STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of
February 28, 1999 (the "Effective Date"), by and between Zstar Enterprises,
Inc., a Nevada Corporation (the Purchaser") and Apex Travel Ltd., a British
Columbia, Canadian Corporation (the "Company").
WHEREAS, Apex Canadian Holidays Ltd. (the "Company") carries on a
travel agency business (hereinafter called the "Business") in and from the
premises at 000 Xxxx 0xx Xxxxxx, Xxxxxxxxx, X.X., Xxxxxx (hereinafter called
the "Premises") and in connection therewith owns certain assets and equipment
and machinery, inventory and stock, clientele, leasehold improvements and
assets, all liabilities and rents the Premises.
WHEREAS, the Company requires capital to fund its activities and is
desirous of accessing the United States capital markets; and
WHEREAS, the Seller is unable to provide the necessary capital
required to fund the Company's ongoing business activities;
WHEREAS, the Purchaser has agreed to make a good faith attempt to
raise the Capital (as hereinafter defined) through which it shall fund the
Company's future activities; and
WHEREAS, based upon the above premises, the Seller desires to sell
to the Purchaser, and the Purchaser desires to acquire, all of the issued and
outstanding shares of the Company's common stock, all as hereinafter set
forth;
NOW, THEREFORE, in consideration of the premises and the mutual and
independent agreements and covenants hereinafter set forth, the parties hereto
hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF STOCK
1.1 PURCHASE AND SALE
Subject to the terms and conditions hereof, the Purchaser hereby
agrees to purchase and acquire from the Seller, and the Seller hereby agrees
to issue and sell to the Purchaser, at the Closing (as such term is
hereinafter defined), one hundred (100) shares of the Company's Common Stock
(the "Shares"), being all of the issued and outstanding shares of the
Company's stock.
1.2 CONSIDERATION
The purchase price to be paid by the Purchaser to the Seller for the
Shares shall be U.S.$50,000 (the "Purchase Price") to be paid pursuant to the
terms of promissory note (the "Note") attached hereto as Exhibit "A".
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1.3 CLOSING
The closing of the issuance and sale to the Purchaser of the Shares,
at which certificate(s) duly evidencing the Shares shall be delivered by the
Seller to the Purchaser and the Note shall be delivered by the Purchaser to
the Seller in the form attached hereto as Exhibit "A" (the "Closing"), shall
take place at 11:59 p.m. on such date and at such time as the parties hereto
may so decide (the "Closing Date"). The Closing shall take place at such
location as is mutually agreed to by the parties.
1.4 CONDITIONS PRECEDENT TO CLOSING BY THE PURCHASER
The obligations hereunder of the Purchaser to purchase and acquire the
Shares are subject to the satisfaction of each of the following conditions at or
prior to the Closing unless waived by the Purchaser in writing:
1.4.1 The representations and warranties of the Seller and the
Company contained in this Agreement shall be true in all material respects,
on the Closing Date, as if originally made on such date.
1.4.2 The Seller and the Company shall have performed and complied
in all material respects with the agreements and covenants required by this
Agreement to be performed or complied with by it prior to or at the Closing.
1.4.3 (a) No statute, rule or regulation shall have been enacted or
promulgated, and no order, decree, writ or injunction shall have been issued and
shall remain in effect, by any court or governmental or regulatory body, agency
or authority which restrains, enjoins or otherwise prohibits the consummation of
the transactions contemplated hereby, and (b) no action, suit or proceeding
before any court or governmental or regulatory body, agency or authority shall
have been instituted or threatened by any governmental or regulatory body,
agency or authority, and no investigation by any governmental or regulatory
body, agency or authority shall have been commenced, with respect to the
transactions contemplated hereby or with respect to the Company which would have
a material adverse effect on the transactions contemplated hereby or on the
business of the Company.
1.4.4 One or more certificates duly issued by the Company in the
name of the Purchaser, evidencing ownership of the Shares by the Purchaser,
shall have been dated as of the Closing Date and delivered to the Purchaser
at the Closing.
1.4.5 The Purchaser shall have received the following documents from
the Company, in form and content satisfactory to the Purchaser:
(a) Certified copies of the Resolutions of the Board of
Directors of the Company unanimously authorizing the execution and performance
by the Company of this Agreement and the agreements referred to elsewhere in
this Agreement, the issuance of the Shares to the Purchaser and the other
transactions contemplated hereby.
