STOCK PURCHASE AGREEMENT
THIS
AGREEMENT is made and entered into this 3rd day of October, 2006, by and between
those Shareholders of IRISH MAG, INC. identified in Exhibit “D” hereto
(collectively "SELLER"), IRISH MAG, INC. and iBROADER DEVELOPMENTS LIMITED
("BUYER");
Background
WHEREAS,
the Seller owns ONE MILLION THREE HUNDRED FIFTY THOUSAND (1,350,000) shares
(the
“Shares”) of common stock, par value $0.01 (the “Common Stock”), of IRISH MAG,
INC., a Florida corporation (“IRHM” or the “Company”); and
WHEREAS,
the Sellers desire to sell the Shares to the Buyers and the Buyers desire to
purchase the Shares from the Sellers, all upon the terms and subject to the
conditions hereinafter set forth and based upon IRISH MAG, INC. approving a
forward stock split of 4.44444444 to 1 prior to September 20, 2006;
NOW,
THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements herein contained and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
SECTION
I
DEFINITIONS
Unless
the context otherwise requires, the terms defined in this Section 1 will have
the meanings herein specified for all purposes of this Agreement, applicable
to
both the singular and plural forms of any of the terms herein
defined.
1.1 “Accredited
Investor” has the meaning set forth in Regulation D under the Securities Act and
set forth on Exhibit “A.”
1.2 “Affiliate”
means any Person that directly or indirectly controls, is controlled by or
is
under common control with the indicated Person.
1.3 “Agreement”
means this Stock Purchase Agreement, including all Schedules and Exhibits
hereto, as this Stock Purchase Agreement may be from time to time amended,
modified or supplemented.
1.4 “Approved
Plans” means a stock option or similar plan for the benefit of employees or
others which has been approved by the stockholders of the Company.
1.5 “Balance
Sheet” means the Company’s reviewed balance sheet at June 30, 2006.
1.6 “Buyer”
has the meaning set forth in the preamble.
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1.7 “Closing”
has the meaning set forth in Section 2.1.
1.8 “Code”
means the Internal Revenue Code of 1986, as amended.
1.9 “Commission”
means the Securities and Exchange Commission or any other federal agency then
administering the Securities Act.
1.10
“Common
Stock” has the meaning set forth in the preamble.
1.11
“Company”
means IRISH MAG, INC., a Florida corporation, and all of its direct and indirect
subsidiaries.
1.12
“Company
Board” means the Board of Directors of the Company.
1.13
“Distributor”
means any underwriter, dealer or other Person who participates, pursuant to
a
contractual arrangement, in the distribution of the securities offered or sold
in reliance on Regulation S.
1.14
“Environmental
Laws” means any Law or other requirement relating to the environment, natural
resources, or public or employee health and safety.
1.15
“Environmental
Permit” means all licenses, permits, authorizations, approvals, franchises and
rights required under any applicable Environmental Law or Order.
1.16
“Equity
Security” means any stock or similar security, including, without limitation,
securities containing equity features and securities containing profit
participation features, or any security convertible into or exchangeable for,
with or without consideration, any stock or similar security, or any security
carrying any warrant, right or option to subscribe to or purchase any shares
of
capital stock, or any such warrant or right.
1.17
“ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
1.18
“Exchange
Act” means the Securities Exchange Act of 1934 or any similar federal statute,
and the rules and regulations of the Commission thereunder, all as the same
will
then be in effect.
1.19
“Exhibits”
means the several exhibits referred to and identified in this
Agreement.
1.20
“GAAP”
means, with respect to any Person, United States generally accepted accounting
principles applied on a consistent basis with such Person’s past
practices.
1.21
“Governmental
Authority” means any federal or national, state or provincial, municipal or
local government, governmental authority, regulatory or administrative agency,
governmental commission, department, board, bureau, agency or instrumentality,
political subdivision, commission, court, tribunal, official, arbitrator or
arbitral body, in each case whether U.S. or non-U.S.
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1.22 “Indebtedness”
means any obligation, contingent or otherwise. Any obligation secured by a
Lien
on, or payable out of the proceeds of, or production from, property of the
relevant party will be deemed to be Indebtedness.
1.23 “Indebtedness
for Borrowed Money” means (a) all Indebtedness in respect of money borrowed; (b)
all Indebtedness evidenced by a promissory note, bond or similar written
obligation to pay money; or (c) all such Indebtedness guaranteed by the relevant
party or for which the relevant party is otherwise contingently
liable.
1.24 “Intellectual
Property” means all industrial and intellectual property,
including, without limitation, all U.S. and non-U.S. patents, patent
applications, patent rights, trademarks, trademark applications, common law
trademarks, Internet domain names, trade names, service marks, service xxxx
applications, common law service marks, and the goodwill associated therewith,
copyrights, in both published and unpublished works, whether registered or
unregistered, copyright applications, franchises, licenses, know-how, trade
secrets, technical data, designs, customer lists, confidential and proprietary
information, processes and formulae, all computer software programs or
applications, layouts, inventions, development tools and all documentation
and
media constituting, describing or relating to the above, including manuals,
memoranda, and records, whether such intellectual property has been created,
applied for or obtained anywhere throughout the world.
1.25 “Laws”
means, with respect to any Person, any U.S. or non-U.S. federal, national,
state, provincial, local, municipal, international, multinational or other
law
(including common law), constitution, statute, code, ordinance, rule, regulation
or treaty applicable to such Person.
1.26 “Lien”
means any mortgage, pledge, security interest, encumbrance, lien or charge
of
any kind, including, without limitation, any conditional sale or other title
retention agreement, any lease in the nature thereof and the filing of or
agreement to give any financing statement under the Uniform Commercial Code
of
any jurisdiction and including any lien or charge arising by Law.
1.27 “Material
Contract” means any and all agreements, contracts, arrangements, leases,
commitments or otherwise, of the Company, of the type and nature that the
Company is required to file with the Commission.
1.28 “Material
Adverse Effect” means, when used with respect to the Company, any change, effect
or circumstance which, individually or in the aggregate, would reasonably be
expected to (a) have a material adverse effect on the business, assets,
financial condition or results of operations of the Company, in each case taken
as a whole or (b) materially impair the ability of the Company to perform their
obligations under this Agreement, excluding any change, effect or circumstance
resulting from (i) the announcement, pendency or consummation of the
transactions contemplated by this Agreement, (ii) changes in the United States
securities markets generally, or (iii) changes in general economic, currency
exchange rate, political or regulatory conditions in industries in which the
Company, as the case may be, operate.
1.29 “Order”
means any award, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any Governmental
Authority.
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1.30 “Organizational
Documents” means the Company’s articles of incorporation and by-laws and any and
all amendments to any of the foregoing.
1.31 “Permits”
has the meaning set forth in Section 3.20.
1.32 “Permitted
Liens” means (a) Liens for Taxes not yet payable or in respect of which the
validity thereof is being contested in good faith by appropriate proceedings
and
for the payment of which the relevant party has made adequate reserves; (b)
Liens in respect of pledges or deposits under workmen’s compensation laws or
similar legislation, carriers, warehousemen, mechanics, laborers and materialmen
and similar Liens, if the obligations secured by such Liens are not then
delinquent or are being contested in good faith by appropriate proceedings
conducted and for the payment of which the relevant party has made adequate
reserves; (c) statutory Liens incidental to the conduct of the business of
the
relevant party which were not incurred in connection with the borrowing of
money
or the obtaining of advances or credits and that do not in the aggregate
materially detract from the value of its property or materially impair the
use
thereof in the operation of its business; and (d) Liens that would not have
a
Material Adverse Effect.
1.33 “Person”
means all natural persons, corporations, business trusts, associations,
companies, partnerships, limited liability companies, joint ventures and other
entities, governments, agencies and political subdivisions.
1.34 “Proceeding”
means any action, arbitration, audit, hearing, investigation, litigation, or
suit (whether civil, criminal, administrative, investigative, or informal)
commenced, brought, conducted, or heard by or before, or otherwise involving,
any Governmental Authority.
