Exhibit 2.1
AGREEMENT FOR SHARE EXCHANGE
THIS AGREEMENT FOR SHARE EXCHANGE (this "Agreement") is dated as of
August13, 2004, by and among SHEFFIELD PRODUCTS, INC., a Delaware corporation
("SHEFFIELD"), DIGITAL NETWORK ALLIANCE HOLDINGS (BVI) INC, a British Virgin
Island corporation ("DIGITAL"), and the Shareholders of DIGITAL listed in
Exhibit A who execute this Agreement ( collectively the "SHAREHOLDERS").
RECITALS:
SHEFFIELD and DIGITAL desire to complete a share exchange transaction
pursuant to which SHEFFIELD shall acquire all of the issued and outstanding
common stock of DIGITAL solely in exchange for the issuance of shares of voting
stock of SHEFFIELD; and
THE Board of Directors of SHEFFIELD and the Board of Directors of
DIGITAL have each approved the proposed transaction, contingent upon
satisfaction prior to closing of all of the terms and conditions of this
Agreement; and
THE SHAREHOLDERS are the owners of all of the issued and outstanding
common stock of DIGITAL; and
THE PARTIES desire to make certain representations, warranties and
agreements in connection with completion of the proposed share exchange
transaction.
NOW, THEREFORE, in consideration of the foregoing recitals, which shall
be considered an integral part of this Agreement, and the covenants,
conditions, representations and warranties hereinafter set forth, the parties
hereby agree as follows:
ARTICLE I
THE EXCHANGE
1.1 THE EXCHANGE. At the Closing (as hereinafter defined), SHEFFIELD
shall acquire all of the issued and outstanding common stock of DIGITAL from
the SHAREHOLDERS. Consideration to be issued by SHEFFIELD shall be a total of
13,248,760 shares of its common stock (the "Exchange Shares") in exchange for
10,000 shares of DIGITAL, representing 100% of the issued and outstanding
common stock of DIGITAL. (The Exchange Ratio shall be approximately 1,325:1
i.e. 1,325 shares of SHEFFIELD common stock for each one (1) share of DIGITAL
common stock exchanged). The Exchange shall take place upon the terms and
conditions provided for
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in this Agreement and in accordance with applicable law. Immediately following
completion of the share exchange transaction through issuance of the Exchange
Shares and completion of the additional share transactions described in Section
4.5 hereof, SHEFFIELD shall have a total of approximately 20,000,000 shares of
its common stock issued and outstanding. For Federal income tax purposes, it
is intended that the Exchange shall constitute a tax-free reorganization within
the meaning of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as
amended (the "Code").
1.2 CLOSING AND EFFECTIVE TIME. Subject to the provisions of this
Agreement, the parties shall hold a closing (the "Closing") on (i) the first
business day on which the last of the conditions set forth in Article V to be
fulfilled prior to the Closing is fulfilled or waived or (ii) such other date
as the parties hereto may agree (the "Closing Date"), at such time and place as
the parties hereto may agree. Such date shall be the date of Exchange (the
"Effective Time").
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF SHEFFIELD. SHEFFIELD represents
and warrants to DIGITAL as follows:
(a) ORGANIZATION, STANDING AND POWER. SHEFFIELD is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, has all requisite power and authority to own, lease and operate its
properties and to carry on its business as now being conducted, and is duly
qualified and in good standing to do business in each jurisdiction in which the
nature of its business or the ownership or leasing of its properties makes such
qualification necessary.
(b) CAPITAL STRUCTURE. As of the date of execution of this Agreement,
the authorized capital stock of SHEFFIELD consists of 200,000,000 shares of
Common Stock with a par value of USD $0.001 per share, of which approximately
6,751,240 shares are currently issued and outstanding. The Exchange Shares to
be issued pursuant to this Agreement shall be, when issued pursuant to the
terms of the resolution of the Board of Directors of SHEFFIELD approving such
issuance, validly issued, fully paid and nonassessable and not subject to
preemptive rights. Except as otherwise specified herein, as of the date of
execution of this Agreement, there are no other options, warrants, calls,
agreements or other rights to purchase or otherwise acquire from SHEFFIELD at
any time, or upon the happening of any stated event, any shares of the capital
stock of SHEFFIELD whether or not presently issued or outstanding.
