Exhibit (C)(1)
ACQUISITION AGREEMENT
AGREEMENT, dated February 24, 1999, among Asia Media Communications,
Ltd., a Nevada corporation ("AMC"), the persons listed on Exhibit "A" attached
hereto and made a part hereof (individually, a "Seller" and collectively, the
"Sellers"), being all of the stockholders of Tecnochannel Sdn Bhd, a Malaysian
corporation ("TSB"), and solely with respect to paragraph 11 below, GEM Ventures
Ltd., a Delaware corporation ("GEM").
WHEREAS, the Sellers own a total of 900,000 shares (the "TSB Shares")
of common stock, RM 1 par value, of TSB; and
WHEREAS, the Sellers desire to sell the TSB Shares to AMC, and AMC
desires to purchase the Shares from the Sellers,
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties herein contained, the parties hereto do hereby
agree as follows:
1. Purchase and Sale. Subject to the terms and conditions of this
Agreement, each of the Sellers hereby sells, transfers, assigns and conveys and
delivers to AMC, and AMC hereby purchases and acquires from each Seller, good
and marketable title to such portion of the TSB Shares owned by each Seller as
set forth in Exhibit "A", free and clear of all mortgages, liens, encumbrances,
claims, equities and obligations to other persons of every kind and character,
except that the TSB Shares are restricted securities as set forth in paragraph 3
(c) hereof. The TSB Shares constitute all of the issued and outstanding shares
of capital stock of TSB. Simultaneously herewith, each Seller is delivering to
AMC certificate(s) duly endorsed for transfer or accompanied by duly executed
stock powers in blank, together with such other instruments, if any, as may be
necessary to convey such portion of the TSB Shares as being sold by each Seller
to AMC as provided herein.
2. Consideration. In exchange for the TSB Shares, AMC hereby agrees to
issue to the Sellers an aggregate of 8,500,000 shares (the "AMC Shares") of AMC
common stock, par value $.01 per share. Each Seller shall be entitled to receive
such portion of the AMC Shares as set forth opposite each Seller's name on
Exhibit "A." AMC shall cause the certificates representing the AMC Shares to be
issued and delivered to the Sellers as soon as practicable following the
execution of this Agreement.
3. Warranties and Representations of Sellers. In order to induce AMC to
enter into this Agreement and to complete the transaction contemplated hereby,
each Seller, jointly and severally, warrants and represents to AMC that:
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(a) Organization and Standing. TSB is a corporation duly organized,
validly existing and in good standing under the laws of Malaysia, is qualified
to do business as a foreign corporation in every other state or jurisdiction in
which it operates to the extent required by the laws of such states and
jurisdictions, and has full power and authority to carry on its business as now
conducted and to own and operate its assets, properties and business. Attached
hereto as Exhibit "B" are true and correct copies of TSB's Certificate of
Incorporation, amendments thereto and By-laws.
(b) Capitalization. TSB's entire authorized capital stock consists of
5,000,000 shares of common stock, par value RM 1 per share, of which 900,000
shares are issued and outstanding. There are no subscriptions, options or other
agreements or commitments obligating TSB to issue any shares of its capital
stock or securities convertible into its capital stock. The TSB Shares
constitute one hundred (100%) percent of the equity capital of TSB, which
includes, inter alia, one hundred (100%) percent of TSB's voting power, right to
receive dividends, when, as and if declared and paid, and the right to receive
the proceeds of liquidation attributable to common stock, if any.
(c) Ownership of TSB Shares. Each Seller is the sole record and
beneficial owner of such portion of the TSB Shares as set forth in Exhibit "A".
Each Seller owns such portion of the TSB Shares free and clear of any lien,
claim, pledge, encumbrance, charge, security interest, claim or right of another
and has the absolute right to sell and transfer such portion of the TSB Shares
to AMC without the consent of any other person or entity. Upon transfer of the
TSB Shares to AMC hereunder, AMC will acquire good and marketable title to the
TSB Shares free and clear of any lien, pledge, encumbrance, charge, security
interest, claim, right of another or restriction whatsoever, except that the TSB
Shares have not been registered under the Securities Act of 1933, as amended
(the "Securities Act"), or any applicable state securities laws.
