SHARE PURCHASE AGREEMENT
This Share Purchase Agreement ("Agreement"), dated as of February ___, 2000,
among H. XXXXXX XXXXX, (SELLER), Xxxxxxx XxXxx Corp. ("KBDD"), and YGCD Assets,
Inc. , (BUYER) a Colorado Corporation.
W I T N E S S E T H:
A. WHEREAS, XXXXXXX XXXXX CORP. ("KBDD") is a corporation duly
organized under the laws of the State of Colorado,
B. WHEREAS, BUYER wishes to purchase 2,400,000 common shares of KBDD
free and clear of liens and encumbrances from SELLER.
C. WHEREAS, the parties hereto wish to enter into this Agreement,
pursuant to the provisions of the Colorado Revised Statutes.
NOW, THEREFORE, it is agreed among the parties as follows:
ARTICLE I
The Consideration
1.1 Subject to the conditions set forth herein on the "Closing Date" (as
herein defined), SELLER shall sell and BUYER shall purchase 2,400,000 common
shares of KBDD common stock. The transactions contemplated by this Agreement
shall be completed at a closing ("Closing") on a closing date ("Closing Date")
on or before March 17, 2000. The purchase price for the KBDD shares to be paid
by BUYER to SELLER is $200,000, $25,000 of which is paid herewith and $175,000
which shall be delivered at closing.
On the Closing Date, all of the documents to be furnished pursuant to
this Agreement, including the documents to be furnished pursuant to Article VI
of this Agreement, shall be delivered to M.A. Xxxxxxx, to be held in escrow
until all closing conditions hereunder have been met or the date of termination
of this Agreement, but no longer than 10 days after closing date, whichever
first occurs, and thereafter shall be promptly distributed to the parties as
their interests may appear.
1.2 Concurrent with the execution hereof, BUYER shall deposit or cause
to be deposited with M.A. Xxxxxxx as a non-refundable consideration for this
agreement, the sum of $25,000. Further, the sum of $175,000 shall be paid at
closing for delivery to SELLER upon receipt of the shares (2,400,000) of KBDD
common stock.
ARTICLE II
Conveyance of Shares
2.1 The shares of no par value common stock of KBDD shall be delivered
and conveyed by SELLER to BUYER at closing by SELLER with duly executed stock
powers, upon receipt of the cash consideration by SELLER.
2.2 SELLER represents that no outstanding options or warrants for
unissued shares exist for KBDD.
ARTICLE III
Representations, Warranties and Covenants of SELLER as to KBDD
SELLER hereby represents, warrants and covenants to BUYER and
will cause KBDD to so represent and warrant, except as stated in the KBDD
Disclosure Statement, as follows:
3.1 KBDD is a corporation duly organized, validly existing and in good
standing under the laws of the State of Colorado, 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 KBDD, copies of which have been delivered to BUYER, are complete and
accurate, and the minute books of KBDD 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 KBDD.
3.2 The aggregate number of shares which KBDD is authorized to issue is
1,000,000,000 shares of common stock with no par value per share, of which
approximately 2,917,000 shares of such common stock will be issued and
outstanding, fully paid and non-assessable, at closing under this agreement.
KBDD has no outstanding options, warrants or other rights to purchase, or
subscribe to, or securities convertible into or exchangeable for any shares of
capital stock.
3.3 KBDD and SELLER have complete and unrestricted power to enter into
and, upon the appropriate approvals as required by law, to consummate the
transactions contemplated by this Agreement.
3.4 Neither the making of nor the compliance with the terms and
provisions of this Agreement and consummation of the transactions contemplated
herein by KBDD will conflict with or result in a breach or violation of the
Articles of Incorporation or Bylaws of KBDD.
3.6 KBDD has delivered to BUYER financial statements of KBDD dated
December 31, 1998. At or prior to closing KBDD shall have filed its 10K for
1999, including unaudited financial statements for the year ended December 31,
1999. All such statements, herein sometimes called "KBDD Financial Statements"
are (and will be) 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 KBDD of the periods indicated. All
financial statements of KBDD will have been prepared in accordance with
generally accepted accounting principles.
3.7 Since the dates of the KBDD Financial Statements, there have not
been any material adverse changes in the business or condition, financial or
otherwise, of KBDD. KBDD does not have any material liabilities or obligations,
secured or unsecured except as shown on updated financials (whether accrued,
absolute, contingent or otherwise).
