EXHIBIT 2
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT dated this 20th day of November, 2002, is made
AMONG:
XXXXX XXXXXXX XXXXX XXXXXX, an individual resident in Egypt ("Tarek");
XXXXXX XXXXX, an individual resident in the Province of Qu bec ("Xxxxx");
(the foregoing two parties being hereinafter referred to collectively as
the "Partners")
-and-
KOALA INTERNATIONAL WIRELESS INC., a corporation incorporated under the
laws of the State of Nevada (the "Purchaser")
-and-
NOWIRE TELECOM, a partnership formed under the laws of Egypt (the "Acquired
Partnership")
WHEREAS the Partners are the sole partners of the Acquired Partnership (the
"Acquired Partnership Interests");
AND WHEREAS the Purchaser desires to purchase all of the Acquired Partnership
Interests from the Partners and the Partners desire to sell the Acquired
Partnership Interests to the Purchaser;
NOW THEREFORE THIS AGREEMENT WITNESSES THAT, in consideration of the mutual
covenants hereinafter contained and provided for and other good and valuable
consideration (the receipt and sufficiency of which is hereby acknowledged by
the Parties), the Parties agree as follows:
ARTICLE I
INTERPRETATION
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1.1 DEFINITIONS. In this Agreement, unless the context otherwise requires,
the terms set forth in Schedule "A" shall have the meanings set forth therein.
1.2 ENTIRE AGREEMENT. This Agreement, together with the agreements and other
documents to be delivered pursuant to this Agreement, constitutes the entire
agreement between the Parties pertaining to the purchase and sale of the
Acquired Partnership Interests and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, and there
are no warranties, representations and other agreements between the Parties in
connection with the subject matter hereof except as specifically set forth in
this Agreement or any other agreement or document to be delivered pursuant to
this Agreement.
1.3 EXTENDED MEANINGS. In this Agreement, words importing the singular
number include the plural and vice versa; words importing the masculine gender
include the feminine and neuter genders.
1.4 HEADINGS. The division of this Agreement into articles, sections,
subsections and paragraphs and the insertion of headings are for convenience of
reference only and shall not affect the construction or interpretation of this
Agreement.
1.5 REFERENCES. References to an article, section, subsection, paragraph,
schedule or exhibit shall be construed as references to an article, section,
subsection, paragraph, schedule or exhibit to this Agreement, unless the context
otherwise requires.
1.6 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Nevada and the laws of the United
States applicable in that State.
1.7 CURRENCY. Unless otherwise specified, the word "dollar", or the symbol
"$" refers to Canadian currency.
1.8 SCHEDULES. The following is a list of schedules attached to and
incorporated into this Agreement by reference and deemed as part of this
Agreement.
SCHEDULE DESCRIPTION
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"A" Definitions
"B" The Partners' Partnership Interests
"C" Outstanding Options of the Purchaser
ARTICLE II
PURCHASE AND SALE
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2.1 AGREEMENT TO PURCHASE AND SELL. On the basis of the representations,
warranties, covenants and agreements contained in this Agreement and subject to
the terms and conditions of this Agreement, the Partners shall sell and the
Purchaser shall purchase all of the Acquired Partnership Interests as of and
with effect from the Closing Time on the Closing Date.
2.2 PURCHASE PRICE. The consideration for the purchase of the Acquired
Partnership Interests shall consist of approximately 6,000,000 shares of common
stock of the Purchaser from treasury (the "Purchaser Common Stock"), issued to
the Partners on Closing pro rata in accordance with their respective partnership
interests in the Acquired Partnership as set out in Schedule "B".
2.3 SECURITIES LAW EXEMPTIONS. The issuance of the Purchaser Common Stock
will be made in reliance upon the exemptions from prospectus and registration
requirements set out in section 63 of the Securities Act (Quebec) and in the
Securities Act of 1933 (U.S.), namely Regulation S with respect to shares issued
to shareholders residing outside of the United States. The Parties hereby
acknowledge that the purchase of the Acquired Partnership Interests constitutes
a take-over bid exempt from the take-over bid provisions of the Securities Act
(Quebec) by virtue of 121 of said Act.
2.4 ARM'S LENGTH TRANSACTION. The Parties hereby acknowledge that the
purchase of the Acquired Partnership Interests for Purchaser Common Stock is an
arm's length transaction and will not constitute a "related party transaction"
under Poic Statement No. Q-27 of the Quebec Securities Commission.
2.5 ESCROW. The Parties hereby acknowledge and agree that the purchase of
the Acquired Partnership Interests contemplated hereunder shall be closed and
held in escrow on November 20, 2002 (or such later date as may be agreed upon by
the Parties) and such escrow shall not be terminated until the Closing Date.
2.6 RESALE RESTRICTIONS. Each Partner understands and agrees that the
Purchaser Common Stock will be issued to the Partners under an exemption from
the prospectus requirements in Quebec and an exemption from the registration
statement requirement in the United States, and the Purchaser Common Stock have
not been registered under the Securities Act of 1933 (U.S.) as amended, under
the Securities Act (Quebec), or under any other securities laws. Accordingly,
each Partner may not sell or otherwise dispose of the Purchaser Common Stock in
the absence of compliance with applicable securities laws, and each Partner
understands that the Purchaser Common Stock being issued to the Partners will be
restricted securities subject to Rule 144 of the Securities Act of 1933 (U.S.)
as amended and may be subject to a resale restriction for an indefinite period
of time in Quebec. For greater certainty, each Partner understands and agrees
that:
(a) he is acquiring Purchaser Common Stock for his own account (and not for the
account of others) for investment and not with a view to the distribution
thereof, and he may not sell or otherwise dispose of the Purchaser Common
Stock without either filing a registration statement under the Securities
Act of 1933 (U.S.) as amended, filing a prospectus under the Securities Act
(Quebec), or an exemption therefrom, and the certificate or certificates
representing such shares may contain a legend to the foregoing effect;
(b) by virtue of his position, each Partner has access to the kind of financial
and other information about the Purchaser as would be contained in a
registration statement filed under the Securities Act of 1933 (U.S.) as
amended and in a prospectus under the Securities Act (Quebec); and
(c) he will indemnify and hold the Purchaser harmless from all liability
imposed upon the Purchaser by reason of any sale, pledge, transfer or other
dealing with the Purchaser Common Stock by the Partner in such
circumstances as to make the issuance of Purchaser Common Stock under this
Agreement no longer a transaction exempt from the registration requirements
of the Securities Act of 1933, as amended, any applicable state securities
laws, or the Securities Act (Quebec).
ARTICLE III
FURTHER COVENANTS
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3.1 DUE DILIGENCE REVIEW. During the Interim Period, each of the Acquired
Partnership and the Purchaser shall each:
(a) allow all each other and their representatives full and free access during
normal business hours to their corporate minute books and records,
including contracts and share registers, personnel, properties and other
documents and data;
(b) provide to each other and their representatives copies of all such
contracts, books, records and other existing documents and data as such
Parties or their representatives may reasonably request; and
(c) provide to each other and their representatives such other information
about themselves as such Parties or their representatives may reasonably
request;
(collectively, the "Due Diligence Review"), provided that such Due Diligence
Review shall be completed on or before November 20, 2002.