(d) Taxes. TSB has filed all federal, state and local income or other
tax returns and reports that it is required to file with all governmental
agencies, wherever situate, and has paid or accrued for payment all taxes as
shown on such returns, such that a failure to file, pay or accrue will not have
a material adverse effect on TSB.
(e) Pending Actions. There are no material legal actions, lawsuits,
proceedings or investigations, either administrative or judicial, pending or
threatened, against or affecting TSB, or against the Sellers that arise out of
their operation of TSB, the laws, rules and regulations governing the operations
of TSB, the Securities Act, the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the rules and regulations of the U.S. Securities and Exchange
Commission ("SEC"), or the securities laws and regulations of any state.
(f) Governmental Regulation. TSB holds the licenses and registrations
set forth on Exhibit "C" hereto from the jurisdictions set forth therein, which
licenses and registrations are all of the licenses and registrations necessary
to permit TSB to conduct its current business. All of such licenses and
registrations are in full force and effect, and there are no proceedings,
hearings or other actions pending that may affect the validity or continuation
of any of them. No approval of any other trade or professional association or
agency of government is required for any of the
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transactions effected by this Agreement, and the completion of the transactions
contemplated by this Agreement will not, in and of themselves, affect or
jeopardize the validity or continuation of any of them.
(g) Ownership of Assets. TSB has good and marketable title, without any
liens or encumbrances of any nature whatever, to all its assets, properties and
rights of every type and description, including, without limitation, all cash on
hand and in banks, certificates of deposit, stocks, bonds, and other securities,
good will, customer lists, its corporate name and all variants thereof,
trademarks and trade names, copy rights and interests thereunder, licenses and
registrations, pending licenses and permits and applications therefor,
inventions, processes, know-how, trade secrets, real estate and interests
therein and improvements thereto, machinery, equipment, vehicles, notes and
accounts receivable, fixtures, rights under agreements and leases, franchises,
all rights and claims under insurance policies and other contracts of whatever
nature, rights in funds of whatever nature, books and records and all other
property and rights of every kind and nature owned or held by TSB as of the date
of this Agreement; except in the ordinary course of its business, TSB has not
disposed of any such asset since the date of the most recent balance sheet
described in Section 3(l) of this Agreement.
(h) No Debt Owed by TSB to Sellers. Except as set forth in Exhibit "D",
TSB does not owe any money, securities, or property to any Seller or any member
of their families or to any company controlled by such a person, directly or
indirectly. To the extent that TSB may have any undisclosed liability to pay any
sum or property to any such person or entity or any member of their families
such liability is hereby forever irrevocably released and discharged.
(i) Corporate Records. All of TSB's books and records, including,
without limitation, its books of account, corporate records, minute book, stock
certificate books and other records of TSB, are up-to-date, complete and reflect
accurately and fairly the conduct of its business in all material respects since
its date of incorporation.
(j) No Misleading Statements or Omissions. Neither this Agreement nor
any financial statement, exhibit, schedule or document attached hereto or
presented to AMC by the Sellers in connection herewith, contains any materially
misleading statement, or omits any fact or statement necessary to make the other
statements or facts therein set forth not materially misleading.
(k) Validity. Each Seller is fully able, authorized and empowered to
execute and deliver this Agreement and any other agreement or instrument
contemplated by this Agreement and to perform his, her or its covenants and
agreements hereunder and thereunder. This Agreement and any such other agreement
or instrument, upon execution and delivery by Sellers (and assuming due
execution and delivery by the other parties hereto and thereto), will constitute
the valid and binding obligation of each Seller, in each case enforceable
against each Seller in accordance with its terms, except to the extent limited
by applicable bankruptcy, reorganization, insolvency, moratorium or other laws
relating to or effecting generally the enforcement of creditors rights. The
execution and delivery of this Agreement and the carrying out of its purposes
will not result in the breach of any of the terms or conditions of, or
constitute a default
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under or violate, TSB's Certificate of Incorporation or By-laws, or any material
agreement, lease, mortgage, bond, indenture, license or other document or
undertaking, oral or written, to which TSB is or any Seller is a party or is
bound or may be affected, nor will such execution, delivery and carrying out
violate any order, writ, injunction, decree, law, rule or regulation of any
court, regulatory agency or other governmental injunction, decree, law, rule or
regulation of any court, regulatory agency or other governmental body; and the
business now conducted by TSB can continue to be so conducted after completion
of the transaction contemplated hereby with TSB as a wholly-owned subsidiary of
AMC.