3.8 There are no pending legal proceedings involving KBDD, there are no
legal proceedings or regulatory proceedings involving material claims pending,
or, to the knowledge of the SELLER, threatened against KBDD or affecting any of
its assets or properties, and KBDD is not in any material breach or violation of
or default under any contract or instrument to which KBDD is a party, and no
event has occurred which with the lapse of time or action by a third party could
result in a material breach or violation of or default by KBDD under any
contract or other instrument to which KBDD is a party or by which it or any of
its properties may be bound or affected, or under its Articles of Incorporation
or Bylaws, nor is there any court or regulatory order pending, applicable to
KBDD.
3.9 KBDD shall not enter into or consummate any transactions prior to
the Closing Date other than in the ordinary course of business and will pay no
dividend, or increase the compensation of officers and will not enter into any
agreement or transaction which would adversely affect its financial condition.
3.10 KBDD is not a party to any contract performable in the future.
3.11 The representations and warranties of SELLER and KBDD shall be true
and correct as of the date hereof and as of the Closing Date.
3.12 KBDD shall deliver to BUYER, all of its corporate books and records
for review. KBDD will also deliver to BUYER on or before the Closing Date any
reports relating to the financial and business condition of KBDD which occur
after the date of this Agreement and any other reports sent generally to its
shareholders after the date of this Agreement.
3.13 KBDD has no employee benefit plan in effect at this time.
3.14 No representation or warranty by KBDD or SELLER in this Agreement,
the KBDD Disclosure Statement 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.
3.15 SELLER or KBDD has delivered, to BUYER true and correct copies of
the 10-K and each of its other reports to shareholders and filing with the
Securities and Exchange Commission ("SEC") for the year ended December 31, 1999.
KBDD will also deliver to BUYER on or before the Closing Date any reports
relating to the financial and business condition of KBDD which are filed with
the SEC after the date of this Agreement and any other reports sent generally to
its shareholders after the date of this Agreement.
3.16 KBDD has duly filed all reports required to be filed by it under
the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934,
as amended, (the "Federal Securities Laws"). No such reports, or any reports
sent to the shareholders of KBDD 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.
3.17 SELLER hereby covenants that during the contract period, prior to
closing, KBDD will not take any board action without BUYER's approval in
writing, pending selection of new officers and directors at closing.
3.17 SELLER owns the 2,400,000 KBDD shares being sold to the BUYER free
and clear of any liens and encumbrances and may transfer such shares without the
consent of any third party.
ARTICLE IV
Obligations of the Parties Pending the Closing Date
4.1 At all times prior to the Closing Date during regular business
hours, each party will permit the other to examine its books and records and the
books and records of its subsidiaries and will furnish copies thereof on
request. It is recognized that, during the performance of this Agreement, each
party may provide the other parties with information which is confidential or
proprietary information. During the term of this Agreement, and for four years
following the termination of this Agreement, the recipient of such information
shall protect such information from disclosure to persons, other than members of
its own or affiliated organizations and its professional advisers, in the same
manner as it protects its own confidential or proprietary information from
unauthorized disclosure, and not use such information to the competitive
detriment of
the disclosing party. In addition, if this Agreement is terminated for any
reason, each party shall promptly return or cause to be returned all documents
or other written records of such confidential or proprietary information,
together with all copies of such writings and, in addition, shall either furnish
or cause to be furnished, or shall destroy, or shall maintain with such standard
of care as is exercised with respect to its own confidential or proprietary
information, all copies of all documents or other written records developed or
prepared by such party on the basis of such confidential or proprietary
information. No information shall be considered confidential or proprietary if
it is (a) information already in the possession of the party to whom disclosure
is made, (b) information acquired by the party to whom the disclosure is made
from other sources, or (c) information in the public domain or generally
available to interested persons or which at a later date passes into the public
domain or becomes available to the party to whom disclosure is made without any
wrongdoing by the party to whom the disclosure is made.
4.2 SELLER and BUYER shall promptly provide each other with information
as to any significant developments in the performance of this Agreement, and
shall promptly notify the other if it discovers that any of its representations,
warranties and covenants contained in this Agreement or in any document
delivered in connection with this Agreement was not true and correct in all
material respects or became untrue or incorrect in any material respect.
4.3 All parties to this Agreement shall take all such action as may be
reasonably necessary and appropriate and shall use their best efforts in order
to consummate the transactions contemplated hereby as promptly as practicable.
ARTICLE V
Procedure for Closing
5.1 At the Closing Date, the purchase and Sale shall be effected with
common stock certificates of KBDD being delivered duly executed for 2,400,000
shares of common stock to BUYER and the delivery of $175,000 in a cashier's
check to SELLER from BUYER, together with delivery of all other agreements,
schedules, warranties and representations set forth in this Agreement.
