Share Exchange Agreement
This
Share Exchange Agreement, dated as of April 18, 2006, is made by and among
Advanced Medical Institute Inc., a Nevada corporation (the “Acquiror Company”),
and
each of
the Persons listed on Exhibit A hereto and executing a signature page hereto
(collectively, the “Shareholders”, and individually a “Shareholder”).
The
Shareholders have agreed to transfer to the Acquiror Company, and the Acquiror
Company has agreed to acquire from the Shareholders, all of the Shares, which
Shares constitute an aggregate of 7% of the outstanding capital stock of
Intelligent Medical Technologies Pty. Ltd. (the “Company”), in exchange for
1,260,000 shares of the Acquiror Company’s Common Stock to be issued on the
Closing Date (the “Acquiror Company Shares”), which Acquiror Company Shares
shall constitute 3.49% of the issued and outstanding shares of Acquiror
Company’s Common Stock immediately after the closing of the transactions
contemplated herein, in each case, on the terms and conditions as set forth
herein.
SECTION
I
Unless
the context otherwise requires, the terms defined in this Section 1 will have
the meanings herein specified for all purposes of this Agreement, applicable
to
both the singular and plural forms of any of the terms herein
defined.
1.1 “Accredited
Investor” has the meaning set forth in Regulation D under the Securities Act and
set forth on Exhibit B.
1.2 “Acquiror
Company Board” means the Board of Directors of the Acquiror
Company.
1.3 “Acquiror
Company Common Stock” means the Acquiror Company’s common stock, par value US
$0.001 per share.
1.4 “Acquiror
Company Shares” means the Acquiror Company Common Stock being issued to the
Shareholders pursuant hereto.
1.5 “Affiliate”
means any Person that directly or indirectly controls, is controlled by or
is
under common control with the indicated Person.
1.6 “Agreement”
means this Share Exchange Agreement, including all Schedules and Exhibits
hereto, as this Share Exchange Agreement may be from time to time amended,
modified or supplemented.
1.7 “Closing
Date” has the meaning set forth in Section 3.
1.8 “Code”
means the Internal Revenue Code of 1986, as amended.
1.9 “Commission”
means the Securities and Exchange Commission or any other federal agency then
administering the Securities Act.
1.10 “Covered
Persons” means all Persons, other than Acquiror Company, who are parties to
indemnification and employment agreements with Acquiror Company existing on
or
before the Closing Date.
1.11 “Damages”
means any costs or expenses (including attorneys’ fees), judgments, fines,
losses, claims, damages, liabilities and amounts paid in settlement in
connection with any Proceeding (x) arising out of or pertaining to the
transactions contemplated by this Agreement or (y) otherwise with respect
to any acts or omissions occurring at or prior to the Closing Date.
1.12 “Distributor”
means any underwriter, dealer or other Person who participates, pursuant to
a
contractual arrangement, in the distribution of the securities offered or sold
in reliance on Regulation S.
1.13 “Equity
Security” means any stock or similar security, including, without limitation,
securities containing equity features and securities containing profit
participation features, or any security convertible into or exchangeable for,
with or without consideration, any stock or similar security, or any security
carrying any warrant, right or option to subscribe to or purchase any shares
of
capital stock, or any such warrant or right.
1.14 “Exchange”
has the meaning set forth in Section 2.1.
1.15 “Exchange
Act” means the Securities Exchange Act of 1934 or any similar federal statute,
and the rules and regulations of the Commission thereunder, all as the same
will
then be in effect.
1.16 “Exhibits”
means the several exhibits referred to and identified in this
Agreement.
1.17 “GAAP”
means, with respect to any Person, United States generally accepted accounting
principles applied on a consistent basis with such Person’s past
practices.
1.18 “Governmental
Authority” means any federal or national, state or provincial, municipal or
local government, governmental authority, regulatory or administrative agency,
governmental commission, department, board, bureau, agency or instrumentality,
political subdivision, commission, court, tribunal, official, arbitrator or
arbitral body, in each case whether U.S. or non-U.S.
1.19 “Indemnified
Parties” has the meaning set forth in Section 6.1.1.
1.20 “Laws”
means, with respect to any Person, any U.S. or non-U.S. federal, national,
state, provincial, local, municipal, international, multinational or other
law
(including common law), constitution, statute, code, ordinance, rule, regulation
or treaty applicable to such Person.
1.21 “Lien”
means any mortgage, pledge, security interest, encumbrance, lien or charge
of
any kind, including, without limitation, any conditional sale or other title
retention agreement, any lease in the nature thereof and the filing of or
agreement to give any financing statement under the Uniform Commercial Code
of
any jurisdiction and including any lien or charge arising by Law.
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1.22 “Material
Acquiror Company Contract” means any and all agreements, contracts,
arrangements, leases, commitments or otherwise, of the Acquiror Company, of
the
type and nature that the Acquiror Company is required to file with the
Commission.
1.23 “Material
Adverse Effect” means, when used with respect to the Acquiror Company, any
change, effect or circumstance which, individually or in the aggregate, would
reasonably be expected to (a) have a material adverse effect on the business,
assets, financial condition or results of operations of the Acquiror Company,
taken as a whole or (b) materially impair the ability of the Acquiror
Company to perform its obligations under this Agreement, excluding any change,
effect or circumstance resulting from (i) the announcement, pendency or
consummation of the transactions contemplated by this Agreement, (ii) changes
in
the United States securities markets generally, or (iii) changes in general
economic, currency exchange rate, political or regulatory conditions in
industries in which the Acquiror Company operates.
1.24 “Order”
means any award, decision, injunction, judgment, order, ruling, subpoena, or
verdict entered, issued, made, or rendered by any Governmental
Authority.
1.25 “Organizational
Documents” means (a) the articles or certificate of incorporation and the
by-laws or code of regulations of a corporation; (b) the partnership agreement
and any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) the articles or certificate of formation and operating
agreement of a limited liability company; (e) any other document performing
a
similar function to the documents specified in clauses (a), (b), (c) and (d)
adopted or filed in connection with the creation, formation or organization
of a
Person; and (f) any and all amendments to any of the foregoing.
1.26 “Person”
means all natural persons, corporations, business trusts, associations,
companies, partnerships, limited liability companies, joint ventures and other
entities, governments, agencies and political subdivisions.
1.27 “Proceeding”
means any action, arbitration, audit, hearing, investigation, litigation, or
suit (whether civil, criminal, administrative or investigative) commenced,
brought, conducted, or heard by or before, or otherwise involving, any
Governmental Authority.
1.28 “Regulation
S” means Regulation S under the Securities Act, as the same may be amended from
time to time, or any similar rule or regulation hereafter adopted by the
Commission.
1.29 “Rule
144” means Rule 144 under the Securities Act, as the same may be amended from
time to time, or any successor statute.
1.30 “Schedules”
means the several schedules referred to and identified herein, setting forth
certain disclosures, exceptions and other information, data and documents
referred to at various places throughout this Agreement.
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1.31 “SEC
Documents” means all reports
and other documents required to be filed by the Acquiror Company under the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
three (3) years preceding the date hereof (or such shorter period as the
Acquiror Company was required by law to file such material).
1.32 “Section
4(2)” means Section 4(2) under the Securities Act, as the same may be amended
from time to time, or any successor statute.
1.33 “Securities
Act” means the Securities Act of 1933, as amended, or any similar federal
statute, and the rules and regulations of the Commission thereunder, all as
the
same will be in effect at the time.
1.34 “Shares”
means seven (7) issued and outstanding ordinary shares of the
Company.
1.35 “Subsidiary”
means, with respect to any Person, any corporation, limited liability company,
joint venture or partnership of which such Person (a) beneficially owns, either
directly or indirectly, more than 50% of (i) the total combined voting power
of
all classes of voting securities of such entity, (ii) the total combined equity
interests, or (iii) the capital or profit interests, in the case of a
partnership; or (b) otherwise has the power to vote or to direct the voting
of
sufficient securities to elect a majority of the board of directors or similar
governing body.
1.36 “Survival
Period” has the meaning set forth in Section 9.1.
