EXHIBIT 2
SHARE PURCHASE AGREEMENT
This Share Purchase Agreement ("Agreement"), dated as of February 18,
2004, among, Xxxxxxx Xxxxxxxxxx (the "Seller"), Golden Sand Eco-Protection. Inc.
("Golden"), and Yellow Jacket Investments Limited, a British Virgin Islands
corporation (the "Buyer").
W I T N E S S E T H:
WHEREAS, Golden is a corporation duly organized under the laws of the
State of Florida.
WHEREAS, the Seller owns 7,800,000 shares of common stock of Golden in
the aggregate.
WHEREAS, Buyer wishes to purchase an aggregate of 7,550,000 shares of
common stock (collectively, the "Purchase Shares"), and the Seller desires to
sell the Purchase Shares to Buyer free and clear of liens and encumbrances.
Golden is joining in this agreement to provide certain covenants
warranties and representations.
NOW, THEREFORE, IT IS AGREED AMONG THE PARTIES AS FOLLOWS:
ARTICLE I
The Consideration
-----------------
1.1 Subject to the conditions set forth herein, Seller shall sell to
Buyer and Buyer shall purchase an aggregate of 7,550,000 shares of common stock
of Golden from Seller. The purchase price for the shares to be paid by Buyer to
Seller is $365,000 (the "Consideration") and shall be paid at closing by a wire
transfer or transmittal of a cashiers check to such escrow account as agreed by
the Seller and the Buyer.
ARTICLE II
Closing and Conveyance of Shares
--------------------------------
2.1 The Purchase Shares shall be conveyed by Seller to Buyer with duly
executed stock powers by depositing with escrow agent for delivery to buyer,
upon receipt of the Consideration by Seller, and satisfaction of a) the
conditions precedent in Article VI, and b) procedures in Article V. The new
shares being subscribed for herein shall be issued and delivered to escrow agent
for delivery to buyer upon receipt of subscription consideration.
2.2 Closing hereunder shall be completed by delivery in escrow to Xxxxx
Xxxxx, Esq. Escrow Account, of the requisite closing documents, cash
consideration and share certificates on or before February 20, 2004 at 5:00 p.m.
PST (Closing Date) subject to satisfaction of the terms and conditions set forth
herein. Consideration may be delivered by Federal Express or wire transfers, and
any closing documents may be delivered by facsimile, Federal Express or other
appropriate means.
ARTICLE III
Representations, Warranties and Covenants of Seller and Golden as to Golden
---------------------------------------------------------------------------
Seller and Golden each hereby represents, warrants and covenants to
Buyer as follows:
3.1 Golden is a corporation duly organized, validly existing and in
good standing under the laws of the State of Florida, and has the corporate
power and authority to own or lease its properties and to carry on its business
as it is now being conducted. The Articles of Incorporation and Amendments and
Bylaws of Golden, are complete and accurate, and the minute books of Golden,
copies of which have also been made available to Buyer, contain a record, which
is complete and accurate in all material respects, of all meetings, and all
corporate actions of the shareholders and Board of Directors of Golden.
3.2 (a)The authorized capital stock of Golden consists of
200,000,000 shares of common stock and 10,000,000 shares of preferred stock, par
value $0.001 per share. There are 8,270,000 shares of Common Stock of Golden
issued and outstanding and no shares of preferred stock outstanding. All such
shares of capital stock of Golden are validly issued, fully paid, non-
assessable and free of preemptive rights. Golden has no outstanding options,
warrants, or other rights to purchase, or subscribe to, or other securities
convertible into or exchangeable for any shares of capital stock of Golden, or
contracts or arrangements of any kind relating to the issuance, sale or transfer
of any capital stock or other equity securities of Golden. All of the
outstanding shares of capital stock of Golden have been offered, issued, sold
and delivered in compliance with applicable federal and state securities laws
and none of such securities were, at the time of issuance, subject to preemptive
rights. None of such issued and outstanding shares is the subject of any voting
trust agreement relating to the voting thereof or restricting in any way the
sale or transfer thereof.