(c) CERTIFICATE OF INCORPORATION, BYLAWS, AND MINUTE BOOKS. The
copies of the Articles of Incorporation and of the Bylaws of SHEFFIELD which
have been delivered to DIGITAL are true, correct and complete copies thereof.
The minute book of SHEFFIELD, which has been made available for inspection,
contains accurate minutes of all meetings and accurate consents in lieu of
meetings of the Board of Directors (and any
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committee thereof) and of the shareholders of SHEFFIELD since the date of
incorporation and accurately reflects all transactions referred to in such
minutes and consents in lieu of meetings.
(d) AUTHORITY. SHEFFIELD has all requisite power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by the Board of
Directors of SHEFFIELD. No other corporate or shareholder proceedings on the
part of SHEFFIELD are necessary to authorize the Exchange, or the other
transactions contemplated hereby.
(e) CONFLICT WITH OTHER AGREEMENTS; APPROVALS. The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby will not result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or the loss of a
material benefit under, or the creation of a lien, pledge, security interest or
other encumbrance on assets (any such conflict, violation, default, right of
termination, cancellation or acceleration, loss or creation, a "violation")
pursuant to any provision of the Articles of Incorporation or Bylaws or any
organizational document of SHEFFIELD or, result in any violation of any loan or
credit agreement, note, mortgage, indenture, lease, benefit plan or other
agreement, obligation, instrument, permit, concession, franchise, license,
judgment, order, decree, statute, law, ordinance, rule or regulation applicable
to SHEFFIELD which violation would have a material adverse effect on SHEFFIELD
taken as a whole. No consent, approval, order or authorization of, or
registration, declaration or filing with, any court, administrative agency or
commission or other governmental authority or instrumentality, domestic or
foreign (a "Governmental Entity") is required by or with respect to SHEFFIELD
in connection with the execution and delivery of this Agreement by SHEFFIELD or
the consummation by SHEFFIELD of the transactions contemplated hereby.
(f) BOOKS AND RECORDS. SHEFFIELD has made and will make available for
inspection by DIGITAL upon reasonable request all the books of SHEFFIELD
relating to the business of SHEFFIELD. Such books of SHEFFIELD have been
maintained in the ordinary course of business. All documents furnished or
caused to be furnished to DIGITAL by SHEFFIELD are true and correct copies, and
there are no amendments or modifications thereto except as set forth in such
documents.
(g) COMPLIANCE WITH LAWS. SHEFFIELD is and has been in compliance in
all material respects with all laws, regulations, rules, orders, judgments,
decrees and other requirements and policies imposed by any Governmental Entity
applicable to it, its properties or the operation of its businesses.
(h) SEC FILINGS. SHEFFIELD has filed all periodic reports required to
be filed with the Securities and Exchange Commission and as of the date hereof,
is current in its filing obligations.
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(i) FINANCIAL STATEMENTS AND TAX RETURNS. Copies of SHEFFIELD's
audited financial statements for the fiscal year ended December 31, 2003, its
unaudited financial statements for the period ended March 31, 2004, and of its
tax return for the fiscal year 2003 have been delivered to DIGITAL.
(j) LITIGATION. There is no suit, action or proceeding pending, or,
to the knowledge of SHEFFIELD, threatened against or affecting SHEFFIELD which
is reasonably likely to have a material adverse effect on SHEFFIELD, nor is
there any judgment, decree, injunction, rule or order of any Governmental
Entity or arbitrator outstanding against SHEFFIELD having, or which, insofar as
reasonably can be foreseen, in the future could have, any such effect.
k) TAX RETURNS. SHEFFIELD has duly filed any tax reports and returns
required to be filed by it and has fully paid all taxes and other charges
claimed to be due from it by any federal, state or local taxing authorities.
There are not now any pending questions relating to, or claims asserted for,
taxes or assessments asserted upon SHEFFIELD.