(l) TSB Financial Statements. Attached hereto as Exhibit "E-1" are the
statutory accounts of TSB for the year ended 31st December, 1997. Included
therein are the balance sheet of TSB as at 31st December, 1997, the profit and
loss account and cash flow statement of TSB for the year then ended, together
with the related notes and the opinion thereon of TSB's independent auditors,
Y.T. Xxx & Co. (collectively, the "Audited Financial Statements"). Attached
hereto as Exhibit "E-2" is the unaudited, pro forma summary profit and loss
account of TSB for the eight months ended August 1998, together with the related
assumptions and notes (collectively, the "Interim Statement"). The Audited
Financial Statements and the Interim Statement (a) are in accordance with the
books and records of TSB, (b) are complete and correct in all material respects,
and (c) fairly present the financial position of TSB as of the dates indicated
and the results of its operations for the periods then ended in accordance with
local generally accepted accounting principles applied on a consistent basis,
subject, in the case of the Interim Statement, to customary year end audit
adjustments, none of which will be material in nature or scope.
(m) TSB's Corporate Summary. TSB's Corporate Summary (attached hereto
as Exhibit "F") accurately describes TSB's business, assets, proposed operations
and management as of the date thereof; since the date of the Corporate Summary
there has been no material change in the business plan set forth therein and no
material adverse change in TSB of any kind or nature whatsoever.
(n) Investment Intent; Legend. Each Seller is acquiring his, her or its
portion of the AMC Shares for such Seller's own account and is purchasing such
portion for investment purposes and not with a view to distribution or resale,
nor with the intention of selling, transferring or otherwise disposing of all or
any part of the AMC Shares except in compliance with all applicable provisions
of the Securities Act and the rules and regulations promulgated by the SEC
thereunder, and applicable state securities laws. The AMC Shares are "restricted
securities" as that term is defined under Rule 144 of the Securities Act, and
any sales of the AMC Shares made in reliance upon Rule 144 can be made only in
limited amounts in accordance with the terms and conditions of that Rule and
will require an opinion of counsel satisfactory to AMC and AMC's counsel that
registration is not required under Securities Act or state securities laws. Each
Seller understands that any and all certificates representing the AMC Shares and
any and all certificates issued in replacement thereof or in exchange therefor
shall bear the customary restrictive legend.
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4. Warranties and Representations of AMC. In order to induce the
Sellers to enter this Agreement and to complete the transaction contemplated
hereby, AMC warrants and represents to the Sellers that:
(a) Organization and Standing. AMC is a corporation duly organized
validly existing and in good standing under the laws of the State of Nevada, is
qualified to do business as a foreign corporation in every other state in which
it operates to the extent required by the laws of such states, and has full
power and authority to carry on its business as now conducted and to own and
operate its assets, properties and business.
(b) Capitalization. AMC's entire authorized capital stock consists of
50,000,000 shares of common stock, par value $0.01 per share, and 10,000,000
shares of preferred stock, of which 55,355 shares of common stock and no shares
of preferred stock are issued and outstanding. There is also issued and
outstanding a warrant to purchase 1,000,000 shares of AMC's common stock at a
price per share equal to the par value thereof and an option to purchase 12,500
shares of AMC's common stock for no consideration. The relative rights and
preferences of AMC's equity securities are set forth in its Certificate of
Incorporation, as amended and By-laws (attached hereto as Exhibit "G" hereto).
