STOCK PURCHASE AGREEMENT
THIS
STOCK PURCHASE AGREEMENT (this “Agreement”), dated February 23rd,
2006,
is entered into by and between Stadium SA, an entity organized pursuant to
the
laws of France and having its principal office at Le Zand Put Xxxxx, France
(“Stadium”), XL Generation AG, an entity established pursuant to the laws of
Switzerland and having its principal office at 00 Xxxxxxxxxxxx, Xxx, Xxxxxxxxxxx
(“XLG”) and XL Generation International Inc., a Nevada corporation having its
principal offices at 000
Xxxxx-Xxxxxxx, Xxxxx 00, Xxxxxxxx, Xxxxxx X0X 0X0 Xxxxxx
(the
“Company”).
W
I T N E
S S E T H :
WHEREAS,
on or about July 28, 2005, XLG and Stadium executed an agreement (the “July 28,
2005 Agreement”) setting forth their relative rights and obligations, and the
relative rights and obligations of the Terenvi Society (“Terenvi”) in connection
with certain transactions;
WHEREAS,
the Company is the holding corporation of XLG, and has agreed to intervene
in
the July 28, 2005 Agreement;
WHEREAS,
Terenvi loaned XLG 1,600,000 euros pursuant to a loan agreement dated December
16, 2004 (the “Terenvi Loan Agreement”);
WHEREAS,
Terenvi has transferred its rights and obligations pursuant to the Terenvi
Loan
Agreement to Stadium;
WHEREAS,
the Soreve Society (“Soreve”) and XLG entered into an exclusive distribution
agreement on April 13, 2004 (the “Soreve Distribution Agreement”);
WHEREAS,
Soreve has transferred its rights and obligations pursuant to the Soreve
Distribution Agreement to Stadium;
WHEREAS,
on August 19, 2005, the Company entered into a Share Exchange Agreement with
XLG, pursuant to which the Company acquired all of the issued and outstanding
shares of common stock of XLG in exchange for the issuance at closing of an
aggregate of 15 Million shares of restricted common stock of the Company;
and
WHEREAS,
the parties hereto hereby wish to modify Stadium’s obligations to the Company,
so as to exchange such obligations for shares of restricted common stock of
the
Company.
NOW,
THEREFORE, in consideration of the covenants, promises and representations
set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:
1.
Purchase
and Sale of Restricted Common Stock.
(a) Subject
to the terms and conditions stated herein, at the Closing (as defined below),
the Company hereby agrees to issue to Stadium an aggregate of 1,236,824 shares
(the “Shares”) of the restricted common stock of the Company, in lieu of any and
all amounts owed by the Company or XLG as follows:
(1) 846,884
shares of the restricted common stock of the Company in lieu of the sum in
the
amount of 1,600,000 euros (which amount the parties hereto hereby deem to be
equal to $1,875,000, based on exchange rate of 1.1719 euros to $1.00) and in
respect of which such number of the shares of restricted common stock of the
Company have a purchase price of $2.214 per share.
(2)
389
940
shares of the restricted common stock of the Company in lieu of the sum in
the
amount of 1,350,000 euros (which amount the parties hereto hereby deem to be
equal to $1,616,105, based on exchange rate of 1.1971 euros to $1.00) and in
respect of which such number of the shares of restricted common stock of the
Company have a purchase price of $4.051 per share.
(b) In
consideration for the issuance and delivery of the Shares, the
parties hereto agree that the Shares issued to Stadium are deemed satisfy any
and all amounts and obligations due and owed to Stadium by XLG and the Company,
and Stadium
hereby releases and discharges XLG and the Company and each of their respective
officers, directors, affiliates, administrators, successors and assigns from
all
actions, causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, controversies,
agreements, promises, variances, trespasses, damages, judgments, extents,
executions, claims, and demands whatsoever, in law or equity, against which
Stadium, its successors and assigns ever had, now have or hereafter can, shall
or may, have for, upon, or by reason of any matter, cause or thing whatsoever
at
any time prior to the date of this Agreement or hereafter. For purposes of
clarity, the satisfaction and release by Stadium of all obligations of XLG
and
the Company shall
include, but not be limited to, any and all amounts advanced or incurred by
Stadium for the following purposes:
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(1)
|
Financing
of the development of sports facilities, including those at Dunfermline
and Vancouver;
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(2)
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Advertising
expenses; and
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(3)
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Expenses
incurred pursuant to, or in connection with the Soreve Distribution
Agreement.
