ACQUISITION AGREEMENT
THIS AGREEMENT is dated for reference this 22nd day of January, 2002.
BETWEEN:
LOOP COMMUNICATIONS INC., a company incorporated pursuant to the laws of
Canada and having an office located at 0000 Xx. 0 Xxxx, Xxxxx #000,
Xxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0;
("Loop")
OF THE FIRST PART
AND:
XXXXX XXXXX, of 0000 Xx. 0 Xxxx, Xxxxx #000, Xxxxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0;
("Cheng")
OF THE SECOND PART
AND:
XXXXXXXXX.XXX, INC., a company incorporated pursuant to the laws of the
State of Nevada and having an office located at 700 - 000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx, X0X 0X0;
("Surforama")
OF THE THIRD PART
WHEREAS:
A. Loop is engaged in the business of selling and direct marketing of wireless
products and services; and
B. Surforama desires to purchase from Cheng all the issued and outstanding
shares of common stock in the capital of Loop (the "Shares") on the terms
and conditions hereinafter set forth;
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NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and
mutual agreements and covenants herein contained, the parties hereby covenant
and agree as follows:
1. LOOP AND CHENG'S REPRESENTATIONS
Loop and Cheng hereby make the following representations and
warranties to Surforama, each of which is true and correct on the date hereof
and will be true and correct on the Closing Date, each of which shall be
unaffected by any investigation made by Surforama and shall survive the Closing
Date:
(a) The authorized capital of Loop consists of 1,000 Class A voting
shares, an unlimited number of Class B voting shares, an unlimited number of
Class C non-voting shares, an unlimited number of Class D non-voting shares and
an unlimited number of Class E redeemable, retractable, preferred shares, of
which 1,000 Class A voting shares are issued to Cheng as fully paid and
non-assessable. There are no other securities issued or outstanding. In
addition, there are no outstanding or authorized options, dividends, warrants,
agreements, subscriptions, calls, demands or rights of any character relating to
the capital stock of Loop, whether or not issued, including, without limitation,
securities convertible into or evidencing the right to purchase any securities
of Loop;
(b) Loop is a corporation duly incorporated, validly existing and in
good standing under the Canada Business Corporations Act and has all requisite
corporate power and authority to own its assets and operate its business as and
where it is now being conducted;
(c) Loop owns a 100% interest in Loop Mobility Inc., a federally
incorporated Canadian company; Unipage Solutions Inc., a federally incorporated
Canadian company; and Unipage Solutions Inc., a British Columbia incorporated
company (collectively, the "Subsidiaries"). Each of the Subsidiaries is duly
incorporated, validly existing and in good standing and has all requisite
corporate power and authority to own its assets and operate its business as and
where it is now being conducted. There are no outstanding or authorized
options, dividends, warrants, agreements, subscriptions, calls demands or rights
of any character relating to the capital stock of the Subsidiaries, whether or
not issued, including without limitation, securities convertible into or
evidencing the right to purchase any securities of any of the Subsidiaries;
(d) Loop is duly licensed and/or qualified and in good standing in
Canada, which is the sole jurisdiction in which the nature of Loop's assets or
the business conducted by Loop makes qualification necessary;
(e) Prior to Closing, Loop shall provide Surforama with consolidated
audited financial
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(the "Financial Statements"), prepared in accordance with United States
generally accepted accounting principles and shall fairly represent Loop's
financial position at that date;
(f) Loop and its Subsidiaries have good and marketable title to all of
their assets free and clear of all mortgages, liens, pledges, charges, claims,
leases, restrictions or encumbrances of any nature whatsoever, and subject to no
restrictions with respect to transferability. All of Loop's assets are in its
possession and control;
(g) Neither Cheng, Loop nor its Subsidiaries have given a power of
attorney, which is currently in effect, to any person, firm or corporation for
any purpose whatsoever;
(h) Neither Cheng, Loop nor its Subsidiaries has entered into any other
agreement or granted any option to sell or otherwise transfer any of its assets
or its securities;
(i) To the knowledge of Cheng, each contract, lease, license,
commitment and agreement to which Loop or any of its Subsidiaries is a party is
in full force and effect and constitutes a legal, valid and binding obligation
