SHARE EXCHANGE AGREEMENT
THIS AGREEMENT dated for reference the 21st day of January, 2002.
BETWEEN:
KWEI CHI PING, JUSTIN, of Flat A, 16th Floor, Cornell Court, 00
Xxxx'x Xxxx, Xxxxx Xxxxx, Xxxx Xxxx;
AND
XXXX XXXX TAK, XXXXX, of Flat 4E, Block 16, Provident Centre, 00
Xxxxx Xxxx, Xxxxx Xxxxx, Xxxx Xxxx;
AND
XXX XXXX KEUNG, WILSON, of Xxxx X, 00xx Xxxxx, Xxxxx 8, Melody
Garden, 2 Wa Chui Road, Tuen Mun N.T., Hong Kong
(hereinafter collectively called the "Vendors")
AND:
WORLD ENVIROTECH, INC., a Colorado corporation with a registered
office in the State of Florida, USA, located at 0000 X. Xxxxxxx
Xxxxxx, Xxxxxxxxx, XX 00000, and a head office within British Columbia
located at Suite 830 - 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx
(hereinafter called the "Purchaser" or "WEI")
AND: PROTECTSERVE PACIFIC LIMITED., a company duly incorporated under the
laws of Hong Kong and having an office and place of business at
1101-2, 11/F 000 Xxxxxxxx Xxxx, Xxxxx Xxxxx, Xxxx Xxxx
(hereinafter called the "Company" or "PSP")
WITNESSES THAT WHEREAS:
A. Majority shareholder Xin Net corp., a Florida corporation with a registered
office in the State of Florida, U.S.A. are legal and /or beneficial owners
of an aggregate OF 15,370,675 shares on a post consolidation basis in the
capital of WORLD ENVIROTECH, INC. after subscribing to US$600,000 in
private placements;
B. The Vendors are the legal and/or beneficial owners of an aggregate of
5,633,036 shares in the capital of the Company (the "Shares"), allocated as
follows:
Kwei Chi Ping, Xxxxxx 3,098,170
Xxx Xxxx Keung, Wilson 1,408,259
Xxxx, Xxxxx 1,126,607
Total 5,633,036
C. The Vendors have each agreed to sell and the Purchaser has agreed to
purchase the Shares upon the terms and conditions herein set forth.
NOW THEREFORE in consideration of the premises, the covenants and agreements and
warranties hereinafter set forth, it is hereby agreed as follows:
SALE AND PURCHASE
1. Based on and relying upon the representations and warranties herein, the
Vendors hereby each agree to sell the Shares to the Purchaser and the
Purchaser hereby agrees to purchase the Shares from the Vendors on the
terms and conditions herein contained.
2. All shares referred to hereunder in this SALE AND PURCHASE section are
after an announced 1: 4 consolidation.
3. The purchase price payable by the Purchaser to the Vendors for the Shares
payable on the Closing Date shall be 30,000,000 restricted common shares in
the capital stock of the Purchaser as per the allocation table set out in
Schedule "A", to be issued in exchange for the shares held by the Vendors
in the Company.
4. On February 15, 2002, the purchase price will be adjusted based the capital
financing of WEI in the following manner:
(a) in the event that WEI has raised US$900,000 on or before February
15, 2002 through private placement, the purchase price shall not
be adjusted;
(b) in the event that WEI has raised US$800,000 on or before February
15, 2002 through private placement, the purchase price shall be
adjusted to 32,500,000 restricted common shares of WEI;
(c) in the event that WEI has raised US$700,000 on or before February
15, 2002 through private placement, the purchase price shall be
adjusted to 35,000,000 restricted common shares of WEI;
(d) in the event that WEI has raised US$600,000 on or before February
15, 2002 the purchase price shall be adjusted to 37,500,000
restricted common shares of WEI.
4. WEI shall on or before February 20, 2002 issue to the Vendors the
additional restricted common shares in the capital stock of WEI, if any,
pursuant to the adjusted purchase price pursuant to Section 3 of this
Agreement.
5. The restricted common shares will be issued pursuant to exemptions under
Regulation S promulgated under the US Securities Xxx 0000 and under the
Securities Act of British Columbia.