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(c) The
Closing.
The
closing (the "Closing") of the transactions contemplated hereunder shall take
place simultaneously with the execution of this Agreement at such place as
the
parties may agree.
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2. Representations
and Warranties of Stadium.
Stadium
hereby
represents and warrants to the Company as follows as of the date hereof and
as
of the Closing Date:
(a) Organization
and Standing.
Stadium
is duly incorporated or organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization.
(b) Authorization
and Power.
Stadium
has the
requisite power and authority to enter into and perform this Agreement and
to
purchase the Shares being sold to it hereunder. The execution, delivery and
performance of this Agreement by Stadium
and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate or partnership action, and no further
consent or authorization of Stadium
or its
Board of Directors, stockholders, or partners, as the case may be, is required.
When executed and delivered by Stadium,
this
Agreement shall constitute the valid and binding obligation of Stadium
enforceable against Stadium
in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditor's rights and remedies or by other
equitable principles of general application.
(c) No
Conflict.
The
execution, delivery and performance of this Agreement by Stadium
and the
consummation by Stadium
of the
transactions contemplated thereby and hereby do not and will not (i) violate
any
provision of Stadium’s
charter or organizational documents; (ii) conflict with, or constitute a default
(or an event which with notice or lapse of time or both would become a default)
under, or give to others any rights of termination, amendment, acceleration
or
cancellation of, any agreement, mortgage, deed of trust, indenture, note, bond,
license, lease agreement, instrument or obligation to which Stadium
is a
party or by which Stadium’s respective properties or assets are bound; or (iii)
result in a violation of any federal, state, local or foreign statute, rule,
regulation, order, judgment or decree (including federal and state securities
laws and regulations) applicable to Stadium
or by
which any property or asset of Stadium
are
bound or affected, except, in all cases, other than violations pursuant to
clauses (i) or (iii) (with respect to federal and state securities laws) above,
except, for such conflicts, defaults, terminations, amendments, acceleration,
cancellations and violations as would not, individually or in the aggregate,
materially and adversely affect Stadium’s
ability to perform its obligations under this Agreement.
(d) Acquisition
for Investment.
Stadium
is purchasing the Shares for the purpose of investment and not with a view
to or
for sale in connection with distribution. Stadium does not have a present
intention to sell any of the Shares, and will only dispose of the Shares in
accordance with federal and state securities laws applicable to such
disposition. Stadium
acknowledges that it (i) has such knowledge and experience in financial and
business matters such that Stadium
is
capable of evaluating the merits and risks of Stadium’s
investment in the Company; (ii) is able to bear the financial risks associated
with an investment in the Shares; and (iii) has been given full access to such
records of the Company and the Subsidiaries and to the officers of the Company
and the Subsidiaries as it has deemed necessary or appropriate to conduct its
due diligence investigation.
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(e) Rule
144.
Stadium
understands that the Shares must be held indefinitely unless such Shares are
registered under the Securities Act of 1933 as amended (the "Securities Act")
or
an exemption from registration is available. Stadium
acknowledges that it is familiar with Rule 144 of the rules and regulations
of
the Commission, as amended, promulgated pursuant to the Securities Act
("Rule
144"),
and
that Stadium
has been
advised that Rule 144 permits resales only under certain circumstances.
Stadium
understands that to the extent that Rule 144 is not available, Stadium
will be
unable to sell any Shares without either registration under the Securities
Act
or the existence of another exemption from such registration
requirement.
(f) General.
Stadium
understands that the Shares are being offered and sold in reliance on a
transactional exemption from the registration requirements of federal and state
securities laws and the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings
of
Stadium
set
forth herein in order to determine the applicability of such exemptions and
the
suitability of Stadium
to
acquire the Shares. Stadium
understands that no United States federal or state agency or any government
or
governmental agency has passed upon or made any recommendation or endorsement
of
the Shares.
(g) No
General Solicitation.
Stadium
acknowledges that the Shares were not offered to Stadium
by means
of any form of general or public solicitation or general advertising, or
publicly disseminated advertisements or sales literature, including (i) any
advertisement, article, notice or other communication published in any
newspaper, magazine, or similar media, or broadcast over television or radio;
or
(ii) any seminar or meeting to which Stadium
was
invited by any of the foregoing means of communications. Stadium,
in
making the decision to purchase the Shares, has relied upon independent
investigation made by it and has not relied on any information or
representations made by third parties.
