ASSET PURCHASE AGREEMENT
This
Asset
Purchase Agreement (this “Agreement”) is entered into on January __, 2006, by
and between Kinder Travel, Inc., a Nevada corporation (“Buyer”),
and
Kinder Travel, Inc., a corporation duly existing under the laws of the Province
of British Columbia, Canada (“Target”).
Buyer
and Target are referred to collectively herein as the “Parties.”
This
Agreement contemplates a transaction in which Buyer will purchase all of the
assets (and assume certain of the liabilities) of Target in return for the
Buyer
Note (as
defined herein).
Now,
therefore, in consideration of the premises and the mutual promises herein
made,
and in consideration of the representations, warranties, and covenants herein
contained, the Parties agree as follows.
§1. Definitions.
“Accredited
Investor”
has
the
meaning set forth in Regulation D promulgated under the Securities
Act.
“Acquired
Assets”
means
all right, title, and interest in and to all of the assets of Target, including
all of its (a) Owned Real Property and Leased Real Property, (b) tangible
personal property (such as machinery, equipment, inventories of raw materials
and supplies, manufactured and purchased parts, goods in process and finished
goods, furniture, automobiles, trucks, tractors, trailers, tools, jigs, and
dies), (c) Intellectual Property, goodwill associated therewith, licenses and
sublicenses granted and obtained with respect thereto, and rights thereunder,
remedies against infringements thereof, and rights to protection of interests
therein under the laws of all jurisdictions, (d) leases, subleases, and rights
thereunder, (e) agreements, contracts, indentures, mortgages, instruments,
Liens, guaranties, other similar arrangements, and rights thereunder, (f)
accounts, notes, and other receivables, (g) securities (including the capital
stock in its Subsidiaries), (h) claims, deposits, prepayments, refunds, causes
of action, choses in action, rights of recovery, rights of set-off, and rights
of recoupment (including any such item relating to the payment of Taxes), (i)
franchises, approvals, permits, licenses, orders, registrations, certificates,
variances, and similar rights obtained from governments and governmental
agencies, and, (j) books, records, ledgers, files, documents, correspondence,
lists, plats, architectural plans, drawings, and specifications, creative
materials, advertising and promotional materials, studies, reports, and other
printed or written materials; provided,
however,
that the
Acquired Assets shall not include (i) the corporate charter, qualifications
to
conduct business as a foreign corporation, arrangements with registered agents
relating to foreign qualifications, taxpayer and other identification numbers,
seals, minute books, stock transfer books, blank stock certificates, and other
documents relating to the organization, maintenance, and existence of Target
as
a corporation or (ii) any of the rights of Target under this Agreement (or
under
any side agreement between Target on the one hand and Buyer on the other hand
entered into on or after the date of this Agreement).
“Affiliate”
has
the
meaning set forth in Rule 12b-2 of the regulations promulgated under the
Securities Exchange Act.
“Assumed
Liabilities”
means
(a) all liabilities of Target set forth on the face of the Most Recent Balance
Sheet (rather than in any notes thereto), (b) all liabilities of Target that
have arisen after the Most Recent Fiscal Month End in the Ordinary Course of
Business, other than any liability resulting from, arising out of, relating
to,
in the nature of, or caused by any breach of contract, breach of warranty,
tort,
infringement, violation of law, or environmental matter, including without
limitation those arising under Environmental, Health, and Safety Requirements,
and, (c) all obligations of Target under the agreements, contracts, leases,
licenses, and other arrangements referred to in the definition of Acquired
Assets either (i) to furnish goods, services, and other non-Cash benefits to
another party after the Closing or (ii) to pay for goods, services, and other
non-Cash benefits that another party will furnish to it after the Closing.
“Basis”
means
any past or present fact, situation, circumstance, status, condition, activity,
practice, plan, occurrence, event, incident, action, failure to act, or
transaction that forms or could form the basis for any specified
consequence.
“Buyer”
has
the
meaning set forth in the preface above.
“Buyer
Note”
has
the
meaning set forth in §2(c) below.
“Closing”
has
the
meaning set forth in §2(d) below.
“Closing
Date”
has
the
meaning set forth in §2(d) below.
“Confidential
Information”
means
any information concerning the business and affairs of Target and its
Subsidiaries that is not already generally available to the public.
“Financial
Statements”
has
the
meaning set forth in §3(g) below.