BUY BACK SHARES
6. The Parties agree that in the event that PSP's net (after tax) profit
calculated according to US GAAP shall be less than HK$9,000,000 for the 12
months ending on December 31, 2002, the Purchaser will have the right to
buy back from the Vendors, pro rata, certain common shares of the Purchaser
issued to the Vendor on the Closing Date at the rate of $US$0.001 per
share. The Pay Back formula shall be for every HK$333,333 that PSP falls
short of the HK$9,000,000 net profit the Purchaser shall have the right to
buy-back 1,000,000 common shares issued to the Vendors. The Parties agree
that within 5 days of written notice from the Purchaser each Vendor will
execute and deliver to the Purchaser all transfer documents necessary to
transfer the Vendors' shares, to be bought back by the Purchaser, free and
clear of all charges, liens and encumbrances, and forthwith upon receipt
and registration of all documents necessary to transfer to the Purchaser
the shares to be bought back by the Purchaser free and clear of all
charges, liens and encumbrances, the Purchaser shall deliver to each Vendor
a certified cheque payable to the Vendor in the amount of the purchase
price specified in the written notice.
COMPANY AND VENDORS' REPRESENTATIONS AND WARRANTIES
7. The Company and the Vendors, jointly and severally, represent and warrant
to the Purchaser, to the best of their knowledge, information and belief
after making due inquiry that:
(a) the Company is a company duly incorporated in Hong Kong on
September 25, 2000 under Companies Ordinance under the name of
Global Surveillance Communications Limited and, effective January
15, 2001, changed its name to ProtectServe Pacific Limited. The
Company is not a reporting company and is a valid and subsisting
company in good standing with all regulatory authorities;
(b) the authorized capital of the Company consists of 6,000,000
Shares with a par value of HK$1.00 per share, of which there are
5,633,036 Shares issued and outstanding;
(c) attached hereto as Schedule "B" are true and complete copies of
the Company's audited and unaudited financial statements for the
period from date of incorporation to September 30, 2001 (the
"Company's Financial Statements"). The Company's Financial
Statements have been prepared in accordance with the Statements
of Auditing Standards issued by the Hong Kong Society of
Accountants and present fairly the financial position, results of
operations and statements of changes in the Company's financial
position for the period indicated.
(d) since September 30, 2001, the Company's business has been
operated substantially in accordance with all laws, rules,
regulations, orders of competent regulatory authorities, and
there has not been:
(i) any event or change in circumstances that has had, or
which the Company may expect to have, a material adverse
effect on the Company or its business;
(ii) any change in liabilities of the Company that has had, or
which the Company may expect to have, a material adverse
effect on the Company or its business;
(iii) any incidence, assumption or guarantee of any indebtedness
for borrowed money by the Company;
(iv) any payments by the Company in respect of any indebtedness
of the Company for borrowed money or in satisfaction of
any liabilities of the Company, other than in the ordinary
course of business;
(v) the creation, assumption or sufferance of the existence of
any lien on any assets reflected on the Company Financial
Statements;
(vi) any grant of any severance, continuation or termination
pay to any director, officer, stockholder or employee of
the Company; or any entering into of an employment,
deferred compensation or other similar agreement, or
amendment or variation to any such existing agreement;
(vii) any change by the Company in its accounting principles,
methods or practices or in the manner it keeps its books
and records; (viii) any distribution, dividend or bonus by
the Company to any of its respective officers, directors,
stockholders or affiliates, or any of their respective
affiliates or associates; and
(ix) any material capital expenditure or commitment by the
Company or material sale, assignment, transfer, lease or
other disposition of or agreement to sell, assign,
transfer lease or otherwise dispose of any asset or
property by the Company other than in the ordinary course
of business.
(e) the Shares are free and clear of all liens, claims, charges and
encumbrances of every nature and kind whatsoever;
(f) the Shares are duly authorized, validly issued and outstanding as
fully paid and non-assessable shares;
(g) the Vendors are the sole registered and/or beneficial owners of
the Shares and have due and sufficient right and authority to
transfer the legal and beneficial title and ownership of the
Shares to the Purchaser, and each of the Vendors and the Company
has due and sufficient right, power and authority (including any
and all necessary corporate and/or shareholder authorizations) to
enter into this Agreement on the terms and conditions herein set
forth, and this Agreement, when executed and delivered by the
Vendors and Company, will constitute a legal and binding
obligation of each such party enforceable against it in
accordance with its terms;
(h) no person, firm or corporation has any agreement or option or a
right capable of becoming an agreement for the purchase of the
Shares or any other shares in the capital of the Company owned by
the Vendors or any right capable of becoming an agreement for the
purchase, subscription or issuance of any of the unissued shares
in the capital of the Company;
(i) the Company has the full corporate power and authority to carry
on the business presently being carried on by it and as proposed
to be carried on by it;
(j) the Company holds all licenses and permits as may be requisite
for carrying on its business in the manner in which it has
heretofore been carried on.