(h) Qualified
Investor and Suitable Investment.
Stadium
has
experience in business and financial matters that it is capable of evaluating
the merits and risks of an investment in the Shares. Stadium
is not
required to be registered as a broker-dealer under Section 15 of the Exchange
Act and Stadium
is not a
broker-dealer. Stadium
acknowledges that an investment in the Shares is speculative and involves a
high
degree of risk.
(i) Certain
Fees.
Stadium
has not
employed any broker or finder or incurred any liability for any brokerage or
investment banking fees, commissions, finders' structuring fees, financial
advisory fees or other similar fees in connection with this
Agreement.
(j) Independent
Investment.
Stadium
has not
agreed to act with any other purchaser for the purpose of acquiring, holding,
voting or disposing of the Shares purchased hereunder for purposes of Section
13(d) under the Exchange Act, and Stadium
is
acting independently with respect to its investment in the Shares.
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(k) Regulation
S Representations.
Stadium
understands and acknowledges that the Shares have not been registered under
the
Securities Act and are being offered in reliance upon the exemptions provided
in
Regulation S of the Securities Act and the Rules and Regulations adopted
thereunder. Accordingly, the Shares may not be offered or sold in the U.S.
or to
U.S. persons (as such term is used in Regulation S) unless the Shares are
registered under the Securities Act, or an exemption for the regulation
requirements is available. Furthermore, hedging transactions involving the
Shares may not be conducted unless in compliance with the Securities Act.
Stadium
makes
the following representations and warranties to the Company with the intent
that
the same may be relied upon in determining the suitability of Stadium
as a
purchaser of the Shares:
(1) Stadium
did not
receive the offer for the Company for the Shares (the “Offer”), nor was it
solicited to purchase the Shares, in the United States; that this Agreement
has
not been executed or delivered by Stadium
in the
United States, and neither Stadium
nor any
person acting on behalf of Stadium
has
engaged, directly or indirectly, in any negotiations with respect to the Offer
or this Agreement in the United States;
(2) Stadium
is not a
U.S. person (i.e., (i) not an individual resident in the U.S.; (ii) a
partnership or corporation organized or incorporated in the United States;
(iii)
an estate of which any executor or administrator is a U.S. person; (iv) a trust
of which any trustee is a U.S. person; (v) a dealer holding an account for
a
customer; (vi) an agency or branch of a foreign entity located in the U.S.;
or
(vii) a partnership or corporation (A) organized or incorporated under the
laws
of any foreign jurisdiction and (B) formed by a U.S. person principally for
the
purpose of investing in securities not registered under the Securities Act
and
is not acquiring the Shares for the account or benefit of a U.S.
person;
(3) Stadium
is not
purchasing the Shares as a result of or subsequent to (i) any advertisement,
article, notice or other communication published in any newspaper, magazine
or
other publication or broadcast over television or radio in the U.S.; (ii) any
promotional seminar or meeting in the U.S.; or (iii) any solicitation by a
person not previously known to him or it in connection with investments in
securities generally;
(4) The
Shares have not been registered under the Securities Act or under any state
securities laws and that Stadium
agrees
to transfer his, her or its Shares in the U.S. or to, or for the account or
benefit of, U.S. persons only if (i) the Shares are duly registered under the
Securities Act and all applicable state securities laws; or (ii) there is an
exemption from registration under the Securities Act, including any exemption
from the registration requirements of the Securities Act which may be available
pursuant to Rule 903 or Rule 904 under Regulation S, and all applicable state
securities laws; that prior to any such transfer the Company may require, as
a
condition affecting a transfer of the Shares, an opinion of counsel in form
and
substance satisfactory to the Company as to the registration or exemption
therefrom under the Securities Act and applicable state securities laws; that
the Company is under no obligation to register the Shares under the Securities
Act or any applicable state securities laws on its or his or her behalf or
to
assist it or him or her in complying with any exemption from such
registration;
5
(5) Except
as
distributed by Stadium
in
accordance with the requirements and provisions of Rule 903 of Regulation S
(i.e., the Shares may be allocated and distributed to Stadium’s
managed accounts so long as such distribution is made by Stadium
in the
manner specified by Rule 903), the Shares will be acquired solely for the
account of Stadium,
for
investment purposes only, and not with a view to, or for sale in connection
with, any distribution thereof and with no present intention of distributing
or
reselling any part of the Shares; and
(6) Stadium
agrees
not to sell, pledge, transfer, dispose of, or otherwise deal with or engage
in
hedging transactions involving, his or her Shares or any portion thereof except
as otherwise permitted herein, unless and until counsel for the Company shall
have determined that the intended disposition or action is permissible and
does
not violate the Securities Act or any applicable state securities laws, or
the
rules and regulations thereunder.