(b) The Seller own the Purchase Shares that they are conveying
pursuant to this Agreement beneficially and of record, free and clear of any
lien, pledge, security interest or other encumbrance, and, upon payment for the
Purchase Shares as provided in this Agreement, the Buyer will acquire good and
valid title to the Purchase Shares, free and clear of any lien, pledge, security
interest or other encumbrance. None of the Purchase Shares are the subject of
any voting trust agreement or other agreement relating to the voting thereof or
restricting in any way the sale or transfer thereof except for this Agreement.
Each Seller has full right and authority to transfer such Purchase Shares
pursuant to the terms of this Agreement.
3.3 Golden does not own nor has it owned, in the last five years, any
outstanding shares of capital stock or other equity interests of any
partnership, joint venture, trust, corporation, limited liability company or
other entity and there are no obligations of Golden to repurchase, redeem or
otherwise acquire any capital stock or equity interest of another entity.
3.4 This Agreement has been duly authorized, validly executed and
delivered on behalf of the Seller and Golden and is a valid and binding
agreement and obligation of Golden and Seller enforceable against the parties in
accordance with its terms, subject to limitations on enforcement by general
principles of equity and by bankruptcy or other laws affecting the enforcement
of creditors' rights generally, and Seller and Golden have complete and
unrestricted power to enter into and, upon the appropriate approvals as required
by law, to consummate the transactions contemplated by this Agreement.
3.5 Neither the making of nor the compliance with the terms and
provisions of this Agreement and consummation of the transactions contemplated
herein by Seller or Golden will conflict with or result in a breach or violation
of the Articles of Incorporation or Bylaws of Golden, or of any material
provisions of any indenture, mortgage, deed of trust or other material agreement
or instrument to which Golden or Seller are a party, or of any material
provision of any law, statute, rule, regulation, or any existing applicable
decree, judgment or order by any court, federal or state regulatory body,
administrative agency, or other governmental body having jurisdiction over
Golden or Seller, or any of its material properties or assets, or will result in
the creation or imposition of any material lien, charge or encumbrance upon any
material property or assets of Golden pursuant to the terms of any agreement or
instrument to which Golden is a party or by which Golden may be bound or to
which any of Golden property is subject and no event has occurred with which
lapse of time or action by a third party could result in a material breach or
violation of or default by Golden or Seller.
3.6 There is no claim, legal action, arbitration, governmental
investigation or other legal or administrative proceeding, nor any order, decree
or judgment in progress, pending or in effect, or to the best knowledge of the
Seller threatened against or relating to Golden or affecting any of its assets,
properties, business or capital stock. There is no continuing order, injunction
or decree of any court, arbitrator or governmental authority to which Golden is
a party or by which Golden or its assets, properties, business or capital stock
are bound.
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3.7 Golden has accurately prepared and filed all federal, state and
other tax returns required by law, domestic and foreign, to be filed by it, has
paid or made provisions for the payment of all taxes shown to be due and all
additional assessments, and adequate provisions have been and are reflected in
the financial statements of Golden for all current taxes and other charges to
which Golden is subject and which are not currently due and payable. None of the
Federal income tax returns of Golden have been audited by the Internal Revenue
Service or other foreign governmental tax agency. Golden has no knowledge of any
additional assessments, adjustments or contingent tax liability (whether federal
or state) pending or threatened against Golden for any period, nor of any basis
for any such assessment, adjustment or contingency.
3.8 Golden has delivered to Buyer audited financial statements dated
December 31, 2002 and unaudited financial statements for the quarters ended
March 31, 2003, June 30, 2003 and September 30, 2003. All such statements,
herein sometimes called "Golden Financial Statements" are complete and correct
in all material respects and, together with the notes to these financial
statements, present fairly the financial position and results of operations of
Golden for the periods indicated. All financial statements of Golden have been
prepared in accordance with generally accepted accounting principles.
3.9 As of the date hereof, Golden, represents and warrants that all
outstanding indebtedness of Golden is as shown on the financial statements
(except for legal and accounting services related to this transaction which will
be paid by Golden) and all such scheduled indebtedness, if any, which will be
the sole responsibility of the Seller and shall be paid by the Seller at the
Closing hereunder.
