MEMORANDUM OF UNDERSTANDING
Exhibit
99.1
This
Memorandum of Understanding, dated January 15, 2009 (“Agreement”) is entered by
and among Changda International, Ltd., a company organized under the laws of
Xxxxxxxx Islands, “Changda”), and
Xxxxxxxxxxxxx.xxx, Inc. , a Nevada corporation (“PDWK”)
(Changda and PDWK each a “Party” and collectively the “Parties”).
WHEREAS,
it is the intention of the Parties that: (i) PDWK acquire 100% of the voting
capital stock of Changda (the “Changda Shares”) in exchange solely
for common shares of PDWK as set forth herein;
NOW,
THEREFORE, in consideration of the mutual terms, conditions and other agreements
set forth herein, the parties hereto hereby agree as follows:
ARTICLE
I
EXCHANGE
OF SHARES FOR COMMON STOCK
Section 1.1
Agreement to Exchange
Changda Shares for PDWK Shares. On the Closing Date (as hereinafter
defined) and subject to the terms and conditions set forth in definitive
agreements governing the transactions anticipated hereby, (the “Definitive
Agreement”), all holders of Changda Shares (the “Changda Shareholders”) shall be
offered the opportunity to sell, assign, transfer, convey and deliver
the Changda Shares (representing 100% of the issued and outstanding Changda
Shares), to PDWK, in exchange for the issuance to the Changda
Shareholders of a number of newly issued shares of PDWK, as shall be negotiated
with the Changda Shareholders.
Section 1.2
Capitalization. On
the Closing Date, immediately before the transactions to be consummated pursuant
to this Agreement, PDWK shall have authorized (a) 100,000,000 shares
of Common Stock, par value $ 0.001 per share, of which
8,800,000 shares shall be issued and outstanding, all of which are
duly authorized, validly issued and fully paid.
Section 1.3
Closing. The closing
of the transactions contemplated by this Agreement (the “Closing”)
are anticipated to take place at 10:00 a.m. E.S.T. at
least 10 days following the filing and transmission of a
Schedule14F-1 and following satisfaction or waiver of the conditions to closing
set forth in Articles IV and V herein (the “Closing Date”). At
the Closing, the Changda Shareholders shall deliver to PDWK stock
certificates representing 100% of the Changda Shares, duly endorsed in blank for
transfer or accompanied by appropriate stock powers duly executed in blank. In
full consideration and exchange for the Changda Shares, PDWK shall issue and
exchange with Changda Shareholders Fifty Three Million Five Hundred
Ninety-nine Thousand Nine Hundred Sixty Five (53,599,965) of common stock of
PDWK.
Section
1.4
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES OF PDWK
PDWK
hereby, jointly and severally, represents, warrants and agrees as
follows:
Section 2.1
Corporate
Organization
PDWK is a
corporation duly organized, validly existing and in good standing under the laws
of Nevada, and has all requisite corporate power and authority to own its
properties and assets and to conduct its business and is duly qualified to do
business in good standing in each jurisdiction in which the nature of the
business conducted by PDWK or the ownership or leasing of its properties makes
such qualification and being in good standing necessary, except where the
failure to be so qualified and in good standing will not have a material adverse
effect on the business, operations, properties, assets, condition or results of
operation of PDWK (a "PDWK
Material Adverse Effect");
Section
2.2
Capitalization of
PDWK. The authorized capital stock of PDWK consists of (a)
100,000,000 shares of Common Stock, par value $0.001 per share, of
which 8,800,000 shares are issued and outstanding, all of which are duly
authorized, validly issued and fully paid. As of the date of this
Agreement there are no outstanding options, warrants, agreements, commitments,
conversion rights, preemptive rights or other rights to subscribe for, purchase
or otherwise acquire any shares of capital stock or any un-issued or treasury
shares of capital stock of PDWK.
Section 2.3
Subsidiaries and Equity
Investments. PDWK has no subsidiaries or equity interest in any
corporation, partnership or joint venture.
Section 2.4
No Conflict or
Violation. The execution, delivery and performance of this Agreement by
PDWK do not and will not violate or conflict with any provision of its Articles
of Incorporation or By-laws, and does not and will not violate any provision of
law, or any order, judgment or decree of any court or other governmental or
regulatory authority, nor violate or result in a breach of or constitute (with
due notice or lapse of time or both) a default under, or give to any other
entity any right of termination, amendment, acceleration or cancellation of, any
contract, lease, loan agreement, mortgage, security agreement, trust indenture
or other agreement or instrument to which PDWK is a party or by which it is
bound or to which any of their respective properties or assets is subject, nor
will it result in the creation or imposition of any lien, charge or encumbrance
of any kind whatsoever upon any of the properties or assets of PDWK, nor will it
result in the cancellation, modification, revocation or suspension of any of the
licenses, franchises, permits to which PDWK is bound.
