Exhibit 2.1
SHARE PURCHASE AGREEMENT
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This Share Purchase Agreement ("Agreement"), dated as of April 22,
2003, among, X.X. Xxxxxx (the "Seller"), and Houston Operating Company ("HOC"),
and Speed Action Limited (the "Buyer").
W I T N E S S E T H:
WHEREAS, HOC is a corporation duly organized under the laws of the
State of Delaware
WHEREAS, the Seller owns 7,085,848 shares of common stock of HOC in the
aggregate.
WHEREAS, Buyer wishes to purchase an aggregate of 7,030,000 shares of
common stock, the Seller (collectively, the "Purchase Shares"), and the Seller
desire to sell the Purchase Shares to Buyer free and clear of liens and
encumbrances.
HOC is joining in this agreement to provide certain covenants
warranties and representations.
NOW, THEREFORE, it is agreed among the parties as follows:
ARTICLE I
THE CONSIDERATION
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1.1 Subject to the conditions set forth herein, Seller shall sell to
Buyer and Buyer shall purchase an aggregate of 7,030,000 shares of common stock
of HOC from Seller. The purchase price for the shares to be paid by Buyer to
Seller is $250,000 (the "Consideration") Consideration shall be paid at closing
by a wire transfer or transmittal of a cashiers check to Sellers Escrow Agent's
account, Business Financial Systems, Inc.
ARTICLE II
CLOSING AND CONVEYANCE OF SHARES
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2.1 The Purchase Shares shall be conveyed by Seller to Buyer with duly
executed stock powers by depositing with Escrow Agent for delivery to buyer,
upon receipt of the Consideration by Seller, and satisfaction of a) the
conditions precedent in Article VI, and b) procedures in Article 5.
2.2 Closing hereunder shall be completed by delivery to Business
Financial Systems, Inc. Escrow Account, of the requisite closing documents and
cash consideration, and delivery of the share certificates to Buyer's Escrow
Agent, Xxxxx Xxxxx, on or before April 24, 2003 at 5:00 p.m. PST ("Closing
Date") subject to satisfaction of the terms and conditions set forth herein.
Consideration may be delivered by Federal Express or wire transfers, and any
closing documents may be delivered by facsimile, Federal Express or other
appropriate means.
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ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER AND HOC AS TO HOC
Seller and HOC each hereby, represents, warrants and covenants to Buyer
as follows:
3.1 HOC is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, and has the corporate power
and authority to own or lease its properties and to carry on its business as it
is now being conducted. The Articles of Incorporation and Amendments and Bylaws
of HOC, are complete and accurate, and the minute books of HOC, copies of which
have also been made available to Buyer, contain a record, which is complete and
accurate in all material respects, of all meetings, and all corporate actions of
the shareholders and Board of Directors of HOC.
3.2 (a) The authorized capital stock of HOC consists of 50,000,000
shares of common stock; and 5 million shares each of Preferred stock and
Preference stock. No Preferred or Preference stock is issued or outstanding.
There are 7,795,172 shares of Common Stock of HOC issued and outstanding. All
such shares of capital stock of HOC are validly issued, fully paid,
non-assessable and free of preemptive rights. HOC has no outstanding options,
warrants, or other rights to purchase, or subscribe to, or other securities
convertible into or exchangeable for any shares of capital stock of HOC, or
contracts or arrangements of any kind relating to the issuance, sale or transfer
of any capital stock or other equity securities of HOC. All of the outstanding
shares of capital stock of HOC have been offered, issued, sold and delivered in
compliance with applicable federal and state securities laws and none of such
securities were, at the time of issuance, subject to preemptive rights. None of
such issued and outstanding shares is the subject of any voting trust agreement
relating to the voting thereof or restricting in any way the sale or transfer
thereof.
(b) The Seller own the Purchase Shares that they are conveying
pursuant to this Agreement beneficially and of record, free and clear of any
lien, pledge, security interest or other encumbrance, and, upon payment for the
Purchase Shares as provided in this Agreement, the Buyer will acquire good and
valid title to the Purchase Shares, free and clear of any lien, pledge, security
interest or other encumbrance. None of the Purchase Shares are the subject of
any voting trust agreement or other agreement relating to the voting thereof or
restricting in any way the sale or transfer thereof except for this Agreement.
