BETWEEN Idolmace Pty Ltd ACN 069 900 492 of Unit 8, Level 1, 11 Lord Street, Botany in the State of New South Wales 2019
Exhibit
99.1
THIS
DEED
is made
on 18
October 2005
| BETWEEN |
Idolmace
Pty Ltd ACN 069 900 492 of
Xxxx 0, Xxxxx 0, 00 Xxxx Xxxxxx, Xxxxxx in the State of New South
Wales
2019
|
Xxxxxxxxxxx
Xxxxxx Xxxxxx
of 00
Xxxxxx Xxxxxxxx, Xxxxxxxx in the State of New South Wales 2214
Xxxxxx
Xxxxx Xxxxxx
of 00
Xxxxxx Xxxxxxxx, Xxxxxxxx in the State of New South Wales 2214
Konstantflo
Sales Pty Ltd ACN
002 428 202 of
Xxxxx
0, Xxxxxxxx Xxxxxxxxx Bank House, 000 Xxxxxx Xxxxxx, Xxxxxx in the State of
New
South Wales 2000
Creative
Consulting Pty Ltd ACN
002 019 829 of
00
Xxxxxxx Xxxx, Xxxxxxxx in the State of New South Wales 2234
Xxxx
Xxxxxx Pty Limited ACN 109 778 421
of 00
Xxxxxx Xxxxxx Newport in the state of Xxxxxxxx
Xxxx
Holdings Pty Limited ACN 000 000 000
of 0
Xxxxxxx Xxxxxx Xxxxxxxxxx in the state of New South Wales.
(together
referred to as the “Vendor”)
| AND |
WLG
(Australia) Pty Ltd
of
Xxxxx 0, 00 Xxxxxx Xx, Xxxxxx in the state of New South Wales
2000
(“Purchaser”)
|
| AND |
Wako Logistics Group,
Inc.
of
000 Xxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxx, X.X.X.
(“Wako”)
|
|
AND
|
Asean
Cargo Services Pty Limited ACN 002 739 657 of
Xxxxx 0, 00 Xxxxxx Xxxxxx, Xxxxxx in the State of New South
Wales 2000
(hereinafter referred to as the
“Company”)
|
RECITALS
| A. |
The
Company:
|
| (a) |
is
a company duly incorporated in New South Wales; and
|
| (d) |
carries
on the Business.
|
| B. |
The
Vendors are the legal and beneficial owners of the Sale Shares
and are
able and entitled to sell, the Sale
Shares.
|
| C. |
The
Vendor has agreed to sell, and the Purchaser has agreed to purchase,
the
Sale Shares for the consideration and on the terms and subject
to the
conditions specified in this
document.
|
IT
IS AGREED
| 1. |
DEFINITIONS
AND INTERPRETATION
|
| 1.1 |
Definitions
|
In
this
document, unless the context otherwise requires:
“Accounts
Date”
means 30
June 2005;
“Accounts”
means
the audited balance sheet, profit and loss account and cash flow statement
of
the Company drawn at and to the Accounts Date, annexed as Annexure
A;
“Assets”
means
all the assets of the Company;
“Authorisation”
includes:
| (a) |
a
consent, registration, filing, agreement, notice of non-objection,
notarisation, certificate, licence, approval, permit, authority or
exemption from, by or with a Government Body;
and
|
| (b) |
in
relation to anything which a Government Body may prohibit or restrict
within a specific period, the expiry of that period without intervention
or action.
|
“Bankruptcy”
means:
|
(a)
|
in
relation to any corporation, any event occurring in relation to that
corporation of the kind set out under the definition of “externally-administered
body corporate”
in
Section
9
of
the Corporations Act;
|
|
(b)
|
in
relation to an individual, that person becoming insolvent under
administration as defined in Section
9
of
the Corporations Act; and
|
2
|
(c)
|
in
relation to any person, anything analogous to or having a similar
affect
to anything described above in this definition under the law of any
relevant jurisdiction;
|
“Business”
means
the business carried on by the Company;
“Business
Day”
means
any day on which trading banks are open for business within New South Wales
and
which is not a public holiday;
“Business
Premises”
means
all the land or buildings that are owned, leased or occupied by the
Company;
“Business
Plan”means
the
detailed plan of the anticipated operations and conduct of the Company,
including working capital requirements, for the period from 1 October 2005
to 31
December 2006;
“Completion”
means
the completion of the sale and purchase of the Sale Shares in accordance with
clause
7;
“Completion
Date”
means
(subject to Clause 7.8) 1 October 2005 or a Business Day on or before 1 December
2005 as agreed to between the Vendor and the Purchaser;
“Confidential
Information”
means
any information that has been or will be made available by the Vendor to the
Purchaser of any kind and however recorded relating to the affairs of the
Company or any of its subsidiaries, or by the Purchaser to the Vendor of any
kind and however recorded relating to the affairs of the Purchaser or any of
its
subsidiaries;
“Consideration
Shares”
means up
to 3,500,000 shares in the capital of Wako, which forms part of the Purchase
Price and which are to be allotted to the Vendors in accordance with Clause
4.
“Corporations
Act”
means
the Corporations Act of each jurisdiction in Australia;
“Director”
means a
director of the Company;
“Disclosure
Letter”means
the
letter from the Vendor, delivered to the Purchaser before the signing of this
agreement by all parties and which contains disclosures about the
Warranties;
3
“Earn
Out Accounts”
means
the financial accounts of the Company in respect of the Business from 1 October
2005 to 31 December 2006 together with a calculation of the Earn Out EBIT which
shall, except as provided in Schedule 6 be prepared on the same basis as the
Accounts;
“Earn
Out EBIT”
means
the normalised earnings before interest and tax of the Company for the period
1
October 2005 to 31 December 2006 calculated in accordance with Schedule
3;
“Earn
Out Payment”
means
the amount (if any) calculated in accordance with clause 6 and Schedule 3,
or
Schedule 3A as required by Section 19.6;
“Earn
Out Shares”
means
the shares in the capital of Wako to be allotted to the Vendor pursuant to
clause 6 and Schedule 3,
or
Schedule 3A, whichever is applicable;
“Earn
Out Payment Date”means
the
date pursuant to clause 6.4
“Effective
Control”
means,
in relation to a corporation, the power (whether legally enforceable or not)
to
control, whether directly or indirectly:
|
(a)
|
the
composition of the board of directors of that
corporation;
|
|
(b)
|
the
voting rights of a simple majority of the voting shares of the
corporation; or
|
|
(c)
|
the
management of the affairs of that
corporation;
|
“Effective
Date”
means 1
October 2005;
“Effective
Day Accounts”
means
the balance sheet and profit and loss statement of Company drawn at and to
30
September 2005;
“Employees”
mean the
employees of the Company listed in Schedule 7;
“Employee
Benefit Plans”
means
any employment contract, bonus, incentive, deferred compensation, loan,
retirement, group life or health insurance, disability or other employee benefit
plan, or anything analogous thereto with the exception of any statutory
entitlements relating to employment;
4
“Encumbrance”
means
any mortgage, pledge, lien, charge, assignment, hypothecation, security
interest, title retention, preferential right or trust arrangement and any
other
security agreement or arrangement, equity, adverse interest or third party
claim;
“Government
Body”
means:
| (a) |
any
person, agency or other thing exercising an executive, legislative,
judicial or other government function of any country or political
subdivision of any country;
|
|
(b)
|
any
public authority constituted by or under a law of any country or
political
subdivision of any country; and
|
|
(c)
|
any
government deriving a power directly or indirectly from any other
Government Body as defined above;
|
“GST
Law”
has the
same meaning as in A New Tax System (Goods and Services Tax) Xxx
0000.
