU AND CVS: DCI shall have
received an opinion from the legal counsel for the SHAREHOLDER, ANDONIOU and
CVS, in form and substance reasonably satisfactory to DCI, to the effect that:
1. CVS is a corporation duly organized and legally existing under the
laws of South Africa and is in good standing with respect to all
of its regulatory filings, and
2. The CVS Shares delivered pursuant to this agreement have been
validly issued, fully paid, non-assessable, and have been
originally issued in full compliance with all applicable South
Africa securities laws.
3. The SHAREHOLDER has the full power to transfer the CVS Shares to
DCI without obtaining the consent or approval of any other person
or governmental agency.
6.5 ESCROW CONDITIONS AND CLOSING: Prior to the Closing the following will
be required:
1. DELIVERY OF CVS SHARES: The SHAREHOLDER shall deliver to the
Escrow Holder the certificate or certificates representing the
100 CVS Shares registered in the name of the SHAREHOLDER, duly
endorsed for transfer accompanied by duly executed assignments of
the CVS Shares to DCI.
2. DELIVERY OF DCI SHARES: DCI shall deliver to the Escrow Holder a
total of 850,000 of the DCI Shares registered in the name of the
SHAREHOLDER.
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3. DELIVERY OF CERTIFICATES OF GOOD STANDING: Each party shall
deliver to the Escrow Holder a current Certificate of Good
Standing issued by the Florida Secretary of State and the
appropriate South African Regulatory Agency.
4. REQUISITE CORPORATE RESOLUTIONS: Each party shall deliver to the
Escrow Holder certified copies of resolutions from their
respective Boards of Directors authorizing the subject
transaction.
5. SATISFACTORY COMPLETION OF DUE DILIGENCE: Each party shall
deliver to the Escrow Holder written notice that it has completed
its due diligence investigation and is satisfied with the results
of such investigation.
6. LEGAL OPINIONS AND DOCUMENTS: Both parties shall deliver to the
Escrow Holder such other documents as are required by the terms
and conditions of the Agreement.
6.6 CLOSE OF TRANSACTION: The subject transaction shall "close" upon the
satisfaction of the above conditions.
6.7 NOTICES: All notices given pursuant to this Agreement must be in
writing and may be given by (1) personal delivery, or (2) registered or
certified mail, return receipt requested, or (3) via facsimile transmission to
the Escrow Holder and the parties as set forth below. Any party hereto may by
notice so given change its address for any future notices:
ESCROW XXXXXXX X. XXX, III, ESQ.
HOLDER: 0000 Xxxxxx Xxx Xxx Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
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SHAREHOLDER, XXXX XXXXXXXX
ANDONIOU AND:CVS TravelHost International (PTY) Ltd.
CVS 000 Xxxxx Xxxx
Xxxx Xxxxxx
Xxxxxx
Xxxxxxxxxxxx, Xxxxx Xxxxxx
Phone: 00-00-0000000
Fax: 00-00-0000000
DCI: XXXXXXX X. XXX, III
0000 Xxxxxx Xxx Xxx Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
7. COOPERATION, ARBITRATION, INTERPRETATION,
MODIFICATION AND ATTORNEY FEES
7.1 COOPERATION OF PARTIES: The parties further agree that they will do all
things necessary to accomplish and facilitate the purpose of this Agreement and
that they will sign and execute any and all documents necessary to bring about
and perfect the purposes of this Agreement.
7.2 ARBITRATION: The parties hereby submit all controversies, claims and
matters of difference arising out of this Agreement to arbitration in San Diego,
California according to the rules and practices of the American Arbitration
Association from time to time in force. This submission and agreement to
arbitrate shall be specifically enforceable. The Agreement shall further be
governed by the laws of the State of Florida.
7.3 INTERPRETATION OF AGREEMENT: The parties agree that should any
provision of this Agreement be found to be ambiguous in any way, such ambiguity
shall not be resolved by construing such provisions or any part of or the entire
Agreement in favor of or against any party herein, but rather by construing the
terms of this Agreement fairly and reasonably in accordance with their generally
accepted meaning.
7.4 MODIFICATION OF AGREEMENT: This Agreement may be amended or modified in
any way at any time by an instrument in writing stating the manner in which it
is amended or modified and signed by each of the parties hereto. Any such
writing amending or modifying this Agreement shall be attached to and kept with
this Agreement.
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7.5 ATTORNEY FEES: If any legal action or any arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default or misrepresentation in connection with any of
the provisions of the Agreement, the successful or prevailing party shall be
entitled to recover reasonable attorneys' fees and other costs incurred in that
action or proceeding, in addition to any other relief to which it may be
entitled.
7.6 ENTIRE AGREEMENT: This Agreement constitutes the entire Agreement and
understanding of the parties hereto with respect to the matters herein set
forth, and all prior negotiations, writings and understandings relating to the
subject matter of this Agreement are merged herein and are superseded and
canceled by this Agreement.
7.7 COUNTERPARTS: This Agreement may be signed in one or more counterparts.
7.8 FACSIMILE TRANSMISSION SIGNATURES: A signature received pursuant to a
facsimile transmission shall be sufficient to bind a party to this Agreement.
SHAREHOLDER
CVS TRAVELHOST S.A.
DATED: December 31, 2000 BY: /s/
-----------------------------
XXXX XXXXXXXX
Managing Director
DATED: December 31, 2000 /s/
------------------------------
XXXX XXXXXXXX as the sole
Shareholder of CVS
TRAVELHOST S.A.
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CVS TRAVELHOST INTERNATIONAL
(PTY) LTD
DATED: December 31, 2000 BY:/s/
-------------------------------
XXXX XXXXXXXX
Managing Director
DIGITAL CONCEPTS
INTERNATIONAL, INC.
DATED: December 31, 2000 BY:/s/
----------------------------
XXXXXX XXXXXX
President
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