Each Seller has full right and authority to transfer such Purchase Shares
pursuant to the terms of this Agreement.
3.3 HOC does not own nor has it owned, in the last three years, any
outstanding shares of capital stock or other equity interests of any
partnership, joint venture, trust, corporation, limited liability company or
other entity and there are no obligations of HOC to repurchase, redeem or
otherwise acquire any capital stock or equity interest of another entity.
3.4 This Agreement has been duly authorized, validly executed and
delivered on behalf of the Seller and HOC and is a valid and binding agreement
and obligation of HOC and Seller enforceable against the parties in accordance
with its terms, subject to limitations on enforcement by general principles of
equity and by bankruptcy or other laws affecting the enforcement of creditors'
rights generally, and Seller and HOC have complete and unrestricted power to
enter into and, upon the appropriate approvals as required by law, to consummate
the transactions contemplated by this Agreement.
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3.5 Neither the making of nor the compliance with the terms and
provisions of this Agreement and consummation of the transactions contemplated
herein by Seller or HOC will conflict with or result in a breach or violation of
the Articles of Incorporation or Bylaws of HOC, or of any material provisions of
any indenture, mortgage, deed of trust or other material agreement or instrument
to which HOC or Seller are a party, or of any material provision of any law,
statute, rule, regulation, or any existing applicable decree, judgment or order
by any court, federal or state regulatory body, administrative agency, or other
governmental body having jurisdiction over HOC or Seller, or any of its material
properties or assets, or will result in the creation or imposition of any
material lien, charge or encumbrance upon any material property or assets of HOC
pursuant to the terms of any agreement or instrument to which HOC is a party or
by which HOC may be bound or to which any of HOC property is subject and no
event has occurred with which lapse of time or action by a third party could
result in a material breach or violation of or default by HOC or Seller.
3.6 There is no claim, legal action, arbitration, governmental
investigation or other legal or administrative proceeding, nor any order, decree
or judgment in progress, pending or in effect, or to the best knowledge of the
Seller threatened against or relating to HOC or affecting any of its assets,
properties, business or capital stock. There is no continuing order, injunction
or decree of any court, arbitrator or governmental authority to which HOC is a
party or by which HOC or its assets, properties, business or capital stock are
bound.
3.7 HOC has accurately prepared and filed all federal, state and other
tax returns required by law, domestic and foreign, to be filed by it, has paid
or made provisions for the payment of all taxes shown to be due and all
additional assessments, and adequate provisions have been and are reflected in
the financial statements of HOC for all current taxes and other charges to which
HOC is subject and which are not currently due and payable. None of the Federal
income tax returns of HOC have been audited by the Internal Revenue Service or
other foreign governmental tax agency. HOC has no knowledge of any additional
assessments, adjustments or contingent tax liability (whether federal or state)
pending or threatened against HOC for any period, nor of any basis for any such
assessment, adjustment or contingency.
3.8 HOC has delivered to Buyer audited financial statements dated
December 31, 2002. All such statements, herein sometimes called "HOC Financial
Statements" are complete and correct in all material respects and, together with
the notes to these financial statements, present fairly the financial position
and results of operations of HOC for the periods indicated. All financial
statements of HOC have been prepared in accordance with generally accepted
accounting principles.
3.9 As of the date hereof, HOC, represents and warrants that all
outstanding indebtedness of HOC is as shown on the financial statements (except
for legal and accounting services related to this transaction) and all such
scheduled indebtedness, if any, which will be the sole responsibility of the
Seller and shall be paid by the Seller at the Closing hereunder.
3.10 Since the dates of the HOC Financial Statements, there have not
been any material adverse changes in the business or condition, financial or
otherwise, of HOC. HOC does not have any liabilities, commitments or
obligations, secured or unsecured except as shown on updated financials (whether
accrued, absolute, contingent or otherwise).
3.11 HOC is not a party to any contract performable in the future.
3.12 The representations and warranties of the HOC shall be true and
correct as of the date hereof.
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3.13 HOC will have delivered to Buyer, all of its corporate books and
records for review.