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(b) A certificate of the Secretary or an Assistant Secretary
of the Company, dated the Closing Date, certifying that the Articles of
Incorporation and the By-Laws of the Company, as respectively amended, have not
been amended, modified or repealed from the forms of such documents in effect on
the date hereof which previously have been provided to the Purchaser.
(c) Long-form certificates dated as of a date proximate to
the Closing Date confirming the good standing of the Company in Canada and in
each state and/or province in which the Company is then required to be qualified
to do business.
1.4.6 The Company shall not have filed or had filed against it a
petition under any Bankruptcy code, or any other similar law or laws, and the
Company shall not be the subject of or be engaged in the appointment of any
receiver, trustee or assignee for the benefit of its creditors or (other than as
contemplated by this Agreement) any reorganization, moratorium, workout,
recapitalization or restructuring.
1.4.7 The Company shall have delivered to the Purchaser executed
written consents of third parties, including, without limitation, governmental
agencies, to the execution, delivery and performance by the Company of this
Agreement and the consummation by the Company of the transactions contemplated
hereby, required pursuant to any agreement to which the Company is a party or by
which it is bound or by any law, regulation, judgment, order, writ, injunction,
decree, permit, license or authorization of any court or governmental or
regulatory body of any jurisdiction applicable to the Company or any of its
properties, except to the extent that the failure to obtain any such consents,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the business of the Company.
1.5 CONDITIONS PRECEDENT TO CLOSING BY THE SELLER
The obligations hereunder of the Seller to sell the Shares to the
Purchaser are subject to the satisfaction of each of the following conditions at
or prior to the Closing unless waived by the Company in writing:
1.5.1 The representations and warranties of the Purchaser
contained in this Agreement shall be true in all material respects on the
Closing Date, as if originally made on such date.
1.5.2 The Purchaser shall have performed and complied in all
material respects with the agreements and covenants required by this
Agreement to be performed or complied with by it prior to or at the Closing.
1.5.3 No statute, rule or regulation shall have been enacted or
promulgated, and no other, decree, writ or injunction shall have been issued and
shall remain in effect, by any court or governmental or regulatory body, agency
or authority which restrains, enjoins or otherwise prohibits the consummation of
the transactions contemplated hereby, and (b) no action, suit or proceeding
before any court or governmental or regulatory body, agency or authority shall
have been instituted or threatened by any governmental or regulatory body,
agency or authority, and no investigation by any governmental or regulatory
body, agency or authority shall have been commenced with respect to the
transactions contemplated hereby or with respect to the Purchaser which would
have
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a material adverse effect on the transactions contemplated hereby or on the
business of the Purchaser.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF THE SELLER AND THE COMPANY
The Seller and the Company hereby represent and warrant to the
Purchaser that:
2.1.1 (a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of British Columbia, Canada,
without limit as to the duration of its existence, and has the full corporate
power and authority to enter into and carry out this Agreement and the
agreements herein contemplated and to issue the Shares as herein provided. The
Company has the corporate power and authority to own, lease and operate its
properties and to carry on the business currently conducted by it. The Company
has previously made available to the Purchaser complete and correct copies of
its Articles of Incorporation and its By-Laws as in effect on the date hereof.
The Company has not taken any action for the purpose of effecting any amendment
of its Articles of Incorporation or By-Laws from the form in which such
instruments were previously provided to the Purchaser.
(b) The Company is duly qualified as a foreign corporation
authorized to do business and is in good standing in each jurisdiction in which
such qualification and good standing may be required, except to the extent that
the failure to so qualify, individually or in the aggregate, could not
reasonably be expected to have a material adverse effect on the business of the
Company.
2.1.2 The execution, delivery and performance by the Company of this
Agreement and the documents herein contemplated, and the consummation by the
Company of the transactions contemplated hereby and thereby, have been duly
authorized by all requisite corporate and shareholder action of the Company,
which has not been revoked, and no other corporate or shareholder action on the
part of the Company is necessary. This Agreement is, and the other agreements
contemplated to be delivered by the Company hereby when executed will be, the
valid and binding obligations of the Company legally enforceable against it in
accordance with their respective terms, subject to the effects of bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and of general equitable principles
(whether considered in a proceeding in equity or at law).