1.35 “Purchase
Price” has the meaning set forth in Section 2.2.
1.36 “Regulation
S” means Regulation S under the Securities Act, as the same may be amended from
time to time, or any similar rule or regulation hereafter adopted by the
Commission.
1.37 “Rule
144” means Rule 144 under the Securities Act, as the same may be amended from
time to time, or any successor statute.
1.38 “Schedules”
means the several schedules referred to and identified herein, setting forth
certain disclosures, exceptions and other information, data and documents
referred to at various places throughout this Agreement.
1.39 “SEC
Documents” has the meaning set forth in Section 3.26.
1.40 “Section
4(2)” means Section 4(2) under the Securities Act, as the same may be amended
from time to time, or any successor statute.
1.41 “Securities
Act” means the Securities Act of 1933, as amended, or any similar federal
statute, and the rules and regulations of the Commission thereunder, all as
the
same will be in effect at the time.
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1.42 “Sellers”
has the meaning set forth in the preamble.
1.43 “Shares”
has the meaning set forth in the preamble.
1.44 “Subsidiary”
means, with respect to the Company, any corporation, limited liability company,
joint venture or partnership of which the Company (a) beneficially owns, either
directly or indirectly, more than 50% of (i) the total combined voting power
of
all classes of voting securities of such entity, (ii) the total combined equity
interests, or (iii) the capital or profit interests, in the case of a
partnership; or (b) otherwise has the power to vote or to direct the voting
of
sufficient securities to elect a majority of the board of directors or similar
governing body.
1.45 “Taxes”
means all foreign, federal, state or local taxes, charges, fees, levies,
imposts, duties and other assessments, as applicable, including, but not limited
to, any income, alternative minimum or add-on, estimated, gross income, gross
receipts, sales, use, transfer, transactions, intangibles, ad valorem,
value-added, franchise, registration, title, license, capital, paid-up capital,
profits, withholding, payroll, employment, unemployment, excise, severance,
stamp, occupation, premium, real property, recording, personal property, federal
highway use, commercial rent, environmental (including, but not limited to,
taxes under Section 59A of the Code) or windfall profit tax, custom, duty or
other tax, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest, penalties or additions to tax with
respect to any of the foregoing; and “Tax” means any of the foregoing
Taxes.
1.46 “Tax
Group” means any federal, state, local or foreign consolidated, affiliated,
combined, unitary or other similar group of which the Acquiror is now or was
formerly a member.
1.47 “Tax
Return” means any return, declaration, report, claim for refund or credit,
information return, statement or other similar document filed with any
Governmental Authority with respect to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
1.48 “Transaction
Documents” means, collectively, all agreements, instruments and other documents
to be executed and delivered in connection with the transactions contemplated
by
this Agreement.
1.49 “U.S.”
means the United States of America.
1.50 “U.S.
person” has the meaning set forth in Regulation S under the Securities
Act.
SECTION
II
CLOSING
2.1 Closing.
The
closing (“Closing”) of the transactions contemplated hereby will occur at the
offices of Ziam, Inc., 00000 Xxx Xxxxx Xxx., Xxx. 000, Xxx Xxxxxxx, Xxxxx,
00000, on the date hereof (the “Closing Date”).
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2.2 Purchase
and Sale; Payment.
On the
terms and subject to the conditions of this Agreement, at the Closing, the
Sellers shall sell, convey, assign, transfer and deliver to the Buyers, free
and
clear of all Liens, and the Buyers will buy from the Sellers, the Shares. The
purchase price for the Shares shall be FIVE HUNDRED FIFTY THOUSAND and no cents
($550,000.00)
(“Purchase Price”). At the Closing, the Sellers will deliver to the Buyers by
and through the Escrow Agent, Xxxxxxxx Law, P.A. (“Escrow Agent”), certificates
representing all the Shares, duly endorsed in blank, or accompanied by stock
powers duly executed in blank, with all required transfer stamps affixed. At
the
Closing, the Buyers shall transfer to the Sellers, via Escrow Agent, by wire
transfer or certified or official bank check in immediately available funds
an
amount equal to the Purchase Price.
SECTION
III
REPRESENTATIONS
AND WARRANTIES OF THE SELLER
The
Seller hereby represents and warrants to the Buyer as follows:
3.1 Organization
and Qualification.
The
Company is duly organized, validly existing and in good standing under the
laws
of its jurisdiction of organization, has all requisite authority and power
(corporate and other), governmental licenses, authorizations, consents and
approvals to carry on its business as presently conducted and to own, hold
and
operate its properties and assets as now owned, held and operated by it, except
where the failure to be so organized, existing and in good standing, or to
have
such authority and power, governmental licenses, authorizations, consents or
approvals would not have a Material Adverse Effect. The Company is duly
qualified, licensed or domesticated as a foreign corporation in good standing
in
each jurisdiction wherein the nature of its activities or its properties owned,
held or operated makes such qualification, licensing or domestication necessary,
except where the failure to be so duly qualified, licensed or domesticated
and
in good standing would not have a Material Adverse Effect. Schedule 3.1 sets
forth a true, correct and complete list of the Company’s jurisdiction of
organization and each other jurisdiction in which the Company presently conducts
its business or owns, holds and operates its properties and assets.
3.2 Subsidiaries.
The
Company does not own, directly or indirectly, any equity or other ownership
interest in any corporation, partnership, joint venture or other entity or
enterprise.
3.3 Organizational
Documents.
True,
correct and complete copies of the Organizational Documents have been delivered
to the Buyer prior to the execution of this Agreement, and no action has been
taken to amend or repeal such Organizational Documents. The Company is not
in
violation or breach of any of the provisions of its Organizational Documents,
except for such violations or breaches as would not have a Material Adverse
Effect.
3.4 Authorization.
The
Seller has all requisite authority and power (corporate and other), governmental
licenses, authorizations, consents and approvals to enter into this Agreement
and each of the Transaction Documents to which the Seller is a party, to
consummate the transactions contemplated by this Agreement and each of the
Transaction Documents to which the Seller is a party and to perform its
obligations under this Agreement and each of the Transaction Documents to which
the Seller is a party. The execution, delivery and performance by the Seller
of
this Agreement and each of the Transaction Documents to which the Seller is
a
party requires no authorization, consent, approval, license, exemption of or
filing or registration with any Governmental Authority or other
Person.
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3.5 No
Violation.
Neither
the execution or delivery by the Seller of this Agreement or any Transaction
Document to which the Seller is a party, nor the consummation or performance
by
the Seller of the transactions contemplated hereby or thereby will, directly
or
indirectly, (a) contravene, conflict with, or result in a violation of any
provision of the Organizational Documents of the Company; (b) contravene,
conflict with, constitute a default (or an event or condition which, with notice
or lapse of time or both, would constitute a default) under, or result in the
termination or acceleration of, or result in the imposition or creation of
any
Lien under, any agreement or instrument to which the Company is a party or
by
which the properties or assets of the Company are bound; (c) contravene,
conflict with, or result in a violation of, any Law or Order to which the
Company, or any of the properties or assets owned or used by the Company, may
be
subject; or (d) contravene, conflict with, or result in a violation of, the
terms or requirements of, or give any Governmental Authority the right to
revoke, withdraw, suspend, cancel, terminate or modify, any licenses, permits,
authorizations, approvals, franchises or other rights held by the Company or
that otherwise relate to the business of, or any of the properties or assets
owned or used by, the Company, except, in the case of clause (b), (c), or (d),
for any such contraventions, conflicts, violations, or other occurrences as
would not have a Material Adverse Effect.
3.6 Binding
Obligations.
Assuming this Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties thereto other than the Seller,
this Agreement has been, and as of the Closing each of the Transaction Documents
to which the Seller is a party will be, duly authorized, executed and delivered
by the Seller and constitutes or will constitute, as the case may be, the legal,
valid and binding obligations of the Seller, enforceable against the Seller
in
accordance with their respective terms, except as such enforcement is limited
by
general equitable principles, or by bankruptcy, insolvency and other similar
Laws affecting the enforcement of creditors rights generally.