Section 2.5
Consents and
Approvals. No consent, waiver, authorization or approval of any
governmental or regulatory authority, domestic or foreign, or of any other
person, firm or corporation, is required in connection with the execution and
delivery of this Agreement by PDWK or the performance by PDWK of its obligations
hereunder.
Section 2.6
Absence of Certain Changes
or Events. Since its inception:
a.
As of the
date of this Agreement, PDWK does not know or have reason to know of any event,
condition, circumstance or prospective development which threatens or may
threaten to have a material adverse effect on the assets, properties,
operations, prospects, net income or financial condition of PDWK;
b.
there has
not been any declaration, setting aside or payment of dividends or distributions
with respect to shares of capital stock of PDWK; and
c.
there has
not been an increase in the compensation payable or to become payable to any
director or officer of PDWK.
Section
2.7
Disclosure. This
Agreement and any certificate attached hereto or delivered in accordance with
the terms hereby by or on behalf of PDWK in connection with the transactions
contemplated by this Agreement, when taken together, do not contain any untrue
statement of a material fact or omit any material fact necessary in order to
make the statements contained herein and/or therein not misleading.
Section
2.8
Absence of Changes; No
Undisclosed Liabilities. Except as disclosed in any Form 10-K and Form
10-Q, PDWK has not incurred any liability material to PDWK on a consolidated
basis, except in the ordinary course of its business, consistent with past
practices; suffered a change, or any event involving a prospective change, in
the business, assets, financial condition, or results of operations of PDWK
which has had, or is reasonably likely to have, individually or in the
aggregate, a PDWK Material Adverse Effect, (other than as a result of changes or
proposed changes in federal or state regulations of general applicability or
interpretations thereof, changes in generally accepted accounting principles,
and changes that could, under the circumstances, reasonably have been
anticipated in light of disclosures made in writing by PDWK to Changda pursuant
hereto); or subsequent to the date hereof, will not conduct its business and
operations other than in the ordinary course of business and consistent with
past practices. PDWK has no liability (and PDWK is not aware of any basis for
any present or future action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand against any of them giving rising to any liability
which individually or is in the aggregate are reasonably likely to have a PDWK
Material Adverse Effect on PDWK) except for (a) liabilities set forth on the
face of the most recent balance sheet included in the PDWK Financial Statements,
and (b) liabilities which have arisen after the date of such balance sheet in
the ordinary course of business (none of which results from, arises out of,
relates to, is in the nature of, or was caused by any breach of contract, tort,
infringement, or violation of law).
Section
2.09
Litigation. There is
no action, suit, proceeding or investigation pending or threatened against the
Company or any subsidiary that may affect the validity of this Agreement or the
right of PDWK to enter into this Agreement or to consummate the transactions
contemplated hereby.
Section
2.10
Securities Laws. As
of the date hereof, PDWK has complied in all material respects with applicable
federal and state securities laws, rules and regulations, including the Sarbanes
Oxley Act of 2002, as such laws, rules and regulations apply to PDWK and its
securities; and (b) all shares of capital stock of the Company have been issued
in accordance with applicable federal and state securities laws, rules and
regulations. There are no stop orders in effect with respect to any of the
Company’s securities.
Section
2.11
Tax. PDWK has paid
all taxes due to date, if any.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF CHANGDA
Changda represents,
warrants and agrees as follows:
Section 3.1
Corporate
Organization.
Changda
is duly organized, validly existing and in good standing under the laws of the
Xxxxxxxx Islands and has all requisite corporate power and authority to own its
properties and assets and to conduct its business as now conducted and is duly
qualified to do business, is in good standing in each jurisdiction wherein the
nature of the business conducted by Changda or the ownership or leasing of its
properties makes such qualification and being in good standing necessary, except
where the failure to be so qualified and in good standing will not have a
material adverse effect on the business, operations, properties, assets,
condition or results of operation of Changda (a “Changda Material Adverse
Effect”). As of the date of this Agreement, Changda owns, directly or
indirectly, One Hundred Percent (100%) of the issued and outstanding equity or
voting interests in the following companies: Changda Fertiliser, Changda
Chemical, Changda Fengtai, and Changda Heze (collectively the “Changda Subsidiaries”). Each
of the Changda Subsidiaries are duly organized, validly existing and in good
standing under the laws of the Peoples’ Republic of China (“PRC”) and have all requisite
corporate power and authority to own their properties and assets and to conduct
their business as now conducted and are duly qualified to do business, are in
good standing in each jurisdiction wherein the nature of the business conducted
by Changda Subsidiaries or the ownership or leasing of their properties makes
such qualification and being in good standing necessary, except where the
failure to be so qualified and in good standing will not have a material adverse
effect on the business, operations, properties, assets, condition or results of
operation of Changda Subsidiaries (a "Changda Subsidiaries Material
Adverse Effect")
Section 3.2
Authorization and Validity
of Agreements. Changda has all corporate power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by Changda and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary corporate action and no other
corporate proceedings on the part of Changda are necessary to authorize this
Agreement or to consummate the transactions contemplated hereby. The Changda
Shareholders have approved this Agreement on behalf of Changda and no other
stockholder approvals are required to consummate the transactions contemplated
hereby.