“Intellectual
Property Rights”
means
all inventions, patents, trade marks, designs and business or trade names or
similar Intellectual Property Right, or any right thereto, owned by, or
otherwise the property of the Company;
“Insolvency
Event”
means:
| (a) |
the
Bankruptcy of the person concerned;
|
| (b) |
the
appointment of an official manager in respect of all or any part
of the
property of the person
concerned;
|
| (c) |
the
entry by the person concerned into a scheme of arrangement or a
composition with, or assignment for the benefit of, all or any class
of
its creditors, or a moratorium involving any of
them;
|
| (d) |
the
person concerned being, or stating that it is, unable to pay its
debts
within the meaning of Part 5.4 Division 2 of the Corporations
Act;
|
| (e) |
the
person concerned being or stating that it is unable to pay its debts
when
they fall due;
|
5
| (f) |
the
appointment of a receiver or receiver and manager in respect of the
person
concerned or any part of its
property;
|
| (g) |
the
making of a winding up order, or the passing of or attempted passing
of a
resolution for winding up, in respect of the person concerned except
for
the purposes of reconstruction;
|
| (h) |
an
application being made (which is not dismissed within five Business
Days)
for an order, resolution being passed or proposed, a meeting being
convened or any other action being taken to cause anything described
above; and
|
| (i) |
anything
analogous to or of a similar effect to anything described above under
the
law or any relevant jurisdiction;
|
“Inventory”
means
| (a) |
the
business names owned or currently used by the
Company;
|
| (b) |
all
trade marks owned or currently used by the
Company;
|
| (c) |
all
confidential information owned or currently used by the
Company;
|
| (d) |
all
patents, patent applications, discoveries, inventions, registered
or
unregistered designs, copyright and similar rights owned or currently
used
by the Company.
|
“Item”
means an
item listed in Schedule
1;
“Leased
Premises”
means
the premises leased by the Company for the conduct of the Business as specified
in Item
7;
“Long
Term Receivables”
means
all receivables and trade debts owed to the Company as at 30 September 2005
and
outstanding more than 60 days, including, without limitation, the note
receivable from Warehouse Solutions International Pty Limited (ACN
100
603 889) for $160,000 and from Asean Cargo Services (Qld) Pty Limited (ACN
069
561 128) for $211,463 or any part of any such receivables.
“Losses”
means
any and all losses, claims, actions, liabilities, damages, expenses, diminutions
in value or deficiencies of any kind or character (whether or not known or
asserted on or before Completion) including, without limitation, all interest
and other amounts payable to third parties. all liabilities on account of Taxes
and all legal and other expenses reasonably incurred in connection with
investigating or defending any claims or actions, whether or not resulting
in
any liability and all amounts paid in settlement of claims or
actions;
6
“Permitted
Encumbrances”
means
the following Encumbrances:
| (a) |
the
Encumbrances specified in Item
5;
|
| (b) |
any
lien arising by operation of law, but not arising through any default
or
omission on the part of the
Company;
|
| (c) |
any
title retention in respect of purchases of Stock made in the ordinary
course of business trading; and
|
| (d) |
any
Encumbrance which, on or before Completion, the Purchaser agrees
in
writing to be a Permitted
Encumbrance;
|
“Plant
and Equipment”
means
all plant, equipment, motor vehicles, machinery, furniture, fixtures and
fittings owned or used by the Company and its Subsidiaries at the Signing
Date.
“Proceeding”
includes
any claim, suit or litigation whether:
| (a) |
civil,
criminal, administrative or by way of
arbitration;
|
| (b) |
before
any court, tribunal, governmental board, commission, authority, agency,
department or officer;
|
“Property
Leases”
means
the leases in respect of the Leased Premises copies of which are annexed and
marked “B1”
and
“B2”;
“Purchase
Price”
means
the consideration paid to the Vendors as set out in clause 4, being the
Consideration Shares and the Earn
Out
Shares, which are valued at A$1.00 each.
“Receivable
Shares”
means
the sum of the Consideration Shares, if any, for which issue is to be deferred
pursuant to clause 4.5 and 4.6 hereof; and the Consideration Shares, if any,
which shall be returned to the Purchasers pursuant to clause 4.7
7
“Records”
means
all the accounts, books, ledgers, income tax returns, financial and other
material records of every kind kept by, or in relation to, the Company and
its
affairs whether recorded or stored in written form, electronically or
otherwise;
“Revenue
Authority”
means
any body or organisation (whether Commonwealth, State, Municipal or otherwise)
located in a country where the Company carries on the Business having, from
time
to time in relation to the Company’s operations in Australia, a responsibility
for the administration or collection of Taxes;
“Sale
Shares”
means
the shares in the Company specified in Item 6 (which, for the avoidance of
doubt, shall be all the issued shares in the Company) and, subject to the terms
of this document, all rights attached or attaching as at 1 October
2005;
“Shareholder
Control”
means
any voting power or other rights that a party is directly or indirectly able
to
exercise in respect of the Company by the legal or beneficial ownership of
shares in the Company or otherwise;
“Signing
Date”
means
the date of this document;
“Stock”
means
the finished goods, stock, raw materials, work-in-progress, spare parts,
stock-in-transit and other inventories of the Company;
“Tax”
means a
tax, levy, charge, impost, fee, deduction, withholding or duty of any nature,
including, without limitation, stamp and transaction duty or any goods and
services tax (including GST), value added tax or consumption tax, which is
imposed or collected by a Government Body, except where the context requires
otherwise. This includes, but is not limited to, any interest, fine, penalty,
charge, fee or other amount imposed in addition to those amounts.
“Tax
Liability”
includes
any Tax levied on income and all liabilities by virtue of the loss of, or a
failure to obtain an allowance, credit or relief from Tax which would otherwise
have been available and any counteraction of a Tax advantage obtained or alleged
to have been obtained.
“Wako
Group Trade Payables”means
money owing by any Wako Group company to any other Wako Group company in respect
of services provided in the normal course of business.
8
“Wako
Group”
means
the Purchaser, Wako and any company in which the Wako owns more than 50% of
its
voting shares, or any company of which Wako has effective control of such
company (collectively “Wako Group”).
“Warranties”
means
the representations, warranties and agreements set out in Schedule
2.
| 1.2 |
Construction
|
In
this
document, unless the context otherwise requires:
| (a) |
words
importing:
|
| (i) |
the
singular include the plural and vice versa;
|
|
(ii)
|
any
gender include the other
genders;
|
| (b) |
an
obligation of 2 or more parties shall bind them jointly and
severally;
|
|
(c)
|
if
a word or phrase is defined, cognate words and phrases have
corresponding
definitions;
|
| (d) |
a
reference to:
|
| (i) |
a
person includes a corporation and bodies
politic;
|
| (ii) |
a
person includes the legal personal representatives, successors and
assigns
of that person;
|
| (iii) |
a
statute, ordinance, code or other law includes regulations and other
statutory instruments under it and consolidations, amendments,
re-enactments or replacements of any of them made by any legislative
authority;
|
| (iv) |
this
or any other document includes the document (together with all Schedules,
Annexures and appendices thereto) as varied or replaced and
notwithstanding any change in the identity of the
parties;
|
9
| (v) |
writing
includes any mode of representing or reproducing words in tangible
and
permanently visible form, and includes telex and facsimile
transmission;
|
| (vi) |
time
is to local time in Sydney,
Australia;
|
| (vii) |
any
thing (including, without limitation, any amount) is a reference
to the
whole or any part of it and a reference to a group of things or persons
is
a reference to any one or more of
them;
|
| (viii) |
a
month and cognate terms means a period commencing on any day of a
calendar
month and ending on the corresponding day in the next calendar month
but
if a corresponding day does not occur in the next calendar month
the
period shall end on the last day of that next calendar
month;
|
| (ix) |
a
right includes a remedy, authority or
power;
|
| (x) |
“$”and
“dollar”
is
a reference to the lawful currency of the Commonwealth of
Australia;
|
| (xi) |
“to
the best of the knowledge and belief”
of
a person means “to the best of the knowledge and belief after due enquiry
where knowledge of a fact would prompt enquiry of a reasonable person” of
that person and where that person is the Vendor it includes the Company
also;
|
| (xii) |
“deliver”
includes procure the delivery of;
|
| (xiii) |
“sell”
includes procure the sale of;
|
| (xiv) |
“party”
means a party to this document;
|
| (xv) |
“Schedule”
or
“Annexure”
means the corresponding Schedule or Annexure to this
document;
|
| (e) |
where
time is to be reckoned by reference to a day or event, that day or
the day
of that event shall be excluded;
and
|
10
| (f) |
where
the day for the doing of any act, matter or thing to be done pursuant
to
this document falls on a day which is not a Business Day, such act,
matter
or thing shall be done on the Business Day immediately
thereafter.