ARTICLE VI
Conditions Precedent to the
Consummation of the Purchase
The following are conditions precedent to the consummation of the
Agreement on or before the Closing Date:
6.1 SELLER shall have performed and complied with all of its respective
obligations hereunder which are to be complied with or performed on or before
the Closing Date and SELLER and KBDD and BUYER shall provide one another at the
Closing with a certificate to the effect that such party has performed each of
the acts and undertakings required to be performed by it on or before the
Closing Date pursuant to the terms of this Agreement.
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 All actions, proceedings, instruments and documents required to
carry out this Agreement and the transactions contemplated hereby and the form
and substance of all legal proceedings and related matters shall have been
approved by counsel for BUYER.
6.4 The representations and warranties made by BUYER and SELLER 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 (1) changes caused by transactions suggested or approved in writing
by BUYER or (2) events or changes (which shall not, in the aggregate, have
materially and adversely affected the business, assets, or financial condition
of KBDD during or arising after the date of this Agreement.)
6.5 All outstanding liabilities of KBDD shall have been paid and
released prior to closing.
6.6 The Share Exchange Agreement between KBDD and the BUYER which is
currently being negotiated will close concurrently with the closing hereof.
6.7 SELLER shall cause KBDD to appoint, at closing, Xxxx Xxxxxxxxx as
President of KBDD and shall appoint such persons directors as BUYER may direct.
ARTICLE VII
Termination and Abandonment
7.1 Anything contained in this Agreement to the contrary
notwithstanding, the Agreement may be terminated and abandoned at any time prior
to the Closing Date:
(a) By mutual consent of parties;
(b) By either party, if any condition set forth in Article VI
relating to the other party has not been met or has not been
waived;
(c) By BUYER, if any suit, action or other proceeding shall be
pending or threatened by the federal or a state government before
any court or governmental agency, in which it is sought to
restrain, prohibit or otherwise affect the consummation of the
transactions contemplated hereby;
(d) By any party, if there is discovered any material error,
misstatement or omission in the representations and warranties of
another Party;
(e) By any party if the Agreement Closing Date is not within 30 days
from the date hereof; or
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 him or the Board of Directors, provided; however, that such action shall be
taken only if, in the judgment of the Board of Directors or Party 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.
7.3 The deposit of $25,000 paid as consideration herefore shall be
non-refundable if this transaction does not close due to the failure of the
BUYER to perform under the terms and conditions of this Agreement. If this
transaction does not close due to the failure of the SELLER to perform under the
terms and conditions of this Agreement or due to the breach by KBDD of its
representations and warranties under this agreement, the deposit shall be
returned to the BUYER.
ARTICLE VIII
Termination of Representation and
Warranties and Certain Agreements
8.1 The respective representations and warranties of the parties hereto
shall
expire with, and be terminated and extinguished by consummation of the
Agreement; provided, however, that the covenants and agreements of the parties
hereto shall survive in accordance with their terms.
ARTICLE IX
Miscellaneous
9.1 This Agreement embodies the entire agreement between the parties,
and there have been and are no agreements, representations or warranties among
the parties other than those set forth herein or those provided for herein.
9.2 To facilitate the execution of this Agreement, any number of
counterparts hereof may be executed, and each such counterpart shall be deemed
to be an original instrument, but all such counterparts together shall
constitute but one instrument.
9.3 All parties to this Agreement agree that if it becomes necessary or
desirable to execute further instruments or to make such other assurances as are
deemed necessary, the party requested to do so will use its best efforts to
provide such executed instruments or do all things necessary or proper to carry
out the purpose of this Agreement.
9.4 This Agreement may be amended upon approval of the Board of
Directors of BUYER and SELLER.
9.5 Any notices, requests, or other communications required or permitted
hereunder shall be delivered personally or sent by overnight courier service,
fees prepaid, addressed as follows:
To H. XXXXXX XXXXX:
copy to: Xxxxxxx X. Xxxxxxx
Attorney at Law
00000 X. 00xx Xxx., #000
Xxxxx Xxxxx, XX 00000
To YGCD ASSETS, INC.
c/o Xxx Xxxxxx Esq.
000 00xx Xxxxxx, Xxxxx 0000 Xxxxx
Xxxxxx, XX 00000
copy to:
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 BUYER and
SELLER. However, KBDD 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.
IN WITNESS WHEREOF, the parties have set their hands and seals this _____ day of
-----------.
SELLER:
----------------------------
BUYER:
By:__________________________
President
XXXXXXX XxXXX CORPORATION
By: __________________________