3.2 BUSINESS IN THE ORDINARY COURSE. From the date hereof until the Closing
(the "Interim Period"), the Partners shall cause the Acquired Partnership to
continue to carry on its business in the ordinary course. The Partners shall
ensure that the Acquired Partnership shall not sell or pledge any of its
Properties or other assets, issue any shares or enter into any transac-tions
outside the ordinary course of its business.
3.3 PUBLICITY. The Parties agree to keep confidential all negotiations with
respect to the transactions contemplated between the parties herein, save and
accept for such disclosure as may be required by any applicable securities
legislation or regulatory authorities. For greater certainty, it is anticipated
that the Purchaser will issue a press release to announce the execution of this
Agreement and the Closing, and both Parties must approve the language on such
press releases prior to their dissemination to the public.
3.4 LOCK-UP. From the date hereof until the earlier of the Closing or the
termination of this Agreement, the Acquired Partnership and the Partners shall
not solicit or enter into any negotiations or agreements with any Person other
than the Purchaser with a view to the acquisition of the Acquired Partnership
Interests by any Person other than the Purchaser.
3.5 REGISTRATION RIGHTS. The Purchaser shall use its best efforts to
register the Purchaser Common Stock (the "Registrable Securities") with the
Securities and Exchange Commission ("SEC") in the United States, subject to
compliance with the Securities Act of 1933 (United States) as amended (the "US
Securities Act"), for resale within 180 days (the "Registration"). In
connection with the Registration, the Purchaser shall:
(a) prepare and file a registration statement or similar document (a
"Registration Statement") with the SEC in respect of the Registrable
Securities and cause such Registration Statement to become effective within
180 days from the date of this Agreement and remain effective until the
earlier of such time as all the Registrable Securities subject to such
Registration Statement have been disposed of or the expiration of one year;
(b) prepare and file with the SEC such amendments and supplements to such
Registration Statement used in connection therewith as may be necessary to
keep such Registration Statement effective and to comply with the
provisions of the US Securities Act in respect of the sale or other
disposition of all the Registrable Securities covered by such Registration
Statement until the earlier of such time as all of such Registrable
Securities have been disposed of or the expiration of one year;
(c) furnish to the Partners such number of copies of the Registration Statement
in conformity with the requirements of the US Securities Act and each
amendment or supplement thereto, together with such other documents as the
Partners may reasonably request;
(d) otherwise comply with all applicable rules and regulations of the SEC, and
make available to its security holders, as soon as practicable, an earnings
statement covering the period of at least twelve months, beginning with the
first month after the effective date of such Registration Statement, which
earnings statement will satisfy the provisions of Section 11(a) of the US
Securities Act;
(e) provide and cause to be maintained a transfer agent and registrar for the
Registrable Securities covered by the Registration Statement from and after
a date not later than the effective date of such Registration Statement;
and
(f) during the period when the Registration Statement is required to be
effective, notify the Partners of the occurrence of any event, the result
of which will cause the prospectus included in the Registration Statement
to contain an untrue statement of a material fact or to omit to state any
material fact required to be stated therein or must be disclosed to make
the statements therein not misleading, and prepare a supplement or
amendment to such prospectus so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus will not contain
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading.
The Purchaser shall bear all expenses arising or incurred in connection with any
of the transactions contemplated by this section, including without limitation:
(a) all expenses in respect of filing with the SEC, OTCBB, any securities
exchange or the National Association of Securities Dealers, Inc.; (b)
registration fees; (c) printing expenses; (d) accounting and legal fees and
expenses (but excluding the fees and expenses of any accountants or legal
counsel engaged by the Partners); (e) expenses of any special audits or comfort
letters incidental to or required by the Registration; and (f) expenses in
respect of complying with securities laws of any jurisdiction in connection with
the Registration.
3.6 DIRECTORS' ROLLOVER. The board of directors of the Purchaser following
completion of the Transaction shall consist of four (4) directors, one (1) of
which shall be a nominee of the Acquired Partnership.
3.7 CHANGE OF NAME. The Purchaser's shareholders have approved a name
change to "Route 1 Corporation" which will be in effect following the filing of
an Information Statement with the SEC.
3.8 EXPENSES OF THE TRANSACTION. Except for costs and expenses of any
accountants, legal counsel or other professional advisor engaged by the
Partners, the Purchaser shall bear all expenses arising or incurred in
connection with the Transaction including without limitation, all costs and
expenses incurred by the Parties in respect of the Transaction whether incurred
prior to, on or after Closing. For further certainty, the Purchaser shall be
responsible for all such expenses even if the Transaction is not completed.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
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4.1 REPRESENTATIONS AND WARRANTIES OF THE PARTNERS. Each Partner represents
and warrants to the Purchaser as follows and acknowledges that the Purchaser is
relying on these representations and warranties in entering into this Agreement
and performing its obligations under the same:
(a) CAPACITY AND AUTHORITY- Each of the Partners has full power, right and
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authority to own the Acquired Partnership Interests, enter into this
Agreement and to perform his obligations under it. If an individual, the
Partner has attained the age of majority. If not an individual, the Partner
has been duly formed and is validly existing under the laws of its
jurisdiction of incorporation, and execution and delivery of this Agreement
and the Partner's performance of its obligations hereunder have been duly
authorized by all necessary proceedings of the directors, shareholders,
trustees, beneficiaries, partners or members of the Partner, and the
individual signing this Agreement on behalf of the Partner has the
authority to do so and to bind the Partner by his signature.
(b) TITLE TO ACQUIRED PARTNERSHIP INTERESTS - The Partner is the sole legal
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and beneficial owner of the Acquired Partnership Interests set out opposite
his name in Schedule "B" hereto with good and marketable title thereto,
free and clear of any Encumbrances other than Permitted Encumbrances.
(c) NO OPTION - Except as set out in this Agreement, no Person has any
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agreement, warrant, option or right, or a right capable of becoming an
agreement for, the purchase of the Partner's Acquired Partnership
Interests.
(d) ABSENCE OF CONFLICT - The Partner is not a party to, bound or affected
---------------------
by any agreement which would be violated, breached or terminated by, or
which would result in creation or imposition of any Encumbrance upon any of
the Acquired Partnership Interests as a consequence of the execution and
delivery of this Agreement or the consummation of the transactions
contemplated in this Agreement. The consummation of transactions
contemplated herein do not and will not conflict with, or result in a
breach of, or constitute a default under the terms or conditions of any
Constating Documents of the Acquired Partnership (if not an individual),
any court or administrative order or process, any agreement or instrument
to which the Partner is party or by which it is bound.
