Exhibit 2.14
AGREEMENT
entered into between
VIRTUAL COLOUR PROPERTY CC
(Registration No. CK97/18915/23)
and
XXXXXXXXXX.xxx, Inc. USA
(Registration No. 95/08558/07)
and
XXXXX XXXXXX XXXXXX
and
XXXXXXX XXXXX XXXXXXXXX
and
XXXXX XXXX
TABLE OF CONTENTS
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CLAUSE NO. DESCRIPTION PAGE
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1. INTERPRETATION AND PRELIMINARY ............................. 2
2. CONDITIONS PRECEDENT ....................................... 6
3. SALE OF THE BUSINESS ....................................... 7
4. PURCHASE PRICE ............................................. 8
5. SECTION 34 ADVERTISEMENT ................................... 9
6. DELIVERY ................................................... 9
7. THE NAME ................................................... 11
8. WARRANTIES ................................................. 11
9. INDEMNITY .................................................. 13
10. AGENT'S COMMISSION ......................................... 13
11. BREACH ..................................................... 14
12. DOMICILIUM CITANDI ET EXECUTANDI ........................... 14
13. WHOLE AGREEMENT ............................................ 16
14. COSTS ...................................................... 17
15. VALUE-ADDED TAX ............................................ 17
16. JOINT AND SEVERAL LIABILITY OF THE SELLER .................. 18
17. JOINT AND SEVERAL LIABILITY OF THE PURCHASER ............... 18
18. EXECUTION IN COUNTERPARTS .................................. 18
ANNEXURE A - DESIGNATED FIXED ASSETS ................................. 1
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WHEREBY IT IS AGREED AS FOLLOWS:
1. INTERPRETATION AND PRELIMINARY
The headings of the clauses in this agreement are for the purpose of
convenience and reference only and shall not be used in the interpretation
of nor modify nor amplify the terms of this agreement nor any clause
hereof. Unless a contrary intention clearly appears -
1.1. words importing -
1.1.1. any one gender include the other two genders;
1.1.2. the singular include the plural and vice versa; and
1.1.3. natural persons include created entities (corporate or
unincorporate) and vice versa;
1.2. the following terms shall have the meanings assigned to them
hereunder and cognate expressions shall have corresponding meanings,
namely -
1.2.1. "Act" means the Xxxxxxxxx Xxx, 0000;
1.2.2. "business" means the business of holding and owning
property;
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1.2.3. "condition precedent" means the conditions precedent in
clause 2;
1.2.4. "designated fixed assets" means those fixed assets reflected
in Annexure A hereto;
1.2.5. "effective date" means the close of business on 31 January
2000;
1.2.6. "fixed assets" means all the fixed assets used in connection
with and comprising part of the business including at least
the designated fixed assets;
1.2.7. "implementation date" means 31 January 2000;
1.2.8. "name" means Virtual Colour Property CC and all such other
names under which the business is or has been conducted;
1.2.9. "NASDAQ" means the NASDAQ Stock Market in the United States
of America;
1.2.10. "premises" means the leased premises at which the business
is carried on, being Units 19 and 20 together with the
parking bays allocated to these units, 0xx Xxxxx, Xxxxxx
Xxxx Xxxxxxxx, 00X Xxxxxxxxx Xxxxxx, Xxxx Xxxx 8001.