|
| 1.3 |
Headings
|
Headings
shall be ignored in construing this document.
| 2. |
SALE
AND PURCHASE
|
The
Vendor agrees to sell and transfer, legally and beneficially, free from all
Encumbrances, the Sale Shares (together with all rights attached to them as
at 1
October 2005 and all rights accruing to them after that date) to the Purchaser
for the Purchase Price and the Purchaser agrees to buy and take transfers of
the
Sale Shares in accordance with the terms of this document.
| 3. |
CONDITIONS
PRECEDENT
|
| 3.1 |
Conditions
Precedent
of the Purchaser
|
The
obligations of the Purchaser to complete the sale and purchase of the Sale
Shares are subject to the satisfaction of the following conditions precedent
for
the benefit of the Purchaser on or before the Completion Date:
| (a) |
The
National Australia Bank providing its consent to this transaction
to the
extent same is required under its Registered Charge No 761099;
and
|
| (b) |
the
Vendor provides the Purchaser with the Effective Day Accounts in
a form
agreed by the Purchaser and Vendor.
|
| 3.2 |
Conditions
Precedent of the Vendor
|
The
obligations of the Vendor
to
complete the sale and purchase of the Sale Shares are subject to the
satisfaction of the following conditions precedent for the benefit of the Vendor
on or before the Completion Date:
11
| (a) |
The
National Australia Bank providing its consent to this transaction
to the
extent same is required under its Registered Charge No 761099;
and
|
| (b) |
Each
representation and warranty of the Purchaser and/or Wako made in
this
Agreement that is qualified as to materiality or material adverse
effect
shall be true and correct in all respects and each such representation
and
warranty that is not so qualified shall be true and correct in all
material respects on the Completion Date, as though made on such
date;
and
|
| (c) |
The
execution by the Vendor and Wako of a Rights Registration Agreement
in a
form to be agreed between Wako and the
Vendor.
|
| 3.3 |
Non-Fulfilment
|
If
the
conditions referred to in clause
3.1 and
clause
3.2 are
not
fulfilled or waived under clause
3.4
on or
before the Completion Date (or such later date as the parties agree) then this
document automatically terminates and is of no further force or effect and
no
party will have any further obligations under this document other than
specifically contemplated by this document whether in accordance with
clause
16.2
or
otherwise, but the termination will not affect any right to claim in respect
of
this document of any party which has arisen before termination.
| 3.4 |
Fulfilment
by Waiver
|
A
condition referred to in clause
3.1 or
clause
3.2 is
waived
if and only if:
| (a) |
where
the condition is expressed to be for the benefit of a particular
party,
that party gives notice of waiver of the condition to the other party;
and
|
| (b) |
in
other cases, the parties agree in writing to waive the
condition.
|
| 3.5 |
Obligations
to Satisfy Conditions
|
The
Vendor, the Purchaser and Wako must use their respective best endeavours to
ensure that the conditions referred to in clause
3.1 and
clause
3.2 are
fulfilled on or before the Completion Date. This obligation imposed on a party
does not require that party to waive any condition under clause
3.4.
12
| 4. |
CONSIDERATION
|
| 4.1 |
Time
and Manner of Payment
|
The
Purchaser shall pay the Purchase Price, at the following times:
| (a) |
On
the Completion Date the Purchaser and Wako shall procure that the
Consideration Shares (less the Receivable Shares, if any) shall be
allotted to the Vendor in accordance with clause 4.3 to be apportioned
as
set out in Item
1;
and
|
|
(b)
|
On
the Earn Out Payment Date the Purchaser and Wako shall procure that
the
Earn Out Shares will be allotted to the Vendor in accordance with
Clause
4.4 to be apportioned as set out in Item
2.
|
| 4.2 |
Time
of the Essence
|
Time
shall be the essence of the payment and other obligations contained in
clause
4.1.
| 4.3 |
Consideration
Shares
|
| (a) |
The
Vendor agrees at Completion to subscribe for the Consideration Shares
constituting part of the Purchase Price (by executing a subscription
agreement in a form to be agreed between the Vendor and Wako).
|
| (b) |
The
Purchaser and Wako represents, warrants and covenants with the Vendor
that
on the allotment at Completion the Consideration Shares will rank
pari
passu in all respects with the then issued shares in the capital
of
Wako.
|
| (c) |
Wako
shall:
|
| (i) |
hold
a duly convened meeting of the directors of Wako at which it is
resolved:
|
| (A) |
to
allot and issue to the Vendor the Consideration Shares and
reserve for allotment to the Vendor the Earn Out Shares;
|
13
| (B) |
the
Consideration Shares are to rank from the Completion Date pari passu
in
all respects with the then existing issued shares in the capital
of
Wako;
|
| (C) |
to
register the Vendor or its nominee as the holder of the Consideration
Shares;
|
| (D) |
to
execute duly sealed share certificates for the shares constituting
the
Consideration Shares; and
|
| (ii) |
deliver
the share certificate constituting the Consideration Shares to the
Vendor
or its nominee; and
|
| (iii) |
do
and execute all other acts and documents which this document requires
the
Purchaser to do or execute at
Completion.
|
| 4.4 |
Earn
Out Shares
|
| (a) |
The
Vendor or its nominee agrees at the Earn Out Payment Date to subscribe
for
the Earn Out Shares constituting part of the Purchase Price (by executing
a subscription agreement in a form to be agreed between the Vendor
and
Wako).
|
| (b) |
The
Purchaser and Wako represents, warrants and covenants with the Vendor
that
on the allotment at the Earn Out Payment Date the Earn Out Shares
will
rank pari passu in all respects with the then issued shares of common
stock of Wako.
|
| (c) |
Wako
shall:
|
| (i) |
hold
a duly convened meeting of the directors of Wako at which it is
resolved:
|
| (A) |
to
allot and issue to the Vendor the Earn Out
Shares;
|
| (B) |
the
Earn Out Shares are to rank from the Earn Out Payment Date pari passu
in
all respects with the then existing issued shares of common stock
of
Wako;
|
14
| (C) |
to
register the Vendor or its nominee as the holder of the Earn Out
Shares;
|
| (D) |
to
execute duly sealed share certificates for the shares constituting
the
Earn Out Shares; and
|
| (ii) |
deliver
the share certificate constituting the Earn Out Shares to the Vendor
or
its nominee; and
|
| (iii) |
do
and execute all other acts and documents which this document requires
the
Purchaser to do or execute at the Earn Out Payment
Date.
|
| 4.5 |
Receivable
Shares
|
|
If
the net assets of the Company as disclosed in the Effective Day
Accounts
are less than $200,000 then Wako shall defer the issue of a number
of the
Consideration Shares to be calculated on the basis
of:
|
| 1 Consideration Share : |
A$1.00
of Long Term Receivables written off by the Company up to the Effective
Date (“Receivables Written Off”), as reflected in the Effective Day
Accounts.
|
|
4.6
|
Release
of Receivable Shares.
|
|
(a)
|
Subject
to paragraph (b), if, during the period from the Effective Date
to the
Earn Out Payment Date, the Company recovers any of the Receivables
Written
Off then the Purchaser shall immediately release to the Vendor
a
proportionate number of Receivable Shares on the basis
of:
|
| 1 Receivable Share : |
A$1.00
of Receivables Written Off
recovered.
|
|
(b)
|
Wako
is not required to issue the Receivable
Shares:
|
| (i) |
other
than in increments of 1,000 shares;
and
|
| (ii) |
more
than once in any given month.
|
15
| 4.7 |
Return
of Receivable
Shares.
|
|
(a)
|
If
the net assets at the Effective Date are greater than $200,000, and
all of
the Long Term Receivables as of the Effective Date are not collected
as of
December 31, 2006, a pro-forma adjustment shall be made to charge
off all
remaining amounts of such Long Term Receivables.