Section 3.3
No Conflict or
Violation. The execution, delivery and performance of this Agreement by
Changda does not and will not violate or conflict with any provision of the
constituent documents of Changda, and does not and will not violate any
provision of law, or any order, judgment or decree of any court or other
governmental or regulatory authority, nor violate, result in a breach of or
constitute (with due notice or lapse of time or both) a default under or give to
any other entity any right of termination, amendment, acceleration or
cancellation of any contract, lease, loan agreement, mortgage, security
agreement, trust indenture or other agreement or instrument to which Changda is
a party or by which it is bound or to which any of its respective properties or
assets is subject, nor result in the creation or imposition of any lien, charge
or encumbrance of any kind whatsoever upon any of the properties or assets of
Changda nor result in the cancellation, modification, revocation or suspension
of any of the licenses, franchises, permits to which Changda is
bound.
Section 3.4
Access to Properties and
Records. Changda shall afford PDWK’s accountants, counsel and authorized
representatives, and PDWK shall afford to Changda's accountants, counsel and
authorized representatives full access during normal business hours throughout
the period prior to the Closing Date (or the earlier termination of this
Agreement) to all of such parties’ properties, books, contracts, commitments and
records and, during such period, shall furnish promptly to the requesting party
all other information concerning the other party's business, properties and
personnel as the requesting party may reasonably request, provided that no
investigation or receipt of information pursuant to this Section 4.2 shall
affect any representation or warranty of or the conditions to the obligations of
any party.
ARTICLE
IV
CONDITIONS
TO OBLIGATIONS OF CHANGDA AND CHANGDA SHAREHOLDERS
The
obligations of Changda and the Changda Shareholders to consummate the
transactions contemplated by the Definitive Agreements shall be subject to the
fulfillment, at or before the Closing Date, of the following conditions, any one
or more of which may be waived by Changda in their sole
discretion:
Section 4.1
Representations and
Warranties of PDWK. All representations and warranties made by PDWK in
this Agreement as well as the Definitive Agreements shall be true and
correct on and as of the Closing Date as if again made by PDWK as of such
date.
Section 4.2
Agreements and
Covenants. PDWK shall have performed and complied in all material
respects to all agreements and covenants required by this Agreement and the
Definitive Agreements to be performed or complied with by it on or prior to the
Closing Date.
Section 4.3
Consents and
Approvals. Consents, waivers, authorizations and approvals of any
governmental or regulatory authority, domestic or foreign, and of any other
person, firm or corporation, required in connection with the execution, delivery
and performance of this Agreement shall be in full force and effect on the
Closing Date.
Section 4.4
No Violation of
Orders. No preliminary or permanent injunction or other order issued by
any court or governmental or regulatory authority, domestic or foreign, nor any
statute, rule, regulation, decree or executive order promulgated or enacted by
any government or governmental or regulatory authority, which declares this
Agreement invalid in any respect or prevents the consummation of the
transactions contemplated hereby, or which materially and adversely affects the
assets, properties, operations, prospects, net income or financial condition of
PDWK shall be in effect; and no action or proceeding before any court or
governmental or regulatory authority, domestic or foreign, shall have been
instituted or threatened by any government or governmental or regulatory
authority, domestic or foreign, or by any other person, or entity which seeks to
prevent or delay the consummation of the transactions contemplated by this
Agreement or which challenges the validity or enforceability of this
Agreement.
ARTICLE
V
CONDITIONS
TO OBLIGATIONS OF PDWK
The
obligations of PDWK to consummate the transactions contemplated by this
Agreement are subject to the fulfillment, at or before the Closing Date, of the
following conditions, any one or more of which may be waived by PDWK in its sole
discretion:
Section 5.1
Representations and
Warranties of Changda and Changda Shareholders. All representations and
warranties made by Changda in this Agreement and the Definitive Agreements shall
be true and correct on and as of the Closing Date as if again made by them on
and as of such date.