1.37 “Transaction
Documents” means, collectively, all agreements, instruments and other documents
to be executed and delivered in connection with the transactions contemplated
by
this Agreement.
1.38 “U.S.”
means the United States of America.
1.39 “U.S.
Dollars” or “US $” means the currency of the United States of
America.
1.40 “U.S.
Person” has the meaning set forth in Regulation S under the Securities Act and
set forth on Exhibit C hereto.
SECTION
II
2.1 Share
Exchange.
At the
Closing, each Shareholder shall transfer to the Acquiror Company the number
of
Shares set forth in Exhibit
A,
and, in
consideration therefor, subject to Section 2.2, Acquiror Company shall issue
to
such Shareholder the number of shares of Acquiror Company Common Stock so set
forth (the “Exchange”). The total amount of Acquiror Company Common Stock to be
issued to the Shareholders shall be 1,260,000 shares.
2.2 Withholding.
The
Acquiror Company shall be entitled to deduct and withhold from the Acquiror
Company Shares otherwise payable pursuant to this Agreement to the Shareholder
such amounts as it is required to deduct and withhold with respect to the making
of such payment under the Code or any provision of state, local, provincial
or
foreign tax Law. To the extent that amounts are so withheld, such withheld
amounts shall be treated for all purposes of this Agreement as having been
paid
to the Shareholder in respect of which such deduction and withholding was
made.
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SECTION
III
3.1 Closing
Date.
The
closing of the Exchange will occur upon execution of this Agreement on April
18,
2006 or at such later date as all of the closing conditions set forth in
Sections 7 and 8 have been satisfied or waived (the “Closing
Date”).
SECTION
IV
4.1 Generally.
Each
Shareholder, severally and not jointly, hereby represents and warrants to the
Acquiror Company:
4.1.1 Authority.
(a) Such
Shareholder has the right, power, authority and capacity to execute and deliver
this Agreement and each of the Transaction Documents to which such Shareholder
is a party, to consummate the transactions contemplated by this Agreement and
each of the Transaction Documents to which such Shareholder is a party, and
to
perform such Shareholder’s obligations under this Agreement and each of the
Transaction Documents to which such Shareholder is a party. This Agreement
has
been, and each of the Transaction Documents to which such Shareholder is a
party
will be, duly and validly authorized and approved, executed and delivered by
such Shareholder. Assuming this Agreement and the Transaction Documents have
been duly and validly authorized, executed and delivered by the parties thereto
other than such Shareholder, this Agreement is, and each of the Transaction
Documents to which such Shareholder is a party have been, duly authorized,
executed and delivered by such Shareholder and constitutes the legal, valid
and
binding obligation of such Shareholder, enforceable against such Shareholder
in
accordance with their respective terms, except as such enforcement is limited
by
general equitable principles, or by bankruptcy, insolvency and other similar
Laws affecting the enforcement of creditors rights generally.
(b) In
the
event that the Shareholder is an entity and not a natural person, such
Shareholder has all requisite authority and power (corporate and other),
governmental licenses, authorizations, consents and approvals to enter into
this
Agreement and each of the Transaction Documents to which such Shareholder is
a
party, to consummate the transactions contemplated by this Agreement and each
of
the Transaction Documents to which such Shareholder is a party and to perform
its obligations under this Agreement and each of the Transaction Documents
to
which such Shareholder is a party. The execution, delivery and performance
by
such Shareholder of this Agreement and each of the Transaction Documents to
which the Shareholder is a party have been duly authorized by all necessary
corporate action and do not require from the board of directors or the
stockholders of such Shareholder any consent or approval that has not been
validly and lawfully obtained. The execution, delivery and performance by such
Shareholder of this Agreement and each of the Transaction Documents to which
the
Shareholder is a party requires no authorization, consent, approval, license,
exemption of or filing or registration with any Governmental Authority or other
Person other than such other customary filings with the Commission for
transactions of the type contemplated by this Agreement.
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4.1.2 No
Conflict.
Neither
the execution or delivery by such Shareholder of this Agreement or any
Transaction Document to which such Shareholder is a party, nor the consummation
or performance by such Shareholder of the transactions contemplated hereby
or
thereby will, directly or indirectly, (a) contravene, conflict with, or result
in a violation of any provision of the Organizational Documents of such
Shareholder (if such Shareholder is not a natural person); (b) contravene,
conflict with, constitute a default (or an event or condition which, with notice
or lapse of time or both, would constitute a default) under, or result in the
termination or acceleration of, any agreement or instrument to which such
Shareholder is a party or by which the properties or assets of such Shareholder
are bound; or (c) contravene, conflict with, or result in a violation of, any
Law or Order to which such Shareholder, or any of the properties or assets
of
such Shareholder, may be subject.
4.1.3 Ownership
of Shares.
Such
Shareholder owns, of record and beneficially, and has good, valid and
indefeasible title to and the right to transfer to the Acquiror Company pursuant
to this Agreement, such Shareholder’s Shares free and clear of any and all
Liens. There are no options, rights, voting trusts, stockholder agreements
or
any other contracts or understandings to which such Shareholder is a party
or by
which such Shareholder or such Shareholder’s Shares are bound with respect to
the issuance, sale, transfer, voting or registration of such Shareholder’s
Shares. At the Closing Date, the Acquiror Company will acquire good, valid
and
marketable title to such Shareholder’s Shares free and clear of any and all
Liens.
4.1.4 Litigation.
There
is no pending Proceeding against such Shareholder that challenges, or may have
the effect of preventing, delaying or making illegal, or otherwise interfering
with, any of the transactions contemplated by this Agreement and, to the
knowledge of such Shareholder, no such Proceeding has been threatened, and
no
event or circumstance exists that is reasonably likely to give rise to or serve
as a basis for the commencement of any such Proceeding.
4.2 Binding
Obligations.
Assuming this Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties thereto other than the
Shareholders, this Agreement and each of the Transaction Documents to which
the
Shareholders are a party are duly authorized, executed and delivered by the
Shareholders and constitutes the legal, valid and binding obligations of the
Shareholders, enforceable against the Shareholders in accordance with their
respective terms, except as such enforcement is limited by general equitable
principles, or by bankruptcy, insolvency and other similar Laws affecting the
enforcement of creditors rights generally.
4.3 Investment
Representations.
Each
Shareholder, severally and not jointly, hereby represents and warrants to the
Acquiror Company:
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4.3.1 Acknowledgment.
Each
Shareholder understands and agrees that the Acquiror Company Shares to be issued
pursuant to this Agreement have not been registered under the Securities Act
or
the securities laws of any state of the U.S. and that the issuance of the
Acquiror Company Shares is being effected in reliance upon an exemption from
registration afforded either under Section 4(2) of the Securities Act for
transactions by an issuer not involving a public offering or Regulation S for
offers and sales of securities outside the U.S.
4.3.2 Status.
By its
execution of this Agreement, each Shareholder, severally and not jointly,
represents and warrants to the Acquiror Company as indicated on its signature
page to this Agreement, either that:
(a) such
Shareholder is an Accredited Investor; or
(b) such
Shareholder is not a U.S. Person.
Each
Shareholder severally understands that the Acquiror Company Shares are being
offered and sold to such Shareholder in reliance upon the truth and accuracy
of
the representations, warranties, agreements, acknowledgments and understandings
of such Shareholder set forth in this Agreement, in order that the Acquiror
Company may determine the applicability and availability of the exemptions
from
registration of the Acquiror Company Shares on which the Acquiror Company is
relying.
4.3.3 Additional
Representations and Warranties of Accredited Investors.
The
Shareholder indicating that such Shareholder is an Accredited Investor on its
signature page to this Agreement, severally and not jointly, further makes
the
representations and warranties to the Acquiror Company set forth on Exhibit
D.
4.3.4 Additional
Representations and Warranties of Non-U.S. Persons.
Each
Shareholder indicating that it is not a U.S. person on its signature page to
this Agreement, severally and not jointly, further makes the representations
and
warranties to the Acquiror Company set forth on Exhibit E.
4.3.5 Stock
Legends.
Each
Shareholder hereby agrees with the Acquiror Company as follows:
(a) Securities
Act Legend - Accredited Investors.