(e) REGULATORY APPROVALS - No governmental or regulatory authorization,
---------------------
approval, order, consent or filing is required on the part of the Partners
or the Acquired Partnership, in connection with the execution, delivery and
performance of this Agreement and the performance of the Partner's
obligations under this Agreement.
(f) BINDING AGREEMENT - This Agreement constitutes a legal, valid and
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binding obligation of the Partners enforceable against the Partners in
accordance with its terms except as may be limited by laws of general
application affecting the rights of creditors.
(g) BANKRUPTCY/LIQUIDATION - No proceedings have been taken, are pending or
----------------------
have been authorized, and no receiver or trustee has been appointed for the
Partners by the Partners or by any other person in respect to the
bankruptcy or insolvency of the Partners.
(h) LITIGATION - There are no judgements, decrees, injunctions, rulings or
----------
orders of any court, arbitrator, federal, provincial, state, municipal or
other governmental authority, department, commission, board, bureau or
agency, or any actions, suits, grievances or proceedings (whether or not on
behalf of the Partners) commenced, pending or threatened against or
relating to the Partners which may result in the imposition of a
Encumbrance on the Acquired Partnership Interests or which may prevent,
delay, make illegal or otherwise interfere with the consummation of the
transactions contemplated in this Agreement.
(i) NONDISTRIBUTIVE INTENT - Each Partner is acquiring the shares of
-----------------------
Purchaser Common Stock to be issued hereunder to him for his own account
(and not for the account of others) for investment and not with a view to
the distribution thereof.
(j) REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED PARTNERSHIP - The
----------------------------------------------------------------
representations and warranties of the Acquired Partnership set out in
section 4.2 below are true and accurate.
(k) FULL DISCLOSURE - Neither this Agreement nor any document to be
----------------
delivered by the Partners nor any certificate, report, statement or other
document furnished by the Partners in connection with the negotiation of
this Agreement contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make the
statements contained herein or therein not misleading. There has been no
event, transaction or information that has come to the attention of the
Partner that has not been disclosed to the Purchaser in writing that could
reasonably be expected to have a material adverse effect on the assets,
business, earnings, prospects, properties or condi-tion (financial or
otherwise) of the Acquired Partnership.
4.2 REPRESENTATIONS AND WARRANTIES OF THE ACQUIRED PARTNERSHIP. The Acquired
Partnership represents and warrants to the Purchaser as follows and acknowledges
that the Purchaser is relying on these representations and warranties in
entering into this Agreement and performing its obligations under the same:
(a) DUE INCORPORATION - The Acquired Partnership is a partnership duly
------------------
organized and validly existing under the laws of Egypt.
(b) CAPACITY TO ENTER AGREEMENT- The Acquired Partnership has all necessary
----------------------------
power, authority and capacity to enter into this Agreement and perform its
obligations hereunder.
(c) DUE CORPORATE AUTHORIZATION - The Acquired Partnership's execution and
-----------------------------
delivery of this Agreement and its performance of its obligations hereunder
have been duly authorized by all necessary proceedings of the Acquired
Partnership.
(d) BINDING OBLIGATION - This Agreement has been duly executed and delivered
------------------
by the Acquired Partnership and constitutes a valid and binding obligation
on its part.
(e) CAPACITY TO CARRY ON BUSINESS- The Acquired Partnership has all
---------------------------------
necessary power, authority and capacity to carry on the business currently
carried on by it and to own the assets currently owned by it. The Acquired
Partnership has obtained all permits, certificates, approvals,
registrations and licenses which are required for the operation of its
business as it is presently being conducted, and no violations thereof have
been experienced, noted, or recorded, and no proceeding is pending or
threatened to revoke or limit any of them.
(f) TITLE TO ASSETS - The Acquired Partnership is the sole legal and
-----------------
beneficial owner of its assets, as disclosed in its books, records and
financial statements, with good and marketable title thereto free and clear
of any Encumbrances.
(g) CONSTATING DOCUMENTS - The organizational documents of the Acquired
---------------------
Partnership have not been altered since the organization of the Acquired
Partnership except as disclosed in the record books of the Acquired
Partnership.
(h) CORPORATE RECORDS - All material transactions of the Acquired
------------------
Partnership have been promptly and properly recorded or filed in or with
its respective books and records, and the record books of the Acquired
Partnership contain all records of the meetings and proceedings of
shareholders and directors thereof.
(i) FINANCIAL STATEMENTS - The Acquired Partnership's financial statements
---------------------
for its most recently completed fiscal year and its most recently completed
fiscal period are substantially true and correct in every material respect
and present fairly the financial position of the Acquired Partnership and
the results of its operations for the periods then ended, in accordance
with Egyptian generally-accepted accounting principles applied on a
consistent basis.
(j) BUSINESS IN ORDINARY COURSE - Since the end of the most recent period
------------------------------
reported on in the Acquired Partnership's financial statements, the
Acquired Partnership has carried on its business in the ordinary course of
business and there have been no material adverse changes in its business or
assets.
(k) LIABILITIES - The Acquired Partnership has no liabilities which are not
-----------
disclosed or reflected in the Acquired Partnership's financial statements,
except those incurred in the ordinary course of business since the end of
the last fiscal period reported on in the Acquired Partnership's financial
statements, which additional liabilities do not exceed $30,000.00. The
Acquired Partnership has not guaranteed, or agreed to guarantee, any debt,
liability or other obligation of any Person.
(l) DUE ISSUANCE - The Acquired Partnership Interests have been acquired for
------------
good and valuable consideration and are owned of record and beneficially by
the Partners in the case of the Acquired Partnership in accordance with
Schedule "B".
(m) NO OPTION - Except as disclosed in this Agreement, no Person, other than
---------
the Purchaser under this Agreement, has any agreement, warrant, option or
any right capable of becoming an agreement, warrant, option or right for
the purchase of any of further shares of the Acquired Partnership or
securities convertible into shares of the Acquired Partnership.
(n) SUBSIDIARIES- The Acquired Partnership does not own, directly or
------------
indirectly, any shares or interest in any other Person.
(o) ABSENCE OF CONFLICT - The Acquired Partnership is not a party to, bound
--------------------
or affected by any agreement which would be violated, breached or
terminated by, or which would result in creation or imposition of any
Encumbrance upon any of the Acquired Partnership Interests as a consequence
of the execution and delivery of this Agreement or the consummation of the
transactions contemplated in this Agreement. The consummation of
transactions contemplated herein do not and will not conflict with, or
result in a breach of, or constitute a default under the terms or
conditions of any constating documents or by-laws of the Acquired
Partnership, any court or administrative order or process, any agreement or
instrument to which the Acquired Partnership is party or by which it is
bound.
(p) REGULATORY APPROVALS - No governmental or regulatory authorization,
---------------------
approval, order, consent or filing is required on the part of the Acquired
Partnership in connection with the execution, delivery and performance of
this Agreement and the performance of the Acquired Partnership's
obligations under this Agreement.