“GAAP”
means
United States generally accepted accounting principles as in effect from time
to
time, consistently applied.
“Improvements”
has
the
meaning set forth in §3(l) below.
“Income
Tax”
means
any federal, state, local, or foreign income tax, including any interest,
penalty, or addition thereto, whether disputed or not.
“Income
Tax Return”
means
any return, declaration, report, claim for refund, or information return or
statement relating to Income Taxes, including any schedule or attachment
thereto, and including any amendment thereof.
“Intellectual
Property”
means
all of the following in any jurisdiction throughout the world: (a) all
inventions (whether patentable or unpatentable and whether or not reduced to
practice), all improvements thereto, and all patents, patent applications,
and
patent disclosures, together with all reissuances, continuations,
continuations-in-part, revisions, extensions, and reexaminations thereof, (b)
all trademarks, service marks, trade dress, logos, slogans, trade names,
corporate names, Internet domain names, and rights in telephone numbers,
together with all translations, adaptations, derivations, and combinations
thereof and including all goodwill associated therewith, and all applications,
registrations, and renewals in connection therewith, (c) all copyrightable
works, all copyrights, and all applications, registrations, and renewals in
connection therewith, (d) all trade secrets and confidential business
information (including ideas, research and development, know-how, technical
data, designs, drawings, specifications, customer and supplier lists, pricing
and cost information, and business and marketing plans and proposals), (e)
all
computer software (including source code, executable code, data, databases,
and
related documentation), (f) all material advertising and promotional materials,
(g) all other proprietary rights, and (h) all copies and tangible embodiments
thereof (in whatever form or medium).
“Knowledge”
means
actual knowledge after reasonable investigation.
“Lease
Consents”
has
the
meaning set forth in §6(a) below.
“Leased
Real Property”
means
all leasehold or subleasehold estates and other rights to use or occupy any
land, buildings, structures, improvements, fixtures or other interest in real
property held by Target or any of its Subsidiaries.
“Leases”
means
all leases, subleases, licenses, concessions and other agreements (written
or
oral), including all amendments, extensions, renewals, guaranties and other
agreements with respect thereto, pursuant to which Target or any of its
Subsidiaries holds any Leased Real Property.
“Lien”
means
any mortgage, pledge, lien, encumbrance, charge, or other security
interest.
“Material
Adverse Effect”
or
“Material
Adverse Change”
means
any effect or change that would be materially adverse to the business, assets,
condition (financial or otherwise), operating results, operations, or business
prospects of Target and its Subsidiaries, taken as a whole, or to the ability
of
any Party to consummate timely the transactions contemplated
hereby.
“Material
Leased Real Property”
has
the
meaning set forth in §6(a) below.
“Most
Recent Balance Sheet”
means
the balance sheet contained within the Most Recent Financial
Statements.
“Most
Recent Financial Statements”
has
the
meaning set forth in §3(g) below.
“Most
Recent Fiscal Year End”
has
the
meaning set forth in §3(g) below.
“Ordinary
Course of Business”
means
the ordinary course of business consistent with past custom and
practice.
“Owned
Real Property”
means
all land, together with all buildings, structures, improvements, and fixtures
located thereon, and all easements and other rights and interests appurtenant
thereto, owned by Target or any of its Subsidiaries.
“Party”
has
the
meaning set forth in the preface above.
“Person”
means
an individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, any other business entity or a governmental entity.
“Purchase
Price”
has
the
meaning set forth in §2(c) below.
“Real
Property”
has
the
meaning set forth in §3(l) below.
“Securities
Act”
means
the Securities Act of 1933, as amended.
“Securities
Exchange Act”
means
the Securities Exchange Act of 1934, as amended.
“Subsidiary”
means,
with respect to any Person, any corporation, limited liability company,
partnership, association, or other business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
to
vote in the election of directors, managers, or trustees thereof is at the
time
owned or controlled, directly or indirectly, by that Person or one or more
of
the other Subsidiaries of that Person or a combination thereof or (ii) if a
limited liability company, partnership, association, or other business entity
(other than a corporation), a majority of the partnership or other similar
ownership interests thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more Subsidiaries of that Person or a
combination thereof and for this purpose, a Person or Persons own a majority
ownership interest in such a business entity (other than a corporation) if
such
Person or Persons shall be allocated a majority of such business entity's gains
or losses or shall be or control any managing director or general partner of
such business entity (other than a corporation). The term “Subsidiary” shall
include all Subsidiaries of such Subsidiary.
