EXHIBIT 10.10
AGREEMENT OF PURCHASE AND SALE OF STOCK DATED MARCH 30, 1997
BETWEEN MIRAGE HOLDINGS, INC. AND NETWORK SOLUTIONS (PVT), LTD.
AGREEMENT OF PURCHASE AND SALE OF STOCK
This agreement is made as of Xxxxx 00, 0000, xx Xxxxxx, Xxxxxxxx,
among Mirage Holdings, Inc. (Buyer), a Nevada Corporation, having its principal
office at Santa Monica, California; Xxxxx Xxxxxx, Xxxxxx Xxxxxx and Xxxxx Xxxxxx
(Shareholders); Network Solutions (Pvt.), Ltd. (Corporation), a Pakistan
Corporation, having its principal office at Lahore, Pakistan; In this agreement,
Shareholders and Corporation are collectively referred to as Selling Parties.
Shareholders have represented that they own all the outstanding stock
of Corporation. Buyer desires to purchase from Shareholders, and Shareholders
desires to sell to Buyer, 10% (ten percent) of the outstanding stock of
Corporation (the Shares); Corporation desires that this transaction be
consummated. In consideration of the mutual covenants, agreements,
representations, and warranties contained in this agreement, the parties agree
as follows:
Article I: Purchase and Sale of Shares
1.0 Subject to the terms and conditions set forth in this agreement, on the
closing date, Shareholder will transfer and convey the Shares to Buyer, and
Buyer will acquire the Shares from Shareholder.
1.1 As full payment for the transfer of the Shares by Shareholder to Buyer, in
accordance with the provisions of paragraphs 5.2 and 5.3, Buyer must deliver the
following at the closing:
Price as Consideration
1.2 A wire transfer payable to the order of Network Solutions (Pvt), Ltd. in
the amount of $200,000 in United States Dollars by April 22, 1997.
Buyers Shares as part of the Consideration
1.3 80,000 shares of Buyer's stock, which must be issued as follows: Network
Solutions (Pvt.), Ltd.
Article II: Warranties of Selling Party
2.0 Selling Parties, jointly and severally, warrant that:
Form of Organization
2.1 Corporation is a corporation duly organized, validly existing, and in good
standing under the laws of Lahore Pakistan and has all necessary corporate
powers to own its properties and operate its business as now owned and operated
by it. Neither the ownership of its properties nor the nature of its business
requires Corporation to be qualified in any jurisdiction other than the state of
its incorporation.
Capital Structure
2.2 The authorized capital stock of Corporation consists of 1,000,000 shares of
common stock, having a par value of $2.00 each, of which 1,000,000 shares (the
Shares) are issued and outstanding. All the Shares are validly issued, fully
paid, and nonassessable, and such shares have been so issued in full compliance
with all Pakistani federal and state securities laws. There are no outstanding
subscriptions, options, rights, warrants, convertible securities, or other
agreements or commitments obligating Corporation to issue or to transfer from
treasury any additional shares of its capital stock of any class.
Title to Shares
2.3 Shareholders are the owners, beneficially and of record, of all the Shares
free and clear of all liens, encumbrances, security agreements, equities,
options, claims, charges, and restrictions. Shareholders have full power to
transfer the Shares to Buyer without obtaining the consent or approval of any
other person or governmental authority.
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Subsidiaries
2.4 Corporation does not own, directly or indirectly, any interest or
investment (whether equity or debt) in any corporation, partnership, business,
trust, or other entity.
Financial Statements
2.5 Exhibit Al to this agreement sets forth unaudited consolidated and
consolidating balance sheets of Corporation as of March 30, 1997, together with
related unaudited consolidated and consolidating statements of income and
retained earnings for each of the 6 three-month periods ending on those dates,
certified by the chief financial officer of Corporation as accurately reflecting
the financial condition of Corporation for those periods and accurately
reflecting all information normally reported to Corporation's internal
accountants for the preparation of Corporation's financial statements. The
financial statements in Exhibit Al are referred to as the financial statements.
The financial statements have been prepared in accordance with generally
accepted accounting principles consistently followed by Corporation throughout
the periods indicated, and fairly present the financial position of Corporation
on the respective dates of the balance sheets included in the financial
statements, and the results of its operations for the respective periods
indicated.
2.5 Absence of Specified Changes
2.6 Since March 30, 1997 there has not been any change in the financial
condition or operations of Corporation or Subsidiary, except changes in the
ordinary course of business, which have not been materially adverse.