(k) there are no material liabilities, contingent or otherwise, other
than as set forth in Schedule "H" attached hereto;
(l) at the Time of Closing, the Company shall not have any
liabilities, contingent or otherwise, other than those
liabilities set forth as of December 31, 2001 in Schedule "C"
attached hereto, except that the Company may have further
liabilities incurred in its normal course of business for the
period from December 31, 2001 to the Date of Closing;
(m) the books and records of the Company fairly and correctly set out
and disclose in all material respects, in accordance with Hong
Kong generally accepted accounting principles, the financial
position of the Company as at the date hereof and all material
financial transactions of the Company relating to its business
have been accurately recorded in such books and records;
(n) no payments of any kind have been made or authorized to or on
behalf of the Vendors or any of them or to or on behalf of
officers, directors or shareholders of the Company or under any
management agreements with the Company which are not recorded in
the books or records of the Company or which have not been
disclosed in writing to the Purchaser other than payments made in
the normal course of business;
(o) there is no basis for and there are no actions, suits, judgments,
investigations or proceedings outstanding or pending or to the
knowledge of the Company or the Vendors, jointly or severally,
threatened against or affecting the Company at law or in equity
or before or by any federal, state, municipal or other
governmental department, commission, board, bureau or agency;
(p) to the best of the Vendors' knowledge, the Company is not in
breach of any laws, ordinances, statutes, regulations, by-laws,
orders or decrees to which it is subject or which apply to it;
(q) the Company is not a party to any collective agreement with any
labour union or other association or employees and no attempt has
been made to organize or certify the employees of the Company as
a bargaining unit;
(r) there are no pensions, profit sharing, group insurance or similar
plans or other deferred compensation plans affecting the Company;
(s) the Company is not indebted to any employee of the Company or
other workers engaged in the business of the Company for any
wages or salaries and the Company has not received or been
notified of any general wage claims;
(t) the Company is the sole beneficial owner and has good and
marketable title to all its properties and assets free and clear
of all liens, mortgages, pledges, deeds of trust, conditional
sale agreements, encumbrances, charges or claims of every kind
and nature whatsoever;
(u) the Company has not experienced nor is it aware of any occurrence
or event which has had, or might reasonably be expected to have,
a materially adverse affect on its business or the results of its
operations;
(v) neither the Vendors nor any officer, director, employee or
shareholder of the Company is now indebted or under obligation to
the Company on any account whatsoever; and other than those set
forth in Schedule "C" attached hereto the Company is not indebted
or under obligation to the Vendors or any officer, director,
employee or shareholder of the Company.
VENDORS' FURTHER REPRESENTATIONS AND WARRANTIES
8. The Vendors hereby jointly and severally represent and warrant to the
Purchaser as follows that:
(a) the Vendors have the capacity to protect their own interests in
connection with the acquisition of the common shares of the
Purchaser and are capable of evaluating the merits and risks of
an investment in the Purchaser by reason of their business and
financial knowledge and experience;
(b) the Vendors are acquiring the shares of common stock of the
Purchaser for investment for their own account, not as a nominee
or agent, and not with the view to, or for resale in connection
with, any distribution thereof. The Vendors understand that the
shares of common stock of the Purchaser have not been, and will
not be, registered under the US Securities Xxx 0000, as amended
(the "Securities Act"), by reason of a specific exemption from
the registration provisions of the Securities Act, the
availability of which depends upon, among other things, the bona
fide nature of the investment intent and the accuracy of the
Vendors' representations as expressed herein;
(c) each Vendor acknowledges that the shares of common stock of the
Purchaser must be held indefinitely unless subsequently
registered under the Securities Act or unless an exemption from
such registration is available. Each Vendor is aware of the
restrictions and limitations on resale of the shares of common
stock of the Purchaser into the United States or to a US Person
under the Securities Act. In addition, each Vendor is aware of
the provisions of Rule 144 promulgated under the Securities Act
("Rule 144") which permit limited resales in the US of shares
purchased in a private placement subject to the satisfaction of
certain conditions, including, among other things, the existence
of a public market for the shares of common stock of the
Purchaser, the availability of certain current public information
about the Purchaser, the resale occurring not less than one year
after a party has purchased and paid for the security to be sold,
the sale being effected through a "broker's transaction" or in
transactions directly with a "market maker" and the number of
shares being sold during any three-month period not exceeding
specified limitations;
(d) each Vendor also acknowledges that the shares of common stock of
the Purchaser must be held indefinitely unless subsequently
registered under the Securities Act (British Columbia) (the "BC
Act") or unless an exemption from such registration is available.