The
certificates evidencing the Acquiror Company Shares issued to those Shareholders
who are Accredited Investors, and each certificate issued in transfer thereof,
will bear the following legend:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS OR (2) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN
WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY
AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO
THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS.
7
(b) Securities
Act Legend - Non-U.S. Persons.
The
certificates evidencing the Acquiror Company Shares issued to those Shareholders
who are not U.S. Persons, and each certificate issued in transfer thereof,
will
bear the following legend:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) IN ACCORDANCE WITH THE PROVISIONS
OF REGULATION S PROMULGATED UNDER THE SECURITIES ACT, AND BASED ON AN OPINION
OF
COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY,
THAT THE PROVISIONS OF REGULATION S HAVE BEEN SATISFIED (2) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS OR (3) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN
WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY
AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO
THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING THE SECURITIES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
THE SECURITIES ACT.
(c) Other
Legends.
The
certificates representing such Acquiror Company Shares, and each certificate
issued in transfer thereof, will also bear any other legend required under
any
applicable Law, including, without limitation, any U.S. state corporate and
state securities law, or contract.
(d) Opinion.
No
Shareholder will transfer any or all of the Acquiror Company Shares pursuant
to
Regulation S or absent an effective registration statement under the Securities
Act and applicable state securities law covering the disposition of such
Shareholder’s Acquiror Company Shares, without first providing the Acquiror
Company with an opinion of counsel (which counsel and opinion are reasonably
satisfactory to the Acquiror Company) to the effect that such transfer will
be
made in compliance with Regulation S or will be exempt from the registration
and
the prospectus delivery requirements of the Securities Act and the registration
or qualification requirements of any applicable U.S. state securities
laws.
8
(e) Consent.
Each
Shareholder understands and acknowledges that the Acquiror Company may refuse
to
transfer the Acquiror Company Shares, unless such Shareholder complies with
this
Section 4.3.5 and any other restrictions on transferability set forth in
Exhibits D and E. Each Shareholder consents to the Acquiror Company making
a
notation on its records or giving instructions to any transfer agent of the
Acquiror Company’s Common Stock in order to implement the restrictions on
transfer of the Acquiror Company Shares.
SECTION
V
The
Acquiror Company represents and warrants to the Shareholders as
follows:
5.1 Organization
and Qualification.
The
Acquiror Company is duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, has all requisite authority and
power (corporate and other), governmental licenses, authorizations, consents
and
approvals to carry on its business as presently conducted and to own, hold
and
operate its properties and assets as now owned, held and operated by it, except
where the failure to be so organized, existing and in good standing, or to
have
such authority and power, governmental licenses, authorizations, consents or
approvals would not have a Material Adverse Effect. The Acquiror Company is
duly
qualified, licensed or domesticated as a foreign corporation in good standing
in
each jurisdiction wherein the nature of its activities or its properties owned,
held or operated makes such qualification, licensing or domestication necessary,
except where the failure to be so duly qualified, licensed or domesticated
and
in good standing would not have a Material Adverse Effect. The SEC Documents
set
forth the Acquiror Company’s jurisdiction of organization and each other
jurisdiction in which the Acquiror Company presently conducts its business
or
owns, holds and operates its properties and assets.
5.2 Subsidiaries.
Except
as set forth in the SEC Documents, the Acquiror Company does not own, directly
or indirectly, any equity or other ownership interest in any corporation,
partnership, joint venture or other entity or enterprise.
5.3 Authorization.
The
Acquiror Company has all requisite authority and power (corporate and other),
governmental licenses, authorizations, consents and approvals to enter into
this
Agreement and each of the Transaction Documents to which the Acquiror Company
is
a party, to consummate the transactions contemplated by this Agreement and
each
of the Transaction Documents to which the Acquiror Company is a party and to
perform its obligations under this Agreement and each of the Transaction
Documents to which the Acquiror Company is a party. The execution, delivery
and
performance by the Acquiror Company of this Agreement and each of the
Transaction Documents to which the Acquiror Company is a party have been duly
authorized by all necessary corporate action and do not require from the
Acquiror Company Board or the stockholders of the Acquiror Company any consent
or approval that has not been validly and lawfully obtained. The execution,
delivery and performance by the Acquiror Company of this Agreement and each
of
the Transaction Documents to which the Acquiror Company is a party requires
no
authorization, consent, approval, license, exemption of or filing or
registration with any Governmental Authority or other Person other than such
other customary filings with the Commission for transactions of the type
contemplated by this Agreement.
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5.4 No
Violation.
Neither
the execution nor the delivery by the Acquiror Company of this Agreement or
any
Transaction Document to which the Acquiror Company is a party, nor the
consummation or performance by the Acquiror Company of the transactions
contemplated hereby or thereby will, directly or indirectly, (a) contravene,
conflict with, or result in a violation of any provision of the Organizational
Documents of the Acquiror Company; (b) contravene, conflict with, constitute
a
default (or an event or condition which, with notice or lapse of time or both,
would constitute a default) under, or result in the termination or acceleration
of, or result in the imposition or creation of any Lien under, any agreement
or
instrument to which the Acquiror Company is a party or by which the properties
or assets of the Acquiror Company are bound; (c) contravene, conflict with,
or result in a violation of, any Law or Order to which the Acquiror Company,
or
any of the properties or assets owned or used by the Acquiror Company, may
be
subject; or (d) contravene, conflict with, or result in a violation of, the
terms or requirements of, or give any Governmental Authority the right to
revoke, withdraw, suspend, cancel, terminate or modify, any licenses, permits,
authorizations, approvals, franchises or other rights held by the Acquiror
Company or that otherwise relate to the business of, or any of the properties
or
assets owned or used by, the Acquiror Company, except, in the case of clause
(b), (c), or (d), for any such contraventions, conflicts, violations, or other
occurrences as would not have a Material Adverse Effect.
5.5 Binding
Obligations.
Assuming this Agreement and the Transaction Documents have been duly and validly
authorized, executed and delivered by the parties thereto other than the
Acquiror Company, this Agreement and each of the Transaction Documents to which
the Acquiror Company is a party are duly authorized, executed and delivered
by
the Acquiror Company and constitutes the legal, valid and binding obligations
of
the Acquiror Company, enforceable against the Acquiror Company in accordance
with their respective terms, except as such enforcement is limited by general
equitable principles, or by bankruptcy, insolvency and other similar Laws
affecting the enforcement of creditors rights generally.
5.6 Securities
Laws.
Assuming the accuracy of the representations and warranties of the Shareholders
contained in Section 4 and Exhibits D and E, the issuance of the Acquiror
Company Shares pursuant to this Agreement are (a) exempt from the registration
and prospectus delivery requirements of the Securities Act, (b) have been
registered or qualified (or are exempt from registration and qualification)
under the registration permit or qualification requirements of all applicable
state securities laws, and (c) accomplished in conformity with all other
applicable federal and state securities laws.
5.7.1 Capitalization.
The
authorized capital stock of the Acquiror Company consists of 100,000,000 shares
of the Acquiror Company’s Common Stock, of which 36,112,450 shares are issued
and outstanding. All issued and outstanding shares of the Acquiror Company’s
Common Stock are duly authorized, validly issued, fully paid and nonassessable,
and have not been issued in violation of any preemptive or similar rights.
At
the Closing Date, the Acquiror Company will have sufficient authorized and
unissued Acquiror Company’s Common Stock to consummate the transactions
contemplated hereby. There are no outstanding stockholders’ agreements, voting
trusts or arrangements, registration rights agreements, rights of first refusal
or other contracts pertaining to the capital stock of the Acquiror Company.
The
issuance of all of the shares of Acquiror Company’s Common Stock described in
this Section 5.7.1 have been in compliance with U.S. federal and state
securities laws.
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5.7.2 No
Redemption Requirements.
Except
as set forth in the SEC Documents, there are no outstanding contractual
obligations (contingent or otherwise) of the Acquiror Company to retire,
repurchase, redeem or otherwise acquire any outstanding shares of capital stock
of, or other ownership interests in, the Acquiror Company or to provide funds
to
or make any investment (in the form of a loan, capital contribution or
otherwise) in any other Person.