3.14 HOC has no employee benefit plan in effect at this time.
3.15 No representation or warranty by HOC or the Seller in this
Agreement, or any certificate delivered pursuant hereto contains any untrue
statement of a material fact or omits to state any material fact necessary to
make such representation or warranty not misleading.
3.16 Buyer has received copies of Form 10KSB as filed with the
Securities and Exchange Commission ("SEC") which included audits for the year
ended December 31, 2002 and each of its other reports to shareholders filed with
the SEC through the period ended March 31, 2003. HOC is a registered company
under the Securities Exchange Act of 1934, as amended.
3.17 HOC has filed reports required to be filed by it under the
Securities Exchange Act of 1934, as amended (the "Federal Securities Laws".) No
such reports, or any reports sent to the shareholders of HOC generally contained
any untrue statement of material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements in such
report, in light of the circumstances under which they were made, not
misleading.
3.18 The Buyer has not received any general solicitation or general
advertising regarding the shares of Seller's common stock.
3.19 HOC has conducted no business whatsoever since January 1, 2002,
and has incurred no liabilities except as shown on the financial statements,
which shall be paid at closing by the Seller.
3.20 There have been no material changes, debts, or liabilities
incurred by HOC since the date of 10KSB for December 31, 2002, or since then to
date hereof.
3.21 Buyer will receive a good standing certificate from the State of
Delaware and an updated Shareholders List at the time of closing.
ARTICLE IV
TERMINATION OF REPRESENTATION AND
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WARRANTIES AND CERTAIN AGREEMENTS; INDEMNIFICATION
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4.1 The respective representations and warranties of the parties hereto
shall survive this Agreement for two years and the continuing covenants shall
survive hereafter, pursuant to their terms.
4.2 The right to indemnification or payment of Damages (as defined in
section 4.4) or other remedy based on any representation, warranty, covenant or
obligation of a party hereunder shall not be waived by any investigation
conducted with respect to, or any knowledge acquired (or capable of being
acquired) at any time, whether before or after the execution and delivery of
this Agreement, with respect to the accuracy or inaccuracy of or compliance
with, any such representation, warranty, covenant or obligation.
4.3 The waiver of any condition to a party's obligation to consummate
the transactions contemplated hereunder, where such condition is based on the
accuracy of any representation or
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warranty, or on the performance of or compliance with any covenant or
obligation, will not affect the right to indemnification, or payment of Damages,
or other remedy based on such representation, warranty, covenant or obligation.
4.4 Seller, shall indemnify and hold harmless the Buyer and its
respective officers, directors and affiliates (the "Buyer Indemnified Persons")
for, and will pay to the Buyer Indemnified Persons, the amount of, any loss,
liability, claim, damage (including, without limitation, incidental and
consequential damages), cost, expense (including, without limitation, interest,
penalties, costs of investigation and defense and the reasonable fees and
expenses of attorneys and other professional experts) or diminution of value,
whether or not involving a third- party claim (collectively, "Damages"),
directly or indirectly arising from, attributable to or in connection with:
any representation or warranty made by Seller or HOC in this agreement
or any closing deliveries, that is, or was at the time made, false
or inaccurate, or any breach of, or misrepresentation with respect
to, any such representation or warranty; and
any breach by any of the Seller or HOC of any covenant, agreement or
obligation of HOC or Seller contained in this agreement.
any claims or litigation relating to HOC now pending or threatened or
which may hereafter be brought against Buyer and/or HOC or Seller
based upon events occurring prior to the date hereof and not
attributable to the acts of the Buyer.
any and all actions, suits, proceedings, claims, demands, assessments,
judgments, costs, losses, liabilities and reasonable legal and
other expenses incident to any of the foregoing.
4.5 Seller and HOC shall have no liability for indemnification with
respect to any representation or warranty, unless, on or before the second
anniversary of the date hereof, the Buyer notifies the Seller of a claim
specifying the basis thereof in reasonable detail to the extent then known by
Buyer. A claim with respect to any covenant, agreement or obligation contained
in this agreement, may be made at any time without any time limitation.