“Target”
has
the
meaning set forth in the preface above.
“Tax”or
“Taxes”
means
any federal, state, local, or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits,
environmental, unemployment, disability, real property, personal property,
sales, use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, whether computed on a separate
or consolidated, unitary or combined basis or in any other manner, including
any
interest, penalty, or addition thereto, whether disputed or not.
“Tax
Return”
means
any return, declaration, report, claim for refund, or information return or
statement relating to Taxes, including any schedule or attachment thereto,
and
including any amendment thereof.
§2. Basic
Transaction.
(a)
Purchase
and Sale of Assets.
On and
subject to the terms and conditions of this Agreement, Buyer agrees to purchase
from Target, and Target agrees to sell, transfer, convey, and deliver to Buyer,
all of the Acquired Assets at the Closing for the consideration specified below
in this §2.
(b)
Assumption
of Liabilities.
On and
subject to the terms and conditions of this Agreement, Buyer agrees to assume
and become responsible for all of the Assumed Liabilities at the Closing. Buyer
will not assume or have any responsibility, however, with respect to any other
obligation or liability of Target not included within the definition of Assumed
Liabilities.
(c)
Purchase
Price.
Buyer
agrees to pay to Target at the Closing by delivery of a Convertible Promissory
Note (the “Buyer
Note”)
in the
form of Exhibit A attached hereto in the aggregate principal amount of $20,000
USD (the “Purchase
Price”),
with
conversion rights as set forth therein, to the sole shareholder of target,
Xxxx
Xxxxxxxxx.
(d)
The
Closing.
The
closing of the transactions contemplated by this Agreement (the “Closing”)
shall
take place at the offices of Buyer, in Surrey, British Columbia commencing
at
9:00 a.m. local time on the first business day following the satisfaction or
waiver of all conditions to the obligations of the Parties to consummate the
transactions contemplated hereby.
§3. Target's
Representations and Warranties.
Target
represents and warrants to Buyer that the statements contained in this §3 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this
§3).
(a)
Organization
of Target.
Target
is a corporation duly organized, validly existing, and in good standing under
the laws of the jurisdiction of its incorporation.
(b)
Authorization
of Transaction.
Target
has full power and authority (including full corporate or other entity power
and
authority) to execute and deliver this Agreement and to perform its obligations
hereunder. Without limiting the generality of the foregoing, the board of
directors of Target and Target Stockholders have duly authorized the execution,
delivery, and performance of this Agreement by Target. This Agreement
constitutes the valid and legally binding obligation of Target, enforceable
in
accordance with its terms and conditions.
(c)
Non-contravention.
Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which Target
or
any of its Subsidiaries is subject or any provision of the charter or bylaws
of
Target or any of its Subsidiaries or (ii) conflict with, result in a breach
of,
constitute a default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require any notice
under any agreement, contract, lease, license, instrument, or other arrangement
to which Target or any of its Subsidiaries is a party or by which it is bound
or
to which any of its assets is subject (or result in the imposition of any Lien
upon any of its assets), except where the violation, conflict, breach, default,
acceleration, termination, modification, cancellation, failure to give notice,
or Lien would not have a Material Adverse Effect. Neither Target nor any of
its
Subsidiaries needs to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency
in
order for the Parties to consummate the transactions contemplated by this
Agreement (including the assignments and assumptions referred to in §2 above),
except where the failure to give notice, to file, or to obtain any
authorization, consent, or approval would not have a Material Adverse
Effect.
(d)
Brokers'
Fees.
Target
has no liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this Agreement
for which Buyer could become liable or obligated. No Subsidiary of Target has
any liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this
Agreement.
(e)
Title
to Assets.
Target
and its Subsidiaries have good and marketable title to, or a valid leasehold
interest in, the properties and assets used by them, located on their premises,
or shown on the Most Recent Balance Sheet or acquired after the date thereof,
free and clear of all Liens, except for properties and assets disposed of in
the
Ordinary Course of Business since the date of the Most Recent Balance Sheet.
Without limiting the generality of the foregoing, Target has good and marketable
title to all of the Acquired Assets, free and clear of any Liens or restriction
on transfer.
(f)
Financial
Statements.