of all of the parties thereto. Neither Loop or its Subsidiaries is in default
and has not received or given any notice of default, and to Cheng's knowledge,
no other party thereto is in default, under any such contract, lease, license,
commitment or other agreement or under any other obligation relating to Loop's,
or its Subsidiaries', assets or business;
(j) There are no outstanding orders, judgments, injunctions, awards or
decrees of any court, arbitrator or governmental or regulatory body involving
Cheng, Loop nor any of it's Subsidiaries. No suit, action or legal,
administrative, arbitration or other proceeding or reasonable basis therefore,
or, to the best of Cheng's knowledge, no investigation by any governmental
agency pertaining to Loop, any of Loop's Subsidiaries, or their assets is
pending or has been threatened which could adversely affect the financial
condition or prospects of Loop or the conduct of the business thereof or any of
Loop's assets or materially adversely affect the ability of Cheng to consummate
the transactions contemplated by this Agreement;
(k) To Cheng's knowledge, Loop has not infringed any patent or patent
application, copyright or copyright application, trademark or trademark
application or trade name or other proprietary or intellectual property right of
any other person or received any notice of a claim of such infringement;
(l) Loop has the right to use all data and information necessary to
permit the conduct of its business from and after the Closing Date, as such
business is and has been normally conducted;
(m) The Articles and Bylaws of Loop and its Subsidiaries permit them to
carry on their present business and to enter into this Agreement;
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(n) The performance of this Agreement will not be in violation of the
Articles or Bylaws of Loop or its Subsidiaries, or any agreement to which Loop
or its Subsidiaries is a party and will not give any person any right to
terminate or cancel any agreement or any right enjoyed by Loop or its
Subsidiaries and will not result in the creation or imposition of any lien,
encumbrance or restriction of any nature whatsoever in favour of a third party
upon or against the assets of Loop or its Subsidiaries;
(o) Loop and its Subsidiaries hold all permits, licences, registrations
and authorizations necessary for them to conduct their business;
(p) Neither Loop nor its Subsidiaries is in violation of any federal,
state, municipal or other law, regulation or order of any government or
regulatory authority;
(q) Loop and its Subsidiaries have filed with the appropriate
government agencies all tax or information returns and tax reports required to
be filed, and such filings are substantially true, complete and correct;
(r) All federal, state, municipal, foreign, sales, property or excise
or other taxes whether or not yet due have been fully paid or adequately
provided for;
(s) The corporate records and minute books of Loop and its Subsidiaries
contain complete and accurate minutes of all meetings of the directors and
shareholders held since incorporation;
(t) All material transactions of Loop and its Subsidiaries have been
promptly and properly recorded or filed in or with its respective books and
records; and
(u) Loop and its Subsidiaries have complied with all laws, rules,
regulations and orders applicable to it relating to employment, including those
relating to wages, hours, collective bargaining, occupational health and safety,
employment standards and workers' compensation.
2. SURFORAMA'S REPRESENTATIONS
Surforama hereby makes the following representations and warranties to
Loop and Cheng, each of which is true and correct on the date hereof and will be
true and correct on the Closing Date, each of which shall be unaffected by any
investigation made by Loop or Cheng and shall survive the Closing Date:
(a) The authorized capital of Surforama consists of 70,000,000 shares
of common stock at a par value of $0.001 per share, of which 19,828,899 shares
are issued as fully paid and non-assessable. There are no outstanding or
authorized options,
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dividends, warrants, agreements, subscriptions, calls, demand or rights of any
character relating to the capital stock of Surforama, whether or not issued,
including, without limitation, securities convertible into or evidencing the
right to purchase any securities of Surforama;
(b) Surforama is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Nevada and has all requisite
corporate power and authority to own its property and operate its business as
and where it is now being conducted;
(c) Surforama is in good standing with respect to its filings with the
Nevada Secretary of State and the United States Securities & Exchange
Commission;
(d) Surforama owns a 100% interest in Surforama Portal Services Inc.