2.2 REPRESENTATIONS AND WARRANTIES OF DIGITAL. DIGITAL represents and
warrants to SHEFFIELD as follows:
(a) ORGANIZATION, STANDING AND POWER. DIGITAL is a corporation duly
organized, validly existing and in good standing under the laws of the British
Virgin Islands, has all requisite power and authority to own, lease and operate
its properties and to carry on its business as now being conducted, and is duly
qualified and in good standing to do business in each jurisdiction in which the
nature of its business or the ownership or leasing of its properties makes such
qualification necessary.
(b) CAPITAL STRUCTURE. The authorized capital stock of DIGITAL
consists of 10,000 shares of Common Stock with par value of $1.00 per share.
As of the date of execution of this Agreement, it has a total of 10,000 shares
of common stock issued and outstanding. All outstanding shares of DIGITAL
stock are validly issued, fully paid and nonassessable and not subject to
preemptive rights or other restrictions on transfer. All of the issued and
outstanding shares of DIGITAL were issued in compliance with all applicable
securities laws. Except as otherwise specified herein, there are no options,
warrants, calls, agreements or other rights to purchase or otherwise acquire
from DIGITAL at any time, or upon the happening of any stated event, any shares
of the capital stock of DIGITAL.
(c) CERTIFICATE OF INCORPORATION, BYLAWS AND MINUTE BOOKS. The copies
of the Certificate of Incorporation and of the other corporate documents of
DIGITAL which have been delivered to SHEFFIELD are true, correct and complete
copies thereof. The minute books of DIGITAL which have been made available for
inspection contain accurate minutes of all meetings and accurate consents in
lieu of meetings of the Board of Directors (and any committee thereof) and of
the shareholders of DIGITAL since the date
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of incorporation and accurately reflect all transactions referred to in such
minutes and consents in lieu of meetings.
(d) AUTHORITY. DIGITAL has all requisite power to enter into this
Agreement and, subject to approval of the proposed transaction by the holders
of 100% of its issued and outstanding shares which are entitled to vote to
approve the proposed transaction, has the requisite power and authority to
consummate the transactions contemplated hereby. Except as specified herein,
no other corporate or shareholder proceedings on the part of DIGITAL are
necessary to authorize the Exchange and the other transactions contemplated
hereby.
(e) CONFLICT WITH AGREEMENTS; APPROVALS. The execution and delivery
of this Agreement does not, and the consummation of the transactions
contemplated hereby will not, conflict with, or result in any violation of any
provision of the Certificate of Incorporation or Bylaws of DIGITAL or of any
loan or credit agreement, note, mortgage, indenture, lease, benefit plan or
other agreement, obligation, instrument, permit, concession, franchise,
license, judgment, order, decree, statute, law, ordinance, rule or regulation
applicable to DIGITAL or its properties or assets. No consent, approval, order
or authorization of, or registration, declaration or filing with, any
Governmental Entity is required by or with respect to DIGITAL in connection
with the execution and delivery of this Agreement by DIGITAL, or the
consummation by DIGITAL of the transactions contemplated hereby.
(f) FINANCIAL STATEMENTS. Copies of DIGITAL's audited financial
statements for the period ended December 31, 2003 have been delivered to
SHEFFIELD.
(g) BOOKS AND RECORDS. DIGITAL has made and will make available for
inspection by SHEFFIELD upon reasonable request all the books of account,
relating to the business of DIGITAL. Such books of account of DIGITAL have
been maintained in the ordinary course of business. All documents furnished or
caused to be furnished to SHEFFIELD by DIGITAL are true and correct copies, and
there are no amendments or modifications thereto except as set forth in such
documents.
(h) COMPLIANCE WITH LAWS. DIGITAL is and has been in compliance in
all material respects with all laws, regulations, rules, orders, judgments,
decrees and other requirements and policies imposed by any Governmental Entity
applicable to it, its properties or the operation of its businesses.
(i) LIABILITIES AND OBLIGATIONS. DIGITAL has no material liabilities
or obligations (absolute, accrued, contingent or otherwise) except (i)
liabilities that are reflected and reserved against on the DIGITAL financial
statements that have not been paid or discharged since the date thereof and
(ii) liabilities incurred since the date of such financial statements in the
ordinary course of business consistent with past practice and in accordance
with this Agreement.