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1.2.11. "prime rate" means the publicly quoted basic rate per annum
ruling from time to time at which Nedcor Bank lends on
overdraft;
1.2.12. "property" means 0xx Xxxxx, Xxxxxx Xxxx Xxxxxxxx, 00X
Xxxxxxxxx Xxxxxx, Xxxx Xxxx 8001;
1.2.13. "purchaser" means XXXXXXXXXX.xxx, Inc. USA a company with
limited liability duly incorporated in terms of the company
laws of South Africa with registration number 95/08558/07
or its nominee;
1.2.14. "seller" means Virtual Colour Property CC a close
corporation duly incorporated in terms of the Close
Corporation Act of South Africa with registration number
CK97/18915/23;
1.3. any reference in this agreement to "date of signature hereof" shall
be read as meaning a reference to the date of the last signature of
this agreement;
1.4. any reference to an enactment is to that enactment as at the date of
signature hereof and as amended or re-enacted from time to time;
1.5. if any provision in a definition is a substantive provision
conferring rights or imposing obligations on any party,
notwithstanding that it is only in the definition clause, effect
shall be given to it as if it were provision in the body of the
agreement;
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1.6. when any number of days is prescribed in this agreement, same shall
be reckoned exclusively of the first and inclusively of the last day
unless the last day falls on a Saturday, Sunday or public holiday,
in which case the last day shall be the next succeeding day which is
not a Saturday, Sunday or public holiday;
1.7. where figures are referred to in numerals and in words, if there is
any conflict between the two, the words shall prevail;
1.8. expressions defined in this agreement shall bear the same meanings
in schedules or annexures to this agreement which do not themselves
contain their own definitions;
1.9. reference to day/s, month/s or year/s shall be construed as
Gregorian calendar day/s, month/s or year/s;
1.10. the use of any expression in this agreement covering a process
available under South African law such as a winding-up (without
limitation eiusdem generis) shall, if any of the parties to this
agreement is subject to the law of any other jurisdiction, be
construed as including any equivalent or analogous proceedings
under the law of such defined jurisdiction;
1.11. where any term is defined within the context of any particular
clause in this agreement, the term so defined, unless it is clear
from the clause in question that the term so defined has limited
application to the relevant clause, shall bear the meaning
ascribed to it for all purposes in terms of
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this agreement, notwithstanding that that term has not been defined
in this interpretation clause;
1.12. the expiration or termination of this agreement shall not affect such
of the provisions of this agreement as expressly provide that they
will operate after any such expiration or termination or which of
necessity must continue to have effect after such expiration or
termination, notwithstanding that the clauses themselves do not
expressly provide for this;
1.13. the rule of construction that the contract shall be interpreted
against the party responsible for the drafting or preparation of the
agreement, shall not apply.
2. CONDITIONS PRECEDENT
2.1. This agreement, is subject to the suspensive conditions, contained
in this clause 2.1:
2.1.1. the conclusion of a management agreement between the
purchaser and K Xxxxxx, H Xxxxxxxxx and A Xxxx prior to 31
January 2000;
2.1.2. Approval of the members of the seller in terms of s46(b)(ii)
of the Close Corporation Act.
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2.1.3. Exchange Control approval from the South African Reserve
Bank.
2.1.4. The listing of Xxxxxxxxxx.Xxx in the United States of
America on the NASDAQ by 31 January 2000.
2.2. Forthwith after the signature of this agreement, the parties shall
use their best endeavours to procure the fulfilment of the condition
referred to in this clause 2.
3. SALE OF THE BUSINESS
The seller sells, transfers and cedes to the purchaser as an indivisible
whole and as a going concern with effect from the effective date from
which date the risk in and benefit of the business shall vest in the
purchaser, the business comprising -
3.1. the exclusive right to use the name;
3.2. the fixed assets;
3.3. deposits made by the seller in respect of the business;
3.4. the debtors (any debtors not recovered within 90 (ninety) days from
the effective date will be refunded by the seller to the purchaser);
3.5. the creditors;
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3.6. the bank overdrafts and bank accounts; but excluding any debts and
any liabilities other than any liabilities contemplated in clause
8.1.1 in respect of the contracts and the name.
4. PURCHASE PRICE
4.1. The purchase price of the business is based on the nett asset value
at 28 February 1999 and is the sum of R920 996 (nine hundred and
twenty thousand nine hundred and ninety six rand) allocated as
follows -
4.1.1. the property R729 350 (seven hundred and twenty nine
thousand three hundred and fifty rand);
4.1.2. the stock, RNIL;
4.1.3. the name, R100 472,00 (one hundred thousand four hundred and
seventy two rand);
4.1.4. goodwill, R91 924,00 (ninety one thousand nine hundred and
twenty four rand);
4.1.5. the debtors, R12 400 (twelve thousand four hundred rand);
4.1.6. cash at the bank and on deposit, RNIL;
4.1.7. the creditors, R13 000 (thirteen thousand rand);
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4.1.8. bank overdraft, R150,00 (one hundred and fifty rand);
4.2. Any differences in asset value at the effective date will be
reconciled with the values in 4.1. Any shortfall will be deducted
from the purchase price, and any gain will be added to the purchase
price.