(federal Canadian corporation), a 49.07% interest in Xxxxxxxxx.xxx, Inc. (Nevada
corporation) and a 100% interest in Rebatopia Internet Services Inc. (British
Columbia corporation);
(e) Surforama's audited financial statements for the fiscal year ended
November 30, 2001, and its unaudited interim financial statements for the three
month period ended February 28, 2002, as filed with the United States Securities
& Exchange Commission (collectively, the "Surforama Statements"), have been
prepared in accordance with United States generally accepted accounting
principles and fairly represent Surforama's financial position at those
respective dates. Since the date to which the Surforama Statements were
prepared:
(i) There has not been any material adverse change in the financial
position, assets, liabilities, results of operations, business,
prospects or condition, financial or otherwise, of Surforama or
any damage, loss or other change in circumstances materially
affecting the business or assets of Surforama or its right or
capacity to carry on business before or after the Closing Date;
(ii) Surforama has not waived or surrendered any right of material
value;
(iii) The business of Surforama has been conducted in the ordinary
course; and
(iv) Surforama has not guaranteed, or agreed to guarantee, any debt,
liability or other obligation of any person, firm or corporation;
(f) Surforama has not entered into any other agreement or granted any
option to sell or otherwise transfer any of its assets or its securities;
(g) Surforama is not a party to any contracts, leases, licenses,
commitments and other agreements relating to its assets or its business;
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(h) There are no outstanding orders, judgments, injunctions, awards or
decrees of any court, arbitrator or governmental or regulatory body involving
Surforama. No suit, action or legal, administrative, arbitration or other
proceeding or reasonable basis therefore, or, to the best of Surforama's
knowledge, no investigation by any governmental agency, pertaining to Surforama
or its assets is pending or has been threatened against Surforama which could
adversely affect the financial condition or prospects of Surforama or the
conduct of the business thereof or any of Surforama's assets or materially
adversely affect the ability of Surforama to consummate the transactions
contemplated by this Agreement;
(i) The Articles and Bylaws of Surforama permit it to carry on its
present business and to enter into this Agreement;
(j) The performance of this Agreement will not be in violation of the
Articles or Bylaws of Surforama or any agreement to which Surforama is a party;
(k) Surforama is not in violation of any federal, state, municipal or
other law, regulation or order of any government or regulatory authority;
(l) Surforama has filed with the appropriate government agencies all
tax or information returns and tax reports required to be filed, and such
filings are substantially true, complete and correct;
(m) no federal, state, municipal, foreign, sales, property or excise or
other taxes are payable by Surforama;
(n) The corporate records and minute books of Surforama contain
complete and accurate minutes of all meetings of the directors and shareholders
of Surforama held since incorporation;
(o) All material transactions of Surforama have been promptly and
properly recorded or filed in or with its respective books and records;
(p) Surforama has filed all documents it was required to file with the
National Association of Securities Dealers; and
(q) Surforama's shares are quoted for trading on the National
Association of Securities Dealer's Over-The-Counter Bulletin Board.
3. SALE OF SHARES
On the Closing Date, upon the terms and conditions herein set forth,
Surforama agrees to purchase a 100% undivided right, title and interest in and
to the Shares in consideration of Surforama:
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(a) issuing to Cheng 5,940,000 restricted shares of common stock in
the capital of Surforama (the "Vend-In Stock") at a deemed price of US$0.03 per
share; and
(b) using its best efforts to provide Loop with at least US$1,000,000
in working capital within one year of the Closing Date.
4. CLOSING
The sale and purchase of the Shares shall be closed at the office of
Surforama at 10:00 A.M. (Vancouver time) on or before the 5th business day
following the date that Loop notifies Surforama in writing that the condition
subsequent described in paragraph 8 has been satisfied (the "Closing Date").
5. ACTIONS BY THE PARTIES PENDING CLOSING
From and after the date hereof and until the Closing Date, Loop and
Surforama covenant and agree that:
(a) Loop and Surforama, and their authorized representatives, shall
have full access during normal business hours to all documents of Loop and
Surforama and each party shall furnish to the other party or its authorized
representatives all information with respect to the affairs and business of Loop
and Surforama as the parties may reasonably request;
(b) Loop and Surforama shall conduct their business diligently and
substantially in the manner previously conducted and Loop and Surforama shall
not make or institute any unusual or novel methods of purchase, sale,
management, accounting or operation, except with the prior written consent of
the other party. Neither Loop nor Surforama shall enter into any contract or
commitment to purchase or sell any assets or engage in any transaction not in
the usual and ordinary course of business without the prior written consent of
the other party;
(c) Without the prior written consent of the other party, neither Loop
nor Surforama shall increase or decrease the compensation provided to its
employees, officers, directors or agents;
(d) Neither Loop nor Surforama will amend its Articles of Incorporation
or Bylaws, or make any changes in its respective authorized or issued capital
without the prior written approval of the other party;
(e) Neither Loop nor Surforama shall act or omit to do any act, or
permit any act or omission to act, which will cause a breach of any contract,
commitment
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or obligation; and
(f) Neither Loop nor Surforama will declare or pay any dividend or make
any distribution, directly or indirectly, in respect of their respective capital
stock, nor will they directly or indirectly redeem, purchase, sell or otherwise
acquire or dispose of shares in their respective capital stock.