Absence of Undisclosed Liabilities
2.7 The Corporation has no debt, liability, or obligation of any nature,
whether accrued, absolute, contingent, or otherwise, and whether due or to
become due, that is not reflected or reserved against in Corporation's
consolidated balance sheet as of March 30, 1997, included in the financial
statements or set forth in Exhibit A2 to this agreement, except for (1) those
that may have been incurred after the date of that consolidated balance sheet
and (2) those that are not required by generally accepted accounting principles
to be included in a balance sheet. All debts, liabilities, and obligations
incurred after that date were incurred in the ordinary course of business and
are usual and normal in amount both individually and in the aggregate.
Assets of Business
Real Estate
2.8 Exhibit B1 to this agreement is a complete list of all real property owned
by or leased to Corporation together with an accurate brief description of each
property. Exhibit B1 also sets forth brief descriptions of all buildings and
other n-major improvements located on these properties.
2.9 The zoning of each parcel of property described in Exhibit B1 permits the
presently existing improvements and the continuation of the business presently
being conducted on such parcel. Corporation has not commenced, nor have Selling
Parties received notice of the commencement of, any proceeding that would affect
the present zoning classification of any such parcel.
Inventory
2.10 The inventories of raw materials, work in process, and finished goods
(collectively called inventories) shown on Corporation's consolidated balance
sheet as of March 30, 1997, consist of items that are usable and salable in the
ordinary course of business by Corporation. Except for sales made in the
ordinary course of business since that date, all the inventories are the
property of Corporation. No items are subject to security interest, except as
set forth in Exhibit B2 to this agreement. The value of the inventories has
been determined on a first-in, first-out basis consistent with prior years.
Other tangible personal property
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2.11 The books and records of Corporation contain a cot-complete-and accurate
description and specify the location of all trucks, automobiles, machinery,
equipment, furniture, supplies, tools, dies, jigs, molds, patterns, drawings,
and all other tangible personal property owned by, in the possession of, or used
by Corporation in connection with its respective businesses, work in process,
and finished goods. Except as stated in Exhibit B2, no personal property used
by either Corporation in connection with its business is held under any lease,
security agreement, conditional sales contract, or other title retention or
Security arrangement, or is located other than in the possession and under the
control of Corporation. The tangible personal property reflected in those books
and records consulates all such tangible personal property necessary for the
conduct by Corporation of its respective business as now conducted.
Accounts receivable
2.12 All accounts receivable of Corporation shown on the consolidated balance
sheet of Corporation as of March 30, 1997 arose from valid sales in the ordinary
course of business. That consolidated balance sheet reflects adequate reserves
for doubtful accounts-its and trade discounts, on a basis consistent with that
of prior years.
Trade Names, Trademarks, Copyrights
2.13 Corporation does not use any trademark, service xxxx, trade name, or
copyright in its respective business, and neither owns any trademarks, trademark
registration or applications, trade names, service marks, copyrights, or
copyright registrations or applications. No person owns any trademark,
trademark registration application, service xxxx, trade name, copyright, or
copyright registration or application the use of which is necessary or
contemplated in connection with the operation of Corporation business or in
connection with the performance of any contract to which Corporation is a party.
Patents and Patent rights
2.14 Exhibit B3 to this agreement is a complete schedule of all patents,
inventions, industrial models, processes, designs, and applications for patents
owned by Corporation or in which it has any rights, licenses, or immunities.
The patents and applications for patents listed in Exhibit B3 are valid and in
full force and effect and are not subject to any taxes, maintenance fees, or
actions falling due within 90 days after the closing date. Except as set forth
in Exhibits El, there have been no interference actions or other judicial,
arbitration, or other adversary proceedings concerning the patents or
applications for patents listed in Exhibit B3. Each patent application is
awaiting action by its respective patent office except as otherwise indicated in
Exhibit B3. The manufacture, use, or sale of the inventions, models, designs,
and systems covered by the patents and applications for patents listed in
Exhibit B3 do not violate or infringe on any patent or any proprietary or
personal right of any person, firm, or corporation; and Corporation has not
infringed or is now infringing on any patent or other right belonging to any
person, firm, or corporation. Except as set forth in Xxxxxxx X0, Corporation is
not a party to any license, agreement, or arrangement, whether as licensee,
licensor, or otherwise, with respect to any patent, application for patent,
invention, design, model, process, trade secret, or formula. Corporation has
the right and authority to enable it to conduct and continue to conduct all
phases of its business in the manner presently conducted by it, and that use
does not, and will not, conflict with, infringe on, or violate any patent or
other rights of others.
Trade Secrets
2.15 Exhibit B4 to this agreement is a complete list, without extensive or
revealing descriptions, of Corporation's trade secrets, including all customer
lists, processes, know how, computer programs and routines, and other technical
data. The specific location of each trade secret's documentation, including its
complete description, specifications, charts, procedures, and other material
relating to it, is also set forth in that exhibit. Each trade secret's
documentation is current, accurate, and sufficient in detail and content to
identify and explain it and to allow its full and proper use by Buyer without
reliance oil the special knowledge or memory of others.