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(j) LITIGATION. There is no suit, action or proceeding pending, or,
to the knowledge of DIGITAL threatened against or affecting DIGITAL, which is
reasonably likely to have a material adverse effect on DIGITAL, nor is there
any judgment, decree, injunction, rule or order of any Governmental Entity or
arbitrator outstanding against DIGITAL having, or which, insofar as reasonably
can be foreseen, in the future could have, any such effect.
(k) TAXES. DIGITAL has filed or will file within the time prescribed
by law (including extension of time approved by the appropriate taxing
authority) all tax returns and reports required to be filed with all other
jurisdictions where such filing is required by law; and DIGITAL has paid, or
made adequate provision for the payment of all taxes, interest, penalties,
assessments or deficiencies due and payable on, and with respect to such
periods. DIGITAL knows of (i) no other tax returns or reports which are
required to be filed which have not been so filed and (ii) no unpaid assessment
for additional taxes for any fiscal period or any basis therefore.
(l) LICENSES, PERMITS; INTELLECTUAL PROPERTY. DIGITAL owns or
possesses in the operation of its business all material authorizations which
are necessary for it to conduct its business as now conducted. Neither the
execution or delivery of this Agreement nor the consummation of the
transactions contemplated hereby will require any notice or consent under or
have any material adverse effect upon any such authorizations.
2.3 REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS. By execution
of this Agreement, each of the SHAREHOLDERS represents and warrants to
SHEFFIELD as follows:
(a) SHARES FREE AND CLEAR. The shares of DIGITAL which he or she owns
are free and clear of any liens, claims, options, charges or encumbrances of
any nature.
(b) UNQUALIFIED RIGHT TO TRANSFER SHARES. He or she has the
unqualified right to sell, assign, and deliver the portion of the shares of
DIGITAL specified on Exhibit A and, upon consummation of the transactions
contemplated by this Agreement, SHEFFIELD will acquire good and valid title to
such shares, free and clear of all liens, claims, options, charges, and
encumbrances of whatsoever nature.
(c) AGREEMENT AND TRANSACTION DULY AUTHORIZED. He or she is
authorized to execute and deliver this Agreement and to consummate the share
exchange transaction described herein. Neither the execution and delivery of
this Agreement nor the consummation of the transactions contemplated hereby
will constitute a violation or default under any term or provision of any
contract, commitment, indenture, other agreement or restriction of any kind or
character to which such SHAREHOLDER is a party or by which such SHAREHOLDER is
bound.
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ARTICLE III
COVENANTS RELATING TO CONDUCT OF BUSINESS
3.1 COVENANTS OF DIGITAL AND SHEFFIELD. During the period from the
date of this Agreement and continuing until the Effective Time, DIGITAL and
SHEFFIELD each agree as to themselves (except as expressly contemplated or
permitted by this Agreement, or to the extent that the other party shall
otherwise consent in writing):
(a) ORDINARY COURSE. Each party shall carry on its respective
businesses in the usual, regular and ordinary course in substantially the same
manner as heretofore conducted.
(b) DIVIDENDS; CHANGES IN STOCK. No party shall (i) declare or pay
any dividends on or make other distributions in respect of any of its capital
stock, or (ii) repurchase or otherwise acquire, or permit any subsidiary to
purchase or otherwise acquire, any shares of its capital stock.
(c) ISSUANCE OF SECURITIES. No party shall issue, deliver or sell,
or authorize or propose the issuance, delivery or sale of, any shares of its
capital stock of any class, any voting debt or any securities convertible into,
or any rights, warrants or options to acquire, any such shares, voting debt or
convertible securities.
(d) GOVERNING DOCUMENTS. No party shall amend or propose to amend its
Articles of Incorporation or Bylaws.
(e) NO DISPOSITIONS. Except for the transfer of assets in the
ordinary course of business consistent with prior practice, no party shall
sell, lease, encumber or otherwise dispose of, or agree to sell, lease,
encumber or otherwise dispose of, any of its assets, which are material,
individually or in the aggregate, to such party.
(f) INDEBTEDNESS. No party shall incur any indebtedness for borrowed
money or guarantee any such indebtedness or issue or sell any debt securities
or warrants or rights to acquire any debt securities of such party or guarantee
any debt securities of others other than in each case in the ordinary course of
business consistent with prior practice.