There are no other voting or equity securities convertible into voting stock and
no outstanding subscriptions, warrants, calls, options, rights, commitments or
agreements by which AMC is bound, calling for the issuance of any additional
shares of common stock or any other voting or equity security of AMC. The
By-laws of AMC provide that a simple majority of the shares voting at a
stockholders meeting at which a quorum is present may elect all of the directors
of AMC. Cumulative voting is not provided for by the By-laws or Certification of
Incorporation of AMC. Upon issuance all of the AMC Common Stock will be validly
issued fully paid and non-assessable.
(c) Ownership of AMC Shares. By AMC's issuance of the AMC Shares to
the Sellers pursuant to this Agreement, the Sellers will thereby acquire good
and marketable title thereto, free and clear of all liens, encumbrances and
restrictions of any nature whatever, except by reason of the fact that such AMC
Shares will not have been registered under the Securities Act and/or as provided
for in paragraph 3(n) above.
(d) Significant Agreements. AMC is not a party to or otherwise bound by
any of the following:
(i) Employment, advisory or consulting contract;
(ii) Plan providing for employee benefits of any nature, except for
the Asia Media Communications, Ltd. 1999 Incentive Program under which no grants
have been made;
(iii) Lease with respect to any property or equipment;
(iv) Contract or commitment for any future expenditure in excess of
$1,000 in the aggregate;
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(v) Contract or commitment pursuant to which it has assumed,
guaranteed, endorsed or otherwise become liable for any obligation of any other
person, firm or organization;
(vi) Contract, agreement, understanding, commitment or
arrangements, other than in the normal course of business and other than the
warrant and option described above.
(vii) Agreement with any person relating to the dividend, purchase
or sale of securities, that has not been settled by the delivery or payment of
securities when due, and which remains unsettled upon the date of the Agreement.
(e) Taxes. AMC has filed all federal, state and local income or other
tax returns and reports that it is required to file with all governmental
agencies, wherever situated, and has paid all taxes as shown on such returns.
All of such returns are true and complete.
(f) Absence of Liabilities. AMC has no liabilities of any kind or
nature, fixed or contingent, except for the costs, including legal and
accounting fees and other expenses, in connection with the transaction
contemplated hereunder, for which AMC agrees to be responsible and to pay in
full.
(g) No Pending Actions. There are no legal actions, lawsuits,
proceedings or investigations, either administrative or judicial, pending or
threatened, against or affecting AMC, or against any of AMC's officers or
directors and arising out of their operation of AMC. AMC has been in compliance
with, and has not received notice of violation of any law, ordinance or
regulation of any kind whatever, including, but not limited to, the Securities
Act, the Exchange Act, the rules and regulations of the SEC, or the securities
laws and regulations of any state. AMC is not an investment company as defined
in the securities laws.
(h) Corporate Records. All of AMC's books and records, including,
without limitation, its books of account corporate records, minute book, stock
certificate books and other records are up-to-date, complete and reflect
accurately and fairly the conduct of its business in all respects since its date
of incorporation.
(i) No Misleading Statements or Omissions. Neither this Agreement nor
any financial statement, exhibit, schedule or document attached hereto or
presented to the Sellers by AMC in connection herewith contains any materially
misleading statement, or omits any fact or statement necessary to make the other
statements or facts therein set forth not materially misleading.
(j) Validity. All corporate and other proceedings required to be taken
by AMC in order to enter into and to carry out this Agreement have been duly and
properly taken. This Agreement has been duly executed by AMC, and constitutes a
valid and binding obligation of AMC. The execution and delivery of the Agreement
and the carrying out of its purposes will not result in the breach of any of the
terms or conditions of, or constitute a default under or violate, AMC's
Certificate of Incorporation or By-laws, or any agreement, lease, mortgage,
bond, indenture, license or other document or undertaking, oral or written, to
which AMC is a party or
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is bound or may be affected, nor will such execution, delivery and carrying out
violate any order, writ, injunction, decree, law, rule or regulation of any
court, regulatory agency or other governmental body.