(q) NO BANKRUPTCY - No proceedings have been taken, are pending or
--------------
authorized by the Acquired Partnership or by any other person in respect to
the bankruptcy, insolvency, liquidation, dissolution or winding up of the
Acquired Partnership.
(r) LITIGATION - There are no judgements, decrees, injunctions, ruling or
----------
orders of any court, Governmental Authority or arbitration, or any actions,
suits, grievances or proceedings (whether or not on behalf of the Acquired
Partnership) pending or threatened against the Acquired Partnership which
may materially increase the Acquired Partnership's liabilities.
(s) TAXES - The Acquired Partnership is not now and at the Closing Date will
-----
not be in arrears or in default in respect of the filing of any required
federal, provincial or municipal tax or other return, and to the best of
the Acquired Partnership's knowledge, no such return contains any
mis-statement or conceals any statement that should have been included
thereinThe Acquired Partnership has paid and will pay all taxes, filing
fees and other assessments due and payable or collectable. The Acquired
Partnership has withheld and will withhold up to the Closing Date from each
payment made to any employee the amount of all taxes (including but not
limited to income tax) and other deductions required to be withheld
therefrom and has paid or will pay such amounts to the proper tax or other
receiving authority.
(t) QUESTIONABLE PAYMENTS - Neither Acquired Partnership, any Subsidiary,
----------------------
any director, officer, agent, employee, or other person associated with or
acting on behalf of Acquired Partnership or any Subsidiary, nor any Partner
has, directly or indirectly: used any corporate funds for unlawful
contributions, gifts; entertainment, or other unlawful expenses relating to
political activity; made any unlawful payment to foreign or domestic
government officials or employees or to foreign or domestic political
parties or campaigns from corporate funds; violated any provision of the
Foreign Corrupt Practices Act of 1977, as amended; established or
maintained any unlawful or unrecorded fund of corporate monies or other
assets; made any false or fictitious entry on the books or records of
Acquired Partnership or any Subsidiary, made any bribe, rebate, payoff,
influence payment, kickback, or other unlawful payment; given any favour or
gift which is not deductible for federal income tax purposes; or made any
bribe, kickback, or other payment of a similar comparable nature, whether
lawful or not, to any person or entity, private or public, regardless of
form, whether in money, property, or services, to obtain favourable
treatment in securing business or to obtain special concessions, or to pay
for favourable treatment for business secured or for special concessions
already obtained.
(u) FULL DISCLOSURE - Neither this Agreement nor any document to be
----------------
delivered by the Acquired Partnership nor any certificate, report,
statement or other document furnished by the Acquired Partnership in
connection with the negotiation of this Agreement contains or will contain
any untrue statement of a material fact or omits or will omit to state a
material fact necessary to make the statements contained herein or therein
not misleading. There has been no event, transaction or information that
has come to the attention of the Acquired Partnership that has not been
disclosed to the Purchaser in writing that could reasonably be expected to
have a material adverse effect on the assets, business, earnings,
prospects, properties or condition (financial or otherwise) of the
Acquired Partnership.
4.3 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants to the Partners and the Acquired Partnership as follows
and acknowledges that the Partners and the Acquired Partnership are relying on
these representations and warranties in entering into this Agreement and
performing their obligations under the same:
(a) DUE INCORPORATION - The Purchaser is a corporation duly incorporated and
-----------------
validly existing under the laws of the State of Nevada.
(b) CAPACITY TO ENTER AGREEMENT- The Purchaser has all necessary power,
------------------------------
authority and capacity to enter into this Agreement and perform its
obligations hereunder.
(c) DUE CORPORATE AUTHORIZATION - The Purchaser's execution and delivery of
----------------------------
this Agreement and its performance of its obligations hereunder have been
duly authorized by all necessary proceedings of the directors and
stockholders of the Purchaser.
(d) BINDING OBLIGATION - This Agreement has been duly executed and delivered
------------------
by the Purchaser and constitutes a valid and binding obligation on its
part.
(e) ABSENCE OF CONFLICT - The Purchaser is not a party to, bound or affected
-------------------
by any agreement which would be violated, breached or terminated by, or
which would result in creation or imposition of any Encumbrance upon any of
the Purchaser Common Stock as a consequence of the execution and delivery
of this Agreement or the consummation of the transactions contemplated in
this Agreement. The Purchaser's execution of this Agreement and the
consummation of transactions contemplated herein do not and will not
conflict with, or result in a breach of, or constitute a default under the
terms or conditions of any constating documents or by-laws of the
Purchaser, any court or administrative order or process, any agreement or
instrument to which the Purchaser is party or by which it is bound.
(f) REPORTING ISSUER STATUS - The Purchaser is a reporting company in the
-------------------------
United States under the Securities Exchange Act of 1934 (United States) and
is not in default under the provisions of the said Act or the regulations,
rules and policies promulgated thereunder, but is not a "reporting issuer"
in any province of territory of Canada, as that term is defined in the
Securities Act (Quebec) (the foregoing state of affairs being hereinafter
known as the "Reporting Issuer Status"). The Purchaser has made all filings
with the Securities and Exchange Commission (United States) that it has
been required to make under the Securities Exchange Act of 1934 (United
States) and the Securities Act of 1933 (United States) (collectively, the
"Public Reports"). Each of the Public Reports has complied with the
Securities Exchange Act of 1934 (United States) and the Securities Act of
1933 (United States), as applicable, in all material respects. None of the
Public Reports, as of their respective dates, contain any untrue statement
of a material fact or omitted to state a material fact necessary in order
to make the statements made therein, in light of the circumstances under
which they are made, false or misleading.
(g) LISTING STATUS - The common stock of the Purchaser are listed or quoted
---------------
for trading on the NASD Over-the-Counter Bulletin Board ("OTCBB") under the
symbol "KIWI". The Purchaser is in good standing with the OTCBB and is not
in default under any of its rules, policies or by-laws (the foregoing state
of affairs being hereinafter known as the "Listing Status").
(h) CONSTATING DOCUMENTS - The articles of incorporation of the Purchaser
---------------------
have not been altered since the incorporation of the Purchaser except as
disclosed in the minute books of the Purchaser.
(i) CORPORATE RECORDS - All material transactions of the Purchaser have been
-----------------
promptly and properly recorded or filed in or with its respective books and
records, and the minute books of the Purchaser contain all records of the
meetings and proceedings of shareholders and directors thereof.
(j) FINANCIAL STATEMENTS - The Purchaser's financial statements for its most
--------------------
recently completed fiscal year and its most recently completed fiscal
period are substantially true and correct in every material respect and
present fairly the financial position of the Purchaser and the results of
its operations for the periods then ended, in accordance with U.S.
generally-accepted accounting principles applied on a consistent basis.
(k) BUSINESS IN ORDINARY COURSE - Since the end of the most recent period
------------------------------
reported on in the Purchaser's financial statements, the Purchaser has
carried on its business in the ordinary course of business and there have
been no material adverse changes in its business or assets.
(l) ASSETS - The Purchaser has no assets which are not disclosed or
------
reflected in the Purchaser's financial statements.
