Exhibit 10.11
SHARE PURCHASE AGREEMENT
THIS AGREEMENT made effective as of the 2nd day of January, 1997
AMONG
IT STAFFING LTD., an Ontario Corporation (hereinafter called IT)
And
Xxxx Xxxxxx Xxxxxx, an individual resident in the Town of Rockwood, in the
Province of Ontario (hereinafter called "vendor")
And
Systemsearch Consultants Inc., an Ontario Corporation (hereinafter called
"Systems")
And
Systems PS Inc., an Ontario Corporation (hereinafter called "PS")
WHEREAS:
Xxxx Xxxxxx is the legal beneficial owner of 100% of the issued and outstanding
shares in capital stock of both Systems and PS.
IT desires to acquire, on the terms and conditions as set forth below, 100% of
the issued and outstanding shares in the capital stock of both Systems and PS.
The Vendor desires to sell, on the terms and in the manner set forth below, 100%
of the issued and outstanding shares in the capital stock of both Systems and
PS.
The Vendor, as a consequence of the payment of the purchase price will become a
significant shareholder of IT.
NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the premises set
forth above, the mutual covenants and agreements and such other good and
valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
PURCHASE OF SHARES
(A) Closing. The Parties agree to use their best efforts towards the
closing of this agreement on or before March 16th, 1998 but in any
event no later than April 30th, 1998 at the offices of IT. The Vendor
and IT may agree in writing to close the transaction at another time
and place;
(B) Purchase Price is $550,000 paid as follows:
The aggregate purchase price for the issued and outstanding shares in
the capital stock of Systems and P.S. is $550,000.00 and is to be paid
as follows
i) A deposit in the sum of $5,000.00.
ii) On closing, a further deposit of $145,000 by
certified cheque
iii) On or before closing, 133,333 shares in the capital
stock of IT resulting in percentage ownership to Xxxx
Xxxxxx on closing of 13.3 percent of all of
outstanding and issued shares in the capital stock of
IT.
iv) IT herein guarantees that the dollar value of the
133,333 shares at the time of a listing on a Public
Exchange based on the share issue price therein shall
have a minimum value of $400,000.00, on the terms of
this agreement, or in the alternative sufficient
shares will be issued to the Vendor, such that the
Vendor receives a total minimum consideration of
$400,000.00.
v) Said shares shall be issued to the Vendor and held in
escrow until closing of this transaction and until
the shares have been listed on a public exchange.
vi) Delivery of share certification. On closing the
Vendor shall deliver to IT share certificates
representing 100% of the issued and outstanding
shares in Systems and PS duly endorsed in blank for
transfer to IT and the share certificates are to be
held in escrow pending the listing of the shares of
IT on a public exchange
vii) The parties hereby agree that in the event IT is
unsuccessful in listing its shares on a public
exchange within fifteen months of closing, then the
shares of IT will be released from escrow to IT and
the shares of Systems and PS shall be released from
escrow to Xxxx Xxxxxx and Xxxx Xxxxxx shall be
entitled to retain his deposits as liquidated damages
and not as penalty.
CONDUCT OF BUSINESS
Interim Operation from January 2, 1997 until the Closing Date:
(a) The Vendor, Systems and PS shall conduct the Business
in the ordinary course, completely autonomously but
they shall not make any material change in the
customary terms and conditions upon which they
historically did business unless otherwise agreed by
IT and the Vendors.
(b) The Vendor, Systems and PS shall use their best
effort to preserve the Business organization and
goodwill of the suppliers, staff, customers and
Business of Systems and PS.
DUE DILIGENCE
(A) Period. The purchaser shall have until February 16,1998 to conduct its
investigations and at its sole discretion, by written notice and within
the time specified, cause this agreement to be null and void.
VENDOR COVENANTS
The Vendor hereby covenants:
(a) That it shall not take any action or omission which
will in any way prejudice the completion of this
transaction;
(b) That upon acceptance of this agreement, a binding
contract of purchase and sale is constituted;
(c) That it has not been induced into entering into this
Agreement by oral or written representation or
promises except as set out in the Agreement;
(d) That it is not now and will not be on Closing Date a
non-resident as defined in the Income Tax Act;
(e) There is no material information or knowledge which
has been withheld from IT relating to either Systems
or PS, which if known would cause the purchaser to
alter his decision to purchase the shares of either
Systems or PS.
IT ACKNOWLEDGEMENTS
IT hereby acknowledges:
(a) The government filings for both GST and Corporate
taxes are delinquent.
(b) Xxxx Xxxxxxx has a claim outstanding that is not
reflected in the books of Systems and PS.