Attached
hereto as Exhibit B are the following financial statements (collectively the
“Financial
Statements”):
(i)
audited consolidated balance sheets and statements of income, changes in
stockholders' equity, and cash flow as of and for the fiscal years ended
December 31, 2005, (the “Most
Recent Fiscal Year End”)
for
Target and its Subsidiaries. The Financial Statements (including the notes
thereto) have been prepared in accordance with GAAP throughout the periods
covered thereby, present fairly the financial condition of Target and its
Subsidiaries as of such dates and the results of operations of Target and its
Subsidiaries for such periods; provided,
however,
that
the Most Recent Financial Statements are subject to normal year-end adjustments
and lack footnotes and other presentation items.
(g)
Events
Subsequent to Most Recent Fiscal Year End.
Since
the Most Recent Fiscal Year End, there has not been any Material Adverse Change.
Without limiting the generality of the foregoing, since that date:
(i)
neither
Target nor any of its Subsidiaries has sold, leased, transferred, or assigned
any material assets, tangible or intangible, outside the Ordinary Course of
Business;
(ii)
neither
Target nor any of its Subsidiaries has entered into any material agreement,
contract, lease, or license outside the Ordinary Course of
Business;
(iii)
no
party
has accelerated, terminated, made material modifications to, or cancelled any
material agreement, contract, lease, or license to which Target or any of its
Subsidiaries is a party or by which any of them is bound;
(iv)
neither
Target nor any of its Subsidiaries has imposed any Lien upon any of its assets,
tangible or intangible;
(v)
neither
Target nor any of its Subsidiaries has made any material capital expenditures
outside the Ordinary Course of Business;
(vi)
neither
Target nor any of its Subsidiaries has made any material capital investment
in,
or any material loan to, any other Person outside the Ordinary Course of
Business;
(vii)
neither
Target nor any of its Subsidiaries has transferred, assigned, or granted any
license or sublicense of any material rights under or with respect to any
Intellectual Property;
(viii)
there
has
been no change made or authorized in the charter or bylaws of Target or any
of
its Subsidiaries;
(ix)
neither
Target nor any of its Subsidiaries has issued, sold, or otherwise disposed
of
any of its capital stock, or granted any options, warrants, or other rights
to
purchase or obtain (including upon conversion, exchange, or exercise) any of
its
capital stock;
(x) neither
Target nor any of its Subsidiaries has declared, set aside, or paid any dividend
or made any distribution with respect to its capital stock (whether in cash
or
in kind) or redeemed, purchased, or otherwise acquired any of its capital
stock;
(xi)
neither
Target nor any of its Subsidiaries has experienced any material damage,
destruction, or loss (whether or not covered by insurance) to its
property;
(xii)
neither
Target nor any of its Subsidiaries has made any loan to, or entered into any
other transaction with, any of its directors, officers, and employees outside
the Ordinary Course of Business;
(xiii)
neither
Target nor any of its Subsidiaries has granted any increase in the base
compensation of any of its directors, officers, and employees outside the
Ordinary Course of Business;
(xvii)
neither
Target nor any of its Subsidiaries has made any other material change in
employment terms for any of its directors, officers, and employees outside
the
Ordinary Course of Business;
(xviii)
Target
and its Subsidiaries have not changed their normal business practices or taken
any other action outside the Ordinary Course of Business in order to generate
Cash;
(xix)
neither
Target nor any of its Subsidiaries has made any loans or advances of money;
and
(xx)
neither
Target nor any of its Subsidiaries has committed to any of the
foregoing.
(h)
Undisclosed
Liabilities.
Neither
Target nor any of its Subsidiaries has any material liability, whether known
or
unknown, whether asserted or unasserted, whether absolute or contingent, whether
accrued or unaccrued, whether liquidated or unliquidated, and whether due or
to
become due, including any liability for Taxes, except for liabilities set forth
on the face of the Most Recent Balance Sheet.
(i)
Legal
Compliance.
Each of
Target and its Subsidiaries has complied with all applicable laws (including
rules, regulations, codes, plans, injunctions, judgments, orders, decrees,
rulings, and charges thereunder and including the Foreign Corrupt Practices
Act,
15 U.S.C. 78dd-1, et seq.) of federal, state, local, and foreign governments
(and all agencies thereof), and no action, suit, proceeding, hearing,
investigation, charge, complaint, claim, demand, or notice has been filed or
commenced against any of them alleging any failure so to comply, except where
the failure to comply would not have a Material Adverse Effect.