6. CONDITIONS PRECEDENT TO SURFORAMA'S OBLIGATIONS
Each and every obligation of Surforama to be performed on the Closing
Date shall be subject to the satisfaction by the Closing Date of the following
conditions, unless waived in writing by Surforama:
(a) The representations and warranties made by Loop and Cheng in this
Agreement shall be true and correct on and as of the Closing Date with the same
effect as though such representations and warranties had been made or given by
the Closing Date;
(b) Loop shall have performed and complied with all of their
obligations under this Agreement which are to be performed or complied with by
them by the Closing Date;
(c) Loop shall have obtained the necessary consent of its director and
shareholder to effect the transactions contemplated herein;
(d) Loop shall deliver to Surforama:
(i) a certified true copy of resolutions of Loop's Board of Directors
authorizing the transfer of the Shares from Cheng to Surforama,
the registration of the Shares in the name of the Surforama and
the issuance of a share certificate representing the Shares in
the name of the Surforama;
(ii) share certificates representing the Shares issued in the name of
Cheng accompanied by a duly executed Irrevocable Power of
Attorney to transfer the Shares to Surforama; and
(iii) A share certificate or certificates registered in the name of
the Surforama, signed by the President of Loop, representing the
Shares.
7. CONDITIONS PRECEDENT TO LOOP'S OBLIGATIONS
Each and every obligation of Loop and Cheng to be performed on the
Closing Date shall be subject to the satisfaction by the Closing Date of the
following conditions, unless waived in writing by Loop and Cheng:
(a) The representations and warranties made by Surforama in this
Agreement shall be true and correct on and as of the Closing Date with the same
effect as though such representations and warranties had been made or given by
the Closing Date;
(b) Surforama shall have performed and complied with all of its
obligations under this Agreement which are to be performed or complied with by
its by the Closing Date;
(c) Surforama shall deliver to Loop:
(i) a certified true copy of resolutions of Surforama's Board of
Directors authorizing the issuance of the Vend-In Stock to Cheng
and appointing Cheng to Surforama's Board of Directors; and
(ii) share certificates representing the Vend-In Stock issued in the
name of Cheng.
8. CONDITION SUBSEQUENT
This Agreement shall not be binding on either party unless Loop
completes a financing of at least US$200,000 by June 1, 2002.
9. FURTHER ASSURANCES
The parties hereto covenant and agree to do such further acts and
execute and deliver all such further deeds and documents as shall be reasonably
required in order to fully perform and carry out the terms and intent of this
Agreement.
10. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement to date between the
parties hereto and supersedes every previous agreement, communication,
expectation, negotiation, representation or understanding, whether oral or
written, express or implied, statutory or otherwise, between the parties with
respect to the subject of this Agreement.
11. NOTICE
11.1 Any notice required to be given under this Agreement shall be
deemed to be well and sufficiently given if delivered by hand, in the case of
LOOP as follows:
Loop Communications Inc.
000 - 0000 Xx. 0 Xxxx
Xxxxxxxx, X.X.
X0X 0X0
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and in the case of the Surforama addressed as follows:
Xxxxxxxxx.xxx, Inc.
000 - 000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, X.X.
X0X 0X0
and any notice given as aforesaid shall be deemed to have been given when
delivered.
11.2 Either party may time to time by notice in writing change its
address for the purpose of this section.
12. TIME OF ESSENCE
Time shall be of the essence of this Agreement.
13. TITLES
The titles to the respective sections hereof shall not be deemed a
part of this Agreement but shall be regarded as having been used for convenience
only.
14. SCHEDULES
The schedules attached to this Agreement are incorporated into this
Agreement by reference and are deemed to be part hereof.
15. SEVERABILITY
If any one or more of the provisions contained herein should be
invalid, illegal or unenforceable in any respect in any jurisdictions, the
validity, legality and enforceability of such provisions shall not in any way be
affected or impaired thereby in any other jurisdiction and the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby.
16. CONFIDENTIALITY
Neither the existence of this Agreement nor any of its terms shall be
disclosed by either party to any third party without the written consent of the
other party until the condition subsequent described in paragraph 8 herein is
satisfied.
17. APPLICABLE LAW
The situs of the Agreement is Vancouver, British Columbia, and for all
purposes
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this Agreement will be governed exclusively by and construed and
enforced in accordance with laws prevailing in the Province of British Columbia.
The parties hereto agree to attorn to the jurisdiction of the Courts of the
Province of British Columbia.
18. ENUREMENT
This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
IN WITNESS WHEREOF this Agreement has been executed as of the day and
year first above written.
LOOP COMMUNICATIONS INC. XXXXXXXXX.XXX, INC.
PER: /s/ Xxxxx Xxxxx PER: /s/ Xxxx Xxxxxx
_____________________________ _______________________________
Authorized Signatory Authorized Signatory
/s/ Xxxxx Xxxxx
__________________________
Xxxxx Xxxxx