(c) All professional fees related to this acquisition are
for the account of Systems and PS. and will be paid
on closing.
(d) That there is a management salary liability of
$30,000 pertaining to 1996 which will be paid asap.
And IT acknowledges that it will be responsible for same after closing.
IT shall enter into an employment or consulting agreement with Xxxx Xxxxxx or
Xxxx X. Xxxxxx Enterprises Inc. as Xxxx Xxxxxx may direct, substantially in the
form annexed.
CONFIDENTIALITY
IT, Vendor, Systems and PS agree that any information obtained during
examination of the financial records and/or other legal documentation is
confidential and warrant that any such information will not be transmitted to
anyone other than their respective advisors.
If any term, representation or condition of this Agreement is determined invalid
or to any extent unenforceable, that provision insofar as it related to that
party or circumstances shall be deemed not to be included herein and the balance
of this Agreement shall remain in full force and effect and continue to be
binding upon the parties hereto.
IN WITNESS WHEREOF the partied here to have duly executed this Agreement as of
the 4th day of February, 1998.
IT STAFFING LTD.
Per: /s/ Declan French
------------------------------
SYSTEMSEARCH CONSULTANTS INC. SYSTEMS PS INC.
Per: /s/ Xxxx Xxxxxx Xxxxxx Per:/s/ Xxxx Xxxxxx Xxxxxx
------------------------------ ---------------------------
/s/ Xxxx Xxxxxx Xxxxxx
------------------------------
Xxxx Xxxxxx Xxxxxx
AMENDING AGREEMENT
THIS AGREEMENT made as of January 2, 1997
A M O N G:
IT STAFFING LTD.,
a corporation existing under
the laws of the Province of Ontario
("IT")
- and -
Xxxx Xxxxxx Xxxxxx, an individual, resident in the
Town of Rockwood, in the Province of Ontario
("Vendor")
- and-
SYSTEMSEARCH CONSULTING SERVICES INC.,
a corporation existing under
the laws of the province of Ontario
("Systemsearch")
- and -
SYSTEMSEARCH PS INC.
a corporation existing under
the laws of the Province of Ontario
("PS")
- and -
Declan French, an individual, resident in the
City of Toronto, in the Province of Ontario
FOR VALUE RECEIVED the parties agree as follows:
1. INTERPRETATION
1.1 Definitions. In this Agreement:
(a) "Share Purchase Agreement" means the agreement dated effective as of January
2, 1997 among IT, Vendor, Systemsearch and PS without regard to this Agreement;
(b) All other capitalized terms used in this Agreement have the meanings given
to them in the Share Purchase Agreement.
1.2 Headings. The division of this Agreement into sections and the insertion of
headings are for the convenience of reference only and are not to affect the
construction or interpretation of this Agreement.
1.3 References. Unless otherwise specified, all references to Sections in this
Agreement are to sections of the Share Purchase Agreement.
1.4 Governing Law. This Agreement is governed by, and is to be construed and
interpreted in accordance with, the laws of the Province of Ontario and the laws
of Canada applicable in the Province of Ontario.
1.5 One Agreement. This Agreement amends the Share Purchase Agreement. This
Agreement and The Share Purchase Agreement shall be read together and constitute
one agreement with the same effect as if the amendments made by this Agreement
had been contained in the Share Purchase Agreement as of the date of this
Agreement.
1.6 Conflict. If there is a conflict between any provision of this Agreement and
any provision of the Share Purchase Agreement, the relevant provision of this
Agreement is to prevail.
2. AMENDMENTS
2.1 The parties confirm that Systemsearch is the proper party to the Share
Purchase Agreement and acknowledge and agree that the reference in the Share
Purchase Agreement to "Systemsearch Consultants Inc." was meant to be a
reference to Systemsearch.
2.2 Section (B) iv) of the Share Purchase Agreement under the heading "Purchase
Of Shares" is amended by deleting the figure "$4000,000" in the third and fifth
lines thereof and inserting instead "$3.00 per share"
2.3 Section (B) of the Share Purchase Agreement under the heading "Purchase of
Shares" is amended by deleting subsections v), vi) and vii) in their entirety.