3.2 OTHER ACTIONS. No party shall take any action that would or is
reasonably likely to result in any of its representations and warranties set
forth in this Agreement being untrue as of the date made (to the extent so
limited), or in any of the conditions to the Exchange set forth in Article V
not being satisfied.
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ARTICLE IV
ADDITIONAL AGREEMENTS AND RELATED TRANSACTIONS
4.1 RESTRICTED SHEFFIELD SHARES. The Exchange Shares will not be
registered under the Securities Act, but will be issued pursuant to applicable
exemptions from such registration requirements for transactions not involving a
public offering and/or for transactions which constitute "offshore
transactions" as defined in Regulation S under the Securities Act of 1933.
Accordingly, the Exchange Shares will constitute "restricted securities" for
purposes of the Securities Act and the holders of Exchange Shares will not be
able to transfer such shares except upon compliance with the registration
requirements of the Securities Act or in reliance upon an available exemption
therefrom. The certificates evidencing the Exchange Shares shall contain a
legend to the foregoing effect and the holders of such shares shall deliver at
Closing an Investment Letter acknowledging the fact that the Exchange Shares
are restricted securities and agreeing to the foregoing transfer restrictions.
4.2 ACCESS TO INFORMATION. Upon reasonable notice, SHEFFIELD and
DIGITAL shall each afford to the officers, employees, accountants, counsel and
other representatives of the other company, access to all their respective
properties, books, contracts, commitments and records and, during such period,
each of SHEFFIELD and DIGITAL shall furnish promptly to the other (a) a copy of
each report, schedule, registration statement and other document filed or
received by it during such period pursuant to the requirements of Federal or
state securities laws and (b) all other information concerning its business,
properties and personnel as such other party may reasonably request. Unless
otherwise required by law, the parties will hold any such information which is
nonpublic in confidence until such time as such information otherwise becomes
publicly available through no wrongful act of either party, and in the event of
termination of this Agreement for any reason each party shall promptly return
all nonpublic documents obtained from any other party, and any copies made of
such documents, to such other party.
4.3 LEGAL CONDITIONS TO EXCHANGE. Each of SHEFFIELD and DIGITAL shall
take all reasonable actions necessary to comply promptly with all legal
requirements which may be imposed on itself with respect to the Exchange and
will promptly cooperate with and furnish information to each other in
connection with any such requirements imposed upon any of them or upon any of
their related entities or subsidiaries in connection with the Exchange. Each
party shall take all reasonable actions necessary to obtain (and will cooperate
with each other in obtaining) any consent, authorization, order or approval of,
or any exemption by, any Governmental Entity or other public or private third
party, required to be obtained or made by SHEFFIELD or DIGITAL or any of their
related entities or subsidiaries in connection with the Exchange or the taking
of any action contemplated thereby or by this Agreement.
4.4 SHEFFIELD BOARD OF DIRECTORS AND OFFICERS. The current directors
of SHEFFIELD shall resign as of the Closing Date after appointing successors
designated by DIGITAL.
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ARTICLE V
CONDITIONS PRECEDENT
5.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE EXCHANGE. The
respective obligations of each party to effect the Exchange shall be
conditional upon the filing, occurring or obtainment of all authorizations,
consents, orders or approvals of, or declarations or filings with, or
expirations of waiting periods imposed by any governmental entity or by any
applicable law, rule, or regulation governing the transactions contemplated
hereby.
5.2 CONDITIONS TO OBLIGATIONS OF SHEFFIELD. The obligation of
SHEFFIELD to effect the Exchange is subject to the satisfaction of the
following conditions on or before the Closing Date unless waived by SHEFFIELD:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of DIGITAL and of the SHAREHOLDERS set forth in this Agreement shall
be true and correct in all material respects as of the date of this Agreement
and (except to the extent such representations and warranties speak as of an
earlier date) as of the Closing Date as though made on and as of the Closing
Date, except as otherwise contemplated by this Agreement, and SHEFFIELD shall
have received a certificate signed on behalf of DIGITAL by the President of
DIGITAL and a certificate signed by each of the SHAREHOLDERS to such effect.