Corporation is the sole owner of each of these trade secrets, free and
clear of any liens, encumbrances, restrictions, or legal or equitable claims of
others, except as specifically stated in Exhibit B4. Corporation has taken all
reasonable security measures to protect the secrecy, confidentiality, and value
of these trade secrets; any of their employees and any other persons who, either
alone or in concert with others, developed, invented, discovered, derived,
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programmed, or designed these secrets, or who have knowledge of or access to
information relating to them, have been put on notice and, if appropriate, have
entered into agreements that these secrets are proprietary to Corporation and
not to be divulged or misused.
All these trade secrets are presently valid and protectible and are
not part of the public knowledge or literature; they have not, to Selling
Parties' knowledge, been used, divulged, or appropriated for the benefit of any
past or present employees or other persons, or to the detriment of Corporation.
Title to Assets
2.16 Corporation has good and marketable title to all its respective assets and
interests in assets, whether real, personal, mixed, tangible, or intangible,
which constitute all the assets and interests in assets that are used in the
businesses of Corporation. All these assets are free and clear of restrictions
on or conditions to transfer or assignment and free and clear of mortgages,
liens, pledges, charges, encumbrances, equities, claims, easements, rights of
way, covenants, conditions, or restrictions, except for (1) those disclosed in
Corporation's consolidated balance sheet as of March 30, 1997, or in Exhibit(s)
B1 and B2 to this agreement; (2) the lien of current taxes not yet due and
payable; and (3) possible minor matters that, in the aggregate, are not
substantial in amount and do not materially detract from or interfere with the
present or intended use of any of these assets or materially impair business
operations. Corporation is not in default or in arrears in any materials
respect under any lease. All real property and tangible personal property of
Corporation that is necessary to the operation of their businesses is in good
operating condition and repair, ordinary wear and tear excepted. Corporation is
in possession of all premises leased to it from others. Neither Shareholder nor
any officer, director, or employee of Corporation nor any spouse, child, or
other relative of any of these persons, owns, or has any interest, directly or
indirectly, in any of the real or personal property owned by or leased to
Corporation or any copyright its, patents, trademarks, trade names or trade
secrets, or trade secrets licensed by Corporation.
Corporation does not occupy any real property in violation of any law,
regulation, or decree.
Customers and Sales
2.17 Exhibit DI to this agreement is a correct and current list of all
customers of Corporation together with summaries of the sales made to each
customer during the most recent fiscal year. Except as indicated in Exhibit DI,
neither Corporation, nor Shareholders have any information indicating that any
of these customers intend to cease doing business with Corporation or materially
alter the amount of the business they are presently doing with Corporation.
Insurance Policies
2.18 Exhibit B5 to this agreement is a description of all insurance policies
held by Corporation concerning its businesses and properties. All these
policies are in the respective principal amounts set forth in Exhibits B5.
Corporation has maintained and now maintains (1) insurance on all their assets
and businesses of a type customarily insured, covering property damage and loss
of income by fire or other casualty, and (2) adequate insurance protection
against all liabilities, claims, and risks against which it is customary to
insure. Corporation is not in default with respect to payment of premiums on any
such policy. Except as set forth in Exhibit B5, no claim is pending under any
such policy.
Other Contracts
2.19 Corporation is not a party to, nor is the property of it bound by, any
distributor's or manufacturer's representative or agency agreement; any output
or requirements agreement; any agreement not entered into in the ordinary course
of business; any indenture, mortgage, deed of trust, or lease; or any agreement
that is unusual in nature, duration, or amount (including any agreement
requiring the performance by Corporation of any obligation for more than one
year from closing date or calling for consideration of more than $ 10,000);
except the agreements listed in Exhibit D2, copies of which have been furnished
or made available to Buyer. There is no default or event that, with notice,
lapse of time, or both, would constitute a default by any party to any of these
agreements. Corporation has not received notice that any party to any of these
agreements intends to cancel or terminate any of these agreements or to exercise
or not exercise any options under any of these agreements. Corporation is not a
party to, nor is it or the
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property of it bound by, any agreement that is materially adverse to the
businesses, properties, or financial condition of Corporation.
Compliance with Laws
2.20 Corporation has not received notice of any violation of any applicable
federal, state, or local statute, law, or regulation (including any applicable
building, zoning, environmental protection, or other law, ordinance, or
regulation) affecting its properties or the operation of its business; and to
the best of the knowledge of Shareholder and Corporation, there are no such
violations.