4.6 Promptly after receipt by an indemnified party of written notice
(the "Notice of Claim") of the commencement of any action, suit or proceeding
against it, or written threat thereof, such indemnified party will, if a claim
is to be made against an indemnifying party under either of said sections, as
applicable, give notice to the indemnifying party of the commencement of such
action, suit or proceeding. The indemnified party shall furnish to the
indemnifying party in reasonable detail such information as the indemnified
party may have with respect to such indemnification claims (including copies of
any summons, complaint or other pleading which may have been served on it and
any written claim, demand, invoice, billing or other document evidencing or
assenting the same). Subject to the limitations set forth in this section, no
failure or delay by the indemnified party in the performance of the foregoing
shall reduce or otherwise affect the obligation of the indemnifying party to
indemnify and hold the indemnified party harmless except to the extent that such
failure or delay shall have materially and adversely affected the indemnifying
party's ability to defend against, settle or satisfy any action, suit or
proceeding the claim for which the indemnified party is entitled to
indemnification hereunder. The foregoing shall not apply to the extent
inconsistent with the provisions of section 4.8 relating to Proceedings.
4.7 If the claim or demand set forth in the Notice of Claim given by
the indemnified party is a claim or demand asserted by a third party, the
indemnifying party shall have 30 days
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after the Date of Notice of Claim to notify the indemnified party in writing of
its election to defend such third party claim or demand on behalf of the
indemnified party (the "Notice Period"); provided, however, that the indemnified
party is authorized to file any motion, answer or other pleading which it deems
necessary or appropriate to protect its interests during the Notice Period. If
the indemnifying party elects to defend such third party claim or demand, the
indemnified party shall make available to the indemnifying party and its agents
and representatives all records and other materials which are reasonably
required in the defense of such third party claim or demand and shall otherwise
cooperate (at the sole cost and expense of the indemnifying party) with, and
assist (at the sole cost and expense of the indemnifying party) the indemnifying
party in the defense of, such third party claim or demand, and so long as the
indemnifying party is diligently defending such third party claim in good faith,
the indemnified party shall not pay, settle or compromise such third party claim
or demand. If the indemnifying party elects to defend such third party claim or
demand, the indemnified party shall have the right to control the defense of
such third party claim or demand, at the indemnified party's own expense. If the
indemnifying party does not elect to defend such third party claim or demand or
does not defend such third party claim or demand in good faith, the indemnified
party shall have the right, in addition to any other right or remedy it may have
hereunder at the indemnifying party's expense, to defend such third party claim
or demand.
4.8 The term "Date of Notice of Claim" shall mean the date the Notice
of Claim is effective pursuant to section 4.6 of this Agreement.
4.9 A claim for indemnification for any matter not involving a
third-party claim may be asserted by notice to the party from whom
indemnification is sought.
4.10 Any legal action or proceeding with respect to this Agreement or
any matters arising out of or in connection with this Agreement or the
transactions contemplated hereby or the documents executed and delivered in
connection herewith, and any action for enforcement of any judgment in respect
thereof may be brought in the courts of the State of Colorado or of the United
States of America for the District of Colorado, and, by execution and delivery
of this Agreement, the parties each hereby accepts for itself and in respect of
its property, generally and unconditionally, the jurisdiction of the aforesaid
courts and appellate courts thereof. The parties irrevocably consent to service
of process out of any of the aforementioned courts in any such action or
proceeding in accordance with the notice provisions set forth in Section 9.5.
The parties each hereby irrevocably waive any objection that it may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or the
transactions contemplated hereby or the documents execute and delivered in
connection herewith brought in the courts referred to above and hereby further
irrevocably waive and agree, to the extent permitted by applicable law, not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum. Nothing herein shall
affect the right of any party hereto to serve process in any other manner
permitted by law.
ARTICLE V
PROCEDURE FOR CLOSING
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5.1 At the Closing Date, the purchase and sale shall be consummated
after satisfaction of all conditions precedent set forth in Article VI, by
Seller' common stock certificates for the Purchase Shares being delivered, duly
executed, for 7,030,000 shares of common stock to Escrow Agent, and the delivery
of the Consideration for share purchase to Escrow Agent from the Buyer, together
with delivery of all other items, agreements, stock powers, warranties, and
representations set forth in this Agreement.