2.4 The Share Purchase Agreement is amended by adding a new Section (C) under
the heading "Purchase of Shares" as follows:
(C) Failure of IT to Gain Listing on Stock Exchange
1. Re-Purchase of IT Shares
1.1 In the event that the 133,000 common shares of IT (the "IT Shares")
to be issued to the Vendor hereunder are not listed and posted for
trading on a North American stock exchange (a "Public Exchange") prior
to July 31, 1999, or in the event that the value of the IT Shares owned
by the Vendor on the date on which they are listed and posted for
trading on a Public Exchange (the "Listing Date") is less than $3.00
per share and IT is unable to fulfil its obligations to Vendor under
Section B iv), IT shall, upon written request from the Vendor, which
request shall be made within 30 days of the earlier of the Listing Date
and July 31, 1999, purchase from Vendor for cancellation all of the IT
Shares then owned by the Vendor (the "Re-Purchased Shares") for a
purchase price of $3.00 per share (the "Purchase Price"), subject to
Section 1.4 below.
1.2 The closing of the transaction of purchase and sale contemplated in
Section C 1.1 of this Agreement shall take place at the offices of IT
at such time and date as shall be mutually agreed by the parties, but
not later than 10 days after July 31, 1999 (the "IT Closing Date").
1.3 On the IT Closing Date:
(a) the Vendor shall deliver to IT the certificate or certificates
representing the Re-Purchased Shares, together with a duly
endorsed share transfer instrument and a representation and
warranty executed by Vendor in favour of IT that the
Re-Purchased Shares are owned of record and beneficially by
Vendor with a good and marketable title thereto, free and
clear of all encumbrances of any kind;
(b) IT shall deliver to the Vendor the Purchase Price in cash or
by certified cheque or bank draft payable to the Vendor; and
(c) If requested by the Vendor, IT shall cause Systemsearch and PS
to change their respective names and shall do all such acts
and things as are reasonably required and within its power in
connection therewith to make such names available for use by
the Vendor.
1.4 If, for any reason other than the fault of the Vendor, IT fails to
complete the purchase of the Re-Purchased Shares on the IT Closing
Date, then in consideration of the sum of two dollars and other good
and valuable consideration, including the benefit derived by French
from the completion of the transactions contemplated by the Share
Purchase Agreement in his capacity as a shareholder of IT, French
agrees to purchase from the Vendor all of the Re-Purchased Shares for
the Purchase Price and upon payment of the Purchase Price by French, IT
shall have no further rights or obligations to the Vendor hereunder,
except under Section 1.6 (C).
1.5 The closing of the transaction of purchase and sale contemplated in
Section C 1.2 of this Agreement shall take place at the offices of IT
at such time and date as shall be mutually agreed by the parties, but
not later than 5 days after the IT Closing Date (the "French Closing
Date").
1.6 On the French Closing Date:
(a) the Vendor shall deliver to French the certificate or
certificates representing the Re-Purchased Shares, together
with a duly endorsed share transfer instrument and a
representation and warranty executed by Vendor in favour of
French that the Re-Purchased Shares are owned of record and
beneficially by Vendor with a good and marketable title
thereto, free and clear of all encumbrances of any kind; and
(b) IT shall deliver to the Vendor the Purchase Price in cash or
by certified cheque or bank draft payable to the Vendor; and
(c) If requested by the Vendor, IT shall cause Systemsearch and PS
to change their respective names and shall do all such acts
and things as are reasonably required and within its power in
connection therewith to make such names available for use by
the Vendor.
1.7 Notwithstanding anything in the Employment Agreement dated
February 11, 1998 (the "Employment Agreement") between the
Vendor and IT, upon the completion of the transaction of
purchase and sale of the Repurchased Shares, the Employment
Agreement shall be terminated and
neither the Vendor nor IT shall have any further obligations
to the other except with respect to such remuneration as shall
have been earned by the Vendor pursuant to the Employment
Agreement prior to such termination and the Vendor shall not
be restricted from competing with the business of IT.
3.0 GENERAL
3.1 Benefit of Agreement. This Agreement enures to the benefit of and
binds the parties and their respective heirs, executors,
administrators, personal and legal representatives successors and
permitted assigns.
3.2 Further Assurances. Each party shall from time to time promptly
execute and deliver all further documents and take all further
action reasonably necessary or appropriate to give effect to the
provisions and intent of this Agreement.
3.3 Execution in Counterparts. This Agreement may be executed and
delivered in any number of counterparts, each of which when
executed and delivered is an original but all of which taken
together constitute one and the same instrument.
IN WITNESS WHEREOF the parties have executed this Agreement as
of the date first written above.
IT STAFFING LTD SYSTEMSEARCH CONSULTING
SERVICES INC.
By: /s/ Xxxx Xxxxxx Xxxxxx By: /s/ Xxxx Xxxxxx Xxxxxx
----------------------- --------------------------
SYSTEMSEARCH PS INC.
By: /s/ Xxxx Xxxxxx Xxxxxx /s/ Xxxx Xxxxxx Xxxxxx
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Xxxx Xxxxxx Xxxxxx