5.7.3 Duly
Authorized.
The
issuance of the Acquiror Company Shares has been duly authorized and, upon
delivery to the Shareholders of certificates therefor in accordance with the
terms of this Agreement, the Acquiror Company Shares will have been validly
issued and fully paid, and will be nonassessable, have the rights, preferences
and privileges specified, will be free of preemptive rights and will be free
and
clear of all Liens and restrictions, other than Liens created by the
Shareholders and restrictions on transfer imposed by this Agreement and the
Securities Act.
5.8 Certain
Proceedings.
There
is no pending Proceeding that has been commenced against the Acquiror Company
and that challenges, or may have the effect of preventing, delaying, making
illegal, or otherwise interfering with, any of the transactions contemplated
by
this Agreement. To the knowledge of the Acquiror Company, no such Proceeding
has
been threatened.
5.9 Changes.
Except
as set forth in Schedule 5.9 or in the SEC Documents, the Acquiror Company
has,
since December 31, 2005:
5.9.1
Adverse
Changes.
Not
suffered or experienced any change in, or affecting, its condition (financial
or
otherwise), properties, assets, liabilities, business, operations, results
of
operations or prospects other than changes, events or conditions in the usual
and ordinary course of its business, none of which would have a Material Adverse
Effect;
5.9.2
Accounting.
Changed
its method of accounting or the accounting principles or practices utilized
in
the preparation of its financial statements, other than as required by
GAAP;
5.10 SEC
Documents; Financial Statements.
The
Acquiror Company has filed all reports required to be filed by it under the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
three (3) years preceding the date hereof (or such shorter period as the
Acquiror Company was required by law to file such material) (the foregoing
materials being collectively referred to herein as the “SEC Documents”) and,
while not having filed all such SEC Documents prior to the expiration of any
extension(s), is nevertheless current with respect to its Exchange Act filing
requirements. As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Securities Act and the Exchange
Act and the rules and regulations of the Commission promulgated thereunder,
and
none of the SEC Documents, when filed, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statement therein, in light of the
circumstances under which they were made, not misleading. All material
agreements to which the Acquiror Company is a party or to which the property
or
assets of the Acquiror Company are subject have been appropriately filed as
exhibits to the SEC Documents as and to the extent required under the Exchange
Act. The financial statements of the Acquiror Company included in the SEC
Documents comply in all material respects with applicable accounting requirement
and the rules and regulations of the Commission with respect thereto as in
effect at the time of filing, were prepared in accordance with GAAP applied
on a
consistent basis during the periods involved (except as may be indicated in
the
notes thereto, or, in the case of unaudited statements as permitted by Form
10-QSB of the Commission), and fairly present in all material respects (subject
in the case of unaudited statements, to normal, recurring audit adjustments)
the
financial position of the Acquiror Company as at the dates thereof and the
results of its operations and cash flows for the periods then
ended.
11
5.11 Board
Recommendation.
The
Acquiror Company Board, at a meeting duly called and held, has determined that
this Agreement and the transactions contemplated by this Agreement are advisable
and in the best interests of the Acquiror Company’s stockholders and has duly
authorized this Agreement and the transactions contemplated by this
Agreement.
SECTION
VI
6.1.1 The
Acquiror Company shall to the fullest extent permitted under applicable Law
or
its Organizational Documents, indemnify and hold harmless, each present and
former director, officer or employee of the Acquiror Company (collectively,
the
“Indemnified Parties”) against any costs or expenses (including attorneys’
fees), judgments, fines, losses, claims, damages, liabilities and amounts paid
in settlement in connection with any Proceeding (x) arising out of or pertaining
to the transactions contemplated by this Agreement or (y) otherwise with
respect to any acts or omissions occurring at or prior to the Closing Date,
to
the same extent as provided in the Acquiror Company’s Organizational Documents
or any applicable contract or agreement as in effect on the date hereof, in
each
case for a period of two years after the Closing Date. In the event of any
such
Proceeding (whether arising before or after the Closing Date), (i) any counsel
retained by the Indemnified Parties for any period after the Closing Date shall
be reasonably satisfactory to the Acquiror Company, (ii) after the Closing
Date,
the Acquiror Company shall pay the reasonable fees and expenses of such counsel,
promptly after statements therefor are received, provided that the Indemnified
Parties shall be required to reimburse the Acquiror Company for such payments
in
the circumstances and to the extent required by the Acquiror Company’s
Organizational Documents, any applicable contract or agreement or applicable
Law, and (iii) the Acquiror Company will cooperate in the defense of any such
matter; provided,
however,
that
the Acquiror Company shall not be liable for any settlement effected without
its
written consent (which consent shall not be unreasonably withheld); and
provided, further, that, in the event that any claim or claims for
indemnification are asserted or made within such two (2) year period, all rights
to indemnification in respect of any such claim or claims shall continue until
the disposition of any and all such claims. The Indemnified Parties as a group
may retain only one law firm to represent them in each applicable jurisdiction
with respect to any single action unless there is, under applicable standards
of
professional conduct, a conflict on any significant issue between the positions
of any two or more Indemnified Parties, in which case each Indemnified Person
with respect to whom such a conflict exists (or group of such Indemnified
Persons who among them have no such conflict) may retain one separate law firm
in each applicable jurisdiction.
12
6.1.2 This
Section 6.1 shall survive the consummation of the transactions contemplated
by
this Agreement upon execution, is intended to benefit the Indemnified Parties
and the Covered Persons, shall be binding on all successors and assigns of
the
Acquiror Company and shall be enforceable by the Indemnified Parties and the
Covered Persons.
6.2 Rule
144 Reporting.
Subject
to the Acquiror Company not being in material breach of the warranties and
representations in Section 5, with a view to making available to the Acquiror
Company’s stockholders the benefit of certain rules and regulations of the
Commission which may permit the sale of the Acquiror Company Common Stock to
the
public without registration, from and after the Closing Date, the Acquiror
Company agrees to:
6.2.1 Make
and
keep public information available, as those terms are understood and defined
in
Rule 144; and
6.2.2 File
with
the Commission, in a timely manner, all reports and other documents required
of
the Acquiror Company under the Exchange Act.
6.3 Scrip
for Scrip Rollover.
The
Acquiror Company and the Shareholders jointly choose a scrip for scrip rollover
for Australian tax purposes in accordance with subdivision 124-M of the Income
Tax Assessment Act in respect of this Agreement and the Acquiror Company and
Shareholders must execute all documents required to effect this. This clause
does not merge on Closing.
SECTION
VII
The
Acquiror Company’s obligation to acquire the Shares and to take the other
actions required to be taken by the Acquiror Company at the Closing Date is
subject to the satisfaction, at or prior to the Closing Date, of each of the
following conditions (any of which may be waived by the Acquiror Company, in
whole or in part):
7.1 Accuracy
of Representations.
The
representations and warranties of the Shareholders set forth in this Agreement
or in any Schedule or certificate delivered pursuant hereto that are not
qualified as to materiality shall be true and correct in all material respects
as of the date of this Agreement except to the extent a representation or
warranty is expressly limited by its terms to another date and without giving
effect to any supplemental Schedule. The representations and warranties of
the
Shareholders set forth in this Agreement or in any Schedule or certificate
delivered pursuant hereto that are qualified as to materiality shall be true
and
correct in all respects as of the date of this Agreement, except to the extent
a
representation or warranty is expressly limited by its terms to another date
and
without giving effect to any supplemental Schedule.
13
7.2.1 All
of
the covenants and obligations that each Shareholder is required to perform
or to
comply with pursuant to this Agreement (considered collectively), and each
of
these covenants and obligations (considered individually), must have been duly
performed and complied with in all material respects.
7.2.2 Each
document required to be delivered by the Shareholders pursuant to this Agreement
must have been delivered.
7.3 Certificate
of the Shareholders.
Each
Shareholder will have delivered to the Acquiror Company a certificate certifying
the satisfaction of the conditions specified in Sections 7.1 and
7.2.