Section 5.2
Agreements and
Covenants. Changda and Changda Shareholders shall have performed and
complied in all material respects to all agreements and covenants required by
this Agreement and the Definitive Agreements to be performed or complied with by
it on or prior to the Closing Date.
Section 5.3
Consents and
Approvals. All consents, waivers, authorizations and approvals of any
governmental or regulatory authority, domestic or foreign, and of any other
person, firm or corporation, required in connection with the execution, delivery
and performance of this Agreement, shall have been duly obtained and shall be in
full force and effect on the Closing Date.
Section 5.4
No Violation of
Orders. No preliminary or permanent injunction or other order issued by
any court or other governmental or regulatory authority, domestic or foreign,
nor any statute, rule, regulation, decree or executive order promulgated or
enacted by any government or governmental or regulatory authority, domestic or
foreign, that declares this Agreement invalid or unenforceable in any respect or
which prevents the consummation of the transactions contemplated hereby, or
which materially and adversely affects the assets, properties, operations,
prospects, net income or financial condition of Changda or
Changda’s Subsidiaries, taken as a whole, shall be in effect; and no
action or proceeding before any court or government or regulatory authority,
domestic or foreign, shall have been instituted or threatened by any government
or governmental or regulatory authority, domestic or foreign, or by any other
person, or entity which seeks to prevent or delay the consummation of the
transactions contemplated by this Agreement or which challenges the validity or
enforceability of this Agreement.
Section
5.5.
Other Closing
Documents. PDWK shall have received such other certificates, instruments
and documents in confirmation of the representations and warranties of Changda
or in furtherance of the transactions contemplated by this Agreement as PDWK or
its counsel may reasonably request.
ARTICLE
VI
TERMINATION
SECTION 6.1
Termination. This
Agreement may be terminated and the transactions contemplated hereby may be
abandoned at any time before the Closing by either Party, with or without
cause. In the event that the transactions anticipated by this
Agreement do not close for any reason, or for no reason, this Agreement shall
terminate and no Party shall have any further rights or obligations
hereunder.
ARTICLE
VII
MISCELLANEOUS
PROVISIONS
Section 7.1
Survival of
Provisions. The respective representations, warranties, covenants and
agreements of each of the parties to this Agreement shall terminate upon
execution of the Definitive Agreements.
Section 7.2
Publicity. No party
shall cause the publication of any press release or other announcement with
respect to this Agreement or the transactions contemplated hereby without the
consent of the other parties, unless a press release or announcement is required
by law. If any such announcement or other disclosure is required by law, the
disclosing party agrees to give the non-disclosing parties prior notice and an
opportunity to comment on the proposed disclosure.
Section 7.3
Notices. All notices
and other communications given or made pursuant hereto shall be in writing and
shall be deemed to have been given or made if in writing and delivered
personally or sent by registered or certified mail (postage prepaid, return
receipt requested) to the parties or to such other persons or at such other
addresses as shall be furnished by any party by like notice to the others, and
such notice or communication shall be deemed to have been given or made as of
the date so delivered or mailed. No change in any of such addresses shall be
effective insofar as notices under this Section 9.5 are concerned unless such
changed address is located in the United States of America and notice of such
change shall have been given to such other party hereto as provided in this
Section 9.5
Section 7.4
Entire Agreement.
This Agreement, together with the exhibits hereto, represents the entire
agreement and understanding of the parties with reference to the transactions
set forth herein and no representations or warranties have been made in
connection with this Agreement other than those expressly set forth herein or in
the exhibits, certificates and other documents delivered in accordance herewith.
This Agreement supersedes all prior negotiations, discussions, correspondence,
communications, understandings and agreements between the parties relating to
the subject matter of this Agreement and all prior drafts of this Agreement, all
of which are merged into this Agreement. No prior drafts of this Agreement and
no words or phrases from any such prior drafts shall be admissible into evidence
in any action or suit involving this Agreement.
Section 7.5
Titles and Headings.
The Article and Section headings contained in this Agreement are solely for
convenience of reference and shall not affect the meaning or interpretation of
this Agreement or of any term or provision hereof.
Section
7.6
Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed one and the same agreement.
Section 7.7
Governing Law. This
Agreement shall be governed by and interpreted and enforced in accordance with
the laws of the State of Nevada without giving effect to the choice of law
provisions thereof.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first above written.
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Changda International,Ltd.
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By:
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/s/ Jan Panneman
/s/
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Print Name:
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Jan
Panneman
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Title:
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Director
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Xxxxxxxxxxxxx.xxx,
Inc.
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By:
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/s/ Xxxxx Xxxxxxx
/s/
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Print Name:
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Xxxxx
Xxxxxxx
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Title:
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President
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