Litigation
2.21 Except as set forth in Exhibit El, there is no pending, or, to the best
knowledge of Shareholders and Corporation, threatened, suit, action,
arbitration, or legal, administrative, or other proceeding, or governmental
investigation against or affecting Corporation or at any of its businesses,
assets, or financial conditions. The matters set forth in Exhibit El, if
decided adversely to Corporation, will not result in a material adverse change
in the business, assets, or financial condition of Corporation. Selling Parties
have furnished or made available to Buyer copies of all relevant court papers
and other documents relating to the matters set forth in Exhibit El.
Corporation is not in default with respect to ally order, writ, injunction, or
decree of any federal, state, local, or foreign court, department, agency, or
instrumentality. Except as set forth in Exhibit El, neither Corporation, nor
Shareholder is presently engaged in any legal action to recover money due to any
of them-n or damages sustained by any of them.
Agreement will not cause breach
2.22 The consummation of the transactions contemplated by this agreement will
not result in or constitute any of the following: (1) a breach of any term or
provision of this agreement; (2) a default or an event that, with notice, lapse
of time, or both, would be a default, breach, or violation of the articles of
incorporation or bylaws of Corporation or any lease, license, promissory note,
conditional sales contract, commitment, indenture, mortgage, deed of trust, or
other agreement, instrument, or arrangement to which SI-Shareholders or
Corporation are a party or by which any of them or the property of any of them
is bound; (3) an event that would permit any party to terminate any agreement or
to accelerate the maturity of any indebtedness or other obligation of
Corporation; or (4) the creation or imposition of any lien, charge, or
encumbrance on any of the properties of Corporation.
Authority and Consent
2.23 Selling Parties have the right, power, legal capacity, and authority to
enter and authority to enter into and perform their respective obligations under
this agreement; and no approvals or consents of any persons other than Selling
Parties are necessary in connection with it. The execution and delivery of this
agreement by Corporation has been duly authorized by all necessary corporate
action.
Corporate Documents
2.24 Selling Parties have finished to Buyer for its examination (1) copies of
the articles of incorporation and bylaws of Corporation; (2) the minute books of
Corporation containing all records required to be set forth of all proceedings,
consents, actions, and meetings of the shareholders and boards of directors of
Corporation.
Personnel
2.25 Exhibit C2 is a list of the names and addresses of all off-officers,
directors, employees, agents, and manufacturer's representatives of Corporation,
stating the rates of condensation payable to each.
Employment Contracts and Benefits
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2.26 Exhibit Cl is a list of all Corporation's material employment contracts;
collective bargaining agreements; and pension, bonus, profit-sharing, stock
option, or other agreements providing for employee remuneration or benefits. To
the best of Selling Parties' knowledge, Corporation is not in default tinder any
of these agreements-its.
Persons with Certain Authority
2.27 Exhibit C3 lists (1) the names and addresses of all persons holding a
power of attorney on behalf of Corporation and (2) the names and addresses of
all banks or other financial institutions in which Corporation has an account,
deposit, or safe deposit box, with the names of all persons authorized to draw
on these accounts or deposits or to have access to these boxes.
Information for Buyer's Shareholders
2.28 Exhibit A3 is a description of the business and properties of Corporation
prepared by Selling Parties for inclusion in Buyer's proxy statement for the
special meeting of Buyer's shareholders that is to be held for the purpose,
among others, of authorizing and approving the execution and delivery of this
agreement (and amending Buyer's articles of incorporation to increase its
authorized capital stock). Selling Parties acknowledge that financial
statements will also be used in that proxy statement and that potential
liability to Buyer may arise out of such use. Neither the description of the
business and pro properties of Corporation nor the financial statements contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made. Selling Parties agree, on Buyer's
request, to furnish to Buyer such additional information about the Selling
Parties' business and properties as Buyer may require for inclusion in that
proxy statement. The information set forth in Exhibit A3, as supplemented by any
additional information that Selling Parties may furnish under this paragraph,
will not contain any untrue statement of a material fact, or omit any material
fact necessary to make the statements made.
Full Disclosure
2.29 None of the warranties made by Shareholders or Corporation or-made in any
certificate or memorandum furnished or to be furnished by any of them or on
their behalf, contains or will contain any untrue statement of a material fact,
or omits to state any material fact necessary to make the statements made.
Article III: Selling Parties' Obligations Before Closing
3.0 Selling Parties Covenant that from the date of this agreement until
Closing:
Buyer's Access to Premises and Information
3.1 Buyer and its counsel, accountants, and other representatives will have
full access during normal business hours to all properties, books, accounts,
records, contracts, and documents of or relating to Corporation. Selling
Parties will furnish or cause to be furnished to Buyer and its representatives
all data and information concerning the business, finances, and properties of
Corporation that may reasonably be requested. Nothing in this agreement will
obligate Selling Parties to disclose any classified information or provide any
access to representatives of Buyer prohibited or not authorized by applicable
governmental authority.