(m) LIABILITIES - The Purchaser has no liabilities which are not disclosed
-----------
or reflected in the Purchaser's financial statements, except those incurred
in the ordinary course of business. The Purchaser has not guaranteed, or
agreed to guarantee, any debt, liability or other obligation of any Person.
(n) SHARE CAPITAL - The authorized share capital of the Purchaser consists
--------------
of 100,000,000 common shares having a par value of $0.001 per share, and
20,000,000 preferred shares having a par value of $0.001 per share, of
which 19,695,990 common shares are issued and outstanding and no preferred
shares are issued and outstanding.
(o) DUE ISSUANCE - The Purchaser Common Stock have been validly reserved and
------------
allotted for issuance to the Partners, and at Closing the Purchaser Common
Stock will be validly issued to the Partners as fully-paid and
non-assessable.
(p) NO OPTION - Except as set out in Schedule "C" of this Agreement, no
----------
Person has any agreement, warrant, option or any right capable of becoming
an agreement, warrant, option or right for the purchase of any further
shares of the Purchaser or securities convertible into stock of the
Purchaser.
(q) SUBSIDIARIES - The Purchaser does not own, directly or indirectly, any
------------
shares or interest in any other Person except for Xxxxxxxxxx.xxx Inc., its
wholly-owned subsidiary.
(r) NO BANKRUPTCY - No proceedings have been taken, are pending or
--------------
authorized by the Purchaser or by any other person in respect to the
bankruptcy, insolvency, liquidation, dissolution or winding up of the
Purchaser.
(s) LITIGATION - There are no judgements, decrees, injunctions, ruling or
----------
orders of any court, Governmental Authority or arbitration, or any actions,
suits, grievances or proceedings (whether or not on behalf of the
Purchaser) pending or threatened against the Purchaser which may materially
increase the Purchaser's liabilities.
(t) REGULATORY APPROVALS - Except for filing an 8-K on completion of the
---------------------
Transaction, no governmental or regulatory authorization, approval, order,
consent or filing is required on the part of the Purchaser in connection
with the execution, delivery and performance of this Agreement and the
performance of the Acquired Partnership's obligations under this Agreement.
(u) TAXES - The Purchaser is not now and at the Closing Date will not be in
-----
arrears or in default in respect of the filing of any required federal,
state, provincial or municipal tax or other return, and to the best of the
Purchaser's knowledge, no such return contains any misstatement or conceals
any statement that should have been included therein. The Purchaser has
paid and will pay all taxes, filing fees and other assessments due and
payable or collectable. The Purchaser has withheld and will withhold up to
the Closing Date from each payment made to any employee the amount of all
taxes (including but not limited to income tax) and other deductions
required to be withheld therefrom and has paid or will pay such amounts to
the proper tax or other receiving authority.
(v) NONDISTRIBUTIVE INTENT - The Purchaser is acquiring the Acquired
-----------------------
Partnership Interests for his own account (and not for the account of
others) for investment and not with a view to the distribution thereof.
(w) FULL DISCLOSURE - Neither this Agreement nor any document to be
----------------
delivered by the Purchaser nor any certificate, report, statement or other
document furnished by the Purchaser in connection with the negotiation of
this Agreement contains or will contain any untrue statement of a material
fact or omits or will omit to state a material fact necessary to make the
statements contained herein or therein not misleading. There has been no
event, transaction or information that has come to the attention of the
Purchaser that has not been disclosed to the Partners and the Acquired
Partnership in writing that could reasonably be expected to have a material
adverse effect on the assets, business, earnings, prospects, properties or
condi-tion (financial or otherwise) of the Purchaser.
4.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties contained in this Agreement shall survive the Closing until the
expiry of one (1) year from the Closing Date, after which time, if no claim
shall have been made against a Party with respect to any incorrectness or in
breach of any representation or warranty, that Party shall have no further
liability under this Agreement with respect to the representation or warranty.
4.5 CERTIFICATES AND INSTRUMENTS INCLUDED. All statements contained in any
certificate or any instrument delivered by or on behalf of a Party pursuant to
or in connection with the transactions contemplated by this Agreement shall be
deemed to be made by such Party under this Agreement.
ARTICLE V
CLOSING
-------
5.1 CLOSING. The Closing shall take place at Toronto, Ontario at the
Closing Time on the Closing Date, subject to the satisfaction of the conditions
set out in sections 5.2 and 5.3 below, in accordance with the procedures set out
in section 5.4 below.
5.2 CONDITIONS FOR THE PURCHASER'S BENEFIT. The Purchaser shall not be
obliged to complete the purchase of the Acquired Partnership Interests unless
each of the following conditions shall have been satisfied on or before the
Closing Date:
(a) ACCURACY OF REPRESENTATIONS - The representations and warranties of the
----------------------------
Partners and the Acquired Partnership set forth in sections 4.1 and 4.2
above shall be true and correct as of the Closing Date, except as those
representations and warranties may be affected by the occurrence of events
or transactions expressly contemplated and permitted by this Agreement,
including, without limitation, those in the ordinary course of business,
and the Purchaser shall have received a certificate from the Acquired
Partnership and the Partners confirming the foregoing.
(b) DUE DILIGENCE REVIEW - The Due Diligence Review shall have been
----------------------
completed to the satisfaction of the Purchaser and its counsel.
(c) PERFORMANCE OF OBLIGATIONS - The Acquired Partnership and the Partners
---------------------------
shall have performed all of the obligations hereunder to be performed by
them at or prior to the Closing. The Acquired Partnership and the Partners
shall not be in breach of any provision of this Agreement.
(d) DELIVERIES - Subject to section 5.2(e) below, the Partners shall have
----------
delivered or caused to be delivered to the direction of the Purchaser
possession of the Acquired Partnership Interests free and clear of any
Encumbrances, together with all endorsements and documents required to
authorize or give effect to said transfer.
(e) CONSENTS, AUTHORIZATIONS AND REGISTRATIONS - All consents, approvals,
---------------------------------------------
orders and authorizations of, from or notifications to any Persons or
Governmental Authorities required (if any) in connection with the
completion of any of the transactions contemplated by this Agreement, the
execution of this Agreement, the Closing or the performance of any of the
terms and conditions of this Agreement shall have been obtained on or
before the Closing Date.
(f) NO CLAIMS - There shall be no injunction or order issued preventing, and
---------
no pending or threatened claim, action, litigation or proceeding, judicial
or administrative, or investigation against any Party by any Governmental
Authority or Person for the purpose of enjoining or preventing the
consummation of this Agreement, or otherwise claiming that this Agreement
or the consummation thereof is improper or would give rise to proceedings
under any statute or rule of law.
(g) NO MATERIAL CHANGES - During the Interim Period, there shall have been
---------------------
no material adverse change in the busi-ness, assets, or liabilities of the
Acquired Partnership, or in the Acquired Partnership's title to its assets,
and the Acquired Partnership shall not have sold or pledged any assets,
issued any shares or entered into any transac-tions outside the ordinary
course of its businesses.