2.1.3 The Company does not own, directly or indirectly, any equity
Stock, or options, warrants or other rights to acquire equity Stock, or Stock
convertible into or exchangeable for equity Stock, of any other corporation
(limited liability or otherwise), or any partnership interest in any general or
limited partnership or limited liability partnership or unincorporated joint
venture. There are no agreements, arrangements, undertakings or understandings
governing the rights and duties of the Company as a shareholder of any other
corporation, including, without limitation, any agreement, arrangement or
understanding under which the Company is or may become obligated, directly or
indirectly, to acquire or dispose of any equity interest in, make any capital
contribution
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or extend credit to, or act as guarantor, surety or indemnitor for any
obligation or liability of, any such corporation.
2.1.4 The issued capital stock of the Company, at the Closing of the
transaction contemplated hereby, consists of 100 shares of Common Stock. There
are no existing options, warrants, calls or agreements requiring or entitling
the holder thereof to the issuance of additional shares of capital stock of the
Company, or Stock convertible into capital stock of the Company, and there are
no arrangements or understandings to which the Company is a party or by which it
is bound pursuant to which the Company is or may be required to issue additional
shares of its capital stock. All of the issued and outstanding shares of
capital stock of the Company were duly authorized and validly issued and are
fully paid and non-assessable, and were not issued in violation of any
preemptive rights or Federal or provincial Stock laws.
2.1.5 The Shares are not subject to preemptive rights and, when
issued in accordance with this Agreement, and the terms and conditions of the
Warrant will be duly authorized, validly issued, fully paid and
non-assessable, and free of any and all encumbrances, claims, security
interests or any other rights or interests of third parties whatsoever (other
than rights or interests in favor of the Purchaser hereunder and the rights
and interests granted to third parties by or through the Purchaser).
2.1.6 The execution, delivery and performance by the Company of this
Agreement and the documents herein contemplated, and the consummation by the
Company of the transactions contemplated hereby and thereby will not: (i)
result in a breach of, or a default under (or an event which, with the lapse of
time or the giving of notice or both, would constitute an event of default), or
give any third party the right to terminate, cancel, modify or accelerate, or
require any consent or the giving of any notice under, any contract, mortgage,
loan, note, lease, bond, indenture, security agreement, undertaking or other
agreement, instrument or obligation to which the Company is a party or by which
it, or any of its property, may be bound or affected, or cause any security
interest, lien, claim or other encumbrance to be created or imposed upon any
such property by reason thereof, (ii) be in conflict with or contravention of
any terms or provisions of the Articles of Incorporation or By-Laws of the
Company, (iii) violate or conflict with any law, statute, ordinance, code, rule,
regulation, judgment, order, writ, injunction, decree or other instrument of any
Federal, state/provincial, local or foreign court or governmental or regulatory
body, agency or authority applicable to the Company or by which any of its
respective properties or assets may be bound or (iv) those which shall have been
made or obtained on or prior to the Closing Date and except, in the case of each
of the preceding subclauses (i) and (iii), those, the failure of the Company to
make or obtain which, or the occurrence of which, could not reasonably be
expected, individually or in the aggregate, to have a material adverse effect on
the business of the Company.
2.1.7 (a) The Company has delivered to the Purchaser true,
complete and accurate copies of the Company's unaudited financial statements
(including balance sheets, statements of operations and statements of cash
flows) at and for the financial year ended February 28, 1999 (the "1999
Financial Statements"). Except as otherwise described therein (including any
notes thereto), the 1999 Financial Statements have been prepared in conformity
with generally accepted accounting principles consistently applied during the
periods covered thereby, and present fairly in all material respects the
financial condition, results of operations and cash flows of the Company as at
the dates, and for the periods, stated therein
2.1.8 Except for any of the following that are not expected to have
a materially adverse effect on the business or financial condition of the
Company: (a) there are no actions,
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suits, investigations, hearings, workers compensation claims or proceedings
(including, without limitation, arbitral or administrative proceedings)
pending or, to the best knowledge of the Company, threatened, against or
affecting the Company or its properties, assets or business (or to the best
knowledge of the Company, pending or threatened against, relating to or
involving any of the officers, directors, employees, agents or consultants of
the Company in connection with the business of the Company); and (b) the
Company is not in default with respect to, there does not remain unsatisfied,
and continuing compliance is not required under, any judgment, order, writ,
injunction, decree, rule or award of any court, arbitrator or federal,
state/provincial, municipal or other governmental or regulatory body,
department, commission, board, bureau, agency, authority or instrumentality,
domestic or foreign.