|
| (b) |
To
the extent the nets assets at the Effective Date would have been
less than
A$200,000 following such pro-forma adjustment, Vendors
shall:
|
| (i) |
return
one Consideration Share to Wako for each A$1.00 of Long Term Receivables
charged off as part of the pro-Forma adjustment;
and
|
| (ii) |
shall
covenant that the Vendors jointly shall retain sufficient Consideration
Shares to satisfy the maximum liability that may arise under this
clause
4.7
|
| 5. |
LOCK-UP
ARRANGEMENTS
|
| 5.1 |
TheVendor
shall not directly or indirectly during the Restraint Period
Deal in any
of the Consideration Shares or Deal in any interest or right
in respect of
any of the Consideration Shares nor do or omit to do any act
which would
have the effect of directly or indirectly transferring effective
ownership
or control of any of the Consideration Shares to any
person.
|
| 5.2 |
The
Vendor acknowledges that if this clause
5
is
contravened by the Vendor, in addition to the rights and remedies
of the
Purchaser at common law or in equity, Wako may refuse to acknowledge,
deal
with, accept or register any sale, assignment or transfer of
the
Consideration Shares or any part thereof or any interest or right
in
respect of the Consideration Shares or any part thereof in breach
of this
clause and the Vendor and any other person shall cease to be
entitled to
any dividends or voting rights in respect of those shares so
long as the
contravention subsists.
|
| 5.3 |
For
the purposes of this clause the following words have the following
meanings:
|
“Deal”
means:
| (a) |
sell, assign,
transfer, gift, create an Encumbrance over or otherwise dispose
of;
|
16
| (b) |
agree
or offer to sell, assign, transfer, gift, create an Encumbrance over
or
otherwise dispose of; or
|
| (c) |
enter
into any option which, if exercised, enables or requires the
vendor
to
sell, assign, transfer, gift or otherwise dispose
of.
|
“Restraint
Period”
means
the period from
1
October 2005 to 31 March 2007.
| 5.4 |
The
allottee of the Consideration Shares shall be entitled to sell
without any
restriction whatsoever the whole or part of the Consideration
Shares:
|
| (a) |
if
the By-Laws of the Purchaser or Wako are amended so that there is
a
diminution in value of the Consideration Shares either directly or
indirectly or they do not rank pari passu with all other shares of
the
common stock of Wako; or
|
| (b) |
if
there is a change in Effective Control of Wako, save for any change
that
arises from Wako’s common stock being publicly traded or
quoted.
|
| 6. |
EARN-OUT
ACCOUNTS
|
| 6.1 |
Preparation
of Earn-Out Accounts
|
| (a) |
The
Company will prepare the Earn-Out Accounts based upon procedures
and
accounting methods determined by the auditor of the Company as at
the
Accounts Date and deliver the same by 31 March 2007 together with
copies
of calculations and working papers relating thereto (including all
working
papers of that auditor of which the Company shall procure delivery)
to the
Vendors.
|
| (b) |
The
Vendors shall review the Earn-Out Accounts and within twenty-one
(21) days
of the delivery under clause 6.1, notify the Purchaser as to whether
they
object to any aspects thereof.
|
| (c) |
The
Purchaser shall review the Earn-Out Accounts and within twenty-one
(21)
days of the delivery under clause 6.1, notify the Vendor as to whether
they object to any aspects thereof.
|
17
| (d) |
If
the Vendor and the Purchaser state that they have no objection, they
shall
cause the same to be duly signed to record that the Earn-Out Accounts
are
final and conclusive of all matters stated
therein.
|
| 6.2 |
Disputes
|
| (a) |
In
the event of any difference of opinion or dispute ("dispute")
between the Vendors and the Purchaser regarding any aspect of the
Earn-Out
Accounts, the Vendor or the Purchaser may give notice thereof to
each
other within twenty one (21) days of delivery of the Earn-Out Accounts
under clause 6.1. If the Vendors and the Purchaser have not resolved
that
dispute in writing within ten (10) Business Days of notice having
been
given, then the dispute must promptly be submitted for determination
to a
person agreed between the parties, or failing agreement, within a
further
three (3) Business Days, to the nominee of the President for the
time
being of the Institute of Chartered Accountants (NSW Branch)
("Expert"),
who will determine the matter or matters in dispute having regard
to the
principles set out in this agreement in relation to such matter or
matters. Each party is entitled to make a submission to the Expert
within
two (2) Business Days after appointment of the
Expert.
|
| (b) |
The
Expert will make his determination no later than ten (10) Business
Days
after his appointment and will act as an expert and not as an arbitrator,
and his written determination is final and binding on the parties
in the
absence of manifest error. The cost of such determination by the
Expert is
to be borne by the parties in accordance with the Expert's determination.
|
| 6.3 |
Final
Acceptance of the Earn-Out
Accounts
|
In
the
event that:
| (a) |
after
the reviews by the Vendors and Purchaser are completed within the
said
twenty-one (21) day period, the Vendors and the Purchaser agree to
make
adjustments to the Earn-Out Accounts; or
|
| (b) |
an
Expert makes a determination under clause 6.2 the result of which
is that
adjustments consistent with that determination should be made to
the
Earn-Out Accounts,
|
18
then
in
either event, the Earn-Out Accounts shall be adjusted accordingly and the
Vendors and the Purchaser and Wako shall cause the same to be duly signed to
record that they are final and conclusive of all matters stated
therein.
| 6.4 |
Earn-Out
Payment
|
Within
seven (7) days of the parties signing the Earn-Out Accounts in accordance with
clause 6.1 and 6.3, the Purchaser and/or Wako must pay the Earn-Out Payment
to
the Vendors.
| 7. |
COMPLETION
|
| 7.1 |
Place
|
Completion
shall take place on or before the Completion Date at the offices of the Vendor’s
Solicitor or at any other place the Vendor may reasonably nominate.
| 7.2 |
Termination
for Failure to Complete
|
| (a) |
If
completion does not occur on the Completion Date by reason of the
Purchaser’s and/or Wako’s default then the Vendor may give notice of its
intention to terminate this document. If Completion does not occur
within
5 Business Days of the above notice being given (other than by default
of
the Vendor), then the Vendor may by further notice terminate this
document
and in addition to any other rights, powers or remedies provided
by
law:
|
| (i) |
each
party is released from its obligations to further perform the agreement
except those imposing on it obligations of confidentiality and its
obligations under clause
15.2;
|
| (ii) |
each
party retains the rights it has against any other party in respect
of any
past breach; and
|
| (iii) |
the
Purchaser must return to the Vendor all documents and other materials
in
any medium in its possession, power or control which contain information
relating to the Company including the
Records.
|
19
| (b) |
If
Completion does not occur on the Completion Date by reason of the
Vendor’s
default the Purchaser may give notice of its intention to terminate
this
agreement to the Vendor. If Completion does not then occur within
5
Business Days of the above notice being given (other than by default
of
the Purchaser), then the Purchaser may by further notice terminate
this
agreement and in addition to any other rights, powers or remedies
provided
by law:
|
| (i) |
each
party is released from its obligations to further perform the agreement
except those imposing on it obligations of
confidentiality;
|
| (ii) |
each
party retains the rights it has against any other party in respect
of any
past breach; and
|
| (iii) |
the
Purchaser and Wako must return to the Vendor all documents and
other
materials in any medium in its possession, power or control which
contain
information relating to the Company including the
Records.
|
| (c) |
Such
termination shall not prejudice any rights which may have accrued
up to
the date of termination.
|
| 7.3 |
Completion
Requirements
|
| (a) |
Before
Completion, the Vendor must, at the Vendor’s expense, obtain any consents
by the lessors of the Leased Premises which may be required pursuant
to
the terms of the relevant Property Leases on reasonable and usual
terms
and conditions that are reasonably satisfactory to the Purchaser.