7.4 Consents.
7.4.1 All
material consents, waivers, approvals, authorizations or orders required to
be
obtained, and all filings required to be made, by the Shareholders for the
authorization, execution and delivery of this Agreement and the consummation
by
them of the transactions contemplated by this Agreement, shall have been
obtained and made by the Shareholders, except where the failure to receive
such
consents, waivers, approvals, authorizations or orders or to make such filings
would not have a Material Adverse Effect on the Acquiror Company.
7.5 Documents.
The
Shareholders must deliver to the Acquiror Company at the Closing:
7.5.1 (i)
share
certificates evidencing the number of Shares held by each Shareholder (as set
forth in Exhibit A), along with executed share transfer forms transferring
such
Shares to the Acquiror Company together with evidence of the registration of
the
transfer of such shares to Acquiror Company (subject to Closing and payment
of
stamp duty);
7.5.2 each
of
the Transaction Documents to which the Shareholders are a party, duly executed,
and such other documents as the Acquiror Company may reasonably request for
the
purpose of (A) evidencing the accuracy of any of the representations and
warranties of the Shareholders pursuant to Section 7.1, (B) evidencing the
performance of, or compliance by the Shareholders with, any covenant or
obligation required to be performed or complied with by the Shareholders, as
the
case may be, (C) evidencing the satisfaction of any condition referred to
in this Section, or (D) otherwise facilitating the consummation or performance
of any of the transactions contemplated by this Agreement.
7.6 No
Proceedings.
There
must not have been commenced or threatened against the Acquiror Company or
any
Shareholder, or against any Affiliate thereof, any Proceeding (which Proceeding
remains unresolved as of the Closing Date) (a) involving any challenge to,
or
seeking damages or other relief in connection with, any of the transactions
contemplated by this Agreement, or (b) that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with any of the transactions
contemplated by this Agreement.
14
7.7 No
Claim Regarding Stock Ownership or Consideration.
There
must not have been made or threatened by any Person any claim asserting that
such Person (a) is the holder of, or has the right to acquire or to obtain
beneficial ownership of the Shares or any other stock, voting, equity, or
ownership interest in, the Company, or (b) is entitled to all or any portion
of
the Acquiror Company Shares.
SECTION
VIII
The
Shareholders’ obligation to transfer the Shares is subject to the satisfaction,
at or prior to the Closing Date, of each of the following conditions (any of
which may be waived by the Shareholders jointly, in whole or in
part):
8.1 Accuracy
of Representations.
The
representations and warranties of the Acquiror Company set forth in this
Agreement or in any Schedule or certificate delivered pursuant hereto that
are
not qualified as to materiality shall be true and correct in all material
respects as of the date of this Agreement except to the extent a representation
or warranty is expressly limited by its terms to another date and without giving
effect to any supplemental Schedule. The representations and warranties of
the
Acquiror Company set forth in this Agreement or in any Schedule or certificate
delivered pursuant hereto that are qualified as to materiality shall be true
and
correct in all respects as of the date of this Agreement, except to the extent
a
representation or warranty is expressly limited by its terms to another date
and
without giving effect to any supplemental Schedule.
8.2.1 All
of
the covenants and obligations that the Acquiror Company is required to perform
or to comply with pursuant to this Agreement (considered collectively), and
each
of these covenants and obligations (considered individually), must have been
performed and complied with in all respects.
8.2.2 Each
document required to be delivered by the Acquiror Company pursuant to this
Agreement must have been delivered.
8.3 Certificate
of Officer.
The
Acquiror Company will have delivered to the Shareholders a certificate, dated
the Closing Date, executed by an officer of the Acquiror Company, certifying
the
satisfaction of the conditions specified in Sections 8.1 and 8.2.
8.4 Consents.
8.4.1 All
material consents, waivers, approvals, authorizations or orders required to
be
obtained, and all filings required to be made, by the Acquiror Company for
the
authorization, execution and delivery of this Agreement and the consummation
by
it of the transactions contemplated by this Agreement, shall have been obtained
and made by the Acquiror Company, except where the failure to receive such
consents, waivers, approvals, authorizations or orders or to make such filings
would not have a Material Adverse Effect on the Acquiror Company.
15
8.5 Documents.
The
Acquiror Company must have caused the following documents to be delivered to
the
Shareholders:
8.5.1 share
certificates evidencing each Shareholder’s pro rata share of the Acquiror
Company Shares (as set forth in Exhibit A);
8.5.2 a
Secretary’s Certificate, dated the Closing Date certifying attached copies of
(A) the Organizational Documents of the Acquiror Company, (B) the resolutions
of
the Acquiror Company Board approving this Agreement and the transactions
contemplated hereby, (C) a Certificate of Good Standing of the Acquiror Company
and (D) the incumbency of each authorized officer of the Acquiror Company
signing this Agreement and any other agreement or instrument contemplated hereby
to which the Acquiror Company is a party;
8.5.3 each
of
the Transaction Documents to which the Acquiror Company is a party, duly
executed; and
8.5.4 such
other documents as the Shareholders may reasonably request for the purpose
of
(i) evidencing the accuracy of any representation or warranty of the Acquiror
Company pursuant to Section 8.1, (ii) evidencing the performance by the Acquiror
Company of, or the compliance by the Acquiror Company with, any covenant or
obligation required to be performed or complied with by the Acquiror Company,
(iii) evidencing the satisfaction of any condition referred to in this Section
8, or (iv) otherwise facilitating the consummation of any of the transactions
contemplated by this Agreement.
8.6 No
Proceedings.
Since
the date of this Agreement, there must not have been commenced or threatened
against the Acquiror Company or any Shareholder, or against any Affiliate
thereof, any Proceeding (which Proceeding remains unresolved as of the date
of
this Agreement) (a) involving any challenge to, or seeking damages or other
relief in connection with, any of the transactions contemplated hereby, or
(b)
that may have the effect of preventing, delaying, making illegal, or otherwise
interfering with any of the transactions contemplated hereby.
8.7 No
Claim Regarding Stock Ownership or Consideration.
There
must not have been made or threatened by any Person any claim asserting that
such Person is the holder of, or has the right to acquire or to obtain
beneficial ownership of the Acquiror Company Common Stock.
8.8 Waiver
of Right to be Represented by Counsel.
The
Shareholders acknowledge that: (i) they have heretofore been advised by the
Acquiror Company to obtain representation by counsel in connection with the
negotiation, execution and delivery of this Agreement and the other agreements,
documents and instruments herein or therein provided and the consummation of
the
transactions contemplated herein or therein; (ii) they voluntarily elect to
forego representation by counsel in such connection; and (iii) they hereby
irrevocably waive any and all rights to contest or challenge the negotiation,
execution and delivery of this Agreement and the other agreements, documents
and
instruments herein or therein provided or the consummation of the transactions
contemplated herein or therein due to the lack of representation by
counsel.
16
SECTION
IX
9.1 Survival.
All
representations, warranties, covenants, and obligations in this Agreement shall
expire on the first (1st)
anniversary of the date this Agreement is executed (the “Survival Period”). The
right to indemnification, payment of Damages or other remedy based on such
representations, warranties, covenants, and obligations will not be affected
by
any investigation conducted with respect to, 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.
The
waiver of any condition based on the accuracy of any representation or warranty,
or on the performance of or compliance with any covenant or obligation, will
not
affect the right to indemnification, payment of Damages, or other remedy based
on such representations, warranties, covenants, and obligations.
9.2 Limitations
on Amount - the Acquiror Company.
No
Indemnified Party shall be entitled to indemnification pursuant to Section
6.1,
unless and until the aggregate amount of Damages to all Indemnified Parties
with
respect to such matters under Section 6.1 exceeds US$20,000, at which time,
the
Indemnified Parties shall be entitled to indemnification for the total amount
of
such Damages in excess of US$20,000.
9.3 Determining
Damages.
Materiality qualifications to the representations and warranties of the Acquiror
Company shall not be taken into account in determining the amount of Damages
occasioned by a breach of any such representation and warranty for purposes
of
determining whether the baskets set forth in Section 9.2 has been
met.