Each Vendor is aware that the shares of common stock of the
Purchaser are subject to restriction on transferability and
resale and may not be transferred or resold in British Columbia
or to British Columbia residents except as permitted by the
Securities Act (British Columbia) (the "BC Act") and Regulations
made under the BC Act;
(e) each of the Vendors has had an opportunity to discuss the
Purchaser's business, management and financial affairs with the
Company's management and has also had an opportunity to ask
questions of the Purchaser's officers, which questions were
answered to the Vendors' satisfaction. Each Vendor has been
furnished with or has had access to such information as a
sophisticated investor would customarily require to evaluate the
merits and risks of the proposed investment together with such
additional information as is necessary to verify the accuracy of
the information supplied. The Vendors represent and acknowledge
that they have been solely responsible for their own
due-diligence investigation of the Purchaser and its management
and business, for their own analysis of the merits and risks of
this investment, and for their own analysis of the terms of the
investment, and that in taking any action or performing any role
relative to the proposed investment, they have acted solely in
their own interest, and that neither they nor any of their agents
or employees has acted as an agent, employee, partner or
fiduciary of any other person, or as an agent of the Purchaser,
or as an issuer, underwriter, broker, dealer or investment
advisor relative to this investment;
(f) each of the Vendors understands that the Purchaser has limited
operating history and that investment in the Purchaser involves
substantial risks. The Vendors further understand that the
acquisition of the shares of common stock of the Purchaser will
be a highly speculative investment. Each of the Vendors is able,
without impairing his financial condition, to hold the shares of
common stock of the Purchaser for an indefinite period of time
and to suffer a complete loss of his investment;
(g) each of the Vendors agrees to indemnify and hold harmless the
Purchaser and its officers, directors and agents for any costs,
liabilities or losses caused by any misstatement of material fact
by such Vendor with respect to the representations and warranties
contained in this Section or any other written information
provided to the Purchaser by such Vendor in connection with the
investment contemplated by this Agreement; and
(h) each Vendor represents and warrants to the Purchaser that he is
not a US Person as defined in Regulation S as promulgated under
the Securities Act and that the buy order for the common shares
of the Purchaser originated by each Vendor outside of the US.
COMPANY AND VENDORS' COVENANTS
9. The Company and the Vendors jointly and severally covenant and agree that:
(a) the representations and warranties contained in this Agreement
shall be true at and as of the Time of Closing as if such
representations and warranties were made as of such time;
(b) the Company and the Vendors will permit the Purchaser or whoever
it directs on its behalf to examine the records, statements and
accounts of the Company on regular business days and during
regular business hours up to and including the Closing Date and
make such audit of the books of account of the Company and
physical verification of the inventory of the Company as the
Purchaser may see fit;
(c) the representations, warranties, covenants and agreements
contained herein shall survive the Closing Date and
notwithstanding the Closing of the purchase and sale herein
contemplated, shall continue in full force and effect;
(d) the Company and the Vendors will, jointly and severally, prior to
Closing, take all steps and proceedings and execute such further
assurances and documents as may be required to obtain the
transfer and registration of the Shares into the name of the
Purchaser provided that all terms and conditions to be observed
and performed by the Purchaser at the Time of Closing have been
observed and performed;
PURCHASERS' REPRESENTATIONS AND WARRANTIES
10. As an inducement to the Company and each of the Vendors to enter into this
Agreement and to consummate the transactions provided for herein, the
Purchaser represents and warrants to the Company and each of the Vendors,
to the best of its knowledge, information and belief after making due
inquiry that:
(a) the Purchaser was incorporated on March 16, 1994 under the laws
of the State of Colorado under the name of World Envirotech,
Inc.;
(b) the Purchaser is duly incorporated, validly existing and in good
standing under the laws of the State of Colorado;
(c) the Purchaser is now and as of the Closing Date will be traded on
the OTC Bulletin Board;
(d) it has full and absolute right, power and authority to enter into
this Agreement on the terms and conditions herein set forth, to
carry out the transactions contemplated hereby and, to transfer
on the Closing Date to the Vendors all legal and beneficial
ownership in and to the restricted common shares;
(e) this Agreement once duly executed and delivered by the Purchaser
will constitute a legal, valid and binding obligation of the
Purchaser; enforceable against the Purchaser in accordance with
its terms;
(f) no proceedings have been taken or authorized by the Purchaser, or
to the knowledge of the Purchaser, by any person, with respect to
the bankruptcy, insolvency, liquidation, dissolution or
winding-up of the Purchaser or with respect to any amalgamation,
merger, consolidation, arrangement or reorganization relating to
the Purchaser;
(g) the authorized capital stock of the Purchaser consists of
100,000,000 shares of US $0.001 par value common stock of which
5,402,700 are issued and outstanding as of January 9, 2002;