3.7 Ownership
of Shares.
The
Sellers are the sole lawful owners of record and beneficially of, and have
good
and marketable title to, the Shares. The sale, transfer, assignment and delivery
of the Shares by the Sellers pursuant to this Agreement is, and will transfer
to
the Buyers good and marketable record and beneficial title thereto, free and
clear of all pledges, liens, security interests, encumbrances, equities, claims
and other charges of any kind whatsoever.
3.8 Capitalization
and Related Matters.
3.8.1 Capitalization.
The
authorized capital stock of the Company consists of 75,000,000 shares of Common
Stock, of which 6,000,000 shares are issued and outstanding. All issued and
outstanding shares of the Common Stock are duly authorized, validly issued,
fully paid and nonassessable, and have not been issued in violation of any
preemptive or similar rights. Except as disclosed in Schedule 3.8.1 or the
SEC
Documents, there are no outstanding or authorized options, warrants, purchase
agreements, participation agreements, subscription rights, conversion rights,
exchange rights or other securities or contracts that could require the Company
to issue, sell or otherwise cause to become outstanding any of its authorized
but unissued shares of capital stock or any securities convertible into,
exchangeable for or carrying a right or option to purchase shares of capital
stock or to create, authorize, issue, sell or otherwise cause to become
outstanding any new class of capital stock. There are no outstanding
stockholders’ agreements, voting trusts or arrangements, registration rights
agreements, rights of first refusal or other contracts pertaining to the capital
stock of the Company. The issuance of all of the shares of Common Stock
described in this Section 3.8.1 have been in compliance with U.S. federal and
state securities laws.
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3.8.2 No
Redemption Requirements.
Except
as set forth in Schedule 3.8.2 or in the SEC Documents, there are no outstanding
contractual obligations (contingent or otherwise) of the Company to retire,
repurchase, redeem or otherwise acquire any outstanding shares of capital stock
of, or other ownership interests in, the Company or to provide funds to or
make
any investment (in the form of a loan, capital contribution or otherwise) in
any
other Person.
3.8.3 Duly
Authorized.
The
issuance of the Shares has been duly authorized and, upon delivery to the Buyer
of certificates therefore in accordance with the terms of this Agreement, the
Shares will have been validly issued and fully paid, and will be nonassessable,
have the rights, preferences and privileges specified, will be free of
preemptive rights and will be free and clear of all Liens and restrictions,
other than Liens created by the Buyer and restrictions on transfer imposed
by
this Agreement and the Securities Act.
3.9
Compliance
with Laws.
Except
as would not have a Material Adverse Effect, the business and operations of
the
Company has been and is being conducted in accordance with all applicable Laws
and Orders. Except as would not have a Material Adverse Effect, the Company
has
not received notice of any violation (or any Proceeding involving an allegation
of any violation) of any applicable Law or Order by or affecting the Company
and, to the knowledge of the Seller, no Proceeding involving an allegation
of
violation of any applicable Law or Order is threatened or
contemplated.
3.10 Certain
Proceedings.
There
is no pending Proceeding that has been commenced against the Company and that
challenges, or may have the effect of preventing, delaying, making illegal,
or
otherwise interfering with, any of the transactions contemplated by this
Agreement. To the knowledge of the Seller, no such Proceeding has been
threatened.
3.11 No
Brokers or Finders.
Except
as disclosed in Schedule 3.11, no Person has, or as a result of the transactions
contemplated herein will have, any right or valid claim against the Company
for
any commission, fee or other compensation as a finder or broker, or in any
similar capacity, and the Seller will indemnify and hold the Buyer harmless
against any liability or expense arising out of, or in connection with, any
such
claim.
3.12 Absence
of Undisclosed Liabilities.
Except
as set forth on Schedule 3.12 or in the SEC Documents, the Company has no debt,
obligation or liability (whether accrued, absolute, contingent, liquidated
or
otherwise, whether due or to become due, whether or not known to the Company)
arising out of any transaction entered into at or prior to the Closing or any
act or omission at or prior to the Closing, except to the extent set forth
on or
reserved against on the Balance Sheet. Except as set forth on Schedule 3.12,
the
Company has not incurred any liabilities or obligations under agreements entered
into, in the usual and ordinary course of business since June 30,
2006.
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3.13 Changes.
Except
as set forth on Schedule 3.13 or in the SEC Documents, the Company has not,
since June 30, 2006:
3.13.1 Ordinary
Course of Business.
Conducted its business or entered into any transaction other than in the usual
and ordinary course of business, except for this Agreement.
3.13.2 Adverse
Changes.
Suffered or experienced any change in, or affecting, its condition (financial
or
otherwise), properties, assets, liabilities, business, operations, results
of
operations or prospects other than changes, events or conditions in the usual
and ordinary course of its business, none of which would have a Material Adverse
Effect;
3.13.3 Loans.
Made
any loans or advances to any Person other than travel advances and reimbursement
of expenses made to employees, officers and directors in the ordinary course
of
business;
3.13.4
Liens.
Created
or permitted to exist any Lien on any material property or asset of the Acquiror
Companies, other than Permitted Liens;
3.13.5 Capital
Stock.
Issued,
sold, disposed of or encumbered, or authorized the issuance, sale, disposition
or encumbrance of, or granted or issued any option to acquire any shares of
its
capital stock or any other of its securities or any Equity Security, or altered
the term of any of its outstanding securities or made any change in its
outstanding shares of capital stock or its capitalization, whether by reason
of
reclassification, recapitalization, stock split, combination, exchange or
readjustment of shares, stock dividend or otherwise;
3.13.6 Dividends.
Declared, set aside, made or paid any dividend or other distribution to any
of
its stockholders;
3.13.7 Material
Contracts.
Terminated or modified any Material Contract, except for termination upon
expiration in accordance with the terms thereof;
3.13.8
Claims.
Released, waived or cancelled any claims or rights relating to or affecting
the
Company in excess of $10,000 in the aggregate or instituted or settled any
Proceeding involving in excess of $10,000 in the aggregate;
3.13.9 Discharged
Liabilities.
Paid,
discharged or satisfied any claim, obligation or liability in excess of $10,000
in the aggregate, except for liabilities incurred prior to the date of this
Agreement in the ordinary course of business;
3.13.10 Indebtedness.
Created, incurred, assumed or otherwise become liable for any Indebtedness
in
excess of $10,000 in the aggregate;
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3.13.11 Guarantees.
Guaranteed or endorsed in a material amount any obligation or net worth of
any
Person;
3.13.12 Acquisitions.
Acquired the capital stock or other securities or any ownership interest in,
or
substantially all of the assets of, any other Person;
3.13.13
Accounting.
Changed
its method of accounting or the accounting principles or practices utilized
in
the preparation of its financial statements, other than as required by
GAAP;
3.13.14 Agreements.
Except
as set forth on Schedule 4.13.14 or in the SEC Documents, entered into any
agreement, or otherwise obligated itself, to do any of the
foregoing.
3.14 Material
Contracts.
Except
to the extent filed with the SEC Documents, the Seller has made available to
the
Buyer, prior to the date of this Agreement, true, correct and complete copies
of
each written Material Contract, including each amendment, supplement and
modification thereto.
3.14.1
No
Defaults.
Each
Material Contract is a valid and binding agreement of the Company, and is in
full force and effect. Except as would not have a Material Adverse Effect,
the
Company is not in breach or default of any Material Contract to which it is
a
party and, to the knowledge of the Seller, no other party to any Material
Contract is in breach or default thereof. Except as would not have a Material
Adverse Effect, no event has occurred or circumstance exists that (with or
without notice or lapse of time) would (a) contravene, conflict with or result
in a violation or breach of, or become a default or event of default under,
any
provision of any Material Contract or (b) permit the Company or any other Person
the right to declare a default or exercise any remedy under, or to accelerate
the maturity or performance of, or to cancel, terminate or modify any Material
Contract. The Company has not received notice of the pending or threatened
cancellation, revocation or termination of any Material Contract to which it
is
a party. There are no renegotiations of, or attempts to renegotiate, or
outstanding rights to renegotiate any material terms of any Material
Contract.