SECTION
X
10.1 Expenses.
Except
as otherwise expressly provided in this Agreement, each party to this Agreement
will bear its respective expenses incurred in connection with the preparation,
execution, and performance of this Agreement and the transactions contemplated
by this Agreement, including all fees and expenses of agents, representatives,
counsel, and accountants. In the event of termination of this Agreement, the
obligation of each party to pay its own expenses will be subject to any rights
of such party arising from a breach of this Agreement by another
party.
10.2 Public
Announcements.
Prior
to the Closing Date, the Shareholders and the Acquiror Company shall consult
with each other in issuing any press releases or otherwise making public
statements or filings and other communications with the Commission or any
regulatory agency or stock market or trading facility with respect to the
transactions contemplated hereby and neither party shall issue any such press
release or otherwise make any such public statement, filings or other
communications without the prior written consent of the other, which consent
shall not be unreasonably withheld or delayed, except that no prior consent
shall be required if such disclosure is required by law, in which case the
disclosing party shall provide the other party with prior notice of such public
statement, filing or other communication and shall incorporate into such public
statement, filing or other communication the reasonable comments of the other
party.
17
10.3 Confidentiality.
10.3.1 Subsequent
to the date of this Agreement, the Acquiror Company and the Shareholders will
maintain in confidence, and will cause their respective directors, officers,
employees, agents, and advisors to maintain in confidence, any written, oral,
or
other information obtained in confidence from another party in connection with
this Agreement or the transactions contemplated by this Agreement, unless (a)
such information is already known to such party or to others not bound by a
duty
of confidentiality or such information becomes publicly available through no
fault of such party, (b) the use of such information is necessary or appropriate
in making any required filing with the Commission, or obtaining any consent
or
approval required for the consummation of the transactions contemplated by
this
Agreement, or (c) the furnishing or use of such information is required by
or
necessary or appropriate in connection with legal proceedings.
10.3.2 In
the
event that any party is required to disclose any information of another party
pursuant to clause (b) or (c) of Section 10.3.1, the party requested or required
to make the disclosure (the “disclosing party”) shall provide the party that
provided such information (the “providing party”) with prompt notice of any such
requirement so that the providing party may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of this Section
10.3. If, in the absence of a protective order or other remedy or the receipt
of
a waiver by the providing party, the disclosing party is nonetheless, in the
opinion of counsel, legally compelled to disclose the information of the
providing party, the disclosing party may, without liability hereunder, disclose
only that portion of the providing party’s information which such counsel
advises is legally required to be disclosed, provided that the disclosing party
exercises its reasonable efforts to preserve the confidentiality of the
providing party’s information, including, without limitation, by cooperating
with the providing party to obtain an appropriate protective order or other
relief assurance that confidential treatment will be accorded the providing
party’s information.
10.3.3 If
the
transactions contemplated by this Agreement are not consummated, each party
will
return or destroy as much of such written information as the other party may
reasonably request.
10.4 Notices.
All
notices, consents, waivers, and other communications under this Agreement must
be in writing and will be deemed to have been duly given when (a) delivered
by
hand (with written confirmation of receipt), (b) sent by telecopier (with
written confirmation of receipt), or (c) when received by the addressee, if
sent
by a nationally recognized overnight delivery service (receipt requested),
in
each case to the appropriate addresses and telecopier numbers set forth below
(or to such other addresses and telecopier numbers as a party may designate
by
written notice to the other parties):
18
|
If
to Acquiror Company:
|
with
a copy to
|
|
Advanced
Medical Institute, Inc.
c/o
Advanced
Medical Institute Pty Ltd.
Xxxxx
0, 000-000 Xxxxxx Xxxx
Xxxxxxxxxx,
XXX 0000 Xxxxxxxxx
|
Loeb
& Loeb LLP
000
Xxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
|
|
Attention:
Xxxxx Xxxxxxx, President and CEO
Telephone
No.: 00 0 0000 0000
Facsimile
No.: 61 2 9640 5264
|
Attention:
Xxxxxxxx X. Xxxxxxxx, Esq.
Telephone
No.: 000-000-0000
Facsimile
No.: 000-000-0000
|
|
If
to the Shareholders:
To
the respective address set forth in Exhibit A attached
hereto.
|
10.5 Arbitration.
Any
dispute or controversy under this Agreement shall be settled exclusively by
arbitration in the City of New York, County of New York in accordance with
the
rules of the American Arbitration Association then in effect. Judgment may
be
entered on the arbitration award in any court having jurisdiction.
10.6 Further
Assurances.
The
parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents,
and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Agreement and the
documents referred to in this Agreement.
10.7 Waiver.
The
rights and remedies of the parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Agreement or the documents referred to
in
this Agreement will operate as a waiver of such right, power, or privilege,
and
no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or
the
exercise of any other right, power, or privilege. To the maximum extent
permitted by applicable law, (a) no claim or right arising out of this Agreement
or the documents referred to in this Agreement can be discharged by one party,
in whole or in part, by a waiver or renunciation of the claim or right unless
in
writing signed by the other party; (b) no waiver that may be given by a party
will be applicable except in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
10.8 Entire
Agreement and Modification.
This
Agreement supersedes all prior agreements between the parties with respect
to
its subject matter and constitutes (along with the documents referred to in
this
Agreement) a complete and exclusive statement of the terms of the agreement
between the parties with respect to its subject matter. This Agreement may
not
be amended except by a written agreement executed by the party against whom
the
enforcement of such amendment is sought.
19
10.9 Assignments,
Successors, and No Third-Party Rights.
No
party may assign any of its rights under this Agreement without the prior
consent of the other parties. Subject to the preceding sentence, this Agreement
will apply to, be binding in all respects upon, and inure to the benefit of
and
be enforceable by the respective successors and permitted assigns of the
parties. Except as set forth in Section 6.1 and Section 9.2, nothing expressed
or referred to in this Agreement will be construed to give any Person other
than
the parties to this Agreement any legal or equitable right, remedy, or claim
under or with respect to this Agreement or any provision of this Agreement.
This
Agreement and all of its provisions and conditions are for the sole and
exclusive benefit of the parties to this Agreement and their successors and
assigns.
10.10 Severability.
If any
provision of this Agreement is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Agreement will remain
in
full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to
the
extent not held invalid or unenforceable.
10.11 Section
Headings, Construction.
The
headings of Sections in this Agreement are provided for convenience only and
will not affect its construction or interpretation. All references to “Section”
or “Sections” refer to the corresponding Section or Sections of this Agreement.
All words used in this Agreement will be construed to be of such gender or
number as the circumstances require. Unless otherwise expressly provided, the
word “including” does not limit the preceding words or terms.
10.12 Governing
Law.
This
Agreement will be governed by the laws of the State of New York without regard
to conflicts of laws principles.
10.13 Counterparts.
This
Agreement may be executed in one or more counterparts, each of which will be
deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.
20
COUNTERPART
SIGNATURE PAGE
IN
WITNESS WHEREOF, the parties have executed and delivered this Share Exchange
Agreement as of the date first written above.
|
Acquiror
Company:
By:
__________________
Name:
Xxxxx Xxxxxxxx
Title:
Chief Financial Officer
|
|
Shareholder:
Xxxxx
Investments Limited
By:
__________________
Name:
Title:
|
|
Shareholder:
__________________
Xxxxxxx
Fanshil
|
21
COUNTERPART
SIGNATURE PAGE
(FOR
ISSUANCES PURSUANT TO REGULATION S)
IN
WITNESS WHEREOF, the parties have executed and delivered this Share Exchange
Agreement as of the date first written above.
ENTITY
NAME:
Xxxxx
Investments Limited
By:
__________________
Name:
Title:
OFFSHORE
DELIVERY INSTRUCTIONS:
PRINT
EXACT NAME IN WHICH YOU WANT
THE
SECURITIES TO BE REGISTERED
|
Attn:
|
|
|
Address:
|
|
|
Phone
No.
|
|
|
Facsimile
No.
|
22
COUNTERPART
SIGNATURE PAGE
(FOR
ISSUANCES PURSUANT TO REGULATION S)
IN
WITNESS WHEREOF, the parties have executed and delivered this Share Exchange
Agreement as of the date first written above.