(h) all of the issued and outstanding shares of the Purchaser have
been duly and validly authorized and issued in accordance with
applicable laws and are validly outstanding, fully paid and
non-assessable;
(i) the Purchaser has no outstanding stock options, warrants or other
rights to purchase, or subscribe to or other securities
convertible into or exchangeable for any shares of the capital
stock of the Purchaser or contracts or arrangements of any kind
relating to the issuance, sale or transfer of any capital stock
or other equity securities of the Purchaser;
(j) all of the restricted common shares which will be issued to the
Vendors hereunder in compliance with applicable laws and the
articles of the Purchaser, and will be issued fully paid and
non-assessable, and free and clear of all liens, charges,
encumbrances and trading restrictions other than as may be
imposed by applicable U.S. Federal and State laws;
(k) attached hereto as Schedule "D" are true and complete copies of
the Purchasers audited financial statements for the fiscal year
ended on February 28, 2001 as contained in the Purchasers' Form
10-KSB and Unaudited Financial Statements as of May 31, August 31
and November 30, 2001 contained in the Purchaser's Form 10-QSB
Interim Reports for the 1st, 2nd and 3rd Quarter, 2001,
respectively (the "Purchaser's Financial Statements"). The
Purchaser's Financial Statements have been prepared in accordance
with the US Generally Acceptable accounting principles and
present fairly the financial position, results of operations and
statements of changes in the Purchaser's financial position for
the period indicated;
(l) no adverse material changes in the affairs of the Purchaser have
occurred since November 30, 2001;
(m) there are no liabilities, contingent or otherwise of the
Purchaser which are not disclosed or reflected in its Financial
Statements set forth in Schedule "D" attached hereto;
(n) at the time of Closing, the Purchaser shall not have any
liabilities, contingent or otherwise, other than those
liabilities set forth as of November 30, 2001 in Schedule "E"
attached hereto, except that the Purchaser may have further
liabilities incurred in its normal course of business for the
period from November 30, 2001 to the Date of Closing;
(o) there is no litigation, proceeding, or investigation pending or
threatened against the Purchaser, nor does the Purchaser know, or
have grounds to know, of any basis for any litigation, proceeding
or investigation against the Purchaser, except as disclosed in
writing to the Vendors;
(p) since November 30, 2001, the Purchaser's business has been
operated substantially in accordance with all laws, rules,
regulations, orders of competent regulatory authorities, and
there has not been:
(i) any event or change in circumstances that has had, or
which the Purchaser may expect to have, a material
adverse effect on the Purchaser or its business;
(ii) any change in liabilities of the Purchaser that has had,
or which the Purchaser may expect to have, a material
adverse effect on the Purchaser or its business;
(iii) any incidence, assumption or guarantee of any indebted-
ness for borrowed money by the Purchaser;
(iv) any payments by the Purchaser in respect of any indebted-
ness of the Purchaser for borrowed money or in satisfac-
tion of any liabilities of the Purchaser, other than in
the ordinary course of business;
(v) the creation, assumption or sufferance of the existence
of any lien on any assets reflected on the Purchaser
Financial Statements;
(vi) any grant of any severance, continuation or termination
pay to any director, officer, stockholder or employee of
the Purchaser; or any entering into of an employment,
deferred compensation or other similar agreement, or
amendment or variation to any such existing agreement;
(vii) any change by the Purchaser in its accounting principles,
methods or practices or in the manner it keeps its books
and records;
(viii) any distribution, dividend or bonus by the Purchaser to
any of its respective officers, directors, stockholders
or affiliates, or any of their respective affiliates or
associates; and
(ix) any material capital expenditure or commitment by the
Purchaser or material sale, assignment, transfer, lease
or other disposition of or agreement to sell, assign,
transfer lease or otherwise dispose of any asset or
property by the Purchaser other than in the ordinary
course of business.
(q) the Purchaser does not own or lease any real property or material
assets other than those set forth in Schedule "F" attached
hereto;
(r) there are no contracts or indebtedness between the Purchaser and
any of its shareholders, or affiliates or associates of any of
its shareholders other than those set forth in Schedule "G"
attached hereto;
(s) there are no material contracts to which the Purchaser is a party
other than those set forth in Schedule "H" attached hereto;
(t) the operation of the Purchaser's business has not violated or
infringed any U.S. Federal or State laws or regulations;
(u) all tax returns and reports of the Purchaser required by law to
be filed prior to the date hereof have been filed and are
substantially true, complete and correct, and all taxes and other
government charges have been paid or accrued in the Purchaser
Financial Statements;
(v) the information contained in the documents, certificates and
written statements (including this Agreement and the attachments
thereto) furnished by the Purchasers to the Vendors are true and
complete in all material respects and do not omit to state any
material fact necessary in order to make the statements therein;
and
(w) there is no fact known to the Purchaser that has not been
disclosed to the Vendors in writing that could reasonably have a
material adverse effect on the Purchaser.