3.15 Employees.
3.15.1 Except
as
set forth on Schedule 3.15.1, the Company has no employees, independent
contractors or other Persons providing research or other services to them.
Except as would not have a Material Adverse Effect, the Company is in full
compliance with all Laws regarding employment, wages, hours, benefits, equal
opportunity, collective bargaining, the payment of Social Security and other
taxes, occupational safety and health and plant closing. The Company is not
liable for the payment of any compensation, damages, taxes, fines, penalties
or
other amounts, however designated, for failure to comply with any of the
foregoing Laws.
3.15.2 No
director, officer or employee of the Company is a party to, or is otherwise
bound by, any contract (including any confidentiality, non-competition or
proprietary rights agreement) with any other Person that in any way adversely
affects or will materially affect (a) the performance of his or her duties
as a
director, officer or employee of the Company or (b) the ability of the Company
to conduct its business. Except as set forth on Schedule 3.15.2, each employee
of the Company is employed on an at-will basis and the Company has no contracts
with any of its employees which would interfere with the Company’s ability to
discharge its employees.
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3.16 Tax
Returns and Audits.
3.16.1 Tax
Returns.
Except
as set forth on Schedule 3.16.1, (a) all material Tax Returns required to be
filed by or on behalf of the Company have been timely filed and all such Tax
Returns were (at the time they were filed) and are true, correct and complete
in
all material respects; (b) all material Taxes of the Company required to have
been paid (whether or not reflected on any Tax Return) have been fully and
timely paid, except those Taxes which are presently being contested in good
faith or for which an adequate reserve for the payment of such Taxes has been
established on the Balance Sheet; (c) no waivers of statutes of limitation
have
been given or requested with respect to the Company in connection with any
Tax
Returns covering the Company or with respect to any Taxes payable by it; (d)
no
Governmental Authority in a jurisdiction where the Company does not file Tax
Returns has made a claim, assertion or threat to the Company that the Company
is
or may be subject to taxation by such jurisdiction; (e) the Company has duly
and
timely collected or withheld, paid over and reported to the appropriate
Governmental Authority all amounts required to be so collected or withheld
for
all periods under all applicable laws; (f) there are no Liens with respect
to
Taxes on the Company’s property or assets other than Permitted Liens; (g) there
are no Tax rulings, requests for rulings, or closing agreements relating to
the
Company for any period (or portion of a period) that would affect any period
after the date hereof; and (h) any adjustment of Taxes of the Company made
by a
Governmental Authority in any examination that the Company is required to report
to the appropriate state, local or foreign taxing authorities has been reported,
and any additional Taxes due with respect thereto have been paid.
3.16.2 No
Adjustments, Changes.
The
Company has not, nor has any other Person on behalf of the Company (a) executed
or entered into a closing agreement pursuant to Section 7121 of the Code or
any
predecessor provision thereof or any similar provision of state, local or
foreign law; or (b) agreed to or is required to make any adjustments pursuant
to
Section 481(a) of the Code or any similar provision of state, local or foreign
law.
3.16.3 No
Disputes.
There
is no pending audit, examination, investigation, dispute, proceeding or claim
with respect to any Taxes of the Company, nor is any such claim or dispute
pending or contemplated. The Company has delivered to the Buyer true, correct
and complete copies of all Tax Returns, examination reports and statements
of
deficiencies assessed or asserted against or agreed to by the Company since
their inception and any and all correspondence with respect to the
foregoing.
3.16.4 Not
a
U.S. Real Property Holding Corporation.
The
Company is not and has not been a United States real property holding
corporation within the meaning of Section 897(c)(2) of the Code at any time
during the applicable period specified in Section 897(c)(1)(A)(ii) of the
Code.
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3.16.5 No
Tax
Allocation, Sharing.
The
Company is not a party to any Tax allocation or sharing agreement. Other than
with respect to the Tax Group of which the Company is the common parent, the
Company has not (a) been a member of a Tax Group filing a consolidated income
Tax Return under Section 1501 of the Code (or any similar provision of state,
local or foreign law), and has no (b) liability for Taxes for any Person under
Treasury Regulations Section 1.1502-6 (or any similar provision of state, local
or foreign law) as a transferee or successor, by contract or
otherwise.
3.16.6 No
Other Arrangements.
The
Company is not a party to any agreement, contract or arrangement for services
that would result, individually or in the aggregate, in the payment of any
amount that would not be deductible by reason of Section 162(m), 280G or 404
of
the Code. The Company is not “consenting corporations” within the meaning of
Section 341(f) of the Code. The Company does not have any “tax-exempt bond
financed property” or “tax-exempt use property” within the meaning of Section
168(g) or (h), respectively of the Code. The Company has no outstanding closing
agreement, ruling request, request for consent to change a method of accounting,
subpoena or request for information to or from a Governmental Authority in
connection with any Tax matter. During the last two years, the Company has
not
engaged in any exchange with a related party (within the meaning of Section
1031(f) of the Code) under which gain realized was not recognized by reason
of
Section 1031 of the Code. The Company is not a party to any reportable
transaction within the meaning of Treasury Regulation Section
1.6011-4.
3.17 Material
Assets.
The
financial statements of the Company set forth in the SEC Documents reflect
the
material properties and assets (real and personal) owned or leased by the
Company.
3.18 Insurance
Coverage.
The
Seller has made available to the Buyer, prior to the date of this Agreement,
true, correct and complete copies of all insurance policies maintained by the
Company on its properties and assets. Except as would not have a Material
Adverse Effect, all of such policies (a) taken together, provide adequate
insurance coverage for the properties, assets and operations of the Company
for
all risks normally insured against by a Person carrying on the same business
as
the Company, and (b) are sufficient for compliance with all applicable Laws
and
Material Contracts. Except as would not have a Material Adverse Effect, all
of
such policies are valid, outstanding and in full force and effect and, by their
express terms, will continue in full force and effect following the consummation
of the transactions contemplated by this Agreement. Except as set forth on
Schedule 3.18, the Company has not received (a) any refusal of coverage or
any
notice that a defense will be afforded with reservation of rights, or (b) any
notice of cancellation or any other indication that any insurance policy is
no
longer in full force or effect or will not be renewed or that the issuer of
any
policy is not willing or able to perform its obligations thereunder. All
premiums due on such insurance policies on or prior to the date hereof have
been
paid. There are no pending claims with respect to the Company or its properties
or assets under any such insurance policies, and there are no claims as to
which
the insurers have notified the Company that they intend to deny liability.
There
is no existing default under any such insurance policies.
3.19 Litigation;
Orders.
Except
as set forth on Schedule 3.19, there is no Proceeding (whether federal, state,
local or foreign) pending or, to the knowledge of the Company, threatened
against or affecting the Company or the Company’s properties, assets, business
or employees. To the knowledge of the Seller, there is no fact that might result
in or form the basis for any such Proceeding. The Company is not subject to
any
Orders.
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3.20 Licenses.
Except
as would not have a Material Adverse Effect, the Company possesses from the
appropriate Governmental Authority all licenses, permits, authorizations,
approvals, franchises and rights that are necessary for the Company to engage
in
its business as currently conducted and to permit the Company to own and use
its
properties and assets in the manner in which it currently owns and uses such
properties and assets (collectively, “Permits”). The Company has not received
notice from any Governmental Authority or other Person that there is lacking
any
license, permit, authorization, approval, franchise or right necessary for
the
Company to engage in its business as currently conducted and to permit the
Company to own and use its properties and assets in the manner in which it
currently owns and uses such properties and assets. Except as would not have
a
Material Adverse Effect, the Permits are valid and in full force and effect.