4.3. The purchase price shall be paid as follows -
4.3.1. by the purchaser discharging the designated liabilities on
due date, and the purchaser indemnifies the seller against
the purchaser's failure to do so on due date;
4.3.2. by the purchaser paying, on the implementation date against
the delivery of the business to the seller, the balance of
the purchase price;
4.4. All payments to be effected by the purchaser to the seller in terms
of this agreement shall be made at Cape Town.
5. SECTION 34 ADVERTISEMENT
The seller shall be obliged to advertise the transaction in terms of
section 34 of the Insolvency Act, 1936.
6. DELIVERY
6.1. The business shall be delivered to the purchaser on the
implementation date (against payment of the relevant portion of the
purchase price) from
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which date the purchaser shall take legal possession of the
business. Delivery shall include -
6.1.1. the purchaser shall be entitled as between it and the seller
to the benefit of and shall bear the risk of such contracts
from the implementation date and the seller shall bear the
risk and be entitled to the benefit of such contracts prior
to the effective date;
6.1.2. the seller shall be obliged to discharge any obligations
under the contracts in respect of the period from the
effective date to the implementation date;
6.1.3. the purchaser shall be obliged at its cost but in the
seller's name to discharge the seller's obligations under
the contracts after the implementation date;
6.1.4. the parties respectively indemnify each other against any
loss of any nature which may arise as a result of the other
of them failing to comply with their obligations hereunder.
6.1.5. the handing over to the purchaser on loan for a period of
120 (one hundred and twenty) days of the seller's documents,
books and records and all information relating to the
business subject to the auditors being given access as
necessary. The purchaser shall be entitled to make copies of
all such
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documents, books and records. After the expiry of the 120 (one
hundred and twenty) day period, the purchaser shall have reasonable
access thereto;
6.1.6. the physical delivery of all assets forming part of the
business to the purchaser by handing them to the purchaser
at the premises;
6.1.7. insofar as motor vehicles are concerned, all necessary
licence papers and transfer documents, but on the basis that
the purchaser shall obtain roadworthy certificates if
necessary;
6.2. The seller shall account to the purchaser for any receipts of the
business paid directly to the seller after the effective date in
respect of transactions that were entered into after the effective
date.
7. THE NAME
The seller shall be obliged to procure that within 30 (thirty) days of
signature hereof, its name is changed, so as to enable the purchaser to
register such name as a defensive name in its favour.
8. WARRANTIES
8.1. The seller warrants that -
8.1.1. the corporation will be the registered owner of the property;
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8.1.2. the property is zoned for commercial and business use;
8.1.3. no person will have any right (including any option or right
of first refusal) to purchase the property, the building
thereon or any part thereof or any other assets of the
corporation;
8.1.4. the sole business of the corporation will be that of a
property owner and apart from the purchase of the property,
the corporation will not have purchased or sold any immovable
property, shares or other investments;
8.1.5. the property has not been provisionally or finally declared
as a national monument under the National Monuments Act,
1969.
8.2. The seller warrants that no application for the winding up of the
seller has been presented at date of signature hereof nor will any
such application have been presented on the implementation date.
8.3. Nothing herein contained shall relieve the seller from its
obligation to make those disclosures which it is in law obliged to
make.
8.4. No warranties or representations which are not set forth in this
agreement shall be binding on the seller and the business is
purchased on the basis that it is taken voetstoots.