(k) Enforceability. When duly executed and delivered by AMC (and
assuming due execution and delivery by the other parties hereto), this Agreement
will be enforceable by the Sellers in accordance with its terms except to the
extent limited by applicable bankruptcy, reorganization, insolvency, moratorium
or other laws relating to or effecting generally the enforcement of creditors
rights.
(l) SEC Reports; Financial Statements. AMC has provided Sellers with a
true and correct copy of each report filed by AMC with the SEC during the
preceding 12 months (collectively, the "SEC Reports") and the SEC Reports
constitute all of the documents required to be filed by AMC with the SEC during
such period. The financial statements of AMC included in the SEC Reports (1) are
in accordance with the books and records of AMC, (2) are complete and correct in
all material respects, (iii) present fairly the financial position and results
of operations of AMC as of their respective dates indicated (subject, in the
case of unaudited statements, to normal, recurring year end audit adjustments
none of which were or will be material and (4) have been prepared in accordance
with generally accepted accounting principles consistently applied.
(m) Financial Condition. As of the date of this Agreement, AMC has no
material assets or liabilities except for liabilities for fees and expenses in
connection with the transaction contemplated hereunder.
5. Survival. All representations, warranties, covenants and agreements
made herein and in the exhibits attached hereto shall survive the execution and
delivery of the Agreement and payment pursuant thereto.
6. Exhibits. All Exhibits attached hereto are incorporated herein by
this reference as if they were set forth in their entirety.
7. Miscellaneous Provisions. This Agreement is the entire agreement
between the parties in respect of the subject matter hereof, and there are no
other agreements, written or oral, nor may the Agreement be modified except in
writing and executed by all of the parties hereto. The failure to insist upon
strict compliance with any of the terms, covenants or conditions of the
Agreement shall not be deemed a waiver or relinquishment of such right or power
at any other time or times.
8. Intermediaries. As compensation for acting as an advisor to AMC with
respect to this transaction, GEM. Ltd. (or its designee(s)) will be issued
440,000 shares of AMC common stock.
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9. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York, and any disputes
hereunder shall be submitted to the jurisdiction of the courts of the State of
New York.
10. Counterparts. This Agreement may be executed in duplicate facsimile
counterparts, each of which shall be deemed an original and together shall
constitute one and the same binding agreement, with one counterpart being
delivered to each party hereto.
11. GEMV. GEMV represents to the Sellers that to the best of its
knowledge neither this Agreement nor any financial statement, exhibit, schedule
or document attached hereto regarding AMC or furnished by AMC to the Sellers in
connection herewith contains any materially misleading statement, or omits any
fact or statement necessary to make the other statements or facts herein or
therein not materially misleading.
IN WITNESS WHEREOF, the parties hereto have set their hands and
seals as of the 24th day of February, 1999.
ON BEHALF OF Asia Media Communications, Ltd.
By: /s/ Xxxxxx X. Xxxxx
President
ON BEHALF OF the Sellers
By: /s/ X.X. Xxxx
ON BEHALF OF GEM VENTURES LTD.
WITH RESPECT SOLELY TO PARAGRAPH 11
By: /s/ Xxxxxx X. Xxxxx
President
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EXHIBIT A
SELLERS
Seller's Name and Address No. of TBS Shares Owned No. of AMC Shares to be Issued
------------------------- ----------------------- ------------------------------
Ambang Dinamik Sdn. Bhd. 359,999 3,399,990
00X Xxxxx Xxxxxxx
Xxxxx Xxxx Xx. Xxxxxx
00000 Xxxxx Xxxxxx
Xxxxxxxx
Star Channel Systems 540.000 5,100,000
Sdn Bhd
17.03B, 00xx Xxxxx
Xxxxx Xxxxx
0 Xxxxx Xxxxx Xxxx
Off Xxxxx Xxxxxx Xxxxx
00000 Xxxxx Xxxxxx
Xxxxxxxx
Cheah Meng Fui 1 10
Suite 10-01, Heritage House
00 XXX XXX XX XXXX
00000 Xxxxx Xxxxxx
Malaysia
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