Except as would not have a Material Adverse Effect, no event has occurred or
circumstance exists that may (with or without notice or lapse of time): (a)
constitute or result, directly or indirectly, in a violation of or a failure
to
comply with any Permit; or (b) result, directly or indirectly, in the
revocation, withdrawal, suspension, cancellation or termination of, or any
modification to, any Permit. The Company has not received notice from any
Governmental Authority or any other Person regarding: (a) any actual, alleged,
possible or potential contravention of any Permit; or (b) any actual, proposed,
possible or potential revocation, withdrawal, suspension, cancellation,
termination of, or modification to, any Permit. All applications required to
have been filed for the renewal of such Permits have been duly filed on a timely
basis with the appropriate Persons, and all other filings required to have
been
made with respect to such Permits have been duly made on a timely basis with
the
appropriate Persons. All Permits are renewable by their terms or in the ordinary
course of business without the need to comply with any special qualification
procedures or to pay any amounts other than routine fees or similar charges,
all
of which have, to the extent due, been duly paid.
3.21 Interested
Party Transactions.
Except
as disclosed in Schedule 3.21, no officer, director or stockholder of the
Company or any Affiliate or “associate” (as such term is defined in Rule 405 of
the Commission under the Securities Act) of any such Person, has or has had,
either directly or indirectly, (1) an interest in any Person which (a) furnishes
or sells services or products which are furnished or sold or are proposed to
be
furnished or sold by the Company, or (b) purchases from or sells or furnishes
to, or proposes to purchase from, sell to or furnish the Company any goods
or
services; or (2) a beneficial interest in any contract or agreement to which
the
Company is a party or by which it may be bound or affected.
3.22 Governmental
Inquiries.
The
Seller has provided to the Buyer a copy of each material written inspection
report, questionnaire, inquiry, demand or request for information received
by
the Company from (and the Company’s response thereto), and each material written
statement, report or other document filed by the Company with, any Governmental
Authority.
3.23 Bank
Accounts and Safe Deposit Boxes.
Schedule 3.23 discloses the title and number of each bank or other deposit
or
financial account, and each lock box and safety deposit box used by the Company,
the financial institution at which that account or box is maintained and the
names of the persons authorized to draw against the account or otherwise have
access to the account or box, as the case may be.
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3.24 Intellectual
Property.
The
Company does not own, use or license any Intellectual Property in its business
as presently conducted.
3.25 Title
to and Condition of Properties.
Except
as would not have a Material Adverse Effect, the Company owns (with good and
marketable title in the case of real property) or holds under valid leases
or
other rights to use all real property, plants, machinery, equipment and other
personal property necessary for the conduct of its business as presently
conducted, free and clear of all Liens, except Permitted Liens. The material
buildings, plants, machinery and equipment necessary for the conduct of the
business of the Company as presently conducted are structurally sound, are
in
good operating condition and repair and are adequate for the uses to which
they
are being put, and none of such buildings, plants, machinery or equipment is
in
need of maintenance or repairs, except for ordinary, routine maintenance and
repairs that are not material in nature or cost.
3.26 SEC
Documents; Financial Statements.
Except
as set forth on Schedule 3.26, the Company has filed all reports required to
be
filed by it under the Exchange Act, including pursuant to Section 13(a) or
15(d)
thereof, for the three years preceding the date hereof (or such shorter period
as the Acquiror was required by law to file such material) (the foregoing
materials being collectively referred to herein as the “SEC Documents”) and has
filed any such SEC Documents prior to the expiration of any such extension.
As
of their respective dates, the SEC Documents complied in all material respects
with the requirements of the Securities Act and the Exchange Act and the rules
and regulations of the Commission promulgated thereunder, and none of the SEC
Documents, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in
order to make the statement therein, in light of the circumstances under which
they were made, not misleading. All material agreements to which the Company
is
a party or to which the property or assets of the Company are subject have
been
appropriately filed as exhibits to the SEC Documents as and to the extent
required under the Exchange Act. The financial statements of the Company
included in the SEC Documents comply in all material respects with applicable
accounting requirement and the rules and regulations of the Commission with
respect thereto as in effect at the time of filing, were prepared in accordance
with GAAP applied on a consistent basis during the periods involved (except
as
may be indicated in the notes thereto, or, in the case of unaudited statements
as permitted by Form 10-Q of the Commission), and fairly present in all material
respects (subject in the case of unaudited statements, to normal, recurring
audit adjustments) the financial position of the Acquiror as at the dates
thereof and the results of its operations and cash flows for the periods then
ended. The Common Stock is quoted on the OTC Bulletin Board and the NQP Pink
Sheets, and the Seller is not aware of any facts which would make the Common
Stock ineligible for continued quotation on the OTC Bulletin Board.
3.27 Stock
Option Plans; Employee Benefits.
3.27.1 Set
forth
on Schedule 3.27.1 is a complete list of all stock option plans providing for
the grant by the Company of stock options to directors, officers or employees.
Except as disclosed on Schedule 3.27.1, all such stock option plans are Approved
Plans.
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3.27.2 The
Company has no employee benefit plans or arrangements covering their present
and
former employees or providing benefits to such persons in respect of services
provided the Company.
3.27.3 Neither
the consummation of the transactions contemplated hereby alone, nor in
combination with another event, with respect to each director, officer, employee
and consultant of the Company, will result in (a) any payment (including,
without limitation, severance, unemployment compensation or bonus payments)
becoming due from the Company, (b) any increase in the amount of compensation
or
benefits payable to any such individual or (c) any acceleration of the vesting
or timing of payment of compensation payable to any such individual. No
agreement, arrangement or other contract of the Company provides benefits or
payments contingent upon, triggered by, or increased as a result of a change
in
the ownership or effective control of the Company.
3.28 Environmental
and Safety Matters.
Except
as set forth on Schedule 3.28 or in the SEC Documents and except as would not
have a Material Adverse Effect:
3.28.1 The
Company has at all time been and is in compliance with all Environmental Laws
applicable to the Company.
3.28.2 There
are
no Proceedings pending or threatened against the Company alleging the violation
of any Environmental Law or Environmental Permit applicable to the Company
or
alleging that the Company is a potentially responsible party for any
environmental site contamination.
3.28.3 Neither
this Agreement nor the consummation of the transactions contemplated by this
Agreement shall impose any obligations to notify or obtain the consent of any
Governmental Authority or third Persons under any Environmental Laws applicable
to any Acquiror Company.
3.29 Money
Laundering Laws.
The
operations of the Company are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the
Currency and Foreign Transactions Reporting Act of 1970, as amended, the money
laundering statutes of all U.S. and non-U.S. jurisdictions, the rules and
regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any Governmental Authority
(collectively, the “Money Laundering Laws”) and no Proceeding involving any
Acquiror Company with respect to the Money Laundering Laws is pending or, to
the
knowledge of the Company, threatened.
SECTION
IV
REPRESENTATIONS
AND WARRANTIES OF THE BUYER
4.1 Generally.
The
Buyers hereby represents and warrants to the Sellers:
4.1.1 Status.
By its
execution of this Agreement, the Buyers represent and warrant to the Sellers
as
indicated on its signature page to this Agreement, either that:
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(a) it
is an
Accredited Investor; or
(b) it
is not
a U.S. person.
The
Buyers understand that the Shares are being offered and sold to the Buyers
in
reliance upon the truth and accuracy of the representations, warranties,
agreements, acknowledgments and understandings of the Buyers set forth in this
Agreement, in order that the Sellers may determine the applicability and
availability of the exemptions from registration of the Shares on which the
Sellers are relying.
4.1.2 Additional
Representations and Warranties of Accredited Investors.
If an
Accredited Investor, the Buyer further makes the representations and warranties
to the Sellers set forth on Exhibit B.
4.1.3 Additional
Representations and Warranties of Non-U.S. Persons.
If not
a U.S. person, the Buyer further makes the representations and warranties to
the
Sellers set forth on Exhibit C.
4.1.4 Stock
Legends.
The
Buyer hereby agrees with the Seller as follows:
(a) Securities
Act Legend - Accredited Investors.