If any one or more of the foregoing conditions shall not have been fulfilled on
or before the Closing Date, the Purchaser may terminate this Agreement by notice
in writing to the other Parties in which event the Purchaser shall be released
from all obligations under this Agreement and (unless the Purchaser can show
that the condition relied upon could reasonably have been performed by the other
parties) the other Parties shall also be released from all obligations
hereunder; provided, however, that the Purchaser shall be entitled to waive
compliance with any one or more of such conditions in whole or in part if it
shall see fit to do so, without prejudice to their rights of termination in the
event of the non-fulfilment of any other condition in whole or in part.
5.3 CONDITIONS FOR THE PARTNERS' BENEFIT. The Partners and the Acquired
Partnership shall not be obliged to complete the sale of the Properties unless
each of the following conditions shall have been satisfied on or before the
Closing Date:
(a) ACCURACY OF REPRESENTATIONS - The representations and warranties of the
----------------------------
Purchaser set forth in section 4.3 above shall be true and correct as of
the Closing Date, except as those representations and warranties may be
affected by the occurrence of events or transactions expressly contemplated
and permitted by this Agreement, including, without limitation, those in
the ordinary course of business, and the Partners shall have received a
certificate from the Purchaser confirming the foregoing.
(b) DUE DILIGENCE REVIEW - The Due Diligence Review shall have been
----------------------
completed to the satisfaction of the Acquired Partnership and its counsel.
(c) PERFORMANCE OF OBLIGATIONS - The Purchaser shall have performed all of
---------------------------
the obligations hereunder to be performed by it at or prior to the Closing,
including but not limited to the obligation to enter into employment or
consulting agreements with the Partners pursuant to section 3.6 above. The
Purchaser shall not be in breach of any provision of this Agreement.
(d) DELIVERIES - Subject to section 5.3(e) below, the Purchaser shall have
----------
delivered or caused to be delivered to the direction of the Partners
possession of the Purchaser Common Stock free and clear of any
Encumbrances, together with all endorsements and documents required to
authorize or give effect to said transfer.
(e) CONSENTS, AUTHORIZATIONS AND REGISTRATIONS - All consents, approvals,
---------------------------------------------
orders and authorizations of, from or notifications to any persons or
Governmental Authorities required (if any) in connection with the
completion of any of the transactions contemplated by this Agreement, the
execution of this Agreement, the Closing or the performance of any of the
terms and conditions of this Agreement shall have been obtained on or
before the Closing Date.
(f) NO CLAIMS - There shall be no injunction or order issued preventing, and
---------
no pending or threatened claim, action, litigation or proceeding, judicial
or administrative, or investigation against any Party by any Governmental
Authority or Person for the purpose of enjoining or preventing the
consummation of this Agreement, or otherwise claiming that this Agreement
or the consummation thereof is improper or would give rise to proceedings
under any statute or rule of law.
(g) NO MATERIAL CHANGES - During the Interim Period, there shall have been
---------------------
no material adverse change in the busi-ness, assets, liabilities, Reporting
Issuer Status or Listing Status of the Purchaser, and the Purchaser shall
not have sold or pledged any assets, issued any shares or entered into any
transactions outside the ordinary course of its businesses or as
contemplated in this Agreement.
(h) ASSETS AND LIABILITIES - The Purchaser shall have no more than
------------------------
US$200,000 in assets and no liabilities which are not disclosed or
reflected in the Purchaser's financial statements, except those incurred in
the ordinary course of business since the end of the last fiscal period
reported on in the Purchaser's financial statements, which additional
liabilities do not exceed US$250,000.00 as of the Closing Date. The
Purchaser's financial statements have not been consolidated with the
financial statements of Route1 Corporation, an Ontario corporation that the
Purchaser acquired on October 8, 2002.
(i) Officers RESIGNATIONS - All officers of the Purchaser shall have
------------
resigned and executed comprehensive releases at or prior to the Closing in
writing effective immediately after the Closing subject to acceptance by
the Purchaser.
If any one or more of the foregoing conditions shall not have been fulfilled on
or before the Closing Date, the Partners or the Acquired Partnership may
terminate this Agreement by notice in writing to the other Parties in which
event the terminating Party or Parties shall be released from all obligations
under this Agreement and (unless the terminating Party or Parties can show that
the condition relied upon could reasonably have been performed by the other
Parties) the other Parties shall also be released from all obligations
hereunder; provided, however, that the terminating Party or Parties shall be
entitled to waive compliance with any one or more of such conditions in whole or
in part if it shall see fit to do so, without prejudice to their rights of
termination in the event of the non-fulfilment of any other condition in whole
or in part.
5.4 CLOSING PROCEDURES. At the Closing Time, the Partners shall deliver all
other documentation required to transfer title to the Acquired Partnership
Interests.
5.5 NON-WAIVER. No investigations made by or on behalf of any Party at any
time shall have the effect of waiving or diminishing the scope of or otherwise
affecting any representation, warranty or indemnity made by or imposed upon the
Parties pursuant to this Agreement.
ARTICLE VI
INDEMNIFICATIONS
----------------
6.1 MUTUAL INDEMNIFICATIONS FOR BREACHES OF WARRANTY, ETC. The Partners
hereby covenant and agree with the Purchaser, and the Purchaser hereby covenants
and agrees with the Partners (the Party or Parties so covenanting and agreeing
to indemnify another Party being hereinafter in this Section 6.1 referred to as
the "Indemnifying Party" and the Party so to be indemnified being hereinafter
called the "Indemnified Party") to indemnify and save harmless the Indemnified
Party, effective as and from the Closing Time, from and against any claims,
demands, actions, causes of action, damage, loss, costs, liability or expense
(hereinafter in this Article 6 called "Claims") which may be brought against the
Indemnified Party and/or which it may suffer or incur as a result of, in respect
of, or arising out of any material non-fulfillment of any covenant or agreement
on the part of the Indemnify-ing Party under this Agreement or any incorrectness
in or breach of any representation or warranty of the Indemnifying Party
contained herein or in any certificate or other document furnished by the
Indemnifying Party pursuant hereto. The foregoing obligation of indemnification
in respect of such Claims shall be subject to the limitation mentioned in
Section 4.4 hereof respecting the survival of the representations and warranties
of the Parties.