Purchasers Covenants
11. The Purchaser covenants and agrees on the Closing Date, and provided that
all terms and conditions to be observed and performed by the Vendors at the
Time of Closing have been observed and performed, the Purchaser will issue
the restricted common shares to the Vendors, such restricted common shares
to be issued free and clear of any liens, encumbrances and charges, but
subject to applicable trading restrictions imposed by U.S. and British
Columbia securities legislation, and imposed under such other securities
legislation applicable in each jurisdiction where any of the Vendors are
resident;
CONDITIONS PRECEDENT FOR THE VENDORS
12. The joint and several obligations of the Vendors to carry out the terms of
this Agreement and to complete the sale contemplated herein is subject to
the following conditions:
(a) the Purchaser shall have performed and satisfied each of its
obligations hereunder required to be performed and satisfied by it on
or prior to the Closing Date and each of the representations and
warranties of the Purchaser contained herein shall have been true and
correct and contained no misstatement or omission that would make any
such representation or warrant misleading when made, and shall be
true and correct and contain no misstatement or omission that would
make any such representation or warranty misleading at and as of the
Closing Date with the same force and effect as if made as of the
Closing Date;
(b) the transactions contemplated by this Agreement shall not violate any
applicable law and there shall be no pending actions or proceedings
by any State, U.S. Federal or State regulatory authority or by any
other person challenging or seeking to materially restrict or
prohibit the transfer and exchange contemplated hereby or the
consummation of the transactions contemplated by this Agreement;
(c) the Purchaser's Board of Directors, by proper and sufficient vote
respectively, shall have approved this Agreement and the transactions
contemplated hereby.
CONDITIONS PRECEDENT FOR THE PURCHASER
13. All obligations of the Purchaser under this Agreement are subject to the
fulfillment on or prior to Closing, of each of the following conditions to
the satisfaction of the Purchaser's solicitor:
(a) all covenants, warranties and agreements of the Company and the
Vendors to be performed on or before the Closing Date pursuant to
the terms and conditions of this Agreement have been duly
performed;
(b) the Vendors shall transfer the Shares to the Purchaser and such
Shares shall be registered on the books of the Company in the
name of the Purchaser at the Time of Closing; and
(c) the representations and warranties of the Company and the Vendors
set forth in this Agreement shall be true and correct as of the
date of the Agreement and shall be true and correct as at the
Date of Closing as if made by the Vendors on the Closing Date.
14. The Company and the Vendors jointly and severally agree that the foregoing
conditions in section 13 are inserted for the exclusive benefit of the
Purchaser and may be waived by the Purchaser in whole or in part at any
time.
15. In the event any of the conditions set forth in section 13, are not met by
the Closing Date for whatever reason, the Purchaser at his option, may
elect not to proceed with the purchase of the Shares contemplated herein
without prejudice to any other rights and remedies.
SHARE CERTIFICATE LEGENDS
16. It is understood that the certificates evidencing the Purchaser's shares of
common stock may bear one or more legends in substantially the following
forms, as well as any other legend required by the laws of any applicable
jurisdiction:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE U.S. OR TO US PERSONS IN THE ABSENCE OF A
REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER
SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED. HEDGING TRANSACTIONS FOR SUCH SECURITIES
MAY NOT BE MADE UNLESS IN COMPLIANCE WITH SUCH ACT.
THE SHARES ARE SUBJECT TO RESTRICTION ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD IN THE U.S. OR TO US PERSONS EXCEPT AS
PERMITTED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
The Purchaser need not record a transfer of the shares, unless the
conditions specified in any applicable legends are satisfied. The Purchaser
may also instruct its transfer agent not to record the transfer of any of
the shares unless the conditions specified in the applicable legends are
satisfied.
17. The legend relating to the Securities Act endorsed on a stock certificate
pursuant to this Agreement and the stop transfer instructions with respect
to the shares represented by such certificate shall be removed and the
Purchaser shall issue a certificate without such legend to the holder of
such shares if such shares are registered under the Securities Act and a
prospectus meeting the requirements of Section 10 of the Securities Act is
available or if such holder provides to the Purchaser an opinion of counsel
reasonably satisfactory to the Purchaser, or a no-action letter or
interpretive opinion of the staff of the Securities and Exchange Commission
(the "SEC") to the effect that a public sale, transfer or assignment of
shares may be made without registration and without compliance with any
restriction such as Rule 144.