If an
Accredited Investor, the certificates evidencing the Shares issued to the Buyer,
and each certificate issued in transfer thereof, will bear the following
legend:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS OR (2) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN
WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY
AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO
THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS.
(b) Securities
Act Legend - Non-U.S. Persons.
If not
a U.S. person, the certificates evidencing the Shares issued to the Buyers,
and
each certificate issued in transfer thereof, will bear the following
legend:
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THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) IN ACCORDANCE WITH THE PROVISIONS
OF REGULATION S PROMULGATED UNDER THE SECURITIES ACT, AND BASED ON AN OPINION
OF
COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY,
THAT THE PROVISIONS OF REGULATION S HAVE BEEN SATISFIED, (2) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS OR (3) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN
WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY
AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO
THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING THE SECURITIES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT.
(c) Other
Legends.
The
certificates representing the Shares, and each certificate issued in transfer
thereof, will also bear any other legend required under any applicable Law,
including, without limitation, any U.S. state corporate and state securities
law, or contract.
(d) Opinion.
The
Buyers will not transfer any or all of the Shares pursuant to Regulation S
or
absent an effective registration statement under the Securities Act and
applicable state securities law covering the disposition of the Shares, without
first providing the Company with an opinion of counsel (which counsel and
opinion are reasonably satisfactory to the Company) to the effect that such
transfer will be made in compliance with Regulation S or will be exempt from
the
registration and the prospectus delivery requirements of the Securities Act
and
the registration or qualification requirements of any applicable U.S. state
securities laws.
(e) Consent.
The
Buyers understand and acknowledge that the Company may refuse to transfer the
Shares, unless the Buyers comply with this Section 3.1.3 and any other
restrictions on transferability set forth in Exhibits B and C. The Buyers
consent to the Company making a notation on its records or giving instructions
to any transfer agent of the Common Stock in order to implement the restrictions
on transfer of the Shares.
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SECTION
V
INDEMNIFICATION;
REMEDIES
5.1 Survival.
All
representations, warranties, covenants, and obligations in this Agreement shall
survive the Closing and expire on the sixth anniversary of the Closing. The
right to indemnification, payment of Damages or other remedy based on such
representations, warranties, covenants, and obligations will not be affected
by
any investigation conducted with respect to the accuracy or inaccuracy of or
compliance with, any such representation, warranty, covenant, or obligation.
The
waiver of any condition based on the accuracy of any representation or warranty,
or on the performance of or compliance with any covenant or obligation, will
not
affect the right to indemnification, payment of Damages, or other remedy based
on such representations, warranties, covenants, and obligations.
5.2 Indemnification
by the Sellers.
With
respect to those representations and warranties made by Sellers in Sections
3.1,
3.3, 3.7, 3.8 and 3.26 of this Agreement, for a period of eight (8) weeks from
and after the Closing, the Sellers shall indemnify and hold harmless the Buyers
(the “Indemnified Party”), from and against any damages arising, directly or
indirectly, from or in connection with (“Damages”) any breach of any such
representation and warranty made by Sellers in the above referenced sections
of
this Agreement.
5.3 Limitations
on Amount - the Sellers.
The
Indemnified Party shall not be entitled to aggregate indemnification pursuant
to
Section 5.2 in excess of the amount of the Purchase Price.
5.4 Breach
by the Sellers.
Nothing
in this Section 5 shall limit the Buyers’ rights to pursue any appropriate legal
or equitable remedy against the Sellers with respect to any Damages arising,
directly or indirectly, from or in connection with any breach by the Sellers
of
any representation or warranty made by the Sellers in this Agreement or in
any
certificate delivered by the Sellers pursuant to this Agreement.
SECTION
VI
GENERAL
PROVISIONS
6.1 Expenses.
Except
as otherwise expressly provided in this Agreement, each party to this Agreement
will bear its respective expenses incurred in connection with the preparation,
execution, and performance of this Agreement and the transactions contemplated
by this Agreement, including all fees and expenses of agents, representatives,
counsel, and accountants. In the event of termination of this Agreement, the
obligation of each party to pay its own expenses will be subject to any rights
of such party arising from a breach of this Agreement by another
party.
6.2 Confidentiality.
6.2.1 Subsequent
to the date of this Agreement, the Buyers and the Sellers will maintain in
confidence, any written, oral, or other information obtained in confidence
from
another party in connection with this Agreement or the transactions contemplated
by this Agreement, unless (a) such information is already known to such party
or
to others not bound by a duty of confidentiality or such information becomes
publicly available through no fault of such party, (b) the use of such
information is necessary or appropriate in making any required filing with
the
Commission, or obtaining any consent or approval required for the consummation
of the transactions contemplated by this Agreement, or (c) the furnishing or
use
of such information is required by or necessary or appropriate in connection
with legal proceedings.
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6.2.2 In
the
event that any party is required to disclose any information of another party
pursuant to clause (b) or (c) of Section 6.2.1, the party requested or required
to make the disclosure (the “Disclosing Party”) shall provide the party that
provided such information (the “Providing Party”) with prompt notice of any such
requirement so that the providing party may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this Section
6.2.2. If, in the absence of a protective order or other remedy or the receipt
of a waiver by the Providing Party, the Disclosing Party is nonetheless, in
the
opinion of counsel, legally compelled to disclose the information of the
Providing Party, the Disclosing Party may, without liability hereunder, disclose
only that portion of the Providing Party’s information which such counsel
advises is legally required to be disclosed, provided that the Disclosing Party
exercises its reasonable efforts to preserve the confidentiality of the
Providing Party’s information, including, without limitation, by cooperating
with the Providing Party to obtain an appropriate protective order or other
relief assurance that confidential treatment will be accorded the Providing
Party’s information.
6.2.3 If
the
transactions contemplated by this Agreement are not consummated, each party
will
return or destroy as much of such written information as the other party may
reasonably request.
6.3 Notices.
All
notices, consents, waivers, and other communications under this Agreement must
be in writing and will be deemed to have been duly given when (a) delivered
by
hand (with written confirmation of receipt), (b) sent by telecopier (with
written confirmation of receipt), or (c) when received by the addressee, if
sent
by a nationally recognized overnight delivery service (receipt requested),
in
each case to the appropriate addresses and telecopier numbers set forth below
(or to such other addresses and telecopier numbers as a party may designate
by
notice to the other parties):
|
If
to SELLER:
Xxxxxxxx
Law, P.A.
0000
Xxxxxxxx Xxxx. Xxxxx, #000
Xxxxx
Xxxxxxxx, Xxxxxxx 00000
|
with
a copy to:
Attn:
Xxxx Xxxxxxx
000
Xxxxx Xxxxxx Xxxxx
Xx.
Xxxxxxxxxx, Xxxxxxx 00000
|
|
Telephone
No.: 000.000.0000
Facsimile
No.: 000.000.0000
|
Telephone
No.: 000.000.0000
Facsimile
No.: _________________________
|
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|
If
to BUYER:
iBroader
Developments
Limited
Attn:
Xxxx
X, 0xx
Xxxxx
Xx.
00 Xxxx Xxx Xxxx
Xxxxx
Xxxxxx, Xxxx Xxxx
|
with
a copy to:
Attn:__________________________________
______________________________________
______________________________________
______________________________________
|
|
Telephone
No.: _________________________
Facsimile
No.: _________________________
|
Telephone
No.: _________________________
Facsimile
No.: _________________________
|
6.4 Further
Assurances.
The
parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents,
and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Agreement and the
documents referred to in this Agreement.
6.5 Waiver.
The
rights and remedies of the parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Agreement or the documents referred to
in
this Agreement will operate as a waiver of such right, power, or privilege,
and
no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or
the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (a) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one party,
in whole or in part, by a waiver or renunciation of the claim or right unless
in
writing signed by the other party; (b) no waiver that may be given by a party
will be applicable except in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
6.6 Entire
Agreement and Modification.