2.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants to the Company that:
2.2.1 The Purchaser is duly formed and validly subsisting under the
laws of its jurisdiction of formation and has the full power and authority to
enter into and carry out this Agreement and the agreements herein contemplated.
2.2.2 (a) The execution, delivery and performance of this
Agreement and the agreements herein contemplated, and the consummation of the
transactions contemplated hereby, have been duly authorized by all requisite
action of the Purchaser, which has not been revoked, and no other action on the
part of the Purchaser is necessary.
(b) The execution, delivery and performance of this
Agreement and the documents herein contemplated, and the consummation by the
Purchaser of the transactions contemplated hereby and thereby, will not: (i)
result in a breach of, or a default under (or an event which, with the lapse of
time or the giving of notice or both, would constitute an event of default), or
give any third party the right to terminate, cancel, modify or accelerate, or
require any consent or the giving of any notice under, any contract, mortgage,
note, lease, bond, indenture, security agreement, undertaking or other
agreement, instrument or obligation to which the Purchaser is a party or by
which it or its property may be bound or affected, or cause any security
interest, lien, claim or encumbrance to be created or imposed upon any such
property by reason thereof, (ii) be in conflict with or contravention of any
term or provision of the charter documents of the Purchaser, (iii) violate or
conflict with any law, statue, ordinance, code, rule, regulation, judgment,
order, writ, injunction, decree or other instrument or any Federal,
state/provincial, local or foreign court or governmental or regulatory body,
agency or authority applicable to the Purchaser or by which it or its properties
or assets may be bound or (iv) require, on the part of the Purchaser, any filing
or registration with, or permit, license, exemption, consent, authorization or
approval of, or the giving of any notice to, any governmental or regulatory
body, agency or authority, except, in the case of the preceding subclause (iv),
those which shall have been made or obtained on or prior to the Closing Date.
(c) This Agreement is, and the other agreements contemplated
to be delivered by the Purchaser hereby when executed will be, the valid and
binding obligations of the Purchaser legally enforceable against it in
accordance with their respective terms, subject to the effects of bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and of general equitable principles
(whether considered in a proceeding in equity or at law).
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ARTICLE III
COVENANTS
3.1 COVENANTS OF THE COMPANY
3.1.1 As soon as reasonably practicable after the date hereof, the
Company will use all reasonable efforts to obtain the consents of all necessary
governmental entities and other persons to the transactions contemplated hereby.
3.1.2 From and after the Closing Date, the Company will promptly
furnish the Purchaser with the following:
(a) Copies of all financial statements, reports and
documents that the Company shall send to its stockholders generally; and
(b) Such other information relating to the financial
condition of the Company as the Purchaser may reasonably request from time to
time.
3.1.3 The Company covenants and agrees that until the full and
final payments of all amounts due under the Note, the Company shall treat as
confidential all information obtained by it in connection with the
transactions contemplated hereby concerning the Purchaser except any
information (i) which was available to the Company on a non-confidential
basis prior to its disclosure by the Purchaser, or was rightfully obtained by
the Company from a source other than the Purchaser, (ii) appearing in public
literature or otherwise in the public domain (through no fault of the
Company), whether at the date hereof or at any time hereafter or (iii) which
the Company is legally compelled (by depositions, interrogatories or requests
for information through documents, subpoena, civil investigative demand or
similar process) to disclose, provided that the Company shall have used its
best efforts to obtain, and shall have afforded the Purchaser an opportunity
to obtain, a protective order or other satisfactory assurance of confidential
treatment for the information required to be disclosed, and provided further
that if such protective order or other remedy is not obtained and the Company
is nonetheless, in the opinion of its counsel, compelled to disclose the
information to any tribunal, the Company shall disclose only that information
which the Company is advised by opinion of its counsel is legally required to
be disclosed. The Company shall not disclose any such information to any
third person other than to employees and advisers of the Company, and shall
preserve and maintain and prevent the disclosure or publication of any
proprietary information and trade secrets.