3.10 Since the dates of the Golden Financial Statements, there have not
been any material adverse changes in the business or condition, financial or
otherwise, of Golden. Golden does not have any liabilities, commitments or
obligations, secured or unsecured except as shown on updated financials (whether
accrued, absolute, contingent or otherwise).
3.11 Golden is not a party to any contract performable in the future.
3.12 The representations and warranties of the Golden shall be true and
correct as of the date hereof.
3.13 Golden will have delivered to Buyer, all of its corporate books
and records for review.
3.14 Golden has no employee benefit plan in effect at this time other
than disclosed in this Agreement as a schedule or exhibit.
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3.15 No representation or warranty by Golden or the Seller in this
Agreement, or any certificate delivered pursuant hereto contains any untrue
statement of a material fact or omits to state any material fact necessary to
make such representation or warranty not misleading.
3.16 Buyer has received copies of Form 10KSB as filed with the
Securities and Exchange Commission ("SEC") which included audits for the year
ended December 31, 2002 and each of its other reports to shareholders filed with
the SEC through the period ended September 30, 2003. Golden is a registered
company under the Securities Exchange Act of 1934, as amended.
3.17 Golden has filed reports required to be filed by it under the
Securities Exchange Act of 1934, as amended (the "Federal Securities Laws".) No
such reports, or any reports sent to the shareholders of Golden generally
contained any untrue statement of material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements in such
report, in light of the circumstances under which they were made, not
misleading.
3.18 The Buyer has not received any general solicitation or general
advertising regarding the shares of Seller's common stock.
3.19 Golden has conducted no business whatsoever since _last
statement_, and has incurred no liabilities except as shown on the financial
statements, which shall be paid at closing by the Seller.
3.20 There have been no material changes, debts, or liabilities
incurred by Golden since the date of 10QSB for September 30, 2003, or since then
to date hereof.
ARTICLE IV
Termination of Representation and
Warranties and Certain Agreements; Indemnification
--------------------------------------------------
4.1 The respective representations and warranties of the parties hereto
shall survive this Agreement for two years and the continuing covenants shall
survive hereafter, pursuant to their terms.
4.2 The right to indemnification or payment of Damages (as defined in
section 4.4) or other remedy based on any representation, warranty, covenant or
obligation of a party hereunder shall not be waived by any investigation
conducted with respect to, or any knowledge acquired (or capable of being
acquired) at any time, whether before or after the execution and delivery of
this Agreement, with respect to the accuracy or inaccuracy of or compliance
with, any such representation, warranty, covenant or obligation.
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4.3 The waiver of any condition to a party's obligation to consummate
the transactions contemplated hereunder, where such condition is 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, or payment of Damages, or other remedy based on such
representation, warranty, covenant or obligation.
4.4 Seller and Golden, jointly and severally, shall indemnify and hold
harmless the Buyer and its respective officers, directors and affiliates (the
"Buyer Indemnified Persons") for, and will pay to the Buyer Indemnified Persons,
the amount of, any loss, liability, claim, damage (including, without
limitation, incidental and consequential damages), cost, expense (including,
without limitation, interest, penalties, costs of investigation and defense and
the reasonable fees and expenses of attorneys and other professional experts) or
diminution of value, whether or not involving a third- party claim
(collectively, "Damages"), directly or indirectly arising from, attributable to
or in connection with:
any representation or warranty made by Seller or Golden in this
agreement or any closing deliveries, that is, or was at the time
made, false or inaccurate, or any breach of, or misrepresentation
with respect to, any such representation or warranty; and
any breach by any of the Seller or Golden of any covenant, agreement
or obligation of Golden or Seller contained in this agreement.
any claims or litigation relating to Golden now pending or threatened
or which may hereafter be brought against Buyer and/or Golden or
Seller based upon events occurring prior to the date hereof and
not attributable to the acts of the Buyer.
any and all actions, suits, proceedings, claims, demands, assessments,
judgments, costs, losses, liabilities and reasonable legal and
other expenses incident to any of the foregoing.