This
Agreement supersedes all prior agreements between the parties with respect
to
its subject matter and constitutes (along with the documents referred to in
this
Agreement) a complete and exclusive statement of the terms of the agreement
between the parties with respect to its subject matter. This Agreement may
not
be amended except by a written agreement executed by the party against whom
the
enforcement of such amendment is sought.
6.7 Assignments,
Successors, and No Third-Party Rights.
No
party may assign any of its rights under this Agreement without the prior
consent of the other parties. Subject to the preceding sentence, this Agreement
will apply to, be binding in all respects upon, and inure to the benefit of
and
be enforceable by the respective successors and permitted assigns of the
parties. Nothing expressed or referred to in this Agreement will be construed
to
give any Person other than the parties to this Agreement any legal or equitable
right, remedy, or claim under or with respect to this Agreement or any provision
of this Agreement. This Agreement and all of its provisions and conditions
are
for the sole and exclusive benefit of the parties to this Agreement and their
successors and assigns.
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6.8 Severability.
If any
provision of this Agreement is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Agreement will remain
in
full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to
the
extent not held invalid or unenforceable.
6.9 Section
Headings, Construction.
The
headings of Sections in this Agreement are provided for convenience only and
will not affect its construction or interpretation. All references to “Section”
or “Sections” refer to the corresponding Section or Sections of this Agreement.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word “including” does not limit the preceding words or terms.
6.10 Governing
Law.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of Florida, without regard to the principles
of conflicts of law thereof. Each party agrees that all legal proceedings
concerning the interpretations, enforcement and defense of the transactions
contemplated by this Agreement (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, employees or agents)
shall be commenced exclusively in courts sitting in the Florida. Each party
hereto hereby irrevocably submits to the exclusive jurisdiction of the courts
sitting in the Florida for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is
improper. Nothing contained herein shall be deemed to limit in any way any
right
to serve process in any manner permitted by law. If either party shall commence
an action or proceeding to enforce any provisions of this Agreement, then the
prevailing party in such action or proceeding shall be reimbursed by the other
party for its attorney’s fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or
proceeding.
6.11 Counterparts
and Facsimile Signatures.
This
Agreement may be executed in one or more counterparts, each of which will be
deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement. Facsimile
signatures are acceptable and deemed original signatures.
REMAINDER
OF PAGE INTENTIONALLY BLANK.
SIGNATURE
PAGE TO FOLLOW.
CONFIDENTIAL
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COUNTERPART
SIGNATURE PAGE
IN
WITNESS WHEREOF, the parties have executed and delivered individual Stock
Purchase Agreements as of the date first written above.
|
BUYER:
IBROADER
DEVELOPMENTS LIMITED
By:
/s/ Xxxxxx Xx
Its:
President
|
|
|
By:
/s/ Xxxx Xxxxxxx
Its:
President
|
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EXHIBIT
“A”
Definition
of “Accredited Investor”
The
term
“accredited investor” means:
| (1) |
A
bank as defined in Section 3(a)(2) of the Securities Act, or a savings
and
loan association or other institution as defined in Section 3(a)(5)(A)
of
the Securities Act, whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934; an insurance company as defined in
Section 2(13) of the Securities Act; an investment company registered
under the Investment Company Act of 1940 (the “Investment Company Act”) or
a business development company as defined in Section 2(a)(48) of the
Investment Company Act; a Small Business Investment Company licensed
by
the U.S. Small Business Administration under Section 301(c) or (d)
of the
Small Business Investment Act of 1958; a plan established and maintained
by a state, its political subdivisions or any agency or instrumentality
of
a state or its political subdivisions for the benefit of its employees,
if
such plan has total assets in excess of $5,000,000; an employee benefit
plan within the meaning of the Employee Retirement Income Security
Act of
1974 (“ERISA”), if the investment decision is made by a plan fiduciary, as
defined in Section 3(21) of ERISA, which is either a bank, savings
and
loan association, insurance company, or registered investment advisor,
or
if the employee benefit plan has total assets in excess of $5,000,000
or,
if a self-directed plan, with investment decisions made solely by persons
that are accredited investors.
|
| (2) |
A
private business development company as defined in Section 202(a)(22)
of
the Investment Advisers Act of 1940.
|
| (3) |
An
organization described in Section 501(c)(3) of the Internal Revenue
Code,
corporation, Massachusetts or similar business trust, or partnership,
not
formed for the specific purpose of acquiring the securities offered,
with
total assets in excess of $5,000,000.
|
| (4) |
A
director or executive officer of the
Acquiror.
|
| (5) |
A
natural person whose individual net worth, or joint net worth with
that
person’s spouse, at the time of his or her purchase exceeds
$1,000,000.
|
| (6) |
A
natural person who had an individual income in excess of $200,000 in
each
of the two most recent years or joint income with that person’s spouse in
excess of $300,000 in each of those years and has a reasonable expectation
of reaching the same income level in the current
year.
|
| (7) |
A
trust, with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase
is
directed by a sophisticated person as described in Rule 506(b)(2)(ii)
(i.e., a person who has such knowledge and experience in financial
and
business matters that he is capable of evaluating the merits and risks
of
the prospective investment).
|
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| (8) |
An
entity in which all of the equity owners are accredited investors.
(If
this alternative is checked, the Shareholder must identify each equity
owner and provide statements signed by each demonstrating how each
is
qualified as an accredited investor.)
|
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EXHIBIT
“B”
ACCREDITED
INVESTOR REPRESENTATIONS
Each
Shareholder indicating that it is an Accredited Investor, severally and not
jointly, further represents and warrants to the Acquiror as
follows:
| 1. |
Such
Shareholder qualifies as an Accredited Investor on the basis set forth
on
its signature page to this Agreement.
|
| 2. |
Such
Shareholder has sufficient knowledge and experience in finance,
securities, investments and other business matters to be able to protect
such Shareholder’s interests in connection with the transactions
contemplated by this Agreement.
|
| 3. |
Such
Shareholder has consulted, to the extent that it has deemed necessary,
with its tax, legal, accounting and financial advisors concerning its
investment in the Acquiror Shares.
|
| 4. |
Such
Shareholder understands the various risks of an investment in the Acquiror
Shares and can afford to bear such risks for an indefinite period of
time,
including, without limitation, the risk of losing its entire investment
in
the Acquiror Shares.
|
| 5. |
Such
Shareholder has had access to the Acquiror’s publicly filed reports with
the SEC.
|
| 6. |
Such
Shareholder has been furnished during the course of the transactions
contemplated by this Agreement with all other public information regarding
the Acquiror that such Shareholder has requested and all such public
information is sufficient for such Shareholder to evaluate the risks
of
investing in the Acquiror Shares.
|
| 7. |
Such
Shareholder has been afforded the opportunity to ask questions of and
receive answers concerning the Acquiror and the terms and conditions
of
the issuance of the Acquiror Shares.
|
| 8. |
Such
Shareholder is not relying on any representations and warranties
concerning the Acquiror made by the Acquiror or any officer, employee
or
agent of the Acquiror, other than those contained in this
Agreement.
|
| 9. |
Such
Shareholder is acquiring the Acquiror Shares for such Shareholder’s own
account, for investment and not for distribution or resale to
others.
|
| 10. |
Such
Shareholder will not sell or otherwise transfer the Acquiror Shares,
unless either (A) the transfer of such securities is registered under
the
Securities Act or (B) an exemption from registration of such securities
is
available.
|
| 11. |
Such
Shareholder understands and acknowledges that the Acquiror is under
no
obligation to register the Acquiror Shares for sale under the Securities
Act.
|
CONFIDENTIAL
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| 12. |
Such
Shareholder consents to the placement of a legend on any certificate
or
other document evidencing the Acquiror Shares substantially in the
form
set forth in Section 4.2.5(a).
|
| 13. |
Such
Shareholder represents that the address furnished by such Shareholder
on
its signature page to this Agreement and in Exhibit A is such
Shareholder’s principal residence if he is an individual or its principal
business address if it is a corporation or other
entity.
|
| 14. |
Such
Shareholder understands and acknowledges that the Acquiror Shares have
not
been recommended by any federal or state securities commission or
regulatory authority, that the foregoing authorities have not confirmed
the accuracy or determined the adequacy of any information concerning
the
Acquiror that has been supplied to such Shareholder and that any
representation to the contrary is a criminal
offense.
|
| 15. |
Such
Shareholder acknowledges that the representations, warranties and
agreements made by such Shareholder herein shall survive the execution
and
delivery of this Agreement and the purchase of the Acquiror
Shares.
|
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EXHIBIT
“C”
NON-U.S.