3.2 COVENANTS OF THE PURCHASER
3.2.1 The Purchaser covenants and agrees that until the full and final
payments of all amounts under the Note, the Purchaser shall treat as
confidential all information obtained by it in connection with the transactions
contemplated hereby concerning the Company except any information (i) which was
available to the Purchaser on a non-confidential basis prior to its disclosure
by the Company, or was rightfully obtained by the Purchaser from a source other
than the Company, (ii) appearing in public literature or otherwise in the public
domain (through no fault of the Purchaser), whether at the date hereof or at any
time hereafter or (iii) which the Purchaser is legally compelled (by deposition,
interrogatories or requests for information through documents, subpoena, civil
investigative demand or similar process) to disclose, provided that the
Purchaser shall have used its best efforts to obtain, and shall have afforded
the Company an opportunity to obtain, a protective
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order or other satisfactory assurance of confidential treatment for the
information required to be disclosed, and provided further that if such
protective order or other remedy is not obtained and the Purchaser is
nonetheless, in the opinion of its counsel, compelled to disclose the
information to any tribunal, the Purchase shall disclose only that
information which the Purchaser is advised by opinion of its counsel is
legally required to be disclosed. The Purchaser shall not disclose any such
information to any third party other than to employees and advisers of the
Purchaser, and shall preserve and maintain and prevent the disclosure or
publication of any proprietary information and trade secrets.
3.2.2 The Purchaser hereby agrees that the existing shareholders
shall collectively have the right to appoint one additional director to the
Company's Board.
3.2.3 The Purchaser covenants and agrees that it shall use
commercially reasonable efforts to raise a sum of five hundred thousand United
States dollars (U.S.$500,000) (the "Capital") which shall be applied towards the
Business and towards developing the Purchaser's website and related internet
technology.
3.2.4 In the event that the Purchaser is not able to raise all of
the Capital on or before June 30, 1999, the Company shall thereafter at any
time, and from time to time, have the right to purchase all of the Shares
from the Purchaser for a consideration in the amount of ten thousand United
States Dollars (U.S. $10,000) and the Purchaser hereby covenants and agrees
to sell the Shares to the Company for such consideration.
ARTICLE IV
SURVIVAL OF REPRESENTATIONS
AND WARRANTIES; INDEMNIFICATION
4.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
All other representations and warranties made or contained herein
shall terminate as of the Closing and be of no further force and effect.
4.2 INDEMNITY OBLIGATIONS OF THE COMPANY.
Seller hereby agrees to indemnify, defend and hold the Purchaser
and its affiliates and any director, officer, employee, agent or
representative of the Purchaser or any of its affiliates (the "Purchaser
Indemnified Parties") harmless from, and to reimburse the Purchaser
Indemnified Parties for any and all losses, damages, deficiencies,
liabilities, obligations, actions, claims, suits, proceedings, demands,
assessments, judgments, recoveries, fees, penalties, interest, costs and
expenses (including, without limitation, out-of-pocket expenses, reasonable
investigation expenses and reasonable fees and disbursements of accountants
and counsel) of any nature whatsoever arising out of, based upon or resulting
from (i) any breach of any representation and warranty of the Seller and/or
Company which is contained in this Agreement or any Schedule or certificate
delivered by the Seller and/or Company pursuant thereto; or (ii) any breach
or nonfulfillment of, or any failure to perform, any of the covenants,
agreements or undertaking of the Seller and/or Company which are contained in
or made pursuant to the terms and conditions of this Agreement or contained
in any documents required to be delivered pursuant hereto.
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4.3 INDEMNITY OBLIGATIONS OF THE PURCHASER.
The Purchaser hereby agrees to indemnify, defend and hold the
Seller and any director, officer, employee, agent or representative of the
Seller (the "Seller Indemnified Parties") harmless from, and to reimburse the
Seller Indemnified Parties for any and all losses, damages, deficiencies,
liabilities, obligations, actions, claims, suits, proceedings, demands,
assessments, judgments, recoveries, fees, penalties, interest, costs and
expenses (including, without limitation, out-of-pocket expenses, reasonable
investigation expenses and reasonable fees and disbursements of accountants
and counsel) of any nature whatsoever arising out of, based upon or resulting
from (i) any breach of any representation and warranty of the Purchaser which
is contained in this Agreement; or (ii) any breach or nonfulfillment of, or
any failure to perform, any of the covenants, agreements or undertaking of
the Purchaser which are contained in or made pursuant to the terms and
conditions of this Agreement.