4.5 Seller and Golden shall have no liability for indemnification with
respect to any representation or warranty, unless, on or before the second
anniversary of the date hereof, the Buyer notifies the Seller of a claim
specifying the basis thereof in reasonable detail to the extent then known by
Buyer. A claim with respect to any covenant, agreement or obligation contained
in this agreement, may be made at any time without any time limitation.
4.6 Promptly after receipt by an indemnified party of written notice
(the "Notice of Claim") of the commencement of any action, suit or proceeding
against it, or written threat thereof, such indemnified party will, if a claim
is to be made against an indemnifying party under either of said sections, as
applicable, give notice to the indemnifying party of the commencement of such
action, suit or proceeding. The indemnified party shall furnish to the
indemnifying party in reasonable detail such information as the indemnified
party may have with respect to such indemnification claims (including copies of
any summons, complaint or other pleading which may have been served on it and
any written claim, demand, invoice, billing or other document evidencing or
assenting the same). Subject to the limitations set forth in this section, no
failure or delay by the indemnified party in the performance of the foregoing
shall reduce or otherwise affect the obligation of the indemnifying party to
indemnify and hold the indemnified party harmless except to the extent that such
failure or delay shall have materially and adversely affected the indemnifying
party's ability to defend against, settle or satisfy any action, suit or
proceeding the claim for which the indemnified party is entitled to
indemnification hereunder. The foregoing shall not apply to the extent
inconsistent with the provisions of section 4.8 relating to Proceedings.
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4.7 If the claim or demand set forth in the Notice of Claim given by
the indemnified party is a claim or demand asserted by a third party, the
indemnifying party shall have 30 days after the Date of Notice of Claim to
notify the indemnified party in writing of its election to defend such third
party claim or demand on behalf of the indemnified party (the "Notice Period");
provided, however, that the indemnified party is authorized to file any motion,
answer or other pleading which it deems necessary or appropriate to protect its
interests during the Notice Period. If the indemnifying party elects to defend
such third party claim or demand, the indemnified party shall make available to
the indemnifying party and its agents and representatives all records and other
materials which are reasonably required in the defense of such third party claim
or demand and shall otherwise cooperate (at the sole cost and expense of the
indemnifying party) with, and assist (at the sole cost and expense of the
indemnifying party) the indemnifying party in the defense of, such third party
claim or demand, and so long as the indemnifying party is diligently defending
such third party claim in good faith, the indemnified party shall not pay,
settle or compromise such third party claim or demand. If the indemnifying party
elects to defend such third party claim or demand, the indemnified party shall
have the right to control the defense of such third party claim or demand, at
the indemnified party's own expense. If the indemnifying party does not elect to
defend such third party claim or demand or does not defend such third party
claim or demand in good faith, the indemnified party shall have the right, in
addition to any other right or remedy it may have hereunder at the indemnifying
party's expense, to defend such third party claim or demand.
4.8 The term "Date of Notice of Claim" shall mean the date the Notice
of Claim is effective pursuant to section 4.6 of this Agreement.
4.9 A claim for indemnification for any matter not involving a
third-party claim may be asserted by notice to the party from whom
indemnification is sought.
4.10 Any legal action or proceeding with respect to this Agreement or
any matters arising out of or in connection with this Agreement or the
transactions contemplated hereby or the documents executed and delivered in
connection herewith, and any action for enforcement of any judgment in respect
thereof may be brought in the courts of the State of Florida or of the United
States of America for the District of Florida, and, by execution and delivery of
this Agreement, the parties each hereby accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts and appellate courts thereof. The parties irrevocably consent to service
of process out of any of the aforementioned courts in any such action or
proceeding in accordance with the notice provisions set forth in Section 9.5.
The parties each hereby irrevocably waive any objection that it may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or the
transactions contemplated hereby or the documents execute and delivered in
connection herewith brought in the courts referred to above and hereby further
irrevocably waive and agree, to the extent permitted by applicable law, not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum. Nothing herein shall
affect the right of any party hereto to serve process in any other manner
permitted by law.