CLOSING
18. The sale and purchase of the Shares shall be closed on January 18, 2002 or
on such other date agreed by all of the parties hereunder, at the office of
the Purchaser, or at any other place agreed to by all of the Parties, which
date and time are referred to herein as the "Date of Closing", the "Closing
Date", the "Closing" and the "Time of Closing".
19. At Closing, the Vendors shall deliver to the Purchaser:
(a) share certificates duly endorsed for transfer of 5,623,036
Shares, constituting the totality of Shares issued and
outstanding at Closing Date, with a par value of HK$1.00 per
share in the capital of the Company into the Purchaser's name
representing the Shares;
(b) certified copies of resolutions of the directors of the Company
authorizing and approving the transfer of the Shares,
registration of the Shares in the name of the Purchaser,
authorizing the issue of new share certificates representing the
Shares in the name of the Purchaser, and entry of the name and
address of the Purchaser into the Register of Members and
Register of Directors of the Company;
(c) all corporate records and books of account of the Company,
including, without limitation, the minute book, corporate seal,
share register books, share certificate books and annual reports
of the Company;
(d) certified copies of such resolutions of the shareholders and
directors of the Company as are to be passed to authorize the
execution, delivery and implementation of this Agreement and of
all documents to be delivered by the Vendor pursuant thereto;
(e) a certificate signed by the Company and the Vendors that all
covenants, warranties and agreements of the Vendors pursuant to
the terms of this Agreement have been duly performed and that the
representations and warranties of the Vendors set forth in this
Agreement are true and correct as at the Date of Closing;
20. At Closing the Purchaser shall deliver to the Vendor the following:
(a) share certificates representing the restricted common shares in
the names and denominations set out in Schedule "A" hereto;
(b) certified copies of resolutions of the directors of the Purchaser
authorizing and approving the issuance of the restricted common
shares, registration of the restricted common shares in the name
of the Vendors in accordance with Schedule "A" hereto and
authorizing the issue of the new share certificates representing
such restricted common shares;
(c) all corporate records and books of account of the Company,
including without limitation, the minute book;
(d) certified copies of such resolutions of the directors of the
Purchaser as are to be passed to authorize the execution,
delivery and implementation of this Agreement and of all
documents to be delivered to the Vendors pursuant thereto; and
(e) a certificate signed by a duly authorized officer of the
Purchaser that all covenants, warranties and agreements of the
Purchaser pursuant to the terms of this Agreement have been duly
performed and that the representations and warranties of the
Purchaser set forth in this Agreement are true and correct as at
the Closing;
INDEMNITY
21. The Purchaser shall be indemnified and held harmless by the Company and the
Vendors in respect of any and all damages incurred by the Purchaser as a
result of any inaccuracy or misrepresentation in or breach of any
representation or warranty, covenant or agreement made in this Agreement by
the Company and the Vendors.
22. The Vendors shall each be indemnified and held harmless by the Purchaser in
respect of any and all damages incurred by any of such Vendors as a result
of any inaccuracy or misrepresentation in or breach of any representation,
warranty, covenant or agreement made by the Purchaser in this Agreement.
SURVIVAL OF REPRESENTATION, WARRANTIES AND COVENANTS
23. Except as hereinafter provided, all representations, warranties, covenants,
agreements and obligations of the parties hereto shall survive the Closing
and shall expire one year following the Closing Date.
GENERAL
24. This Agreement shall be governed by and be construed in accordance with the
laws of the State of Colorado, USA.
25. Any notice to be given to a party hereto shall be in writing and signed by
or on behalf of such party and shall be given to the other party by
delivery thereto, or by sending by prepaid registered mail, telex,
facsimile, telegram or cable to the address of the other as hereinbefore
set forth or to such other address of which notice is given, and any notice
shall be deemed not to have been sufficiently given until it is received.
Any notice or other communication contemplated herein shall be deemed to
have been received on the day delivered, if delivered; on the seventh
business day following the mailing thereof, if sent by registered mail; and
on the business day following the transmittal thereof, if sent by telex,
facsimile, telegram or cable. If normal mail, telex, facsimile, telegram or
cable service shall be interrupted by strike, slow down, force majeure or
other cause, the party sending the notice shall utilize any of the other
such services which have not been so interrupted or shall deliver such
notice in order to ensure prompt receipt of same by the other party.