ARTICLE VII
CONFIDENTIALITY
---------------
7.1. CONFIDENTIALITY. Each Party (referred to as the "Receiving Party" in
this Article VII) acknowledges and agrees that the information which it receives
from any of the other Parties (referred to as the "Disclosing Party" in this
Article VII), is and shall be confidential and proprietary to the Disclosing
Party (the "Confidential Information"). The Receiving Party agrees not to
disclose the Confidential Information to any third party, nor to use the
Confidential Information for any purpose other than the performance of its
obligations under this Agreement and any other agreement with the Disclosing
Party, without the prior written consent of the Disclosing Party. The Receiving
Party agrees to restrict dissemination of particular Confidential Information to
only those persons in its organization, or to its legal counsel, who must have
access to such Confidential Information in order for the Receiving Party to
perform its obligations under this Agreement and any other agreement with the
Disclosing Party. The Receiving Party shall cause every employee or third party
to whom it discloses Confidential Information as permitted hereunder to abide by
the foregoing confidentiality provisions. Upon the termination of this
Agreement, the Receiving Party shall promptly return such confidential
information (and any copies, extracts and summaries thereof) to the Disclosing
Party or, with the Disclosing Party's written consent, shall promptly destroy
such confidential information (and any copies, extracts and summaries thereof)
and, with respect to electronically stored copies, delete such records from any
storage unit. The Receiving Party's obligations under this Article VII shall
come into effect on the date hereof and shall continue indefinitely.
7.2 EXCLUSIONS. The Receiving Party's obligations with regard to the
Confidential Information shall not apply in respect of such information that:
(a) the Disclosing Party authorizes the Receiving Party to disclose to third
parties by prior written authorization;
(b) is or becomes available in the public domain, other than by an act or
omission of the Receiving Party or any employee, agent or other person
acting for or on behalf of the Receiving Party;
(c) is lawfully acquired by the Receiving Party from another source without
restriction; or
(d) is ordered to be disclosed by a court, administrative agency or other
governmental body with jurisdiction over the parties, provided the
Receiving Party will first have provided the Disclosing Party with prompt
written notice of such required disclosure and will take reasonable steps
to allow the Disclosing Party to seek a protective order with respect to
the confidentiality of the information required to be disclosed. The
Receiving Party will promptly co-operate with and assist the Disclosing
Party in connection with obtaining such protective order, at the Disclosing
Party's expense.
ARTICLE VIII
GENERAL
-------
8.1 TERMINATION.
(a) This agreement may be terminated at any time prior to the Closing Date:
(i) by the mutual agreement of the Parties;
(ii) by the Parties if:
(A) the purchase and sale of the Acquired Partnership Interests
shall not have been completed by January 30, 2003 (or such other date,
if any, as the Parties may agree on in writing), if the failure to
complete such purchase and sale on or before such date is not caused
by any breach of this Agreement by the Party electing to terminate; or
(B) the purchase and sale of the Acquired Partnership Interests
would violate any non-appealable final order, decree or judgement of
any court or Governmental Authority having competent jurisdiction.
(b) If this Agreement is terminated by a Party under subsection 8.1(a), such
termination shall be without liability of either Party to the other
parties, or to any of their directors, officers, employees, agents,
consultants or representatives provided that if such termination shall
result from the wilful failure of the Party to fulfil a condition to the
performance of the other Parties or to perform a covenant of this agreement
or from a wilful breach by the party to this Agreement, the Party shall be
fully liable for any and all damages, costs and expenses (including, but
not limited to, reasonable counsel fees and disbursements) sustained or
incurred by the other Parties.
8.2 NOTICES. All notices, requests, demands and other communications
hereunder must be made in writing and will be deemed to have been duly given if
delivered by courier, sent by prepaid registered mail addressed to the
addressee, or sent by facsimile transmission if such notice is delivered,
addressed or sent to the address or fax number given below, or such other
address or fax number as the Party receiving the notice may give to the Party
giving the notice:
(a) if to the Partners:
See Schedule "B".
(b) if to the Acquired Partnership:
c/x Xxxxxx & Associates
000 Xxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxx X. Xxxxxx
Tel: 000-000-0000
Fax: 000-000-0000
(c) if to the Purchaser:
000-000 Xxxx Xxxxxxxx, Xxxxx 000
Xxxxxxxxx, XX, Xxxxxx
X0X 0X0
Tel: 000-000-0000
Fax: 000-000-0000
Any notice given by personal delivery shall be deemed to be received on the date
of delivery. Any notice sent by courier shall be deemed to be received on the
next Business Day following the deposit of the communication with the courier
service. Any notice sent by prepaid registered mail shall be deemed to be
received on the fifth (5th) day other than a Saturday, Sunday or statutory
holiday in Canada, following the deposit of the communication in the mail. If
the party giving any Communication knows or ought reasonably to know of any
difficulties with the postal system which might affect the delivery of mail, any
such Communication may not be mailed but must be given by personal delivery or
by electronic communication. Any notice sent by facsimile or similar method of
recorded communication shall be deemed to have been received on the date of its
transmission if transmitted before 4:30 p.m. (Toronto time), and on the next
Business Day following the date of its transmission if transmitted after that
time.
8.3 TIME OF ESSENCE. Time shall be of the essence in all respects of this
Agreement.
8.4 FURTHER ASSURANCES. The Parties shall with reasonable diligence do all
things and provide all reasonable assurances as may be required to complete the
transactions contemplated by this Agreement, and each Party shall provide such
further documents or instruments required by any other Party as may be
reasonably necessary or desirable to give effect to this Agreement and carry out
its provisions.
8.5 PUBLIC NOTICE. All public notices to third parties and all other
publicity concerning the transactions contemplated by this Agreement shall be
jointly planned and co-ordinated by the Parties and no Party shall act
unilaterally in this regard without the prior consent of the other Party, such
approval not to be unreasonably withheld.
8.6 AMENDMENT. No supplement, modification, waiver or termination of this
Agreement shall be binding unless executed in writing by both Parties.
8.7 WAIVER. No waiver of any of the provisions of this Agreement shall
constitute a waiver of any other provision (whether or not similar) nor shall
such waiver constitute a continuing waiver unless otherwise expressly provided.
8.8 ASSIGNMENT. This Agreement and the rights or obligations hereunder or
thereunder may not be assigned by either Party without the prior written consent
of the other Parties.
8.9 BINDING AGREEMENT. This Agreement shall be binding on and enure to the
benefit of both Parties and their respective successors and permitted assigns.
In addition all obligations of the Parties under this Agreement shall also be
binding upon any and all directors, officers, employees, consultants, advisors
and agents of each Party as well as all parent corporations, subsidiaries,
related and affiliated companies thereof.
8.10 ATTORNMENT. For the purpose of all legal proceedings this Agreement
shall be deemed to have been performed in the Province of Ontario and the courts
of the Province of Ontario shall have jurisdiction to entertain any action
arising under this Agreement. The Partner and the Purchasers each hereby
attorns to the jurisdiction of the courts of the Province of Ontario.
8.11 SEVERABILITY. If any provision of this Agreement is determined to be
prohibited, void or unenforceable in whole or in part, such void or
unenforceable provision shall not affect or impair the validity of any other
provision of this Agreement and shall be severable from this Agreement. Any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
8.12 INDEPENDENT LEGAL ADVICE AND TAX ADVICE. Each Party acknowledges
having been advised to seek independent legal counsel and independent tax advice
in respect of the Agreement and the matters contemplated herein. To the extent
that a Party declines to receive independent legal counsel and independent tax
advice in respect of the Agreement, that Party hereby waives the right, should a
dispute later develop, to rely on its lack of independent legal counsel or
independent tax advice to avoid its obligations, to seek indulgences from the
other Parties hereto, or to otherwise attack the integrity of the Agreement and
the provisions thereof, in whole or in part.