The
Purchaser agrees that the following conditions are included in those
reasonably satisfactory to it for the purposes of this
clause:
|
| (i) |
the
provision of a bank guarantee or security
deposit;
|
| (ii) |
the
entering into of a deed of covenant approved or prepared by the lessor
of
the Leased Premises;
|
| (iii) |
the
entering into of a deed of guarantee approved or prepared by the
lessor of
the Leased Premises by the Purchaser and delivered to the
lessor;
|
20
| (iv) |
the
payment of the lessor of the Leased Premises’ reasonable costs and
expenses incurred by the lessor of the Leased Premises in making
any
enquiries concerning the Purchaser and in respect of any deed of
covenant
or guarantee.
|
| (b) |
Before
Completion, the Purchaser shall:
|
| (i) |
notify
the Vendor of the identities of the individuals to be appointed pursuant
to clause
7.4(d)(iii)
as
the new Directors and secretary of the Company following Completion;
and
|
| (ii) |
provide
the Vendor with copies of all relevant consents given by such individuals
in relation thereto.
|
| 7.4 |
Action
Required on Completion
|
On
Completion:
|
(a)
|
the
Purchaser shall deliver to the Vendor share certificates for Consideration
Shares;
|
|
(b)
|
the
Vendor warrants that all loans by or to the Company involving
shareholders, Directors and their associates (other than the note
receivable from Warehouse Solutions International Pty Limited for
$160,000) were repaid in full on or before 14 October 2005;
|
| (c) |
the
Vendor shall deliver to the
Purchaser:
|
| (i) |
duly
executed transfers of the Sale Shares to the Purchaser in a form
approved
by the Purchaser as being registrable, subject to payment of
stamp duty by
the Purchaser;
|
|
(ii)
|
the
share certificates for all the Sale Shares or relevant statutory
declarations as to their loss if such certificates cannot be
found;
|
|
(iv)
|
originals
of any lessor’s consents referred to in clause
7.3(a);
|
|
(v)
|
the
Records with the exception of those with accounts and the common
seal of
the Company;
|
21
|
(vi)
|
all
title documentation (subject to clause
6.5);
and
|
| (vii) |
the
resignation of the then Directors and secretaries of the
company.
|
|
(d)
|
the
Vendor will cause a meeting of the Directors to be held at which
the
Directors shall:
|
|
(i)
|
approve
the registration of the transfer of all the Sale Shares into the
name of
the Purchaser forthwith (subject, if appropriate, to their due
stamping);
|
| (ii) |
direct
the making of the requisite entries in the share register of the
Company;
|
| (iii) |
appoint
as new Directors and secretary of the Company those persons as
the
Purchaser may nominate;
|
|
(iv)
|
accept
the resignation of the then Directors and secretaries as officers
of the
Company;
|
| (g) |
the
beneficial ownership of the Sale Shares shall vest in the
Purchaser
|
| 7.5 |
Interdependence
of Obligations
|
|
(a)
|
The
obligations of the parties in respect of Completion shall be
interdependent to the intent that the Purchaser shall not be obliged
to
complete the purchase of any Sale Shares unless the purchase of all
the
Sale Shares is completed
simultaneously.
|
|
(b)
|
All
actions at Completion shall be deemed to take place simultaneously
and no
delivery or payment will be deemed to have been made until all deliveries
and payments have been made.
|
| 7.6 |
Assistance
|
The
Vendor (whether by exercise of its Shareholder Control or otherwise) shall
cause
the Company to do promptly all things which the Company is to do under or to
give effect to this document.
22
| 7.7 |
Registration
of Purchaser as
Member
|
|
(a)
|
Immediately
following Completion, the Purchaser shall promptly take all steps
necessary to ensure the registration of the Sale Shares in its
name.
|
|
(b)
|
From
Completion until the Sale Shares are registered in the name of the
Purchaser, the Vendor appoints the Purchaser and the Company jointly
and
severally to be its attorney. The Purchaser and the Company may do
in the
name of the Vendor and on its behalf everything necessary or expedient,
in
the Purchaser’s and the Company’s sole discretion,
to:
|
|
(i)
|
transfer
the Sale Shares;
|
|
(ii)
|
exercise
any rights, including rights to appoint a proxy or representative
and
voting rights, attaching to the Sale
Shares;
|
|
(iii)
|
receive
any dividend or other entitlement paid or credited to the Vendor
in
respect of the Sale Shares; and
|
|
(iv)
|
do
any other act or thing in respect of the Sale
Shares.
|
The
Vendor acknowledges and declares that all acts and things done by the Purchaser
and the Company in exercising powers under this power of attorney will be as
good and valid as if they had been done by the Vendor and agrees to ratify
or
confirm whatever the Purchaser and Company does in exercising powers under
this
power of attorney. The Vendor declares that this power of attorney of the
Purchaser and the Company is given for valuable consideration and is irrevocable
from the date of this power of attorney until the Sale Shares are registered
in
the name of the Purchaser. The Purchaser and the Company are expressly
authorised to do any act as a result of which a benefit is conferred on them.
The costs of the Vendor in carrying out its obligations under this clause shall
be borne by the Purchaser. The Purchaser must to the maximum extent permitted
by
law indemnify and hold the Vendor harmless against any Loss suffered by or
brought, or that may be recovered, against the Vendor that is in any way
connected with the Vendor’s obligations under this clause.
| 7.8 |
Extension
|
If any of the conditions precedent referred to in clause 3.1 have not been fulfilled or waived or do not occur by the Completion Date, at the Purchaser’s discretion and by notice in writing to the Vendor, the Completion Date may be extended up to but no later than 1 December 2005.
23
| 8. |
CONDUCT
PENDING COMPLETION
|
| 8.1 |
Vendor’s
Obligations Pending
Completion
|
The
Vendor shall procure that:
|
(a)
|
from
the Signing Date to the Completion Date, except with the prior consent
of
the Purchaser, the Company does not enter into any material commitment
other than in the ordinary course of its business or as contemplated
by
this document;
|
|
(b)
|
from
the Signing Date to the Completion Date, except with the prior consent
of
the Purchaser, the Company does not dispose of or encumber any of
its
Assets, other than disposals in the ordinary course of its business
or as
contemplated by this document; and
|
|
(c)
|
from
the Signing Date to the Completion Date, the Company shall carry
on the
Business in the ordinary course as a going concern with all due care
and
maintain the Assets in the condition in which they were acquired,
subject
to fair wear and tear.
|
|
(d)
|
from
1 October until Completion, unless the Purchaser otherwise agrees,
the
Vendor must procure that the Company does
not:
|
| (i) |
increase,
reduce or otherwise alter its share capital or grant any options
for issue
of shares or other securities;
|
| (ii) |
declare
or pay a dividend;
|
| (iii) |
make
a distribution of assets;
|
| (iv) |
buy
back its shares;
|
|
(v)
|
make
any alteration to its constitution;
|
24
|
(vi)
|
engage
in any material change in the conduct of the
Business;
|
|
(vii)
|
enter
into a contractual or other arrangement that involves commitment
exceeding
the value of $50,000.00.
|
| 8.2 |
Supply
Agreements
|
The
Purchaser acknowledges that the Company has entered into certain supply
agreements with certain of its customers for periods of up to twelve (12) months
to supply stock at certain agreed prices in good faith in the ordinary course
of
business and also acknowledges the existence of and will comply with quotations
given by the Company in good faith in the ordinary course of business prior
to
Completion.
| 8.3 |
Standstill
|
Prior
to
Completion the Vendor must not initiate, solicit or engage in any negotiations
with respect to the sale of the Sale Shares or Business. The Vendor agrees
to
promptly divulge to the Purchaser the existence of any approaches it may receive
from any person concerning the acquisition of the Sale Shares or the
Business.
| 9. |
EMPLOYEES
AND RELATED MATTERS
|
| 9.1 |
Employee
Benefit Plans and Salaries
|
Pending
Completion, except as may be necessary for the proper conduct of the Business
in
the ordinary course or required to comply with the law, the Vendor shall procure
that other than referred to in clause
9.6:
|
(a)
|
no
Employee Benefit Plan in existence in respect of the Employees as
at the
Signing Date will be modified or varied by the
Company;
|
|
(b)
|
no
new Employee Benefit Plan in addition to such plans in existence
in
respect of the Employees as at the Signing Date will be agreed to,
entered
into, or otherwise instituted by the
Company.
|
| 9.2 |
Managing
Director
|
Xxxx
Xxxxxx will enter into a service agreement for his employment as Managing
Director of the Company upon Completion in the form annexed as Annexure
“B”.
The
parties agree and covenant that the employment of Xxxx Xxxxxx may only be
terminated before the Earn Out Payment Date in the event of fraud, criminal
activity or gross negligence.