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9. INDEMNITY
9.1. The seller indemnifies the purchaser against any claims, which may
be made in respect of finished products and work-in-progress which
are included in the stock forming part of the business, provided
that to the extent that any claims are made against the purchaser in
respect of any such stock which was sold and delivered to third
parties in the course of the business during the period 1 January
1998 to implementation date, the seller's indemnity shall only
operate in respect of claims the amount of which exceeds the amount
of net profits earned by the business during the period from 1
January 1998 to the implementation date in respect of such products
sold and delivered during such period. Should any claims be made
against the purchaser in respect of such stock, the purchaser shall
afford the seller an opportunity to assist the purchaser to contest
the claim and, subject to an indemnity in a form acceptable to the
purchaser against costs being given by the seller, shall engage
attorneys and counsel nominated by the seller for the said purpose.
9.2. The seller indemnifies the purchaser against any losses or damages
of whatsoever nature which the purchaser may sustain by reason of
assuming all the obligations of the seller under the contracts of
employment with the employees of the business, the cause of which
arose prior to the effective date.
10. AGENT'S COMMISSION
It is recorded that the sale was not concluded through the instrumentality
of any agent.
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11. BREACH
If any party breaches any material provision or term of this agreement
(other than those which contain their own remedies or limit the remedies
in the event of a breach thereof) and fails to remedy such breach within 7
(seven) days of receipt of written notice requiring it to do so (or if it
is not reasonably possible to remedy the breach within 7 (seven) days,
within such further period as may be reasonable in the circumstances
provided that the party in breach furnishes evidence within the period of
7 (seven) days, reasonably satisfactory to the other party, that it has
taken whatever steps are available to it, to commence remedying the
breach)) then the aggrieved party shall be entitled without notice, in
addition to any other remedy available to it at law or under this
agreement, including obtaining an interdict, to cancel this agreement or
to claim specific performance of any obligation whether or not the due
date for performance has arrived, in either event without prejudice to the
aggrieved party's right to claim damages.
12. DOMICILIUM CITANDI ET EXECUTANDI
12.1. The parties choose as their domicilia citandi et executandi for all
purposes under this agreement, whether in respect of court process,
notices or other documents or communications of whatsoever nature
(including the exercise of any option), the following addresses:
12.1.1. PURCHASER
Physical: 0xx Xxxxx, Xxxxxx Xxxxx
Xxxxxxxxxxxx Xxxxxx
Xxxx Xxxx
Postal: P O Box 10118
Caledon Square
7905
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12.1.2. SELLER
Physical: 0xx Xxxxx, Xxxxxx Xxxx
00X Xxxxxxxxx Xxxxxx
Xxxx Xxxx
8001
Telefax: (021) 462-1660
Postal: X Xxxxxx & Xx.
X 0 Xxx 00
Xxxxxxxxxx
0000
12.1.3. Xxxxx Xxxx
Physical: 00 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx
12.1.4. Xxxxx Xxxxxx Xxxxxx
Physical: 00 Xxxxxx Xxxx
Xxxxxxxxxx
12.1.5. Xxxxxxx Xxxxx Xxxxxxxxx
Physical: 00 Xxxxxx Xxxxxx
Xxxxxxxxx
12.2. Any notice or communication required or permitted to be given in
terms of this agreement shall be valid and effective only if in
writing but it shall be competent to give notice by telefax.
12.3. Either party may by notice to the other party change the physical
address chosen as its domicilium citandi et executandi to another
physical address where postal delivery occurs in the Republic of
South Africa or its postal
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address or its telefax number, provided that the change shall become
effective on the 7th business day from the deemed receipt of the
notice by the other party.
12.4. Any notice to a party -
12.4.1. sent by prepaid registered post (by airmail if appropriate)
in a correctly addressed envelope to it at an address chosen
as its domicilium citandi et executandi to which post is
delivered shall be deemed to have been received on the 7th
business day after posting (unless the contrary is proved);
12.4.2. delivered by hand to a responsible person during ordinary
business hours at the physical address chosen as its
domicilium citandi et executandi shall be deemed to have
been received on the day of delivery; or
12.4.3. sent by telefax to its chosen telefax number stipulated in
clause 12.1, shall be deemed to have been received on the
date of despatch (unless the contrary is proved).