8.13 COUNTERPARTS. This Agreement may be executed by the Parties in one or
more counterparts by facsimile, each of which when so executed and delivered
shall be an original and such counterparts shall together constitute one and the
same instrument.
IN WITNESS WHEREOF the Parties have executed this Agreement as of the date
written above.
NO WIRE TELECOM
Per: /S/ XXXXXX XXXXX
-----------------
Authorized Signing Officer
Per: /S/ XXXXX XXXXXXX XXXXX XXXXXX
------------------------------
Authorized Signing Officer
I have authority to bind the partnership
KOALA INTERNATIONAL WIRELESS INC.
Per: /S/ K. XXXXXX XXXXX
-------------------
Authorized Signing Officer
I have authority to bind the corporation
THE PARTNERS:
/S/ XXXXX XXXXXXX XXXXX XXXXXX
_________________________ _________________________________________
Witness XXXXX XXXXXXX XXXXX XXXXXX
/S/ XXXXXX XXXXX
_________________________ _________________________________________
Witness XXXXXX XXXXX
SCHEDULE "A"
DEFINITIONS
"Acquired Partnership" means Nowire Telecom.
"Acquired Partnership Interests" means the partnership interests of the Acquired
Partnership owned by the Partners, as set out in Schedule "B" hereto.
"Agreement" means the Agreement and any instrument supplemental or ancillary to
it.
"Business Day" means any day other than a Saturday, Sunday or statutory holiday
in the State of Nevada.
"Claims" means claims, demands, actions, causes of action, damages, losses,
costs, fines, penalties, interest, liabilities and expenses, including, without
limitation, reasonable legal fees.
"Closing" means the completion of the purchase and sale of the Acquired
Partnership Interests pursuant to this Agreement.
"Closing Date" means the date that is one day after the Information Statement
becomes effective or such later date as may be agreed upon by the Parties, but
no later than January 30, 2003.
"Closing Time" means 2:00 p.m. (Toronto time) on the Closing Date or such other
time on the Closing Date as may be agreed to by the Parties.
"Encumbrances" means any mortgage, charge, pledge, hypothecate, lien,
encumbrance, restriction, option, voting trusts, right of others or security
interest of any kind.
"Governmental Authorities" means any applicable Canadian or U.S. federal,
provincial and municipal agency, ministry, crown corporation, department,
inspector and official.
"Interim Period" means the period commencing on the date of this Agreement and
ending immediately before the Closing Time on the Closing Date.
"Listing Status" means the Purchaser's status as a company whose common shares
are listed or quoted for trading on the OTCBB and which is in good standing with
the OTCBB and is not in default under any of its rules, policies or by-laws.
"OTCBB" means the NASD Over-The-Counter Bulletin Board in the United States.
"Parties" means the parties to this Agreement and "Party" means any one of them.
"Person" means an individual, body corporate, partnership, trustee, trust,
unincorporated association, executor, administrator or legal representative.
"Permitted Encumbrances" means the resale restrictions set forth in section 2.7
herein.
"Purchaser" means Koala International Wireless Inc.
"Purchaser Common Stock" means approximately 6,000,000 common stock of the
Purchaser to be issued to the Partners as partial consideration for the Acquired
Partnership Interests pursuant to section 2.2 of this Agreement.
"Reporting Issuer Status" means the Purchaser's status as a reporting company in
the United States under the U.S. Securities Exchange Act of 1934, in good
standing and not in default under said act, but not a "reporting issuer" in any
province of territory of Canada, as that term is defined in the Securities Act
(Ontario).
"Partners" means the registered partners of the Acquired Partnership Interests
as set out in Schedule "B" hereto.
SCHEDULE "B"
THE PARTNERS' PARTNERSHIP INTERESTS
NAME AND ADDRESS OF PARTNER NUMBER OF ACQUIRED NUMBER OF PURCHASER
PARTNERSHIP INTERESTS OWNED COMMON STOCK TO BE ISSUED
BY PARTNER TO PARTNER
--------------------------- --------------------------- -------------------------
XXXXXX XXXXX 92.5% 5,550,000
MONTREAL, QUEBEC
--------------------------- --------------------------- -------------------------
XXXXX XXXXXXX XXXXX
XXXXXX 7.5% 450,000
--------------------------- --------------------------- -------------------------
TOTAL 100% 6,000,000
--------------------------- --------------------------- -------------------------
SCHEDULE "C"
OUTSTANDING OPTIONS OF THE PURCHASER
NAME OF OPTION DATE OF VESTING NUMBER AND TERMS OF OPTIONS
HOLDER GRANT SCHEDULE
------------------ ---------- --------------- ---------------------------------------------
Xxxxxxxx Xxxxxx March 22, N/A 600,000 OPTIONS AT EXERCISE PRICE OF
2002 US$0.03 PER SHARE UNTIL MARCH 22, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxx March 13, April 15, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$5.00 PER SHARE UNTIL APRIL 15, 2004
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxxxx March 13, April 15, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$5.00 PER SHARE UNTIL APRIL 15, 2004
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxx March 13, June 15, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$7.50 PER SHARE UNTIL JUNE 15, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxxxx March 13, June 15, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$7.50 PER SHARE UNTIL JUNE 15, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxx March 13, Sept. 1, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$10.00 PER SHARE UNTIL SEPT. 1, 2007
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxxxx March 13, Sept. 1, 2002 50,000 OPTIONS AT EXERCISE PRICE OF
2002 US$10.00 PER SHARE UNTIL SEPT. 1, 2007
------------------ ---------- --------------- ---------------------------------------------
Xxxxxxxxx Cerisse August 20, August 20, 2002 100,000 OPTIONS AT EXERCISE PRICE OF US$0.50
2002 PER SHARE UNTIL AUGUST 20, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxxxxxxxx August 20, August 20, 2002 100,000 OPTIONS AT EXERCISE PRICE OF US$0.50
2002 PER SHARE UNTIL AUGUST 20, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxxx Xxxxxxx August 20, August 20, 2002 100,000 OPTIONS AT EXERCISE PRICE OF US$0.50
2002 PER SHARE UNTIL AUGUST 20, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxx Xxxxxxx October 8, October 8, 2002 500,000 OPTIONS AT EXERCISE PRICE OF US$0.05
2002 PER SHARE UNTIL OCTOBER 8, 2005
------------------ ---------- --------------- ---------------------------------------------
Xxxx Xxxxxxxx October 8, October 8, 2002 300,000 OPTIONS AT EXERCISE PRICE OF US$0.05
2002 PER SHARE UNTIL OCTOBER 8, 2005
------------------ ---------- --------------- ---------------------------------------------
TOTAL 2,000,000 OPTIONS
------------------ ---------- --------------- ---------------------------------------------