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5.2 Escrow Agent for Seller is Business Financial Systems, Inc. and the
escrow account is Business Financial Systems. Inc. Escrow Account @ Compass
Bank, 0000 Xxxxxxx Xxxx, Xxxxxx XX 00000, (000) 000-0000. ABA # 000000000, Acct.
# 200075662.
5.3 Buyers Escrow Agent is Xxxxx Xxxxx, Esq., 000 Xxxxxxx Xxxxxx Xx.,
Xxxxx 000, Xxxxxxx Xxxxx, XX 00000.
ARTICLE VI
CONDITIONS PRECEDENT TO THE
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CONSUMMATION OF THE PURCHASE
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The following are conditions precedent to the consummation of the
Agreement on or before the Closing Date:
6.1 Seller and HOC shall have performed and complied with all of their
respective obligations hereunder which are to be complied with or performed on
or before the Closing Date.
6.2 No action, suit or proceeding shall have been instituted or shall
have been threatened before any court or other governmental body or by any
public authority to restrain, enjoin or prohibit the transactions contemplated
herein, or which might subject any of the parties hereto or their directors or
officers to any material liability, fine, forfeiture or penalty on the grounds
that the transactions contemplated hereby, the parties hereto or their directors
or officers, have violated any applicable law or regulation or have otherwise
acted improperly in connection with the transactions contemplated hereby, and
the parties hereto have been advised by counsel that, in the opinion of such
counsel, such action, suit or proceeding raises substantial questions of law or
fact which could reasonably be decided adversely to any party hereto or its
directors or officers.
6.3 The representations and warranties made by Seller and HOC in this
Agreement shall be true as though such representations and warranties had been
made or given on and as of the Closing Date, except to the extent that such
representations and warranties may be untrue on and as of the Closing Date
because of changes caused by transactions suggested or approved in writing by
the Buyer.
ARTICLE VII
TERMINATION AND ABANDONMENT
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7.1 Anything contained in this Agreement to the contrary
notwithstanding, the Agreement may be terminated and abandoned at any time prior
to or on the Closing Date:
(a) By mutual consent of parties;
(b) By Seller or Buyer, if any condition set forth in Article VI
relating to the other party has not been met or has not been
waived;
(c) By Seller or Buyer, if any suit, action, or other proceeding shall
be pending or threatened by the federal or a state government
before any court or governmental
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agency, in which it is sought to restrain, prohibit, or otherwise
affect the consummation of the transactions contemplated hereby;
(d) By Seller or Buyer, if there is discovered any material error,
misstatement or omission in the representations and warranties of
another party; or
(e) By the Seller, if the Closing does not occur, through no failure
to act by Seller, on May 1, 2003, or if Buyer fails to deliver the
consideration required herein.
7.2 Any of the terms or conditions of this Agreement may be waived at
any time by the party which is entitled to the benefit thereof, by action taken
by its Board of Directors provided; however, that such action shall be taken
only if, in the judgment of the Board of Directors taking the action, such
waiver will not have a materially adverse effect on the benefits intended under
this Agreement to the party waiving such term or condition.
ARTICLE VIII
CONTINUING REPRESENTATIONS AND
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WARRANTIES AND COVENANTS
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8.1 The respective representations, warranties, and covenants of the
parties hereto and the covenants and agreements of the parties hereto shall
survive after the closing under this Agreement in accordance with the terms
thereof.
8.2 There are no representations whatsoever about any matter relating
to HOC Seller or any item contained in this Agreement, except as is contained in
the express language of this Agreement.
8.3 Seller and their agents and attorneys shall have no liability
whatsoever for any matter, omission or representation not specifically disclosed
herein, and Buyer, as a specific inducement to Seller hereby releases Seller and
their agents and attorneys and covenant not to xxx Seller, their agents and
attorneys under any circumstances for any matter not specifically and expressly
represented within this document.
ARTICLE IX
MISCELLANEOUS
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9.1 This Agreement embodies the entire agreement between the parties,
and there have been and are no agreements, representations or warranties among
the parties other than those set forth herein or those provided for herein,
except that a companion document, the Reorganization Agreement, has been
executed concurrently which contains numerous warranties and representations.
9.2 To facilitate the execution of this Agreement, any number of
counterparts hereof may be executed, and each such counterpart shall be deemed
to be an original instrument, but all such counterparts together shall
constitute but one instrument.