25
| 9.3 |
Termination
of Employment by Purchaser
|
The
Purchaser and Wako acknowledges that, as at the date of this agreement, it
intends to continue to employ all of the Employees as at Completion on terms
no
less favourable than their then current conditions of employment.
| 10. |
ACCESS
TO INFORMATION &
CONFIDENTIALITY
|
| 10.1 |
Access
by the Vendor After
Completion
|
| (a) |
The
Purchaser shall cause the Company to give the Vendor reasonable access
to
the operating records of the Business in respect of the period after
Completion during working hours and on being given not less than
twenty-four (24) hours’ notice, for a period of seven (7) years following
Completion to the extent necessary to enable the Vendor to comply
with the
requirements of any legislation and to complete the Completion Accounts
and its reasonably necessary accounting
requirements.
|
| (b) |
The
Vendor shall be entitled to make copies of and to take extracts from
all
materials to which it has access pursuant to this clause
10.
|
| (c) |
The
Vendor must and must procure its advisors keep confidential and do
not
directly or indirectly disclose, publish or permit the disclosure
or
publication of information provided pursuant to this clause to any
person
except as required by law. The Vendor is liable for and indemnifies
and
holds harmless the Purchaser and the Company in respect of any loss
suffered or incurred as a result of the breach of this clause by
a Vendor
or its advisors.
|
| 10.2 |
Purchaser’s
Confidentiality
Obligations
|
The
Purchaser and Wako must and must procure its advisers not to directly or
indirectly, without the prior written consent of the Vendor before Completion
use, disclose, publish or permit the disclosure or publication of the
Confidential Information to any person, other than in accordance with this
document and/or to comply with any laws, rules or regulations including, but
not
limited to, the requirements to file reports with the SEC in connection with
listing of Wako’s common stock on any trading medium. The Purchaser is liable
for and indemnifies and holds harmless the Vendor in respect of any Loss
suffered,’ incurred or liable for as a result of the breach of this clause by
either the Purchaser or its advisors.
26
| 10.3 |
No
Disclosure of Terms of
Documents
|
Except
for the purpose of, and to the least extent that, any disclosure is required
by
law or the rules of any stock exchange on which it or its holding company is
listed or for the purpose of issuing a press release announcing the substance
of
the transaction set out in this Deed, no party will disclose, divulge or
otherwise publicise the terms of this document or any other confidential
information in respect of the Company without the prior written approval of
the
other parties.
| 11. |
WARRANTIES
AND GENERAL INDEMNITIES
|
| 11.1 |
Giving
of Warranties
|
| (a) |
The
Vendor represents and warrants to the Purchaser that each of the
Warranties is true:
|
|
(i)
|
as
at the date of this agreement;
|
|
(ii)
|
on
each day up to Completion; and
|
|
(iii)
|
as
at Completion,
|
subject
only to specific qualifications made in the Disclosure Letter.
| (b) |
The
Vendor acknowledges that the Purchaser has entered into this agreement
in
reliance on the Warranties.
|
| (c) |
Each
Warranty must be construed independently and is not limited by reference
to another Warranty.
|
| (d) |
The
Warranties survive Completion of this
agreement.
|
27
| 11.2 |
Purchaser’s
investigation
|
The
Purchaser’s rights are not adversely affected by an investigation made by or on
behalf of the Purchaser about the Company, whether before or after the date
of
this agreement.
| 11.3 |
Indemnity
|
The
Vendor indemnifies the Purchaser against any claim, loss, liability, cost or
expense which the Purchaser pays or is liable for arising directly or indirectly
from:
|
(a)
|
a
Warranty being false or misleading when made or regarded as made
under
this agreement; or
|
| (b) |
a
breach by a Vendor of this
agreement.
|
| 12. |
NO
AGENT
|
| 12.1 |
Warranty
|
The
Vendor warrants that no agent has been employed in either obtaining the
execution of this document by the Purchaser or in introducing the Purchaser
to
the Vendor.
| 12.2 |
Indemnity
|
If
any
claim for commission, costs or expenses is made by any person against the
Company or the Purchaser with respect to the matter referred to in clause
12.1,
then
the Vendor hereby indemnifies the Company or the Purchaser (as the case may
be)
in respect of that claim including all reasonable costs, expenses and outgoings
(and where applicable reasonable legal costs on a full indemnity basis) incurred
by the Purchaser and the Company.
| 13. |
GST
|
| 13.1 |
Capitalised
expressions set out in this clause bear the same meaning as those
expressions in the GST
Act.
|
| 13.2 |
Except
where express provision is made to the contrary, and subject to
this
clause, any amount that may be payable under the Agreement including
the
Purchase Price is exclusive of any GST. If GST is deemed to be
payable on
this transaction by any applicable tax authority then it shall
be paid by
the Purchaser and/or Xxxx.
|
00
| 00. |
NOTICES
|
| 14.1 |
General
|
A
notice,
demand, certification or other communication under this document:
|
(a)
|
shall
be given in writing and in the English language;
and
|
|
(b)
|
may
be given by an agent of the sender.
|
| 14.2 |
Method
of Service
|
In
addition to any means authorised by law a communication may be given
by:
|
(a)
|
being
personally served on a party;
|
|
(b)
|
being
left at the party’s current address for
service;
|
|
(c)
|
being
sent to the party’s current address for service by pre-paid ordinary mail
or if the address is outside Australia, by pre-paid air mail;
or
|
|
(d)
|
facsimile
to the party’s current number for
service.
|
| 14.3 |
Address
for Service
|
|
(a)
|
The
addresses and numbers for service are initially as set out in this
Deed.
|
| 14.4 |
Service
by Post
|
A
communication given by post shall be deemed received:
|
(a)
|
if
posted within Australia to an Australian address on the third Business
Day
after posting; and
|
| (b) |
in
any other case, on the tenth Business Day after
posting.
|
29
| 14.5 |
Service
by Facsimile
|
A
communication given by facsimile shall be deemed received when the sender’s
facsimile machine produces a transmission report stating that the facsimile
was
sent to the addressee’s facsimile number.
| 14.6 |
Form
Received
|
A
communication given by facsimile shall be deemed given in the form transmitted
unless the message is not fully received in legible form and the addressee
immediately notifies the sender of that fact.
| 14.7 |
Service
After Hours
|
If
a
communication to a party is received by it:
| (a) |
after
5.00 p.m.; or
|
| (b) |
on
a day which is not a Business Day;
|
it
will
be deemed to have been received at the commencement of the next Business
Day.
| 15. |
MISCELLANEOUS
|
| 15.1 |
Stamp
Duty
|
|
(a)
|
The
Purchaser and/or Wako shall, as between the parties, be liable for
and
duly pay all stamp duty on or relating to this document and any document
executed under or contemplated by
it.
|
|
(b)
|
If
any party other than the Purchaser and/or Wako pays any stamp duty
on or
relating to this document or any document executed under or contemplated
by it, the Purchaser shall pay that amount to that party upon
demand.
|
| 15.2 |
Costs
|
|
(a)
|
Each
party shall bear its own legal and other costs and expenses relating
directly or indirectly to the preparation of, and performance of
its
obligations under, this document;
|
30
|
(b)
|
Should
Completion not take place as a result of the Purchaser’s shareholders
failing to approve the purchase of the Sale Shares or should the
condition
precedent in clause
3.1(b)
not be fulfilled on or before the Completion Date and
provided that
the Vendor as at Completion is not in breach of any of the Warranties
then
the Purchaser shall pay to the Vendor on demand the amount of the
costs
and expenses incurred by the Vendor relating directly or indirectly
to the
preparation of, and performance of its obligations under this document.
|
|
(c)
|
The
accounting audit taxation and other services of the Company relating
to
the transaction contemplated by this agreement shall be carried out
by
Bentleys MRI and paid for by the
Company.
|
| 15.3 |
Amendment
|
This
document may only be varied or replaced by a document in writing duly executed
by the parties and expressed to be in modification hereof.
| 15.4 |
Waiver
and Exercise of
Rights
|
|
(a)
|
A
single or partial exercise or waiver of a right relating to this
document
will not prevent any other exercise of that right or the exercise
of any
other right.
|
|
(b)
|
A
party will not be liable for any loss, cost or expense of any other
party
caused or contributed to by the waiver, exercise, attempted exercise,
failure to exercise or delay in the exercise of a
right.
|
| 15.5 |
Rights
Cumulative
|
Subject
to any express provision in this document to the contrary, the rights of a
party
under this document are cumulative and are in addition to any other rights
of
that party.
| 15.6 |
Approvals
and Consent
|
Subject
to any express provision in this document to the contrary, a party may
conditionally or unconditionally give or withhold any consent to be given under
this document and is not obliged to give its reasons for doing so.
| 15.7 |
Further
Assurance
|
Each
party shall promptly execute all documents and do all things that another party
from time to time reasonably requires of it to effect, perfect or complete
the
provisions of this document and any transaction contemplated by it and agrees
and undertakes to use its best endeavours to procure relevant third parties
to
do likewise.