Conduct of Business in Normal Course
3.2 Corporation will carry on its respective businesses and activities
diligently at in substantially the same manner as they previously have been
carried out and will not institute any unusual or novel methods of manufacture,
purchase, sale, lease, management, accounting, or operation that vary materially
from those methods used by Corporation as of the date of this agreement.
Preservation of Business Relationships
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3.3 Corporation will use its best efforts without making any commitments on
behalf of Buyer, to preserve its respective business organizations in tact; to
keep available to Corporation its present officers and employees; and to
preserve its present relationships with suppliers, customers, and others having
business relationships with it.
Corporate Matters
3.4 Corporation will not (1) amend its articles of incorporation or bylaws; (2)
issue any shares of its capital stock; (3) issue or create any warrants,
obligations, subscriptions, options, convertible securities, or other
commitments under which any additional shares of its capital stock of any class
might be directly or indirectly authorized, issued, or transferred from
treasury; or (4) agree to do any of the acts listed above.
Maintenance of Insurance
3.5 Corporation will continue to carry their existing insurance, subject to
variation-is in amounts required by the ordinary operations of their businesses.
At the request of Buyer and at Buyer's sole expense, the amount of insurance
against fire and other casualties that, at the date of this agreement,
Corporation carry on any of their properties or in respect of their operations
will be increased by the amount or amounts Buyer will specify.
Employees and Compensation
3.6 Corporation will not, nor will agree to: (1) make any change in
compensation payable or to become payable by either of them, to any officer,
employee, sales agent, or representative; (2) make any change in benefits
payable to any officer, employee, sales agent, or representative under any bonus
or pension plan or other contract or commitment; or (3) modify any collective
bargaining agreement to which either of them is a party or by which either may
be bound.
New Transactions
3.7 Corporation will not do nor agree to do, without Buyer's consent, any of
the following:
(1) Enter into any contract, commitment, or transaction not in the usual
and-id ordinary course of its business;
(2) Enter into any contract, commitment, or transaction in the usual and-id
ordinary course of business involving an amount exceeding $500,000,
individually, or $750,000 in the aggregate;
(3) Make any capital expenditures in excess of $50,000 for any single
item or $100,000 in the aggregate, or enter into any leases of capital equipment
or property under which the annual lease charge is in excess of $50,000; or (4)
Sell or dispose of any capital assets with a net book value exceeding $10,000,
individually, or $50,000 in the aggregate.
(4) Sell or dispose of any capital assets with a net book value exceeding
$10,000, individually, or $50,000 in the aggregate.
Dividends, Distributions, and Stock Acquisitions
3.8 Neither Corporation nor Subsidiary will:
(1) Declare, set aside, or pay any dividend or make any distribution in
respect of its capital stock;
(2) Directly or indirectly purchase, redeem, or otherwise acquire any
shares of its capital stock or
(3) Enter into any agreement obligating it to do any of the foregoing
prohibited acts.
Payment of Liabilities and Waiver of Claims
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3.9 Corporation will not, nor will agree to: (1) pay any obligations or
liability, fixed or contingent, other than current liabilities; (2) waive or
compromise any right or claim; or (3) cancel, without run payment, any note,
loan, or other obligation owed to either Corporation.
Existing Agreements
3.10 Corporation will not, nor will agree to, modify, amend, cancel, or
terminate any of its existing contracts or agreements.
Consents or Others
3.11 As soon as reasonably practical after the execution and delivery of this
agreement, and in any event on or before the closing date, Selling Parties will
obtain the written consent-it of the persons described in Exhibit C2 and C3 to
this agreement and will furnish to Buyer execrated copies of those consents.
Warranties True at Closing
3.12 All warranties of Selling Parties set forth in this agreement-it will also
be true on the closing date as if made on that date, except to the extent that
any of them may become untrue because of events beyond the control of Selling
Parties, who are unable to make them true as of the closing date despite their
best efforts to do so.
Article IV: Conditions Precedent to Buyer's Performance
Accuracy of Selling Parties' Warranties
4.0 Except as otherwise permitted by this agreement, all warranties by each of
the Selling Parties in this agreement, or in any written statement that will be
delivered to Buyer by any of them under this agreement, must be true in all
material respects on the closing date as though made at that time.
Performance by Selling Party
4.1 Selling Parties must have performed, satisfied, and complied in all
material respects with all covenants, agreements, and conditions required by
this agreement to be performed or complied with by them, or any of them, by the
closing date.