(l) Jurisdiction
of Residence.
Stadium’s
jurisdiction of corporate domicile as set forth herein is true and
correct.
(m) Section
13(d) Compliance.
Stadium
hereby
states that he/she is acquainted with the requirements of Section 13(d) of
the
Securities Exchange Act of 1934 and the rules and regulations issued thereunder.
Stadium
understands that, as a result of its acquisition of Shares, and in order to
comply with Section 13(d) and the rules and regulations issued thereunder,
Stadium
may be
required to file a Schedule 13D and hereby agrees to make such filing if so
required.
3. Stock
Legend.
Each
certificate representing the Securities shall be stamped or otherwise imprinted
with legends substantially in the following form (in addition to any legend
required by applicable state securities or "blue sky" laws):
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THE
SECURITIES REPRESENTED BY THIS CERTIFICATE (THE "SHARES") HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT")
OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF AGREES THAT: (1) IT WILL NOT
RESELL OR OTHERWISE TRANSFER THE SHARES EXCEPT (A) IN AN OFFSHORE TRANSACTION
COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S; OR (B) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR ANOTHER THEN AVAILABLE EXEMPTION UNDER THE SECURITIES ACT AND
STATE SECURITIES LAWS OR; (C) IN A TRANSACTION THAT DOES NOT REQUIRE
REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE LAWS; OR (D)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE
SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
TRANSFER); (2) PRIOR TO ANY SUCH TRANSFER, IT WILL FURNISH TO XL GENERATION
INTERNATIONAL INC. AND THE TRANSFER AGENT FOR THE SHARES SUCH CERTIFICATIONS,
LEGAL OPINIONS, OR OTHER INFORMATION AS XL GENERATION INTERNATIONAL INC. OR
SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING
MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR STATE SECURITIES LAWS; AND
(3) IT WILL DELIVER TO EACH PERSON TO WHOM THE SHARES ARE TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. FURTHERMORE, HEDGING TRANSACTIONS
INVOLVING THE SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT.
The
Company agrees to reissue certificates representing any of the Shares, without
the legend set forth above if at such time, prior to making any transfer of
any
such Shares, such holder thereof shall give written notice to the Company
describing the manner and terms of such transfer and removal as the Company
may
reasonably request. Such proposed transfer and removal will not be effected
until: (a) either (i) the Company has received an opinion of counsel reasonably
satisfactory to the Company, to the effect that the registration of the Shares
under the Securities Act is not required in connection with such proposed
transfer, (ii) a registration statement under the Securities Act covering such
proposed disposition has been filed by the Company with the Commission and
has
become effective under the Securities Act, (iii) the Company has received other
evidence reasonably satisfactory to the Company that such registration and
qualification under the Securities Act and state securities laws are not
required, or (iv) the holder provides the Company with reasonable assurances
that such security can be sold pursuant to Rule 144 under the Securities Act;
and (b) either (i) the Company has received an opinion of counsel reasonably
satisfactory to the Company, to the effect that registration or qualification
under the securities or "blue sky" laws of any state is not required in
connection with such proposed disposition, or (ii) compliance with applicable
state securities or "blue sky" laws has been effected or a valid exemption
exists with respect thereto. The Company will respond to any such notice from
a
holder within five (5) business days. In the case of any proposed transfer
under
this Section 5.1, the Company will use reasonable efforts to comply with any
such applicable state securities or "blue sky" laws, but shall in no event
be
required, (x) to qualify to do business in any state where it is not then
qualified, (y) to take any action that would subject it to tax or to the general
service of process in any state where it is not then subject, or (z) to comply
with state securities or “blue sky” laws of any state for which registration by
coordination is unavailable to the Company. The restrictions on transfer
contained in this Section 5.1 shall be in addition to, and not by way of
limitation of, any other restrictions on transfer contained in any other section
of this Agreement. Whenever
a
certificate representing the Shares is required to be issued to a purchaser
without a legend, in lieu of delivering physical certificates representing
the
Shares, provided the Company's transfer agent is participating in the Depository
Trust Company ("DTC")
Fast Automated Securities Transfer program, the Company shall use its reasonable
best efforts to cause its transfer agent to electronically transmit the Shares
to a purchaser by crediting the account of such purchaser's Prime Broker with
DTC through its Deposit Withdrawal Agent Commission ("DWAC") system (to the
extent not inconsistent with any provisions of this Agreement).