(j)
Tax
Matters.
(i)
Each
of
Target and its Subsidiaries has filed all Tax Returns that it was required
to
file. All such Tax Returns were correct and complete in all material respects.
All material Taxes owed by Target or any of its Subsidiaries (whether or not
shown on any Tax Return) have been paid. Neither Target nor any of its
Subsidiaries currently is the beneficiary of any extension of time within which
to file any Income Tax Return. Each of Target and its Subsidiaries has withheld
and paid all Taxes required to have been withheld and paid in connection with
amounts paid or owing to any employee, independent contractor, creditor,
stockholder, or other third party, and all Forms W-2 and 1099 required with
respect thereto have been properly completed and timely filed.
(ii)
There
is
no material dispute or claim concerning any Tax liability of Target or any
of
its Subsidiaries either (A) claimed or raised by any authority in writing or
(B)
as to which Target Stockholders or any of the directors and officers of Target
and its Subsidiaries has Knowledge based upon personal contact with any agent
of
such authority.
(k)
Real
Property.
Neither
Target nor any of its Subsidiaries owns any real property.
(l)
Intellectual
Property.
(i)
Neither
Target nor any of its Subsidiaries has interfered with, infringed upon,
misappropriated, or violated any material Intellectual Property rights of third
parties in any material respect, and none of Target Stockholders and the
directors and officers of Target and its Subsidiaries has ever received any
charge, complaint, claim, demand, or notice alleging any such interference,
infringement, misappropriation, or violation (including any claim that Target
or
any of its Subsidiaries must license or refrain from using any Intellectual
Property rights of any third party). To the Knowledge of any Target Stockholder
and the directors and officers of Target and its Subsidiaries, no third party
has interfered with, infringed upon, misappropriated, or violated any material
Intellectual Property rights of Target or any of its Subsidiaries in any
material respect.
(m)
Tangible
Assets.
The
buildings, machinery, equipment, and other tangible assets that Target and
its
Subsidiaries own or lease are free from material defects (patent and latent),
have been maintained in accordance with normal industry practice, and are in
good operating condition and repair (subject to normal wear and
tear).
(n)
Notes
and Accounts Receivable.
All
notes and accounts receivable of Target and its Subsidiaries are reflected
properly on their books and records, are valid receivables subject to no setoffs
or counterclaims, are current and collectible, and will be collected in
accordance with their terms at their recorded amounts, subject only to the
reserve for bad debts set forth on the face of the Most Recent Balance Sheet
as
adjusted for operations and transactions through the Closing Date in accordance
with the past custom and practice of Target and its Subsidiaries.
(o)
Business
Continuity.
None of
the computer software, computer hardware (whether general or special purpose),
telecommunications capabilities (including all voice, data and video networks)
and other similar or related items of automated, computerized, and/or software
systems and any other networks or systems and related services that are used
by
or relied on by Target and/or its Subsidiaries in the conduct of their business
(collectively, the “Systems”)
have
experienced bugs, failures, breakdowns, or continued substandard performance
in
the past twelve (12) months that has caused any substantial disruption or
interruption in or to the use of any such Systems by Target or its Subsidiaries.
Each of Target and its Subsidiaries is covered by business interruption
insurance in scope and amount customary and reasonable to ensure the ongoing
business operations of Target's and its Subsidiaries' business.
(p)
Certain
Business Relationships with Target and Its Subsidiaries.
Neither
Target Stockholders nor any of their Affiliates, Target Stockholders' directors,
officers, employees, and shareholders and Target's and its Subsidiaries'
directors, officers, employees, and shareholders has been involved in any
material business arrangement or relationship with Target or any of its
Subsidiaries within the past 12 months, and neither Target Stockholders nor
any
of their Affiliates, Target Stockholders' directors, officers, employees, and
shareholders and Target's and its Subsidiaries' directors, officers, employees,
and shareholders own any material asset, tangible or intangible, that is used
in
the business of Target or any of its Subsidiaries.
(q)
Disclosure.
The
representations and warranties contained in this §3 do not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements and information contained in this §3 not
misleading.
(r)
Investment.