PERSON REPRESENTATIONS
Each
Shareholder indicating that it is not a U.S. person, severally and not jointly,
further represents and warrants to the Acquiror as follows:
| 1. |
At
the time of (a) the offer by the Acquiror and (b) the acceptance of
the
offer by such Shareholder, of the Acquiror Shares, such Shareholder
was
outside the United States.
|
| 2. |
No
offer to acquire the Acquiror Shares or otherwise to participate in
the
transactions contemplated by this Agreement was made to such Shareholder
or its representatives inside the United
States.
|
| 3. |
Such
Shareholder is not purchasing the Acquiror Shares for the account or
benefit of any U.S. person, or with a view towards distribution to
any
U.S. person, in violation of the registration requirements of the
Securities Act.
|
| 4. |
Such
Shareholder will make all subsequent offers and sales of the Acquiror
Shares either (x) outside of the United States in compliance with
Regulation S; (y) pursuant to a registration under the Securities Act;
or
(z) pursuant to an available exemption from registration under the
Securities Act. Specifically, such Shareholder will not resell the
Acquiror Shares to any U.S. person or within the United States prior
to
the expiration of a period commencing on the Closing Date and ending
on
the date that is one year thereafter (the “Distribution Compliance
Period”), except pursuant to registration under the Securities Act or an
exemption from registration under the Securities
Act.
|
| 5. |
Such
Shareholder is acquiring the Acquiror Shares for such Shareholder’s own
account, for investment and not for distribution or resale to
others.
|
| 6. |
Such
Shareholder has no present plan or intention to sell the Acquiror Shares
in the United States or to a U.S. person at any predetermined time,
has
made no predetermined arrangements to sell the Acquiror Shares and
is not
acting as a Distributor of such
securities.
|
| 7. |
Neither
such Shareholder, its Affiliates nor any Person acting on such
Shareholder’s behalf, has entered into, has the intention of entering
into, or will enter into any put option, short position or other similar
instrument or position in the U.S. with respect to the Acquiror Shares
at
any time after the Closing Date through the Distribution Compliance
Period
except in compliance with the Securities
Act.
|
| 8. |
Such
Shareholder consents to the placement of a legend on any certificate
or
other document evidencing the Acquiror Shares substantially in the
form
set forth in Section 4.2.5(b).
|
CONFIDENTIAL
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30
| 9. |
Such
Shareholder is not acquiring the Acquiror Shares in a transaction (or
an
element of a series of transactions) that is part of any plan or scheme
to
evade the registration provisions of the Securities Act.
|
| 10. |
Such
Shareholder has sufficient knowledge and experience in finance,
securities, investments and other business matters to be able to protect
such Shareholder’s interests in connection with the transactions
contemplated by this Agreement.
|
| 11. |
Such
Shareholder has consulted, to the extent that it has deemed necessary,
with its tax, legal, accounting and financial advisors concerning its
investment in the Acquiror Shares.
|
| 12. |
Such
Shareholder understands the various risks of an investment in the Acquiror
Shares and can afford to bear such risks for an indefinite period of
time,
including, without limitation, the risk of losing its entire investment
in
the Acquiror Shares.
|
| 13. |
Such
Shareholder has had access to the Acquiror’s publicly filed reports with
the SEC.
|
| 14. |
Such
Shareholder has been furnished during the course of the transactions
contemplated by this Agreement with all other public information regarding
the Acquiror that such Shareholder has requested and all such public
information is sufficient for such Shareholder to evaluate the risks
of
investing in the Acquiror Shares.
|
| 15. |
Such
Shareholder has been afforded the opportunity to ask questions of and
receive answers concerning the Acquiror and the terms and conditions
of
the issuance of the Acquiror Shares.
|
| 16. |
Such
Shareholder is not relying on any representations and warranties
concerning the Acquiror made by the Acquiror or any officer, employee
or
agent of the Acquiror, other than those contained in this
Agreement.
|
| 17. |
Such
Shareholder will not sell or otherwise transfer the Acquiror Shares,
unless either (A) the transfer of such securities is registered under
the
Securities Act or (B) an exemption from registration of such securities
is
available.
|
| 18. |
Such
Shareholder understands and acknowledges that the Acquiror is under
no
obligation to register the Acquiror Shares for sale under the Securities
Act.
|
| 19. |
Such
Shareholder represents that the address furnished by such Shareholder
on
its signature page to this Agreement and in Exhibit A is such
Shareholder’s principal residence if he is an individual or its principal
business address if it is a corporation or other
entity.
|
| 20. |
Such
Shareholder understands and acknowledges that the Acquiror Shares have
not
been recommended by any federal or state securities commission or
regulatory authority, that the foregoing authorities have not confirmed
the accuracy or determined the adequacy of any information concerning
the
Acquiror that has been supplied to such Shareholder and that any
representation to the contrary is a criminal
offense.
|
CONFIDENTIAL
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28 of
30
| 21. |
Such
Shareholder acknowledges that the representations, warranties and
agreements made by such Shareholder herein shall survive the execution
and
delivery of this Agreement and the purchase of the Acquiror
Shares.
|
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30
EXHIBIT
“D”
|
SHAREHOLDER
NAME
|
NUMBER
OF SHARES *
|
|
Xxxx
Xxxxxxx
|
3,121,323
|
|
Xxxxx
Xxxxxxx Xxxxxxx
|
328,333
|
|
Xxxxxx
X. Xxxxxx
|
66,167
|
|
Xxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxxx
Xxxxxxxx
|
66,657
|
|
Xxxx
Xxxxx
|
66,657
|
|
Xxxx
Xxxxxxx
|
66,657
|
|
Xxxxx
Xxxxxxx
|
66,657
|
|
Xxxxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxx
Xxxxxxx
|
66,657
|
|
Xxxx
Xxxxxxx
|
66,657
|
|
Xxxxxx
Xxxx
|
66,657
|
|
Xxxx
Xxxx
|
66,657
|
|
Xxxx
Xxxxx
|
66,657
|
|
Xxxxxxx
Xxxxx
|
66,657
|
|
Xxxx
Xxxx
|
66,657
|
|
Xxxxxxx
Xxx-Xxxxx
|
66,657
|
|
Xxxxx
Xxxxxxx
|
66,657
|
|
Xxxx
Xxxxxxx
|
66,657
|
|
Xxxxxxxx
Xxxxxxx
|
66,467
|
|
Xxxx
X. Xxxxxxx
|
66,467
|
|
Xxxx
X. Xxxxxxx
|
66,467
|
|
Island
Stock Transfer
|
17,222
|
|
Xxxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxxxx
Xxxxxxx, Xx.
|
66,657
|
|
Xxxx
X. Xxxxxxx
|
64,667
|
|
Xxxxx
Xxxxxxx
|
42,444
|
|
Xxxx
Xxxxx
|
66,657
|
|
Xxxxx
Xxxxx
|
66,657
|
|
Xxxx
Xxxxxxx
|
66,657
|
|
Xxxxx
Xxxxxxx
|
66,657
|
|
Xxx
Xxxxx
|
66,657
|
|
Xxxxx
Xxxxx
|
66,657
|
|
Xxxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxxxxxxx
Xxxxxxx
|
66,657
|
|
Xxxxx
Xxxxxxxx
|
66,657
|
|
Xxxxxx
Xxxxxxxx
|
66,657
|
|
Summer
Hai-Kelly
|
66,657
|
|
TOTAL
|
5,770,000
|
*Total
reflects post-forward split effective September 30, 2006
CONFIDENTIAL
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