By:
_____________________
Name:
Xxxxxxx Fanshil
OFFSHORE
DELIVERY INSTRUCTIONS:
PRINT
EXACT NAME IN WHICH YOU WANT
THE
SECURITIES TO BE REGISTERED
|
Attn:
|
|
|
Address:
|
|
|
Phone
No.
|
|
|
Facsimile
No.
|
23
COUNTERPART
SIGNATURE PAGE
(FOR
ISSUANCES PURSUANT TO SECTION 4(2))
IN
WITNESS WHEREOF, the parties have executed and delivered this Share Exchange
Agreement as of the date first written above.
ENTITY
NAME:
By:
____________________
Name:
Title:
Circle
the category under which you are an “accredited investor” pursuant to Exhibit
B:
1
2 3 4 5 6
60; 7 8
PRINT
EXACT NAME IN WHICH YOU WANT
THE
SECURITIES TO BE REGISTERED
|
Attn:
|
|
|
Address:
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Phone
No.
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Facsimile
No.
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24
EXHIBIT
A
SHARES
AND
ACQUIROR COMPANY SHARES TO BE EXCHANGED
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Name
and Address of Shareholder
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Number
of Shares to be delivered by Shareholder
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Number
of Acquiror Company Shares to be issued to
Shareholder
|
|
Xxxxx
Investments Limited
c/o
Asiaciti
Trust Group
0
Xxxxxxx Xxxxx
#00-00
XXX Xxxxxx, Xxxxxxxxx 000000
Attention:
Xxxxx Xxx
Facsimile
No.: 65 6532 5092
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2
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360,000
|
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Xxxxxxx
Fanshil
c/o
Advanced
Medical Institute Pty Ltd.
Xxxxx
0, 000-000 Xxxxxx Xxxx
Xxxxxxxxxx,
XXX 0000
Xxxxxxxxx
Facsimile
No.: 61 2 9640 5264
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5
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900,000
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25
EXHIBIT
B
Definition
of “Accredited Investor”
The
term
“accredited investor” means:
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(1)
|
A
bank as defined in Section 3(a)(2) of the Securities Act, or a savings
and
loan association or other institution as defined in Section 3(a)(5)(A)
of
the Securities Act, whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of
the
Securities Exchange Act of 1934; an insurance company as defined
in
Section 2(13) of the Securities Act; an investment company registered
under the Investment Company Act of 1940 (the “Investment Company Act”) or
a business development company as defined in Section 2(a)(48) of
the
Investment Company Act; a Small Business Investment Company licensed
by
the U.S. Small Business Administration under Section 301(c) or (d)
of the
Small Business Investment Act of 1958; a plan established and maintained
by a state, its political subdivisions or any agency or instrumentality
of
a state or its political subdivisions for the benefit of its employees,
if
such plan has total assets in excess of US $5,000,000; an employee
benefit
plan within the meaning of the Employee Retirement Income Security
Act of
1974 (“ERISA”), if the investment decision is made by a plan fiduciary, as
defined in Section 3(21) of ERISA, which is either a bank, savings
and
loan association, insurance company, or registered investment advisor,
or
if the employee benefit plan has total assets in excess of US $5,000,000
or, if a self-directed plan, with investment decisions made solely
by
persons that are accredited
investors.
|
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(2)
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A
private business development company as defined in Section 202(a)(22)
of
the Investment Advisers Act of
1940.
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(3)
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An
organization described in Section 501(c)(3) of the Internal Revenue
Code,
corporation, Massachusetts or similar business trust, or partnership,
not
formed for the specific purpose of acquiring the securities offered,
with
total assets in excess of US
$5,000,000.
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(4)
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A
director or executive officer of the Acquiror Company.
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(5)
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A
natural person whose individual net worth, or joint net worth with
that
person’s spouse, at the time of his or her purchase exceeds US
$1,000,000.
|
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(6)
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A
natural person who had an individual income in excess of US $200,000
in
each of the two most recent years or joint income with that person’s
spouse in excess of US $300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current
year.
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26
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(7)
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A
trust, with total assets in excess of US $5,000,000, not formed for
the
specific purpose of acquiring the securities offered, whose purchase
is
directed by a sophisticated person as described in Rule 506(b)(2)(ii)
(i.e., a person who has such knowledge and experience in financial
and
business matters that he is capable of evaluating the merits and
risks of
the prospective investment).
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(8)
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An
entity in which all of the equity owners are accredited investors.
(If
this alternative is checked, the Shareholder must identify each equity
owner and provide statements signed by each demonstrating how each
is
qualified as an accredited
investor.)
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27
EXHIBIT
C
Definition
of “U.S. Person”
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(1)
|
“U.S.
person” (as defined in Regulation S)
means:
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(i)
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Any
natural person resident in the United
States;
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(ii)
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Any
partnership or corporation organized or incorporated under the laws
of the
United States;
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(iii)
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Any
estate of which any executor or administrator is a U.S.
person;
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(iv)
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Any
trust of which any trustee is a U.S.
person;
|
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(v)
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Any
agency or branch of a foreign entity located in the United
States;
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(vi)
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Any
non-discretionary account or similar account (other than an estate
or
trust) held by a dealer or other fiduciary for the benefit or account
of a
U.S. person;
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(vii)
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Any
discretionary account or similar account (other than an estate or
trust)
held by a dealer or other fiduciary organized, incorporated, or (if
an
individual) resident in the United States;
and
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(viii)
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Any
partnership or corporation if: (A) organized or incorporated under
the
laws of any foreign jurisdiction; and (B) formed by a U.S. person
principally for the purpose of investing in securities not registered
under the Securities Act, unless it is organized or incorporated,
and
owned, by accredited investors (as defined in Rule 501(a)) who are
not
natural persons, estates or trusts.
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(2)
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Notwithstanding
paragraph (1) above, any discretionary account or similar account
(other
than an estate or trust) held for the benefit or account of a non-U.S.
person by a dealer or other professional fiduciary organized,
incorporated, or (if an individual) resident in the United States
shall
not be deemed a “U.S. person.”
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(3)
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Notwithstanding
paragraph (1), any estate of which any professional fiduciary acting
as
executor or administrator is a U.S. person shall not be deemed a
U.S.
person if:
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(i)
|
An
executor or administrator of the estate who is not a U.S. person
has sole
or shared investment discretion with respect to the assets of the
estate;
and
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(ii)
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The
estate is governed by foreign law.
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(4)
|
Notwithstanding
paragraph (1), any trust of which any professional fiduciary acting
as
trustee is a U.S. person shall not be deemed a U.S. person if a trustee
who is not a U.S. person has sole or shared investment discretion
with
respect to the trust assets, and no beneficiary of the trust (and
no
settlor if the trust is revocable) is a U.S.
person.
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28
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(5)
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Notwithstanding
paragraph (1), an employee benefit plan established and administered
in
accordance with the law of a country other than the United States
and
customary practices and documentation of such country shall not be
deemed
a U.S. person.
|
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(6)
|
Notwithstanding
paragraph (1), any agency or branch of a U.S. person located outside
the
United States shall not be deemed a “U.S. person”
if:
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(i)
|
The
agency or branch operates for valid business reasons;
and
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(ii)
|
The
agency
or branch is engaged in the business of insurance or banking and
is
subject to substantive insurance
or banking regulation, respectively, in the jurisdiction where
located.
|
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(7)
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The
International Monetary Fund, the International Bank for Reconstruction
and
Development, the Inter-American Development Bank, the Asian Development
Bank, the African Development Bank, the United Nations, and their
agencies, affiliates and pension plans, and any other similar
international organizations, their agencies, affiliates and pension
plans
shall not be deemed “U.S. persons.”
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29
EXHIBIT
D
ACCREDITED
INVESTOR REPRESENTATIONS
Each
Shareholder indicating that it is an Accredited Investor, severally and not
jointly, further represents and warrants to the Acquiror Company as
follows:
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(1)
|
Such
Shareholder qualifies as an Accredited Investor on the basis set
forth on
its signature page to this
Agreement.
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(2)
|
Such
Shareholder has sufficient knowledge and experience in finance,
securities, investments and other business matters to be able to
protect
such Shareholder’s interests in connection with the transactions
contemplated by this Agreement.