Each
party shall promptly execute all documents and do all things that another party
from time to time reasonably requires of it to effect, perfect or complete
the
provisions of this document and any transaction contemplated by it and agrees
and undertakes to use its best endeavours to procure relevant third parties
to
do likewise.
31
| 15.8 |
Severance
|
Each
provision of this document is severable from the others and no severance of
a
provision shall affect any other provision.
| 15.9 |
Governing
Law
|
This
document is governed by and shall be construed in accordance with the laws
of
New South Wales.
| 15.10 |
Jurisdiction
|
Each
party:
|
(a)
|
irrevocably
and unconditionally submits to the non-exclusive jurisdiction of
the
courts of New South Wales and any courts which have jurisdiction
to hear
appeals from any of those courts;
and
|
|
(b)
|
waives
any right to object to any proceedings being brought in those courts
for
any reason.
|
| 15.11 |
Process
Service
|
Any
process or other document relating to litigation, administration, arbitral
or
dispute resolution proceedings in relation to this document may be served by
any
method contemplated by clause
15
or in
accordance with any applicable law.
| 15.12 |
Assignment
|
|
(a)
|
Subject
to clause
15.12(b) and (c),
a
party shall not assign any right under this document without the
prior
written consent of all other
parties.
|
32
|
(b)
|
|
(c)
|
If
there is any change in the Effective Control of the Purchaser and/or
Wako
prior to Completion then the Vendor shall be entitled to terminate
this
document by notice in writing in accordance with the provisions of
clause
7.2(a).
|
| 15.13 |
Counterparts
|
|
(a)
|
This
document may consist of a number of counterparts and if so the
counterparts taken together constitute one and the same
instrument.
|
|
(b)
|
This
document shall not be binding on any party unless one or more counterparts
have been duly executed by, or on behalf of, each person named as
a party
to the document.
|
| 15.14 |
Entire
Understanding
|
|
(a)
|
This
document embodies the entire understanding and agreement between
the
parties as to the subject matter of this
document.
|
|
(b)
|
All
previous negotiations, understandings, representations, warranties,
memoranda or commitments in relation to, or in any way affecting,
the
subject matter of this document are merged in and superseded by this
document and shall be of no force or effect whatever and no party
shall be
liable to any other party in respect of those
matters.
|
|
(c)
|
No
oral explanation or information provided by any party to another
shall:
|
| (i) |
affect
the meaning or interpretation of this document;
or
|
| (ii) |
constitute
any collateral agreement, warranty or understanding between any of
the
parties.
|
33
| 15.15 |
No
Merger
|
No
conditions representations or warranties contained in this document shall merge
on Completion.
| 16. |
DISPUTE
RESOLUTION
|
| 16.1 |
Dispute
Resolution
|
|
(a)
|
Unless
a party to this document has complied with paragraphs (a) to (d)
of this
clause, that party may not commence court proceedings relating to
any
dispute, except for disputes under clause 6.2, arising from this
document.
Where a party to this document fails to comply with paragraphs (a)
to (d)
of this clause, any other party to the document in dispute with the
party
so failing to comply need not comply with this clause before commencing
court proceedings relating to that
dispute.
|
|
(b)
|
Any
party to this document claiming that a dispute has arisen under this
document between any of the parties to this document shall give written
notice to the other party or parties in dispute designating as its
representative in negotiations relating to the dispute a person with
authority to settle the dispute and each other party given written
notice
shall promptly give notice in writing to the other parties in dispute
designating as its representative in negotiations relating to the
dispute
a person with similar authority.
|
|
(c)
|
The
designated persons shall, within fifteen (15) days of the first notice
required by paragraph (b) of this clause, following whatever
investigations each deems appropriate, seek to resolve the dispute.
Any
and all meetings between the parties conducted in relation to resolving
the dispute shall be held in Hong Kong or Sydney at a venue mutually
agreed upon and in the event of disagreement in Hong Kong, or at
the
option of the Purchaser at the Australian Commercial Disputes Centre
or
its successor.
|
|
(d)
|
The
parties acknowledge that the purpose of any exchange of information
or
documents or the making of any offer of settlement pursuant to this
clause
is to attempt to settle the dispute between the parties. No party
may use
any information or documents obtained through the dispute resolution
process established by this clause for any purpose other than in
an
attempt to settle a dispute between that party and other parties
to this
document.
|
34
| 17. |
PURCHASER’S
WARRANTIES
|
| 17.1 |
Warranties
|
The
Purchaser and wako represents and warrants to the Vendor (with effect as at
the
Signing Date and at Completion) to the best of their information and belief
as
set out in Schedule
5 that
each
of the statements set out in Schedule
5 to
this
Agreement is accurate. Each of the statements is to be treated as a separate
representation and warranty and the interpretation of any statement made may
not
be restricted by reference
to or inference from any other statement, qualified by any
circumstances, matters or things disclosed to or made available to the Vendor
by the
Purchaser prior to the Signing Date
| 18. |
POST
COMPLETION
|
| 18.1 |
The
Purchaser and Wako warrants on behalf of itself and any Related Body
Corporate that for the period from the Completion Date to 31 December
2006, it will not do any act or conduct the Business in a manner
which has
the effect of artificially reducing the Earn Out EBIT as disclosed
in the
Earn-Out Accounts.
|
| 18.2 |
The
directors of the Company from the Completion Date to the Earn Out
Payment
Date shall be Xxxx Xxxxxx, Xxxxx Xxxx and Xxxxx
Xxxxxx.
|
Funding
| 18.3 |
Vendor
shall provide to the Purchaser as soon as possible a Business Plan
in
respect of the proposed operations of the Company following
Completion.
|
| 18.4 |
Purchaser
and Vendor covenant to use their best efforts to agree the Business
Plan
within a reasonable time of it being delivered to the Purchaser by
the
Vendor.
|
| 18.5 |
The
Purchaser and Wako agrees and covenants
to
provide to the Company sufficient funding and/ or working capital
to
enable the Company to implement the Business Plan, as mutually approved
by
Purchaser, Wako and Vendor.
|
| 18.6 |
If
Purchaser and/or Wako shall fail to provide sufficient funding as
31 March
2006, Schedule 3 shall be replaced by Schedule 3 A.
|
35
| 18.7 |
Purchaser
and Wako shall be required to provide sufficient funding as set forth
in
the Business Plan by 31 March 2006.
|
| 18.8 |
On
or before 31 March 2006, the Purchaser and/or Wako shall provide
documentary evidence, satisfactory to the Vendor, that it has procured
bank guarantees or other forms of credit support for the Company
in
respect of the ongoing obligations of the Company or the provision
of new
debt or new equity securities after Completion sufficient to enable
the
Vendor, to be released from any obligations whatsoever in relation
to the
financial or credit support of the Company which are then in
force.
|
| 18.9 |
On
or before 31 March 2006, the Purchaser and Wako shall procure that
each of
the Vendor and the Directors are released from all personal guarantees
(if
any) given in respect of the
Company;
|
Indemnity
Regarding Funding Matters
| 18.10 |
The
Purchaser and Wako hereby indemnify the Vendor and the Directors
in
relation to any Losses incurred by the Vendor and the Directors arising
out of, directly or indirectly, the guarantees provided by them in
respect
of financial or credit support of the Company and/ or the failure
by the
Purchaser and/or Wako in relation to its assumption of the Vendor’s
obligations in respect of financial or credit support of the Company
in
connection and of the vendor’s obligations in respect of release of
personal guarantees in connection as set out in this clause
18.