(b) PERFORMANCE OF OBLIGATIONS OF DIGITAL. DIGITAL shall have
performed in all material respects all obligations required to be performed by
it under this Agreement at or prior to the Closing Date, and SHEFFIELD shall
have received a certificate signed on behalf of DIGITAL by the President to
such effect.
(c) CLOSING DOCUMENTS. SHEFFIELD shall have received such
certificates and other closing documents as counsel for SHEFFIELD shall
reasonably request.
(d) NO DISSENTING SHARES. SHAREHOLDERS holding 100% of the issued
and outstanding common stock of number of shares of common stock of DIGITAL
shall have executed this Agreement and consented to completion of the share
exchange transaction described herein.
(e) CONSENTS. DIGITAL shall have obtained the consent or approval of
each person whose consent or approval shall be required in connection with the
transactions contemplated hereby under any loan or credit agreement, note,
mortgage, indenture, lease or other agreement or instrument, except those for
which failure to obtain such consents and approvals would not, in the
reasonable opinion of SHEFFIELD, individually or in the aggregate, have a
material adverse effect on DIGITAL and its subsidiaries and related entities
taken as a whole upon the consummation of the transactions contemplated hereby.
DIGITAL shall also have received the approval of its shareholders in accordance
with applicable law.
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(f) DUE DILIGENCE REVIEW. SHEFFIELD shall have completed to its
reasonable satisfaction a review of the business, operations, finances, assets
and liabilities of DIGITAL and shall not have determined that any of the
representations or warranties of DIGITAL contained herein are, as of the date
hereof or the Closing Date, inaccurate in any material respect or that DIGITAL
is otherwise in violation of any of the provisions of this Agreement.
(g) PENDING LITIGATION. There shall not be any litigation or other
proceeding pending or threatened to restrain or invalidate the transactions
contemplated by this Agreement, which, in the sole reasonable judgment of
SHEFFIELD, made in good faith, would make the consummation of the Exchange
imprudent. In addition, there shall not be any other litigation or other
proceeding pending or threatened against DIGITAL, the consequences of which, in
the judgment of SHEFFIELD, could be materially adverse to DIGITAL.
5.3 CONDITIONS TO OBLIGATIONS OF DIGITAL. The obligation of DIGITAL
to effect the Exchange is subject to the satisfaction of the following
conditions unless waived by DIGITAL:
(a) REPRESENTATIONS AND WARRANTIES. The representations and
warranties of SHEFFIELD set forth in this Agreement shall be true and correct
in all material respects as of the date of this Agreement and (except to the
extent such representations speak as of an earlier date) as of the Closing Date
as though made on and as of the Closing Date, except as otherwise contemplated
by this Agreement, DIGITAL shall have received a certificate signed on behalf
of SHEFFIELD by the President to such effect.
(b) PERFORMANCE OF OBLIGATIONS OF SHEFFIELD. SHEFFIELD shall have
performed in all material respects all obligations required to be performed by
it under this Agreement at or prior to the Closing Date, and DIGITAL shall have
received a certificate signed on behalf of SHEFFIELD by the President to such
effect.
(c) CLOSING DOCUMENTS. DIGITAL shall have received such certificates
and other closing documents as counsel for DIGITAL shall reasonably request.
(d) CONSENTS. SHEFFIELD shall have obtained the consent or approval
of each person whose consent or approval shall be required in connection with
the transactions contemplated hereby.
(e) DUE DILIGENCE REVIEW. DIGITAL shall have completed to its
reasonable satisfaction a review of the business, operations, finances, assets
and liabilities of SHEFFIELD and shall not have determined that any of the
representations or warranties of SHEFFIELD contained herein are, as of the date
hereof or the Closing Date, inaccurate in any material respect or that
SHEFFIELD is otherwise in violation of any of the provisions of this Agreement.
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(f) PENDING LITIGATION. There shall not be any litigation or other
proceeding pending or threatened to restrain or invalidate the transactions
contemplated by this Agreement, which, in the sole reasonable judgment of
DIGITAL, made in good faith, would make the consummation of the Exchange
imprudent. In addition, there shall not be any other litigation or other
proceeding pending or threatened against SHEFFIELD the consequences of which,
in the judgment of DIGITAL, could be materially adverse to SHEFFIELD.