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(3)
|
Such
Shareholder has consulted, to the extent that it has deemed necessary,
with its tax, legal, accounting and financial advisors concerning
its
investment in the Acquiror Company
Shares.
|
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(4)
|
Such
Shareholder understands the various risks of an investment in the
Acquiror
Company Shares and can afford to bear such risks for an indefinite
period
of time, including, without limitation, the risk of losing its entire
investment in the Acquiror Company
Shares.
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(5)
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Such
Shareholder has had access to the Acquiror Company’s publicly filed
reports with the SEC.
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(6)
|
Such
Shareholder has been furnished during the course of the transactions
contemplated by this Agreement with all other public information
regarding
the Acquiror Company that such Shareholder has requested and all
such
public information is sufficient for such Shareholder to evaluate
the
risks of investing in the Acquiror Company
Shares.
|
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(7)
|
Such
Shareholder has been afforded the opportunity to ask questions of
and
receive answers concerning the Acquiror Company and the terms and
conditions of the issuance of the Acquiror Company
Shares.
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(8)
|
Such
Shareholder is not relying on any representations and warranties
concerning the Acquiror Company made by the Acquiror Company or any
officer, employee or agent of the Acquiror Company, other than those
contained in this Agreement.
|
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(9)
|
Such
Shareholder is acquiring the Acquiror Company Shares for such
Shareholder’s own account, for investment and not for distribution or
resale to others.
|
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(10)
|
Such
Shareholder will not sell or otherwise transfer the Acquiror Company
Shares, unless either (a) the transfer of such securities is
registered under the Securities Act or (b) an exemption from registration
of such securities is available.
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30
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(11)
|
Such
Shareholder understands and acknowledges that the Acquiror Company
is
under no obligation to register the Acquiror Company Shares for sale
under
the Securities Act.
|
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(12)
|
Such
Shareholder consents to the placement of a legend on any certificate
or
other document evidencing the Acquiror Company Shares substantially
in the
form set forth in
Section 4.2.5(a).
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(13)
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Such
Shareholder represents that the address furnished by such Shareholder
on
its signature page to this Agreement and in Exhibit A is such
Shareholder’s principal residence if he is an individual or its principal
business address if it is a corporation or other
entity.
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(14)
|
Such
Shareholder understands and acknowledges that the Acquiror Company
Shares
have not been recommended by any federal or state securities commission
or
regulatory authority, that the foregoing authorities have not confirmed
the accuracy or determined the adequacy of any information concerning
the
Acquiror Company that has been supplied to such Shareholder and that
any
representation to the contrary is a criminal
offense.
|
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(15)
|
Such
Shareholder acknowledges that the representations, warranties and
agreements made by such Shareholder herein shall survive the execution
and
delivery of this Agreement and the purchase of the Acquiror Company
Shares.
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31
EXHIBIT
E
NON
U.S. PERSON REPRESENTATIONS
Each
Shareholder indicating that it is not a U.S. person, severally and not jointly,
further represents and warrants to the Acquiror Company as follows:
|
(1)
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At
the time of (a) the offer by the Acquiror Company and (b) the acceptance
of the offer by such Shareholder, of the Acquiror Company Shares,
such
Shareholder was outside the United
States.
|
|
(2)
|
No
offer to acquire the Acquiror Company Shares or otherwise to participate
in the transactions contemplated by this Agreement was made to such
Shareholder or its representatives inside the United
States.
|
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(3)
|
Such
Shareholder is not purchasing the Acquiror Company Shares for the
account
or benefit of any U.S. person, or with a view towards distribution
to any
U.S. person, in violation of the registration requirements of the
Securities Act.
|
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(4)
|
Such
Shareholder will make all subsequent offers and sales of the Acquiror
Company Shares either (x) outside of the United States in compliance
with
Regulation S; (y) pursuant to a registration under the Securities
Act; or
(z) pursuant to an available exemption from registration under the
Securities Act. Specifically, such Shareholder will not resell the
Acquiror Company Shares to any U.S. person or within the United States
prior to the expiration of a period commencing on the Closing Date
and
ending on the date that is one year thereafter (the “Distribution
Compliance Period”), except pursuant to registration under the Securities
Act or an exemption from registration under the Securities
Act.
|
|
(5)
|
Such
Shareholder is acquiring the Acquiror Company Shares for such
Shareholder’s own account, for investment and not for distribution or
resale to others.
|
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(6)
|
Such
Shareholder has no present plan or intention to sell the Acquiror
Company
Shares in the United States or to a U.S. person at any predetermined
time,
has made no predetermined arrangements to sell the Acquiror Company
Shares
and is not acting as a Distributor of such
securities.
|
|
(7)
|
Neither
such Shareholder, its Affiliates nor any Person acting on such
Shareholder’s behalf, has entered into, has the intention of entering
into, or will enter into any put option, short position or other
similar
instrument or position in the U.S. with respect to the Acquiror Company
Shares at any time after the Closing Date through the Distribution
Compliance Period except in compliance with the Securities
Act.
|
|
(8)
|
Such
Shareholder consents to the placement of a legend on any certificate
or
other document evidencing the Acquiror Company Shares substantially
in the
form set forth in
Section 4.2.5(b).
|
32
|
(9)
|
Such
Shareholder is not acquiring the Acquiror Company Shares in a transaction
(or an element of a series of transactions) that is part of any plan
or
scheme to evade the registration provisions of the Securities
Act.
|
|
(10)
|
Such
Shareholder has sufficient knowledge and experience in finance,
securities, investments and other business matters to be able to
protect
such Shareholder’s interests in connection with the transactions
contemplated by this Agreement.
|
|
(11)
|
Such
Shareholder has consulted, to the extent that it has deemed necessary,
with its tax, legal, accounting and financial advisors concerning
its
investment in the Acquiror Company
Shares.
|
|
(12)
|
Such
Shareholder understands the various risks of an investment in the
Acquiror
Company Shares and can afford to bear such risks for an indefinite
period
of time, including, without limitation, the risk of losing its entire
investment in the Acquiror Company
Shares.
|
|
(13)
|
Such
Shareholder has had access to the Acquiror Company’s publicly filed
reports with the SEC.
|
|
(14)
|
Such
Shareholder has been furnished during the course of the transactions
contemplated by this Agreement with all other public information
regarding
the Acquiror Company that such Shareholder has requested and all
such
public information is sufficient for such Shareholder to evaluate
the
risks of investing in the Acquiror Company
Shares.
|
|
(15)
|
Such
Shareholder has been afforded the opportunity to ask questions of
and
receive answers concerning the Acquiror Company and the terms and
conditions of the issuance of the Acquiror Company
Shares.
|
|
(16)
|
Such
Shareholder is not relying on any representations and warranties
concerning the Acquiror Company made by the Acquiror Company or any
officer, employee or agent of the Acquiror Company, other than those
contained in this Agreement.
|
|
(17)
|
Such
Shareholder will not sell or otherwise transfer the Acquiror Company
Shares, unless either (A) the transfer of such securities is
registered under the Securities Act or (B) an exemption from registration
of such securities is available.
|
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(18)
|
Such
Shareholder understands and acknowledges that the Acquiror Company
is
under no obligation to register the Acquiror Company Shares for sale
under
the Securities Act.
|
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(19)
|
Such
Shareholder represents that the address furnished by such Shareholder
on
its signature page to this Agreement and in Exhibit B is such
Shareholder’s principal residence if he is an individual or its principal
business address if it is a corporation or other
entity.
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33
|
(20)
|
Such
Shareholder understands and acknowledges that the Acquiror Company
Shares
have not been recommended by any federal or state securities commission
or
regulatory authority, that the foregoing authorities have not confirmed
the accuracy or determined the adequacy of any information concerning
the
Acquiror Company that has been supplied to such Shareholder and that
any
representation to the contrary is a criminal
offense.
|
|
(21)
|
Such
Shareholder acknowledges that the representations, warranties and
agreements made by such Shareholder herein shall survive the execution
and
delivery of this Agreement and the purchase of the Acquiror Company
Shares.
|
34