ARTICLE V
MISCELLANEOUS
5.1 NO WAIVER OF RIGHTS.
No failure or delay on the part of either party in the exercise of any
power, right or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege.
All rights and remedies existing under this Agreement are cumulative to, and
not exclusive of, any rights or remedies otherwise available.
5.2 NOTICE
Any notice or communication herein required or permitted to be given
shall be in writing and may be sent by hand, by registered or certified mail,
return receipt requested, or by facsimile transmission. All such notices and
communications hereunder shall be deemed given when received, as evidenced by
the date indicated as the date of delivery (or attempted delivery if refused) on
the return receipt, or confirmed facsimile transmission, as applicable. For
purposes hereof, the addresses of the parties hereto (until notice of change
thereof is given in accordance with this Section 5.2) shall be as follows:
To the Seller: Apex Travel Ltd.
000 Xxxx 0xx Xxxxxx
Xxxxxxxxx; X.X. X0X 0X0
Xxxxxx
Attention: Xxxxx Xx, President
Telephone: (000) 000-0000
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To Purchaser: Zstar Enterprises, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx; X.X. X0X 0X0
Xxxxxx
Attention: Xxxxxxx Xxxxx, Secretary, Director
Telephone: (000) 000-0000
5.3 GOVERNING LAW
This Agreement, and the respective rights, duties and obligations of
the parties hereunder, shall be governed by and construed in accordance with
the internal substantive laws of the State of Nevada, without regard to the
conflicts of laws or choice of laws principles thereof.
5.4 FACSIMILE SIGNATURES
In the event that any party hereto utilizes a facsimile device or
telecopier to transmit executed documents hereunder, including this Agreement
but excluding any stock certificates, powers or assignments, the other party
hereto shall accept and shall have the right to rely on such executed documents
as so transmitted as if they bore the original signatures.
5.5 INDEPENDENT COUNSEL
Each of the parties hereto has had an adequate opportunity to consult
with legal counsel of its choice regarding the transactions contemplated herein,
and has executed this Agreement with a full understanding of its rights and
obligations as created hereby.
5.6 COUNTERPART ORIGINALS
This Agreement may be executed simultaneously in counterparts each of
which shall be deemed an original but all of which together shall constitute one
and the same instrument.
5.7 EXPENSES
Each party shall bear and pay its own expenses in connection with this
Agreement, including, without limitation, expenses of its legal counsel.
5.8 ASSIGNMENT; SUCCESSORS
This Agreement shall inure to the benefit of and be binding upon the
successors and permitted assigns of the parties hereto. The Company may not
assign or transfer any of its interests, rights or obligations under this
Agreement without the prior written consent of the Purchaser, and any attempted
assignment or transfer without such prior written consent shall be void.
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5.9 FURTHER ASSURANCES
The parties hereto agree that, from time to time hereafter, and upon
request of the other, each of them will execute, acknowledge and deliver such
other documents and instruments as may be reasonably required more effectively
to carry out the terms and conditions of this Agreement.
5.10 THIRD PARTY BENEFICIARIES
This Agreement shall not confer upon any person or entity, other than
the Company and the Purchaser and their respective permitted assigns and
successors, any rights or remedies of any kind or nature.
5.11 ENTIRE AGREEMENT
This Agreement together with the other agreements between the parties
referred to herein, constitute the entire agreement between the parties
pertaining to the subject matter hereof and supersede all prior and
contemporaneous, oral and written, agreements, representations and
understandings of the parties with respect thereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
"Seller"
APEX TRAVEL LTD.
By:
--------------------------------
Name: Xxxxx Xx
Title: President
"Purchaser"
ZSTAR ENTERPRISES, INC.
By:
--------------------------------
Name: Xxxxxxx Xxxxx
Title: Secretary
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PROMISSORY NOTE
$50,000.00 Dated: February 28, 1999
1. PRINCIPAL.
FOR VALUE RECEIVED, the undersigned, ZSTAR ENTERPRISES, INC., a Nevada
corporation ("Borrower"), hereby promises to pay to the order of APEX CANADIAN
HOLIDAYS LTD., a British Columbia, Canada corporation ("Lender"), the principal
sum of Fifty Thousand United States Dollars (U.S.$50,000.00) (the "Loan") with
interest from July 1, 1999, on the unpaid principal at the rate of ten percent
(10%) per annum.