7
4.
Miscellaneous.
(a) Choice
of Law.
This
Agreement shall be governed, construed and enforced in accordance with the
laws
of the State of New York and the federal laws of United States applicable
therein, without giving effect to principles of conflicts of law.
(b)
Jurisdiction.
The
parties hereby irrevocably consent to the in personam jurisdiction of the state
or federal courts located in the State of New York, in connection with any
action or proceeding arising out of or relating to this Agreement or the
transactions and the relationships established thereunder. The parties hereby
agree that such courts shall be the venue and exclusive and proper forum in
which to adjudicate such matters and that they will not contest or challenge
the
jurisdiction or venue of these courts.
(c)
Entire
Agreement.
This
Agreement sets forth the entire agreement and understanding of the parties
in
respect of the transactions contemplated hereby and supersedes all prior and
contemporaneous agreements, arrangements and understandings of the parties
relating to the subject matter hereof. No representation, promise, inducement,
waiver of rights, agreement or statement of intention has been made by any
of
the parties which is not expressly embodied in this Agreement, such other
agreements, notes or instruments related to this transaction executed
simultaneously herewith, or the written statements, certificates, schedules
or
other documents delivered pursuant to this Agreement or in connection with
the
transactions contemplated hereby.
(d)
Assignment.
Each
party's rights and obligations under this Agreement shall not be assigned or
delegated, by operation of law or otherwise, without the other party's prior
consent, and any such assignment or attempted assignment shall be void, of
no
force or effect, and shall constitute a material default by such
party.
(e)
No
Third Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns and is not for the benefit of, nor may any
provision hereof be enforced by, any other person.
8
(f) Amendments.
This
Agreement may be amended, modified, superseded or cancelled, and any of the
terms, covenants, representations, warranties or conditions hereof may be
waived, only by a written instrument executed by each party, in the case of
a
waiver, by the party waiving compliance.
(g) Interpretation.
This
Agreement shall not be interpreted or construed with any presumption against
the
party causing this Agreement to be drafted.
(h)
Waivers.
The
failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a later time to enforce
the same. No waiver by any party of any condition, or the breach of any term,
covenant, representation or warranty contained in this Agreement, whether by
conduct or otherwise, in any one or more instances shall be deemed to be or
construed as a further or continuing waiver of any such condition or breach
or a
waiver of any other term, covenant, representation or warranty of this
Agreement.
(i) Severability.
The
provisions of this Agreement are severable and, in the event that any court
of
competent jurisdiction shall determine that any one or more of the provisions
or
part of the provisions contained in this Agreement shall, for any reason, be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision or part
of a
provision of this Agreement and this Agreement shall be reformed and construed
as if such invalid or illegal or unenforceable provision, or part of such
provision, had never been contained herein, so that such provisions would be
valid, legal and enforceable to the maximum extent possible.
(j) Headings.
The
article, section and subsection headings in this Agreement are for convenience
only and shall not constitute a part of this Agreement for any other purpose
and
shall not be deemed to limit or affect any of the provisions
hereof.
(k) Counterparts.
This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and shall become effective
when counterparts have been signed by each party and delivered to the other
parties hereto, it being understood that all parties need not sign the same
counterpart.
(l) Further
Assurances.
From and
after the date of this Agreement, upon the request of Stadium
or the
Company, the Company and Stadium
shall
execute and deliver such instruments, documents and other writings as may be
reasonably necessary or desirable to confirm and carry out and to effectuate
fully the intent and purposes of this Agreement.
[Signature
Page Follows]
9
IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the
date first set forth above.
| STADIUM SA | ||
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|
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| By: | /s/ Xxxxxx Xxxxxxxx | |
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Name: Xxxxxx Xxxxxxxx |
||
| Title: President | ||
| XL GENERATION AG | ||
| |
|
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| By: | /s/ Xxxxx Xxxxxxx | |
|
Name: Xxxxx Xxxxxxx |
||
| Title: President | ||
| XL GENERATION INTERNATIONAL INC. | ||
| |
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| By: | /s/ Xxxxx Xxxxxxx | |
|
Name: Xxxxx Xxxxxxx |
||
| Title: President | ||
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