Target
(i) understands that the Buyer Note has not been, and will not be, registered
under the Securities Act, or under any state securities laws, and are being
offered and sold in reliance upon federal and state exemptions for transactions
not involving any public offering, (ii) is acquiring the Buyer Note solely
for
its own account for investment purposes, and not with a view to the distribution
thereof, (iii) is a sophisticated investor with knowledge and experience in
business and financial matters, (iv) has received certain information concerning
Buyer and has had the opportunity to obtain additional information as desired
in
order to evaluate the merits and the risks inherent in holding the Buyer Note,
(v) is able to bear the economic risk and lack of liquidity inherent in holding
the Buyer Note, and (vi) is an Accredited Investor.
§4. Buyer's
Representations and Warranties.
Buyer
represents and warrants to Target that the statements contained in this §4 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this
§4).
(a)
Organization
of Buyer.
Buyer is
a corporation duly organized, validly existing, and in good standing under
the
laws of the jurisdiction of its incorporation.
(b)
Authorization
of Transaction.
Buyer
has full power and authority (including full corporate or other entity power
and
authority) to execute and deliver this Agreement and to perform its obligations
hereunder. This Agreement constitutes the valid and legally binding obligation
of Buyer, enforceable in accordance with its terms and conditions. Buyer need
not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order to
consummate the transactions contemplated by this Agreement. The execution,
delivery and performance of this Agreement and all other agreements contemplated
hereby have been duly authorized by Buyer.
(c)
Non-contravention.
Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby (including the assignments and assumptions
referred to in §2 above), will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which Buyer
is
subject or any provision of its charter, or other governing documents or (ii)
conflict with, result in a breach of, constitute a default under, result in
the
acceleration of, create in any party the right to accelerate, terminate, modify,
or cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which Buyer is a party or by which it is
bound or to which any of its assets are subject. Buyer does not need to give
any
notice to, make any filing with, or obtain any authorization, consent, or
approval of any government or governmental agency in order for the Parties
to
consummate the transactions contemplated by this Agreement (including the
assignments and assumptions referred to in §2 above).
(d)
Brokers'
Fees.
Buyer
has no liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this Agreement
for which Target could become liable or obligated.
§5. Pre-Closing
Covenants.
The
Parties agree as follows with respect to the period between the execution of
this Agreement and the Closing:
(a)
General.
Each of
the Parties will use its reasonable best efforts to take all actions and to
do
all things necessary in order to consummate and make effective the transactions
contemplated by this Agreement (including satisfaction, but not waiver, of
the
Closing conditions set forth in §6 below).
(b) Notices
and Consents.
Target
will give any notices to third parties, and Target will use its reasonable
best
efforts to obtain any third-party consents referred to in §3(c) above, the Lease
Consents. Each of the Parties will give any notices to, make any filings with,
and use its reasonable best efforts to obtain any authorizations, consents,
and
approvals of governments and governmental agencies in connection with the
matters referred to in §3(c) and §4(c) above.
(c)
Operation
of Business.
Target
will not engage in any practice, take any action, or enter into any transaction
outside the Ordinary Course of Business.
(d)
Preservation
of Business.
Target
will keep its business and properties substantially intact, including its
present operations, physical facilities, working conditions, insurance policies,
and relationships with lessors, licensors, suppliers, customers, and employees.
(e)
Full
Access.
Target
will permit representatives of Buyer to have full access at all reasonable
times
and in a manner so as not to interfere with the normal business operations
of
Target and its Subsidiaries, to all premises, properties, personnel, books,
records (including Tax records), contracts, and documents of or pertaining
to
Target and each of its Subsidiaries. Buyer will treat and hold as such any
Confidential Information it receives from any Target Stockholder, Target, and
its Subsidiaries in the course of the reviews contemplated by this §5(e), will
not use any of the Confidential Information except in connection with this
Agreement, and, if this Agreement is terminated for any reason whatsoever,
will
return to Target Stockholders, Target, and its Subsidiaries all tangible
embodiments (and all copies) of the Confidential Information that are in its
possession.
(f)
Notice
of Developments.
Each
Party will give prompt written notice to the other Party of any material adverse
development causing a breach of any of its own representations and warranties
in
§3 and §4 above. No disclosure by any Party pursuant to this §5(f), however,
shall be deemed to amend or supplement the Disclosure Schedule or to prevent
or
cure any misrepresentation, breach of warranty, or breach of covenant.
(g)
Exclusivity.