|
| 18.11 |
The
Purchaser and Wako agree and covenant that they shall not receive
or
demand any dividend or loan from the Company during the period from
the
Completion Date until funding in accordance with the Business Plan
is
provided and the Purchaser and Wako’s obligations pursuant to clause 18.5
and 18.6 are satisfied.
|
Registration
of Consideration Shares
| 18.12 |
If
Wako obtains a listing on a major US stock exchange, Wako shall include
the Consideration Shares and Earn Out Shares as part of its shares
to be
listed on such exchange, subject to the extent of its ability to
do so
based on all applicable rules and regulations of such
exchange.
|
36
Rule
144
Information
| 18.13 |
Wako
shall:
|
|
(a)
|
make
and keep public information available, as those terms are understood
and
defined in SEC Rule 144;
|
|
(b)
|
file
with the SEC in a timely manner all reports and other documents required
of the Purchaser under the Securities Act and the Exchange Act;
and
|
|
(c)
|
furnish
to the Vendor, so long as the Vendor owns Consideration Shares or
Earn Out
Shares issued by Wako pursuant to this Deed, forthwith upon request
(i) a
written statement by Wako that it has complied with the reporting
requirements of SEC Rule 144, the Securities Act and the Exchange
Act, or
that it qualifies as a registrant whose securities may be resold
pursuant
to Form S-3, (ii) a copy of the most recent annual or quarterly report
of
Wako (in the event such information can not be obtained by the Vendors
on
the internet) and such other reports and documents so filed by Wako,
and
(iii) such other information as may be reasonably requested in availing
the Vendor of any rule or regulation of the SEC which permits the
selling
of any such securities without registration or pursuant to such
form.
|
| 18.14 |
The
Vendor agrees and covenants that it will, and will procure that the
Company will, do all things necessary to assist Wako to comply with
the
requirements of any rule or regulation of the SEC.
|
| 18.15 |
The
Vendor agrees and covenants to provide prompt details of the beneficial
ownership and ultimate holding companies for each Vendor, as requested
by
Wako from to time.
|
| 19. |
RISK
AND INSURANCE
|
| 19.1 |
The
Vendor must procure that the Company maintains until Completion insurance
of the Assets and Business covering such risks and for such amounts
that
it currently maintains.
|
| 19.2 |
The
Purchaser must procure that the Company maintains from Completion
insurance of the Assets and Business covering such risks and for
such
amounts that it currently maintains, until the Earn Out Payment
Date.
|
37
| 20. |
VENDOR
AS TRUSTEES
|
| 20.1 |
Each
of Idolmace Pty Limited, Xxxxxxxxxxx Xxxxxx Xxxxxx, Konstanflo Pty
Limited, Creative Consulting Pty Limited, Xxxx Xxxxxx Pty Limited,
and
Gial Holdings Pty Limited (“Trustee”)
acknowledges
that it enters into this Agreement in its capacity as trustee of
the PKP
Family Trust, Xxxxxx Family Trust, Xxxxxxx Family Trust, Xxxx Family
Trust, Hilton Family Trust and Pegg Family Trust respectively (“Trust”).
|
| 20.2 |
The
Vendor warrants in respect of each Trustee and Trust
that:
|
|
(a)
|
the
Trustee is the only trustee of the Trust and no action has been taken
or
proposed to remove it as trustee of the
Trust;
|
|
(b)
|
the
Trustee has the power and authority under the terms of Trust to enter
into
and perform this document including the power to sell the Sale
Shares;
|
|
(c)
|
the
entry into and performance of this document is for the benefit of
the
beneficiaries of the Trust, whose consents (if necessary) have been
obtained;
|
|
(d)
|
the
sale of the Sale Shares under this document is not limited to the
interest
of the Trustee in Sale Shares in its capacity as the trustee of the
Trust
but extends to the full beneficial interest in the Sale
Shares;
|
|
(e)
|
the
Trustee has a right to be fully indemnified out of the Trust assets
in
respect of all of their obligations and liabilities incurred by it
under
this document and the assets of the Trust are sufficient to satisfy
that
right; and
|
|
(g)
|
prior
to Completion the Trustee will not:
|
| (i) |
resign
as trustee of the Trust or permit any substitute or additional trustee
to
be appointed;
|
| (ii) |
do
anything which effects or facilitates the termination of the
Trust;
|
38
| (iii) |
do
anything which effects or facilitates the variation of the terms
of the
Trust;
|
| (iv) |
do
anything which effects or facilitates the resettlement of the Trust
funds.
|
| 20.3 |
The
Vendor agrees, in relation to each Trustee and Trust, to ensure that
until
Completion:
|
|
(a)
|
the
Trustee does not resign and no additional trustee is
appointed;
|
|
(b)
|
the
Trust is not terminated;
|
|
(c)
|
the
terms of the Trust are not varied;
|
|
(d)
|
the
property of the Trust is not vested or distributed;
and
|
|
(e)
|
the
Trust funds are not resettled;
|
without
the prior consent of the Purchaser. That consent may not be unreasonably
withheld.
| 23. |
DEFAULT
|
| 23.1 |
Right
of Purchaser to rescind
|
| (a) |
The
Purchaser may elect to either terminate its obligations under
this
agreement if at any time before
Completion:
|
| (i) |
a
Vendor breaches this agreement; or
|
| (ii) |
a
Warranty is or becomes false or misleading when made or regarded
as made
under this agreement; or
|
| (iii) |
a
material adverse change occurs affecting the assets of the Company
or the
financial position or prospects of the
Company.
|
| (b) |
Before
electing to terminate or complete under paragraph (a), the Purchaser
may
delay Completion for a period it nominates but not more than
one month, to
decide whether any of the matters described in that paragraph
can be
remedied, without affecting its rights under that
paragraph.
|
| (c) |
The
Purchaser may elect to either terminate or complete under paragraph
(a) by
giving written notice to the Vendor before or at
Completion.
|
39
|
EXECUTED
by
IDOLMACE PTY LIMITED ACN
069 900 492 in accordance with the Corporations
Xxx 0000:
|
||
| /s/ | /s/ | |
|
Signature
of director
|
Signature
of director/secretary
|
|
|
Name
|
Name
|
|
|
SIGNED,
SEALED AND DELIVERED
by
XXXXXXXXXX
XXXXXX XXXXXX
in
the presence of
|
||
| /s/ | /s/ | |
| Signature of Witness | Signature of Xxxxxx Xxxxx Xxxxxx | |
|
SIGNED,
SEALED AND DELIVERED
by
XXXXXX
XXXXX XXXXXX
in
the presence of
|
||
| /s/ | /s/ | |
| Signature of Witness | Signature of Xxxxxx Xxxxx Xxxxxx | |
|
EXECUTED
by
KONSTANTFLO SALES PTY LIMITED ACN
002 428 202 in accordance with the Corporations
Xxx 0000:
|
||
| /s/ | /s/ | |
|
Signature
of director
|
Signature
of director/secretary
|
|
|
Name
|
Name
|
40
|
EXECUTED
by
CREATIVE CONSULTING PTY LIMITED ACN
002 019 829 in accordance with the Corporations
Xxx 0000:
|
||
| /s/ | /s/ | |
|
Signature
of director
|
Signature
of director/secretary
|
|
|
Name
|
Name
|
|
EXECUTED
by
XXXX XXXXXX PTY LIMITED ACN
109 778 421 in accordance with the Corporations
Xxx 0000:
|
||
| /s/ | /s/ | |
|
Signature
of director
|
Signature
of director/secretary
|
|
|
Name
|
Name
|
|
EXECUTED
by
GIAL HOLDINGS PTY LIMITED ACN
000 000 000 in accordance with the Corporations
Xxx 0000:
|
||
| /s/ | /s/ | |
|
Signature
of director
|
Signature
of director/secretary
|
|
|
Name
|
Name
|
41
|
EXECUTED
by
WLG (Australia) Pty Limited (ACN 116 743 698) by :its
authorised representative, Xxxxx Xxxx
|
||
|
/s/
|
||
|
Signature
of Xxxxx Xxxx
|
||
|
EXECUTED
by
WAKO LOGISTICS GROUP,
|
||
|
/s/
|
||
|
Signature
of Xxxxx Xxxx, Chief Executive Officer of Wako Logistics Group,
Inc
|
||
42