12.5. Notwithstanding anything to the contrary herein contained a written
notice or communication actually received by a party shall be an
adequate written notice or communication to it notwithstanding that
it was not sent to or delivered at its chosen domicilium citandi et
executandi.
13. WHOLE AGREEMENT
13.1. This agreement constitutes the whole agreement between the parties
relating to the subject matter hereof.
13.2. No amendment or consensual cancellation of this agreement or any
provision or term hereof or of any agreement, xxxx of exchange or
other document issued or executed pursuant to or in terms of this
agreement and no settlement of any disputes arising under this
agreement and no extension of time, waiver or relaxation or
suspension of or agreement not
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to enforce or to suspend or postpone the enforcement of any of the
provisions or terms of this agreement or of any agreement, xxxx of
exchange or other document issued pursuant to or in terms of this
agreement shall be binding unless recorded in a written document
signed by the parties. Any such extension, waiver or relaxation or
suspension which is so given or made shall be strictly construed
as relating strictly to the matter in respect whereof it was made or
given.
13.3. No extension of time or waiver or relaxation of any of the
provisions or terms of this agreement or any agreement, xxxx of
exchange or other document issued or executed pursuant to or in
terms of this agreement, shall operate as an estoppel against any
party in respect of its rights under this agreement, nor shall it
operate so as to preclude such party thereafter from exercising its
rights strictly in accordance with this agreement.
13.4. To the extent permissible by law no party shall be bound by any
express or implied term, representation, warranty, promise or the
like not recorded herein, whether it induced the contract and/or
whether it was negligent or not.
14. COSTS
All the costs on an attorney and own client basis of XXXXXX XXXXXX &
XXXXXXXXX INC of and incidental to the preparation of this agreement
(including prior drafts and consultations) and the stamp duty shall be
borne by the purchaser. The costs of Xxxxxx-Xxxx shall be borne by the
seller.
15. VALUE-ADDED TAX
15.1. The seller and the purchaser agree that the business is disposed of
as a going concern and for the purposes of section 11(1)(e) of the
Value-Added Tax Act, 1991, agree that the business will be an
income-earning activity on the implementation date and that the
assets which are necessary for carrying on such business have been
disposed of by the seller to the purchaser in terms of this
agreement.
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15.2. If, notwithstanding the aforegoing, value-added tax is payable in
respect of any of the assets sold in terms hereof, same shall be
borne and paid by the purchaser.
16. JOINT AND SEVERAL LIABILITY OF THE SELLER
The liability of the persons comprising the seller vis-a-vis the purchaser
shall be joint and several.
17. JOINT AND SEVERAL LIABILITY OF THE PURCHASER
The liability of the persons comprising the purchaser vis-a-vis the seller
shall be joint and several.
18. EXECUTION IN COUNTERPARTS
This agreement may be executed in several counterparts, each of which
shall together constitute one and the same instrument.
SIGNED by the parties and witnessed on the following dates and at the following
places respectively:
DATE PLACE WITNESS SIGNATURE
---- ----- ------- ---------
1. __________________
9/11/99 Cape Town /s/ [ILLEGIBLE]
------- --------- --------------------------
2. __________________ VIRTUAL COLOUR PRINTING CC
1. __________________
_____ ____________ --------------------------
2. __________________ XXXXXXXXXX.xxx Inc. USA
DATE PLACE WITNESS SIGNATURE
---- ----- ------- ---------
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1. __________________
9/11/99 Cape Town
------- --------- /s/ Xxxxx Xxxxxx
--------------------------
XXXXX XXXXXX XXXXXX
2. __________________
1. __________________
9/11/99 Cape Town /s/ Xxxxxxx Xxxxxxxxx
------- --------- --------------------------
XXXXXXX XXXXX XXXXXXXXX
2. __________________
1. __________________
9/11/99 Cape Town /s/ Xxxxx Xxxx
------- --------- --------------------------
XXXXX XXXX
2. __________________
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ANNEXURE A - DESIGNATED FIXED ASSETS
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