26. The parties shall execute such further assurances and other documents and
instruments and do such further and other things as may be necessary to
implement and carry out the intent of this Agreement.
27. The provisions herein contained constitute the entire agreement between the
parties hereto and supersede all previous expectations, understandings,
communications, representations and agreements whether verbal or written
between parties.
28. This Agreement may be amended by a written instrument signed by the party
against whom enforcement of the amendment is sought and any waivers made on
the part of the Purchaser with respect to any terms or conditions herein
must be in writing and signed by them.
29. If any provision of this Agreement is unenforceable or invalid for any
reason whatever, such unenforceability or invalidity shall not effect the
enforceability or validity of the remaining provisions of this Agreement
and such provision shall be severable from the remainder of this Agreement.
30. Time shall be of the essence hereof.
31. The headings appearing in this Agreement are inserted for convenience of
reference only and shall not affect the interpretation of this Agreement.
32. This Agreement shall enure to the benefit of and be binding upon the
parties and their successors and permitted assigns.
33. This Agreement may be executed in as many counterparts as may be necessary
or by facsimile and each such agreement or facsimile so executed shall be
deemed to be an original and such counterparts together shall constitute
one and the same Agreement.
IN WITNESS WHEREOF the parties hereto have caused this indenture to be executed
as of the day and year first above written.
Signed, sealed and delivered by )
KWEI CHI PING, XXXXXX in the presence of: )
)
Witness Name ) ________________________
) KWEI CHI PING, XXXXXX
----------------------------------------------- )
Witness Address )
)
----------------------------------------------- )
)
----------------------------------------------- )
Witness Occupation )
Signed, sealed and delivered by )
XXXX XXXX TAK, SIMON in the presence of: )
)
)
Witness Name ) ________________________
) XXXX XXXX TAK, XXXXX
----------------------------------------------- )
Witness Address )
)
----------------------------------------------- )
)
----------------------------------------------- )
Witness Occupation )
Signed, sealed and delivered by )
XXX XXXX KEUNG, WILSON in the presence of: )
)
)
Witness Name ) ________________________
) XXX XXXX XXXXX, XXXXXX
----------------------------------------------- )
Witness Address )
)
----------------------------------------------- )
)
----------------------------------------------- )
Witness Occupation )
WORLD ENVIROTECH, INC.
Per:
----------------------------------------
Authorized Signatory
----------------------------------------
Authorized Signatory
PROTECTSERVE PACIFIC LIMITED
Per:
----------------------------------------
Authorized Signatory
----------------------------------------
Authorized Signatory
SCHEDULE "A"
I. Share Allocation Table for shares of the Purchaser to be issued to the Vendors on closing.
-------------------------------------------------- ------------------------------------------------
Name No. of Shares
-------------------------------------------------- ------------------------------------------------
Kwei Chi Ping, Xxxxxx 15,600,000
-------------------------------------------------- ------------------------------------------------
Xxxx Xxxx Tak, Simon 8,900,000
-------------------------------------------------- ------------------------------------------------
Xxx Xxxx Xxxxx, Xxxxxx 5,500,000
------------
-------------------------------------------------- ------------------------------------------------
Total 30,000,000
-------------------------------------------------- ------------------------------------------------
II. Additional Share Allocation Table for shares of the Purchaser to be issued to the Vendors in the event that WEI has raised
capital funds on or before February 15, 2002.
-------------------------------------- --------------------- -------------------- --------------------- ---------------------
Name if US$900,000 has if US$800,000 has if US$700,000 has if US$600,000 has
been raised been raised been raised been raised
-------------------------------------- --------------------- -------------------- --------------------- ---------------------
Kwei Chi Ping, Xxxxxx 0 2,500,000 5,000,000 7,500,000
-------------------------------------- --------------------- -------------------- --------------------- ---------------------
Total 0 2,500,000 5,000,000 7,500,000
-------------------------------------- --------------------- -------------------- --------------------- ---------------------
SCHEDULE "B"
PSP's Audited and Unaudited Financial Statements
SCHEDULE "C"
As of December 31, 2001 PSP has the following liabilities:
SCHEDULE "D"
WEI's Form 10-KSB for February 28, 2001 and Form 10-QSB Interim Reports
for the 1st, 2nd and 3rd Quarters, 2001
SCHEDULE "E"
As of ___________________, 2002, WEI has the following liabilities:
SCHEDULE "F"
WEI has the following Lease or material assets:
SCHEDULE "G"
WEI has the following contracts with or indebtedness to its shareholders,
affiliates or associates of any of its shareholders:
SCHEDULE "H"
WEI has the following material contracts:
