THIS AGREEMENT dated effective September 15, 2001.
BETWEEN:
Geneva Overseas Holdings Ltd.
a corporation incorporated under the laws of Antigua
(hereinafter called the "Lender")
OF THE FIRST PART,
- and
Netforce Systems Inc., a corporation incorporated
under the laws of Antigua,
(hereinafter called the "Borrower")
OF THE SECOND PART.
DEBT TO EQUITY CONVERSION AGREEMENT
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WHEREAS the Lender is the owner of a debt security which at the date of
this Agreement had a principal amount of $208,120 outstanding and interest of
$6,363 for a total indebtedness of $214,483;
AND WHEREAS the Lender has agreed to transfer the debt security to the
Borrower for a total consideration of 2,144,830 shares in the Company having an
agreed value of $0.10 per share;
NOW THEREFORE in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
ARTICLE I
Interpretation
1.1 Definitions
As used in this Agreement, the following words and phrases shall have the
following meanings:
(a) "Closing Date" means September 15, 2001;
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1.2 United States Dollars
All dollar amounts referred to in this Agreement are in United States of
America currency unless otherwise provided.
1.3 Extended Meanings
In this Agreement, words importing the singular number include the plural
and vice versa and words importing the masculine gender include the
feminine and neuter genders.
1.4 Headings
Articles and section headings are not to be considered part of this
Agreement and are included solely for convenience of reference and are not
intended to be full or accurate descriptions of the contents thereof.
ARTICLE II
Transfer of Debt Security
2.1 Transfer of Debt security
The transfer of the debt security shall effectively occur on the Closing
Date and subject to the terms and conditions hereof, the Lender shall
transfer to the Borrower the debt security, upon delivery by the Borrower
to the Lender of 2,144,830 shares in the common stock of the Company;
2.2 Debt Security
Upon delivery of the debt security to the Borrower and the transfer of the
shares herein is complete the Borrower shall have no further obligations in
respect of the debt security;
ARTICLE III
Representations and Warranties
3.1 Representations and Warranties of the Lender
The Lender hereby represents and warrants as follows in favour of the
Borrower and hereby acknowledges and confirms that the Borrower is relying
upon such representations and warranties in connection with the transfer of
the debt security from the Lender:
(a) the Lender owns, beneficially and of record, the debt security with
good and marketable title thereto, free and clear of any claim, lien,
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security interest or encumbrance of any nature or kind and, as such,
has the exclusive right and full power to sell, transfer and assign
the debt security to the Borrower;
(b) no person, firm or corporation has any agreement, option or any rights
capable of becoming an agreement or option for the acquisition from
the Lender of the debt security;
(c) the Lender is not insolvent, has not committed an act of bankruptcy,
proposed a compromise or arrangement to its creditors generally, had
any petition for a receiving order in bankruptcy filed against it,
taken any proceeding with respect to a compromise or arrangement,
taken any proceeding to have itself declared bankrupt, taken any
proceeding to have a receiver appointed over any part of its debt
security, had any encumbrancer take possession of any of its property,
or had any execution or distress become enforceable or become levied
upon any of its property;
3.2 Representations and Warranties of the Borrower
The Borrower hereby represents and warrants as follows and hereby
acknowledges and confirms that the Lender is relying upon such
representations and warranties in connection with the transfer of the debt
security from the Lender:
(a) the Borrower is an Antigua corporation registered to carry on business
in Antigua;
(b) the Borrower has received independent legal advice before executing
this Agreement and has voluntarily executed this Agreement;
(c) the Borrower is not insolvent, has not committed an act of bankruptcy,
proposed a compromise or arrangement to its creditors generally, had
any petition for a receiving order in bankruptcy filed against it,
taken any proceeding with respect to a compromise or arrangement,
taken any proceeding to have itself declared bankrupt, taken any
proceeding to have a receiver appointed over any part of its debt
security, had any encumbrancer take possession of any of its property,
or had any execution or distress become enforceable or become levied
upon any of its property;
(d) the Borrower will transfer shares to the lender that are free and
clear of any claim, lien, security interest or encumbrance of any
nature or kind and are issued from the treasury of the Borrower.
ARTICLE IV
Covenants
4.1 Covenants of the Lender
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The Lender hereby covenants in favour of the Borrower that he will
cause all necessary steps and proceedings to be taken to permit the
debt security to be duly and regularly transferred to the Borrower
effective the Closing Date.
4.2 Covenants of the Borrower
The Borrower hereby covenants in favour of the Lender that it will
deliver to the Lender 2,144,830 shares from its treasury in
satisfaction of the debt security being satisfied effective the
Closing Date.
ARTICLE V
Closing Matters
5.1 Conditions of Closing for the Lender's Benefit
The Lender shall not be obliged to complete the transfer herein unless on
the Closing Date, the following conditions have been satisfied, it being
understood that the said conditions are included for the exclusive benefit
of the Lender and may be waived in writing in whole or in part by the
Lender at any time:
(a) the Borrower shall have performed all obligations required to be
performed under this Agreement;
(b) the Borrower has delivered to the lender 2,144,830 shares in the
common stock of the Company.
5.2 Conditions of Closing for the Borrower's Benefit
The Borrower shall not be obliged to complete the transfer herein unless on
the Closing Date, the following conditions have been satisfied, it being
understood that the said conditions are included for the exclusive benefit
of the Borrower and may be waived in whole or in part by the Borrower at
any time:
(a) the Lender shall have delivered or cause to be delivered to the
Borrower, duly endorsed for transfer, the transfer documents for the
debt security; and
(b) the Lender shall have performed all obligations required to be
performed under this Agreement.
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ARTICLE VI
General Contract Provisions
6.1 Notices
All notices, requests, demands or other communications by the terms hereof
required or permitted to be given by one party to the other shall be given
in writing by personal delivery or by registered mail, postage prepaid,
addressed to such other party at the following addresses:
(a) to the Borrower at:
X.X. Xxx X-000
Xxxxx #00, Xxxxx Xxxxxx
Xx. John's, Antigua, West Indies
(b) to the Lender at
C/o ABI Trust Ltd.
High Street & Com alley
X.X. Xxx 0000
Xx. Xxxx'x, Xxxxxxx, Xxxx Xxxxxx
or at such other address as may be given by either of them to the other in
writing from time to time. Such notices, requests, demands or other
communications shall be deemed to have been received when delivered or, if
mailed, on the fifth business day following the day of the mailing thereof,
provided that regular mail service shall not then be interrupted by strikes
or other irregularities and where such interruption or other irregularities
occur, all notices, requests, demands or other communications shall be
deemed to have been received on the fifth business day following the
resumption of normal mail service.
6.2 Further and Other Acts
The parties hereto covenant and agree to sign such other papers, cause such
meetings to be held, resolutions passed and by-laws enacted, exercise their
vote and influence, do and perform and cause to be done and performed such
further and other acts and things as may be necessary or desirable in order
to give full effect to this Agreement and every part hereof.
6.3 Governing Law
This Agreement shall be governed by the laws of Antigua.
6.4 Time of Essence
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The effective date of this Agreement is September 15, 2001 and no party
shall make claim that it was made on a later date and each party
acknowledges that this Agreement will be executed subsequent to September
15, 2001 but that it shall remain effective on September 15, 2001 as if the
Agreement had been signed on the said date to reflect the patties
intentions.
6.5 Entire Agreement
This Agreement shall constitute the entire agreement between the parties
hereto with respect to all of the matters herein and supersedes all prior
and contemporaneous agreements, understandings, negotiations and
discussions, whether oral or written, of the parties. This Agreement shall
not be amended except by a memorandum in writing signed by the parties
hereto and any amendment hereof shall be null and void and shall not be
binding upon any party which has not given its consent as aforesaid.
6.6 Successors and Assigns
This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators,
successors and assigns.
6.7 Survival
The representations, warranties and covenants contained herein shall
survive the Closing Date and shall not be merged upon the completion of the
transfers contained herein.
6.8 Countersigning
The parties hereto agree that this Agreement may be signed in counterparts
to reflect the physical distance and difficulty in having all parties
execute the same agreement and that each party shall be bound by the terms
of this Agreement as if each party executed one agreement.
IN WITNESS WHEREOF the parties hereto have duly executed this Agreement.
(Seal) ) NETFORCE SYSTEMS INC,
)
) Per: /s/ Xxxxx Xxxxxxxx
---------------------------
(Authorized Signing Officer)
Per: /s/
---------------------------
(Authorized Signing Officer)
(Seal) ) GENEVA OVERSEAS HOLDINGS LTD.
)
) Per: /s/ Xxxxx Xxxxxxxx
---------------------------
(Authorized Signing Officer)