9.3 All parties to this Agreement agree that if it becomes necessary or
desirable to execute further instruments or to make such other assurances as are
deemed necessary, the party
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requested to do so will use its best efforts to provide such executed
instruments or do all things necessary or proper to carry out the purpose of
this Agreement.
9.4 This Agreement may not be amended except by written consent of both
parties.
9.5 Any notices, requests, or other communications required or
permitted hereunder shall be delivered personally or sent by overnight courier
service, prepaid, addressed as follows:
To Seller: X.X. Xxxxxx
00000 X. Xxxxxxxx Xx.
Xxxxxxxxx, XX 00000
To HOC: X.X. Xxxxxx
00000 X. Xxxxxxxx Xx.
Xxxxxxxxx, XX 00000
To Buyer: Speed Action Limited
x/x Xx. Xxxx Xxx Xxx
0X, Xxxxx 245, Baguio Villa
000 Xxxxxxxx Xxxx, Xxxx Xxxx
Copy to: Seller's Escrow Agent
Escrow Agent: Business Financial Systems, Inc.,
0000 Xxxxxxxxx Xxxx., Xxxxxxxx, XX 00000-0000 (000) 000-0000
or such other addresses as shall be furnished in writing by any party, and any
such notice or communication shall be deemed to have been given as of the date
received.
9.6 No press release or public statement will be issued relating to the
transactions contemplated by this Agreement without prior approval of the Buyer
and Seller. However, HOC may issue at any time any press release or other public
statement it believes on the advice of its counsel it is obligated to issue to
avoid liability under the law relating to disclosures, but the party issuing
such press release or public statement shall make a reasonable effort to give
the other party prior notice of and opportunity to participate in such release
or statement.
9.7 This Agreement shall be governed by and construed in accordance
with and enforced under the laws of the state of Colorado applicable to all
agreements made hereunder. Venue and jurisdiction for any legal actions
hereunder shall be District Court in and for Jefferson County, Colorado.
9.8 In connection with this Agreement the Buyers have appointed Xxxxx
Xxxxx, Esq. as their Escrow Agent to do the following:
1) Transmit the purchase price of $250,000 to Sellers Escrow
Agent upon completion of transmittal to Xx. Xxxxx of the
shares (7,030,000) being purchased herein
2) Accept the common stock certificates of HOC with duly
signed and guaranteed signatures for 7,030,000 common
shares from Seller and,
3) Transmit by Federal Express the stock certificates to
buyers pursuant to their instruction: ____________
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4) In the event of default in delivery of cash or
certificates by a party under this agreement, any cash or
certificates received from the other party shall be
returned to the remitting party 3 business days after
default.
5) Escrow Agent is specifically indemnified and held harmless
hereby for its actions or inactions in following these
instructions. In the event of a dispute involving the
escrow instructions or the consideration to be delivered
in escrow, the Escrow Agent is authorized to implead the
consideration received into the Superior Court of Los
Angeles County, California upon ten days written notice,
and be relieved of any further escrow duties thereupon.
Any and all costs of attorneys fees and legal actions of
Escrow Agent for any dispute resolution or impleader
action shall be paid in equal shares by the parties to
this agreement.
9.9 Sellers Escrow Agent, Business Financial Systems, Inc. shall be
authorized :Upon receipt of the payment for the purchase shares escrow agent
shall disburse the proceeds received in accordance with Seller's written
instructions.
9.10 Seller agrees to appoint the buyer's designee as President, and
immediately resign as the President of HOC, upon closing. Seller agrees to
execute minutes appointing buyer's designee(s) as directors of HOC concurrent
with the closing hereunder. Buyer shall provide the names of the appointees as
soon as the buyer wishes to have the persons appointed to the offices.
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IN WITNESS WHEREOF, the parties have executed this Agreement this 25th
day of April, 2003.
Seller: Houston Operating Company a Delaware
Corporation
__________________________ By: /s/X.X Xxxxxx
Name: X.X Xxxxxx
Title: President
__________________________
BUYER:.
Speed Action Limited
By:/s/Chin Sin Low
Name: Chin Sin Low
Title: President
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