(g) CLOSING UNDER STOCK PURCHASE AGREEMENT. Strong Win Limited, a
British Virgin Islands corporation, shall have completed the purchase of
6,076,116 shares of the issued and outstanding common stock of SHEFFIELD,
pursuant to the terms of a Stock Purchase Agreement dated July 21, 2004, by and
between Strong Win Limited and certain shareholders of SHEFFIELD.
ARTICLE VI
TERMINATION AND AMENDMENT
6.1 TERMINATION. This Agreement may be terminated at any time prior
to the Effective Time:
(a) by mutual consent of SHEFFIELD and DIGITAL;
(b) by either SHEFFIELD or DIGITAL if there has been a material breach
of any representation, warranty, covenant or agreement on the part of the other
set forth in this Agreement which breach has not been cured within five (5)
business days following receipt by the breaching party of notice of such
breach, or if any permanent injunction or other order of a court or other
competent authority preventing the consummation of the Exchange shall have
become final and non-appealable; or
(c) by either SHEFFIELD or DIGITAL if the Exchange shall not have been
consummated before August 31, 2004.
6.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement by either DIGITAL or SHEFFIELD as provided in Section 6.1, this
Agreement shall forthwith become void and there shall be no liability or
obligation on the part of any party hereto. In such event, all costs and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expenses.
6.3 AMENDMENT. This Agreement may be amended by mutual agreement of
SHEFFIELD, DIGITAL and the SHAREHOLDERS, provided that in the case of SHEFFIELD
and DIGITAL, any such amendment must authorized by their respective Boards of
Directors, and to the extent required by law, approved by their respective
shareholders. Any such amendment must be by an instrument in writing signed
on behalf of each of the parties hereto.
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6.4 EXTENSION; WAIVER. At any time prior to the Effective Time, the
parties hereto, by action taken or authorized by their respective Board of
Directors, may, to the extent legally allowed, (a) extend the time for the
performance of any of the obligations or other acts of the other parties
hereto, (b) waive any inaccuracies in the representations and warranties
contained herein or in any document delivered pursuant hereto and (c) waive
compliance with any of the agreements or conditions contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall
be valid only if set forth in a written instrument signed on behalf of such
party.
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ARTICLE VII
GENERAL PROVISIONS
7.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All of
the representations, warranties and agreements in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the Effective
Time for a period of three years from the date of this Agreement.
7.2 NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered personally, telecopied (which
is confirmed) or mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
(a) If to SHEFFIELD:
c/o Mid-Continental Securities Corp
X/X Xxx 000000
Xxxxxx, Xxxxxxx 00000-0000
(b) If to DIGITAL:
15/F East Wing
Sincere Insurance Xxxxxxxx
0 Xxxxxxxx Xxxx, Xxxxxxx
Xxxx Xxxx
(c) If to the SHAREHOLDERS, at their respective addresses specified on
Exhibit A.
7.3 INTERPRETATION. When a reference is made in this Agreement to
Sections, such reference shall be to a Section of this Agreement unless
otherwise indicated. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words "include", "includes" or
"including" are used in this Agreement, they shall be deemed to be followed by
the words "without limitation". The phrase "made available" in this Agreement
shall mean that the information referred to has been made available if
requested by the party to whom such information is to be made available.
7.4 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each
of the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
13
7.5 ENTIRE AGREEMENT; NO THIRD PARTY BENEFICIARIES; RIGHTS OF
OWNERSHIP. This Agreement (including the documents and the instruments
referred to herein) constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter hereof, and is not intended to confer upon any
person other than the parties hereto any rights or remedies hereunder.
7.6 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Delaware without regard to principles
of conflicts of law. Each party hereby irrevocably submits to the jurisdiction
of any Delaware state court or any federal court in the State of Delaware in
respect of any suit, action or proceeding arising out of or relating to this
Agreement, and irrevocably accept for themselves and in respect of their
property, generally and unconditionally, the jurisdiction of the aforesaid
courts.
7.7 NO REMEDY IN CERTAIN CIRCUMSTANCES. Each party agrees that,
should any court or other competent authority hold any provision of this
Agreement or part hereof or thereof to be null, void or unenforceable, or order
any party to take any action inconsistent herewith or not to take any action
required herein, the other party shall not be entitled to specific performance
of such provision or part hereof or thereof or to any other remedy, including
but not limited to money damages, for breach hereof or thereof or of any other
provision of this Agreement or part hereof or thereof as a result of such
holding or order.