Target
will not (i) solicit, initiate, or encourage the submission of any proposal
or
offer from any Person relating to the acquisition of any capital stock or other
voting securities, or any substantial portion of the assets, of Target or any
of
its Subsidiaries (including any acquisition structured as a merger,
consolidation, or share exchange) or (ii) participate in any discussions or
negotiations regarding, furnish any information with respect to, assist or
participate in, or facilitate in any other manner any effort or attempt by
any
Person to do or seek any of the foregoing.
(h)
Leases.
Neither
Target nor any of its Subsidiaries shall amend, modify, extend, renew or
terminate any Lease, nor shall Target or any of its Subsidiaries enter into
any
new lease, sublease, license or other agreement for the use or occupancy of
any
Real Property without the prior written consent of Buyer.
§6. Conditions
to Obligation to Close.
(a)
Conditions
to Buyer's Obligation.
The
obligation of Buyer to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the following
conditions:
(i)
the
representations and warranties set forth in §3 above shall be true and correct
in all material respects at and as of the Closing Date, except to the extent
that such representations and warranties are qualified by the term “material,”
or contain terms such as “Material Adverse Effect” or “Material Adverse Change,”
in which case such representations and warranties (as so written, including
the
term “material” or “Material”) shall be true and correct in all respects at and
as of the Closing Date;
(ii)
Target
shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing, except to the extent that such covenants
are qualified by the term “material,” or contain terms such as “Material Adverse
Effect” or “Material Adverse Change,” in which case Sellers shall have performed
and complied with all of such covenants (as so written, including the term
“material” or “Material”) in all respects through the Closing;
(iii)
Target
and its Subsidiaries shall have procured all of the third-party consents
specified in §5(b) above;
(iv) no
action, suit, or proceeding shall be pending before any court or quasi-judicial
or administrative agency of any federal, state, local, or foreign jurisdiction
or before any arbitrator wherein an unfavorable injunction, judgment, order,
decree, ruling, or charge would (A) prevent consummation of any of the
transactions contemplated by this Agreement, (B) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation, (C)
adversely affect the right of Buyer to own the Acquired Assets, to operate
the
former business of Target, and to control Target's Subsidiaries, or (D)
materially and adversely affect the right of any of Target's Subsidiaries to
own
its assets and to operate its business (and no such injunction, judgment, order,
decree, ruling, or charge shall be in effect);
(vi)
Target
shall have delivered to Buyer a certificate to the effect that each of the
conditions specified above in §6(a)(i)-(iv) is satisfied in all
respects;
(vii)
all
actions to be taken by Target in connection with consummation of the
transactions contemplated hereby and all certificates, opinions, instruments,
and other documents required to effect the transactions contemplated hereby
will
be reasonably satisfactory in form and substance to Buyer;
(viii)
Target
and its Subsidiaries shall have obtained and delivered to Buyer a written
consent for the assignment of each of the Leases, and, if requested by Buyer's
lender in connection with any Material Leased Real Property, a waiver of
landlord liens, collateral assignment of lease or leasehold mortgage from the
landlord or other party whose consent thereto is required under such Lease
(the
“Lease
Consents”),
in
form and substance satisfactory to Buyer and Buyer's lender;
(ix)
Target
shall have delivered to Buyer copies of the certificate of good standing of
each
Seller and Target issued on or soon before the Closing Date by the Secretary
of
State (or comparable officer) of the jurisdiction of each such Person's
organization;
Buyer
may
waive any condition specified in this §6(a) if it executes a writing so stating
at or prior to the Closing.
(b)
Conditions
to Target's Obligation.
The
obligation of Target to consummate the transactions to be performed by it in
connection with the Closing is subject to satisfaction of the following
conditions:
(i)
the
representations and warranties set forth in §4 above shall be true and correct
in all material respects at and as of the Closing Date, except to the extent
that such representations and warranties are qualified by the term “material,”
or contain terms such as “Material Adverse Effect” or “Material Adverse Change,”
in which case such representations and warranties (as so written, including
the
term “material” or “Material”) shall be true and correct in all respects at and
as of the Closing Date;
(ii)
Buyer
shall have performed and complied with all of its covenants hereunder in all
material respects through the Closing, except to the extent that such covenants
are qualified by the term “material,” or contain terms such as “Material Adverse
Effect” or “Material Adverse Change,” in which case Buyer shall have performed
and complied with all of such covenants (as so written, including the term
“material” or “Material”) in all respects through the Closing;
(iii)
no
action, suit, or proceeding shall be pending before any court or quasi-judicial
or administrative agency of any federal, state, local, or foreign jurisdiction
or before any arbitrator wherein an unfavorable injunction, judgment, order,
decree, ruling, or charge would (A) prevent consummation of any of the
transactions contemplated by this Agreement or (B) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation (and
no
such injunction, judgment, order, decree, ruling, or charge shall be in effect);
(iv)
Buyer
shall have delivered to Target a certificate to the effect that each of the
conditions specified above in §6(b)(i)-(iii) is satisfied in all
respects;
(v)
all
actions to be taken by Buyer in connection with consummation of the transactions
contemplated hereby and all certificates, opinions, instruments, and other
documents required to effect the transactions contemplated hereby will be
reasonably satisfactory in form and substance to Target.