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ARTICLE V
Procedure for Closing
---------------------
5.1 At the Closing Date, the purchase and sale shall be consummated
after satisfaction of all conditions precedent set forth in Article VI, by
Seller common stock certificates for the Purchase Shares being delivered, duly
executed, for 7,550,000 shares of common stock to escrow agent, and the delivery
of the Consideration for share purchase to escrow agent from the Buyer, together
with delivery of all other items, agreements, stock powers, warranties, and
representations set forth in this Agreement.
5.2 Escrow Agent is Law Offices of Xxxxx X. Xxxxx, 000 Xxxxxxx Xxxxxx
Xx., Xxxxx 0000, Xxxxxxx Xxxxx, XX 00000 and the escrow account is [as provided
to the Parties]
ARTICLE VI
Conditions Precedent to the
Consummation of the Purchase
----------------------------
The following are conditions precedent to the consummation of the
Agreement on or before the Closing Date:
6.1 Seller and Golden shall have performed and complied with all of
their respective obligations hereunder which are to be complied with or
performed on or before the Closing Date.
6.2 No action, suit or proceeding shall have been instituted or shall
have been threatened before any court or other governmental body or by any
public authority to restrain, enjoin or prohibit the transactions contemplated
herein, or which might subject any of the parties hereto or their directors or
officers to any material liability, fine, forfeiture or penalty on the grounds
that the transactions contemplated hereby, the parties hereto or their directors
or officers, have violated any applicable law or regulation or have otherwise
acted improperly in connection with the transactions contemplated hereby, and
the parties hereto have been advised by counsel that, in the opinion of such
counsel, such action, suit or proceeding raises substantial questions of law or
fact which could reasonably be decided adversely to any party hereto or its
directors or officers.
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6.3 The representations and warranties made by Seller and Golden in
this Agreement shall be true as though such representations and warranties had
been made or given on and as of the Closing Date, except to the extent that such
representations and warranties may be untrue on and as of the Closing Date
because of changes caused by transactions suggested or approved in writing by
the Buyer.
ARTICLE VII
Termination and Abandonment
---------------------------
7.1 Anything contained in this Agreement to the contrary
notwithstanding, the Agreement may be terminated and abandoned at any time prior
to or on the Closing Date:
(a) By mutual consent of parties;
(b) By Seller or Buyer, if any condition set forth in Article VI
relating to the other party has not been met or has not been
waived;
(c) By Seller or Buyer, if any suit, action, or other proceeding shall
be pending or threatened by the federal or a state government
before any court or governmental agency, in which it is sought to
restrain, prohibit, or otherwise affect the consummation of the
transactions contemplated hereby;
(d) By Seller or Buyer, if there is discovered any material error,
misstatement or omission in the representations and warranties of
another party; or
(e) By the Seller, if the Closing does not occur, through no failure
to act by Seller, on February_____, 2004, or if Buyer fails to
deliver the consideration required herein.
7.2 Any of the terms or conditions of this Agreement may be waived at
any time by the party which is entitled to the benefit thereof, by action taken
by its Board of Directors provided; however, that such action shall be taken
only if, in the judgment of the Board of Directors taking the action, such
waiver will not have a materially adverse effect on the benefits intended under
this Agreement to the party waiving such term or condition.
ARTICLE VIII
Continuing Representations and
Warranties and Covenants
------------------------
8.1 The respective representations, warranties, and covenants of the
parties hereto and the covenants and agreements of the parties hereto shall
survive after the closing under this Agreement in accordance with the terms
thereof.
8.2 There are no representations whatsoever about any matter relating
to Golden Seller or any item contained in this Agreement, except as is contained
in the express language of this Agreement.
8.3 Seller and their agents and attorneys shall have no liability
whatsoever for any matter, omission or representation not specifically disclosed
herein, and Buyer, as a specific inducement to Seller hereby releases Seller and
their agents and attorneys and covenant not to xxx Seller, their agents and
attorneys under any circumstances for any matter not specifically and expressly
represented within this document.
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ARTICLE IX
Miscellaneous
-------------
9.1 This Agreement embodies the entire agreement between the parties,
and there have been and are no agreements, representations or warranties among
the parties other than those set forth herein or those provided for herein,
except that a companion document, the Reorganization Agreement, has been
executed concurrently which contains numerous warranties and representations.