No Material Adverse Change
4.2 During the period from March 30, 1997 to the closing date, there will not
have been any material adverse change in the financial condition or the results
of operations of Corporation, and Corporation will not have sustained any
insured or uninsured loss or damage to its assets that materially affects its
ability to conduct a material part of its business.
Certification by Selling Party
4.3 Buyer will have received a certificate, dated the closing date, signed and
verified by Shareholders and by Corporation's respective president or vice
presidents and their respective treasurers or assistant treasurers, certifying,
in such detail as Buyer and its counsel may reasonably request, that the
conditions specified in 3.0 through and including 3.1 1 have been fulfilled.
Opinion Of Selling Parties Counsel
4.4 Buyer will have received from counsel for Selling Parties, an opinion dated
the closing date, in form and substance satisfactory to Buyer and its counsel,
that:
Corporate Standing and Power
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(1) Corporation is a corporation duly incorporated, validly existing, and
in good standing under the laws of the State of Lahore, Pakistan and has all
necessary corporate power to own its properties as now owned and operate its
business as now operated.
Authorized Capital Stock
(2) The authorized capital stock of Corporation consists of 1,000,000
shares of common stock, of $2.00 US par value, of which, based solely on a
review of the stock journal, stock ledger, and the stock books of the
corporation, 1,000,000 shares, are issued and outstanding. All outstanding
shares are validly issued, fully paid, and nonassessable. To the best knowledge
of counsel, except as set forth in Exhibit Hl, there are no outstanding
subscriptions, options, rights, warrants, convertible securities, or other
agreements or commitments obligating Corporation to issue or transfer from
treasury any additional shares of its capital stock of any class.
Validity and Enforceability of Seller's Obligations
(3) This agreement has been daily and validly authorized and, %when
executed and delivered by the Selling Parties, will be valid, binding, and
enforceable against each of them in accordance with its terms, except as limited
by bankruptcy and insolvency laws and by other laws and equitable principles
affecting the rights of creditors generally.
Opinion as to Buyers ability to acquire target's stock
(4) Based solely on a review of the stock journal, stock ledger, and stock
books of the Corporation, Shareholders are the record owners of 100% (One
hundred percent) of the shares of stock of the Corporation. On the transfer and
delivery of the Shares to Buyer in accordance with the agreement, Buyer will
acquire the rights-its in the shares had by buyer free of any adverse claim or
claims.
Sale does not breach of violate corporate obligations
(5) Neither execution or delivery of this agreement nor the consummation of
the transaction contemplated in this agreement will constitute (a) a default or
an event that would-with notice, lapse of time, or both-constitute a default
under, or violation or breach of, Corporation's articles of incorporation or
bylaws, or to the best of counsel's knowledge, any indenture, license, lease,
franchise, mortgage, instrument, or other agreement to which any of Selling
Parties is a party or by which they or the properties of Corporation may be
bound, identified in Exhibit D3; or (b) an event that would permit any party to
any agreement or instrument to terminate it or to accelerate the maturity of any
indebtedness or other obligation of Corporation; or (c) all event that would
result in the creation or imposition of any lien, charge, or encumbrance on any
asset of Corporation.
Except as set forth in Exhibit El to this agreement, to the best of
counsel's knowledge, there is no suit, action, arbitration, or legal,
administrative, or other proceeding or governmental investigation pending or
threatened against or affecting Corporation or any of its businesses or
properties or financial or other condition.
Absence of Litigation
4.5 No action, suit, or proceeding before any court or any governmental body or
authority, pertaining to the transaction contemplated by this agreement or to
its consummation, will have been instituted or threatened on or before the
closing date.
Corporate Approval
4.6 The execution and delivery of this agreement by Corporation and the
performance---ice of their covenants and obligations under it, will have been
duly authorized by all necessary corporate action, and Buyer will have received
copies of all resolutions pertaining to that authorization, certified
respectively by the secretaries of Corporation.
Article V: The Closing
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Time and Place
5.0 The transfer of the Shares by Shareholder to Buyer ("xxx Xxxxxxx") will
take place at the offices of NetSol Private, Ltd. at [time] local time, on
[date] or at such other time and place as the parties may agree to in writing
(the closing date).
Obligations at Closing
Seller
5.1 At the closing, Shareholder must deliver to Buyer the following
instruments, in form and substance satisfactory to Buyer and its counsel,
against delivery of the items specified in paragraphs 5.2 and 5.3:
A certificate or certificates representing the Shares, registered in the
name of Shareholders, duly endorsed by Shareholders for transfer or accompanied
by an assignment of the Shares duly executed by Shareholder, with signatures
guaranteed by a member of the New York Stock Exchange or by a bank or trust
company, and with all required documentary stock transfer stamps affixed or
accompanied by Shareholders' personal checks for the amount of these stamps.