Target
may waive any condition specified in this §6(b) if it executes a writing so
stating at or prior to the Closing.
§7. Termination.
(a)
Termination
of Agreement.
Buyer
and Target may terminate this Agreement by mutual written consent at any time
prior to the Closing;
(b)
Effect
of Termination.
If any
Party terminates this Agreement pursuant to §7(a) above, all rights and
obligations of the Parties hereunder shall terminate without any liability
of
any Party to any other Party (except for any liability of any Party then in
breach); provided,
however,
that
the confidentiality provisions contained in §5(e) above shall survive
termination.
§8. Miscellaneous.
(a)
Survival
of Representations and Warranties.
All of
the representations and warranties of the Parties contained in this Agreement
shall survive the Closing.
(b)
Press
Releases and Public Announcements.
No Party
shall issue any press release or make any public announcement relating to the
subject matter of this Agreement without the prior written approval of the
other
Party; provided,
however,
that
any Party may make any public disclosure it believes in good faith is required
by applicable law or any listing or trading agreement concerning its publicly
traded securities, in which case the disclosing Party will use its best efforts
to advise the other Party prior to making the disclosure.
(c)
No
Third-Party Beneficiaries.
This
Agreement shall not confer any rights or remedies upon any Person other than
the
Parties and their respective successors and permitted assigns.
(d)
Succession
and Assignment.
This
Agreement shall be binding upon and inure to the benefit of the Parties named
herein and their respective successors and permitted assigns. No Party may
assign either this Agreement or any of its rights, interests, or obligations
hereunder without the prior written approval of the other Party; provided,
however,
that
Buyer may (i) assign any or all of its rights and interests hereunder to one
or
more of its Affiliates and (ii) designate one or more of its Affiliates to
perform its obligations hereunder (in any or all of which cases Buyer
nonetheless shall remain responsible for the performance of all of its
obligations hereunder).
(e)
Counterparts.
This
Agreement may be executed in one or more counterparts (including by means of
facsimile), each of which shall be deemed an original but all of which together
will constitute one and the same instrument.
(f)
Headings.
The
section headings contained in this Agreement are inserted for convenience only
and shall not affect in any way the meaning or interpretation of this
Agreement.
(g)
Governing
Law. This
Agreement shall be governed by and construed in accordance with the domestic
laws of the State of Nevada
without
giving effect to any choice or conflict of law provision or rule that would
cause the application of the laws of any jurisdiction other than the State
of
Nevada.
(h)
Severability.
Any term
or provision of this Agreement that is invalid or unenforceable in any situation
in any jurisdiction shall not affect the validity or enforceability of the
remaining terms and provisions hereof or the validity or enforceability of
the
offending term or provision in any other situation or in any other
jurisdiction.
(i)
Construction.
The
Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties
and no presumption or burden of proof shall arise favoring or disfavoring any
Party by virtue of the authorship of any of the provisions of this Agreement.
Any reference to any federal, state, local, or foreign statute or law shall
be
deemed also to refer to all rules and regulations promulgated thereunder, unless
the context requires otherwise. The word including
shall
mean including without limitation.
(n)
Incorporation
of Exhibits and Schedules.
The
Exhibits and Schedules identified in this Agreement are incorporated herein
by
reference and made a part hereof.
IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
|
/s/
XXXXXX X. XXXXXX
BY:
Xxxxxx X. Xxxxxx
ITS:
President
DATED:
January 1, 2006
|
KINDER
TRAVEL, INC. (BRITISH COLUMBIA)
/s/
XXXX XXXXXXXXX
BY:
Xxxx Xxxxxxxxx
ITS:
President
DATED:
January 1, 2006
|