2. PAYMENT OF PRINCIPAL AND INTEREST.
Unless accelerated pursuant to the terms of this Note, the unpaid
balance of this Note, together with all then unpaid interest accrued on the
unpaid principal balance, shall be due and payable on demand (the "Maturity
Date"), PROVIDED, HOWEVER, that Borrower shall use its best efforts to pay the
Loan in full on or before June 30, 1999. No amount paid under this Note may be
reborrowed.
All interest due hereunder shall be computed on the basis of a year of
365 days for the actual number of days elapsed.
Except as provided in the immediately following paragraph, all
payments received by Lender under this Note shall be credited first to any
charges or other expenses for which Lender is entitled to payment hereunder,
next to accrued but unpaid interest, and third to unpaid principal.
Notwithstanding anything to the contrary set forth in this Note, if at
any time until payment in full of all amounts due Lender hereunder, the rate of
interest payable by Borrower pursuant to this Note (the "Stated Rate") exceeds
the amount payable under the highest rate of interest permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto (the "Maximum Lawful Rate"), then in such event and so long as
the Maximum Lawful Rate would be so exceeded, the rate of interest payable
hereunder shall be equal to the amount payable under the Maximum Lawful Rate;
PROVIDED, HOWEVER, that if at any time thereafter the Stated Rate is less than
the Maximum Lawful Rate, Borrower shall continue to pay interest hereunder at
the Maximum Lawful Rate until such time as the total interest received by Lender
hereunder is equal to the total interest which Lender would have received had
the Stated Rate been (but for the operation of this paragraph) the interest rate
payable since the date hereof. Thereafter, the interest rate payable
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hereunder shall be the Stated Rate unless and until the Stated Rate again
exceeds the Maximum Lawful Rate, in which event this paragraph shall again
apply. In no event shall the total interest payable by Borrower hereunder
exceed the amount payable under the Maximum Lawful Rate. In the event that a
court of competent jurisdiction shall make a final determination that Lender
has received interest hereunder in excess of the amount payable under the
Maximum Lawful Rate, Lender shall, to the extent permitted by applicable law,
promptly apply such excess in the following order: (i) then due and payable
fees and expenses; (ii) then due and payable interest payments; (iii) then
due and payable principal payments on the Loan; (iv) then to any other unpaid
obligations of Borrower to Lender under this Note; and (v) thereafter as a
refund to Borrower or as a court of competent jurisdiction may otherwise
order.
3. MANNER OF PAYMENT.
Principal and interest on the Loan, and all other amounts payable
hereunder, are payable in lawful currency of the United States of America in
immediately available funds at such address and in such form as may be required
by Lender.
4. EVENTS OF DEFAULT/REMEDIES.
a. EVENTS OF DEFAULT. Any of the following events shall constitute
an Event of Default:
(1) breach by Borrower of any of Borrower's obligations or
covenants under this Note; or
(2) Borrower (A) becomes insolvent or admits in writing
Borrower's inability to pay Borrower's debts as they mature, (B) makes any
assignment for the benefit of creditors, or (C) applies for or consents to the
appointment of a receiver or trustee for Borrower or for a substantial part of
Borrower's property or business, or a receiver or trustee otherwise is appointed
and is not discharged within thirty (30) days after such appointment; or
(3) any of Borrower's representations or warranties made herein
or in any statement or certificate at any time given by Borrower pursuant hereto
or in connection herewith is false or misleading in any material respect; or
(4) any bankruptcy, insolvency, reorganization or liquidation
proceeding or other proceeding for relief under any bankruptcy law or any law
for the relief of debtors is instituted by or against Borrower; or
(5) any money judgment, writ or warrant of attachment, or
similar process (singly or, if more than one, cumulatively in excess of
$100,000) is entered or filed against Borrower or any of the assets of Borrower
and (A) remains unvacated, unbonded, unstayed, undismissed or undischarged for a
period of thirty (30) days or in any event later
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than five (5) days before the date of any proposed sale thereunder, or (B)
Borrower has not appealed the same in good faith to Lender's satisfaction; or
(6) the condition, financial or otherwise, of Borrower suffers
any material adverse change, in the reasonable opinion of Lender; or
b. REMEDIES. Upon demand or upon the occurrence and during the
continuance of an Event of Default described in Subsections 4(a)(2) or 4(a)(4)
above, all indebtedness under this Note shall automatically be immediately due
and payable. In addition, Lender, at its option, and without notice to
Borrower, may take one or more of the actions described below. Upon the
occurrence and during the continuance of any other Event of Default, Lender at
its option and, unless otherwise specified below, without notice to Borrower,
may do any one or more of the following:
(1) declare all indebtedness under this Note immediately due and
payable and credit any sums received thereafter in such manner as it elects upon
such indebtedness; provided, however, that such application of sums so received
shall not serve to waive or cure any default existing under this Note nor to
invalidate any notice of default or any act done pursuant to such notice and
shall not prejudice any rights of Lender; and
(2) exercise any or all rights provided or permitted by law or
granted pursuant to this Note in such order and in such manner as Lender may, in
its sole judgment, determine.