9.2 To facilitate the execution of this Agreement, any number of
counterparts hereof may be executed, and each such counterpart shall be deemed
to be an original instrument, but all such counterparts together shall
constitute but one instrument.
9.3 All parties to this Agreement agree that if it becomes necessary or
desirable to execute further instruments or to make such other assurances as are
deemed necessary, the party requested to do so will use its best efforts to
provide such executed instruments or do all things necessary or proper to carry
out the purpose of this Agreement.
9.4 This Agreement may not be amended except by written consent of both
parties.
9.5 Any notices, requests, or other communications required or
permitted hereunder shall be delivered personally or sent by overnight courier
service, prepaid, addressed as follows:
To Seller: Xxxxxxx Xxxxxxxxxx [address provided to the Buyer]
To Golden: Xxxxxxx Xxxxxxxxxx [address provided to the Buyer]
To Buyer: Yellow Jacket Investments Limited [ address provided to Seller]
Copy to: Escrow Agent: Law Offices of Xxxxx X. Xxxxx, 000 Xxxxxxx Xxxxxx
Xx., Xxxxx 0000, Xxxxxxx Xxxxx, XX 00000
or such other addresses as shall be furnished in writing by any party, and any
such notice or communication shall be deemed to have been given as of the date
received.
9.6 No press release or public statement will be issued relating to the
transactions contemplated by this Agreement without prior approval of the Buyer
and Seller. However, Golden may issue at any time any press release or other
public statement it believes on the advice of its counsel it is obligated to
issue to avoid liability under the law relating to disclosures, but the party
issuing such press release or public statement shall make a reasonable effort to
give the other party prior notice of and opportunity to participate in such
release or statement.
9.7 This Agreement shall be governed by and construed in accordance
with and enforced under the laws of the state of California applicable to all
agreements made hereunder. Venue and jurisdiction for any legal actions
hereunder shall be District Court in and for Orange County, California.
9.8 In connection with this Agreement the parties have appointed the
escrow agent, Law Offices of Xxxxx X. Xxxxx which shall be authorized by this
agreement to do the following:
1) Accept the total funds of $400,000 from Buyers, and
disburse such funds in accordance with Seller and Buyers
written instructions, upon receipt of a copy of this
agreement signed by Seller, Buyer and Golden, and disburse
the purchase price, as defined herein, to Seller upon
completion of delivery of the shares (7,550,000) being
purchased herein;
2) Accept the common stock certificates of Golden with duly
signed and guaranteed signatures on the stock power(s) for
7,550,000 common shares from Seller and,
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3) Upon receipt of the certificates for the purchase shares
disburse the funds received from the Seller from the
escrow as follows:
i) $365,000 to Seller in accordance with their and
Buyer written instructions
ii) $ 35,000 to Corporate Capital Research, Inc.
in accordance with the Buyer and Seller
written instructions.
4) Transmit by Federal Express the stock certificates to
Buyer at: [address provided by Buyer].
5) In the event of default in delivery of cash or
certificates by a party under this agreement, any cash or
certificates received from the other party shall be
returned to the remitting party 3 business days after
default.
6) Escrow Agent is specifically indemnified and held harmless
hereby for its actions or inactions in following these
instructions. In the event of a dispute involving the
escrow instructions or the consideration to be delivered
in escrow, the escrow agent is authorized to implead the
consideration received into the special account upon ten
days written notice, and be relieved of any further escrow
duties thereupon. Any and all costs of attorneys fees and
legal actions of escrow agent for any dispute resolution
or impleader action shall be paid in equal shares by the
parties to this agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement this 18th
day of February, 2004.
Seller: Golden Sand Eco-Protection, Inc.,
a Florida Corporation
Xxxxxxx Xxxxxxxxxx By: /s/ Xxxxxxx Xxxxxxxxxx
Name: Xxxxxxx Xxxxxxxxxx
/s/ Xxxxxxx Xxxxxxxxxx Title:President
__________________________
BUYER:
Yellow Jacket Investments Limited
/s/ A.D. Stamp
/s/ F. K. Stamp
---------------------------------------
By: A.D. Stamp & F.K. Stamp
Name:_______________________
Title:Directors
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