7.8 PUBLICITY. Except as otherwise required by law or the rules of
the SEC, so long as this Agreement is in effect, no party shall issue or cause
the publication of any press release or other public announcement with respect
to the transactions contemplated by this Agreement without the written consent
of the other party, which consent shall not be unreasonably withheld.
7.9 ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of and be enforceable by
the parties and their respective successors and assigns.
14
IN WITNESS WHEREOF, this Agreement for Share Exchange has been signed by
the parties set forth below as of the date set forth above.
SHEFFIELD PRODUCTS, INC
By: /s/ Xxxxxxx Xxx, President
Date: August 13, 2004
DIGITAL NETWORK ALLIANCE HOLDINGS (BVI) INC
By: /s/ Xxxxxx Xxxx, Director
Date: August 13, 2004
15
DIGITAL NETWORK ALLIANCE HOLDINGS (BVI) INC SHAREHOLDERS
/s/ Xxxxxxx Xxx Xxxx Xxxx
Date: August 13, 2004
/s/ Xxxxxx Xxxx Chi Fai
Date: August 13, 2004
/s/ Xxxxx Xxxx Xxx Ping
Date: August 13, 2004
/s/ Xxxxxxx Xxx Chee Keong
Date: August 13, 2004
/s/ Strong Win Limited
Date: August 13, 2004
/s/ Xxxxxx Xxx Xxxxxx
/s/ Mid-Continental Securities Corp
Date: August 13, 2004
/s/ Xxxxxxxx X. Xxxxxx
Date: August 13, 2004
/s/ Xxxx Xxxxx
Date: August 13, 2004
/s/ Keen Associates Limited
Date: August 13, 2004
/s/ Topworth Assets Limited
Date: August 13, 2004
16
Exhibit A
SHAREHOLDERS OF DIGITAL NETWORK ALLIANCE HOLDINGS (BVI) INC:
NAME SHARES OF DIGITAL POST-EXCHANGE SHARES OF
NETWORK SHEFFIELD
Xxxxxxx Xxx Xxxx Xxxx 1,625 2,152,924
1/F, Xiu Ping Commercial Building
104 Jervois Street
Xxxxxx Xxx
Hong Kong
Xxxxxx Xxxx Chi Fai 1,625 2,152,924
Xxxx X, 00/X, Xxxxx 0,
Xxxxxxx Garden
Tsuen Wan, N.T.
Hong Kong
Xxxxx Xxxx Xxx Ping 1,359 1,800,507
1/F, Xiu Ping Commercial Xxxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx Xxx
Xxxx Xxxx
Xxxxxxx Xxx Chee Keong 1,393 1,845,553
1/F, Xiu Ping Commercial Xxxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx Xxx
Xxxx Xxxx
Strong Win Limited 831 1,100,972
1/F, Xiu Ping Commercial Xxxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx Xxx
Xxxx Xxxx
Xxxxxx Xxx Xxxxxx 754 998,957
Xxxx 00X0, 00xx Xxxxx, Xxxxx X, Xxxxx Xxxxxx Lodge
10 Hong Pak Path
Quarry Bay, Hong Kong
Mid-Continental Securities Corp 528 699,534
X.X. Xxx 000000
Xxxxxx, Xxxxxxx 00000-0000
Xxxxxxxx X. Xxxxxx 302 400,112
X.X. Xxx 000000
Xxxxxx, Xxxxxxx 00000-0000
75 99,365
Xxxx Xxxxx
00-00, Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Keen Associates Limited 754 998,956
Xxxx 00X, 00xx Xxxxx, Xxxx Xxxx Mansion, 0 Xxx Xx Xxxxxx, Xxxxxxxx Xxx
Xxxx Xxxx
Topworth Assets Limited 754 998,956
Rm 0000-00, 00xx Xxxxx, Xxxxxxxxx Tower, The Landmark, 00 Xxxxx'x Xxxx Xxxxxxx,
Xxxx Xxxx
TOTAL 10,000 13,248,760
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