c. NO WAIVER OF REMEDIES. No waiver of any breach of or default
under any provision of this Note shall constitute or be construed as a waiver by
Lender of any subsequent breach of or default under that or any other provision
of this Note.
d. REMEDIES NOT EXCLUSIVE. No remedy herein conferred upon Lender
is intended to be exclusive of any other remedy herein or in any other agreement
between the parties hereto or by law provided or permitted, but each shall be
cumulative and shall be in addition to every other remedy given hereunder or now
or hereafter existing at law, in equity or by statute.
5. COVENANTS AND AGREEMENTS.
Borrower hereby makes the following covenants, which shall be deemed
to be continuing covenants until payment in full of all indebtedness of Borrower
to Lender arising under this Note:
a. Borrower shall promptly notify Lender in writing of the
occurrence of any act or event including, without limitation, the commencement
or threat of any action, suit, claim or proceeding against or investigation of
Borrower, which could materially and adversely affect Borrower or which could
impair the validity, effectiveness or enforceability of, or impair Borrower's
ability to perform its obligations under, this Note, and of the occurrence of
any Event of Default or any event which with the giving of notice, the lapse of
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time, or both, would become an Event of Default and the action Borrower proposes
to take with respect thereto.
b. Borrower shall, at any time and from time to time, upon the
written request of Lender, execute and deliver to Lender such further documents
and instruments and do such other acts and things as Lender may reasonably
request in order to effectuate fully the purpose and intent of this Note.
6. REPRESENTATIONS AND WARRANTIES OF BORROWER.
Borrower hereby makes the following representations and warranties,
which shall be deemed to be continuing representations and warranties until
payment in full of all indebtedness of Borrower to Lender arising pursuant to
this Note:
a. NO CONFLICT. The execution, delivery and performance of this
Note are not in contravention of or in conflict with any agreement, indenture or
undertaking to which Borrower is a party or by which Borrower or any of
Borrower's assets or property may be bound or affected and do not cause any
security interest, lien or other encumbrance to be created or imposed upon any
such property by reason thereof.
b. LITIGATION. There is no action, suit or proceeding pending or,
to the best of Borrower's knowledge and belief, threatened against or affecting
Borrower which could impair the validity, effectiveness or enforceability of, or
impair Borrower's ability to perform its obligations under, this Note, whether
said actions, suits or proceedings are at law or in equity or before or by any
governmental authority.
7. LEGAL FEES.
Borrower agrees to pay all costs and expenses, including without
limitation reasonable attorneys' fees, incurred by Lender in connection with the
enforcement of any obligation of Borrower under this Note.
8. SEVERABILITY.
In case any term or any provision of this Note shall be invalid,
illegal or unenforceable, such provision shall be severable from the rest of
this Note and the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
9. HEADINGS.
Headings used in this Note are inserted for convenience only and shall
not be deemed to constitute a part hereof.
10. GOVERNING LAW.
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This Note shall be governed by and construed in accordance with the
laws of the State of Nevada.
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Borrower:
ZSTAR ENTERPRISES, INC.
a Nevada corporation
By:_______________________
Name:_____________________
Title:____________________
By:_______________________
Name:_____________________
Title:____________________
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