On submission of that certificate or certificates to Corporation for transfer,
Corporation will issue to Buyer a certificate representing the Shares,
registered in the Buyer's name.
Buyer
5.2 At the closing, Buyer must deliver to Corporation a certificate
representing 80,000 shares of Buyer's common stock to be issued and delivered at
the closing under paragraphs 1.0 through and including 1.3 against delivery of
the items Sellers are to deliver as specified in paragraph 5.1.
5.3 At the closing, Buyer must deliver to Shareholders the following
instruments and documents against delivery of the items specified in paragraph
5.1:
[a] A wire transfer in the amount of $200,000 in US funds;
[b] Certified resolutions of Buyer's board of directors, in form
satisfactory to counsel for Selling Parties, authorizing the execution and
performance of this agreement and all actions to be taken by Buyer under this
agreement; and
[c] A certificate executed by the president or vice president and the
secretary or treasurer of Buyer certifying that all Buyer's representations and
warranties under this agreement are true as of the closing date, as though each
of those representations and warranties had been made on that date.
Seller's Indemnity
5.4 Shareholder will indemnify, defend, and hold harmless Buyer against( ii-and
in respect of claims, demands, losses, costs, expenses, obligations,
liabilities, damages, recoveries, and deficiencies, including interest,
penalties, and reasonable attorney fees, that it may incur or suffer, which
arise, result from, or relate to at-any breach of, or failure by Selling
Parties-ties to perform, any of their representations, warranties, covenants, or
agreements ill this agreement or in any schedule, certificate, exhibit, or other
instrument famished or to be furnished by Selling Parties under this agreement.
Shareholder's liability under this paragraph will not, however, exceed the
aggregate amount of $___[amount]___. Despite any other provision of this
agreement, Shareholder will not be liable to Buyer on any warranty
representation, or covenant made by Selling Parties in this agreement, or under
any of their indemnities in this agreement, regarding any single claim, loss,
expense, obligation, or other liability that does not exceed $___[amount]___;
provided, however, that when the aggregate amount of all such claims, losses,
expenses, obligations, and liabilities not exceeding $___[amount]___ each
reaches $___[amount]___, Shareholder will, subject to the above limitation on
his maximum aggregate liability, thereafter be liable in full for all his
breaches and indemnities and regarding all those claims, losses, expenses,
obligations, and liabilities.
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Seller's Right to Defend
5.5 Buyer will promptly notify Shareholder of the existence of any claim,
demand, or other matter to which Shareholders' indemnification obligations would
apply and will give them a reasonable opportunity to defend the same at their
own expense and with counsel of their own selection; provided that Buyer will at
all times also have the right to participate fully in the defense at its own
expense. If Shareholders, within a reasonable time after this notice, fails to
defend, Buyer will have the right, but not the obligation, to undertake the
defense of, and to compromise or settle (exercising reasonable business
judgment), the claim or other matter on behalf, for the account, and at the
risk, of Shareholders. If the claim is one that cannot by its nature be
defended solely by Shareholders (including any federal or state tax proceeding),
Buyer will make available and cause Corporation to make available all
information and assistance that Shareholders may reasonably request.
Article VI: Costs
6.0 Each party represents and warrants that it has dealt with no broker or
finder in connection with any transaction contemplated by tells agreement, and,
as far as it knows, no broker or other person is entitled to any commission or
finder's fee in connection with any of these transactions.
Expenses
6.1 Each party will pay all costs and expenses incurred or to be intended by it
negotiating and preparing this agreement and in closing and carrying out the
transactions contemplated by this agreement.
Article VII Form of Agreement
7.0 This agreement constitutes the entire agreement between the parties
pertaining subject matter cot-contained in it and supersedes all prior and
contemporaneous agreements, representations, and understandings of the parties.
No supplement-it, modification, or amendment of this agreement will be binding
unless executed in writing by all the parties. No waiver of any of the
provisions of this agreement will constitute a waiver of any other provision
whether or not similar, nor will any waiver constitute a continuing waiver. No
waiver will be binding unless executed in writing by the party making the
waiver.
Subject Headings
7.1 The subject headings of the paragraphs and subparagraph-is of this
agreement are included for convenience only and will not affect the construction
or interpretations of any of its provisions.
Counterparts
7.2 This agreement may be executed simultaneously in one or more Counterparts,
each of which will be considered an original, but all of which together will
constitute one and the same instrument.
Article VIII: Parties
Parties in Interest
8.0 Nothing in this agreement, whether express or implied Is intended to confer
any rights or remedies tinder or by reason of this agreement on any persons
other than the parties to it and their respective successors and assigns.
Nothing in this agreement is intended to relieve or discharge the obligation or
liability of any third persons to any party to this agreement. No provision
gives any third persons any right of subrogation or action against any party to
this agreement.
Assignment
8.1 This agreement will be binding on, and will inure to the benefit of, the
parties to it and their respective heirs, legal representatives, successors, and
assigns; provided, however, that Buyer may not assign any of its rights under
this
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agreement, except to a wholly owned subsidiary corporation of Buyer. No such
assignment by Buyer to its wholly owned subsidiary will relieve Buyer of any of
its obligations or duties under this agreement.
Article IX: Remedies
9.0 Any controversy or claim arising out of, or relating to, this agreement, or
the making, performance, or interpretation of it, will be settled by arbitration
in Santa Monica, CA under the commercial arbitration rules of the American
Arbitration Association then existing, and judgment on the arbitration award may
be entered in any court having jurisdiction over the subject matter of the
controversy. Arbitrators will be persons experienced in negotiating, making, and
consummating acquisition agreements.
Specific Performance and Waiver of Rescission Rights
9.1 Each party's obligation under this agreement is unique. If any party should
default in its obligations under this agreement, both parties acknowledge that
it would be extremely impracticable to measure the resulting damages;
accordingly, the nondefaulting party or parties, in addition to any other
available rights or remedies, may xxx in equity for specific performance, and
the parties each expressly waive the defense that a remedy in damages will be
adequate. Despite any breach or default by any of the parties of any of their
respective representations, warranties, covenants, or agreements under this
agreement, if the purchase and sale contemplated by it will be consummated at
the closing, each of the parties waives any rights that it may have to rescind
this agreement or the transaction consummated by it; provided, however, that
this waiver will not affect any other rights or remedies available to the
parties under this agreement or under the law.
Recovery of Litigation Costs
9.2 If any legal action or any arbitration or other proceeding is brought for
the enforcement of this agreement, or because of an alleged dispute, breach,
default, or misrepresentation in connection with any of the provisions of this
agreement, the successful or prevailing party or parties will be entitled to
recover reasonable attorney fees and other costs incurred in that action or
proceeding, in addition to any other relief to which it or they may be entitled.
Termination
9.3 Subject to the provisions of above paragraphs relating to the postponement
of the closing date, any party may on the closing date terminate this agreement,
without liability to any other:
(1) If any bona fide action or proceeding will be pending against any party
on the closing date that could result in an unfavorable judgment, decree, or
order that would prevent or make unlawful the performance of this agreement or
if any agency of the federal or of any state government has objected at or
before the closing date to this acquisition or to any other action required by
or in connection with this agreement-it;
(2) If the legality and sufficiency of all steps taken and to be taken by
the parties and their shareholders in carrying out this agreement has not been
approved by counsel as required by this agreement; or
Default
9.4 If either Buyer or Selling Parties materially default in the due and timely
performance of any of their warranties or agreements under this agreement, the
nondefaulting party or parties may on the closing date give notice of
termination of this agreement, in the manner provided in this paragraph. The
notice will specify with particularity the default or defaults on which the
notice is based. The termination will be effective five days after the closing
date, unless the specified default or defaults have been cured on or before this
effective date for termination.
Article X: Nature and Survival of Warranties and Obligations
Representations and obligations expires at Closing
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10.0 The representations and warranties made by the parties to this agreement,
and their respective obligations to be performed under its terms on or before
the closing date, will expire with, and be terminated and extinguished by, the
closing, and consummation of the closing will be conclusive evidence that each
party is fully satisfied with the facts constituting the basis of the
representations and warranties of the other parties and with the performance of
their obligations. This paragraph will not affect any obligation of any party
under this agreement that is permitted to be performed, in whole or in part,
after the closing.
Article XI: Governing Law
11.0 This agreement will be construed in accordance with, and governed by, the
laws of the State of California as applied to contracts that are executed and
performed entirely in California.
Article XII: Severability
12.0 If any provision of this agreement is held invalid or unenforceable by any
court of final jurisdiction, it is the intent of the parties that all other
provisions of this agreement be construed to remain fully valid, enforceable,
and binding on the parties.
Article XIII: Signatures
IN WITNESS WHEREOF, the parties to this agreement have duly executed it on the
day and year first above written.
Mirage Holdings, Inc. NetSol Private, Ltd.
By: /s/ XXXXXX XXXXXX By: /s/ XXXXX XXXXXX
------------------------------- --------------------------------
Xxxxxx Xxxxxx, President Xxxxx Xxxxxx, President
By: /s/ XXXXXX XXXXXX
--------------------------------
Mirage Holdings, Inc. Shabab Ghauri
By: /s/ XXXXXX XXXXXX By: /s/ XXXXX XXXXXX
------------------------------- ----------------------------------
Xxxxxx Xxxxxx, President Xxxxx Xxxxxx
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