Exhibit 99.1
SHARE EXCHANGE AGREEMENT
THIS AGREEMENT is made the 4th day of March, 2005.
BETWEEN:
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇; ▇▇▇▇▇ ▇▇▇▇▇▇; ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇; ▇▇▇▇ ▇▇▇▇▇▇
HOLDINGS INC.; ▇▇▇▇▇ ▇▇▇▇▇▇ HOLDINGS INC.; and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
HOLDINGS INC. (each a "Vendor" and collectively, the "Vendors")
AND:
1588102 ONTARIO INC., a company incorporated pursuant to the laws of
Ontario with its principal office at ▇▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇ ("Exchangeco")
AND:
WIRELESS AGE COMMUNICATIONS, INC., a corporation incorporated under
the laws of the State of Nevada, having its principal office at
▇▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇ ("WACI")
WHEREAS the Vendors are the registered holders and beneficial owners of an
aggregate 5,700 Class A Common shares in the capital of mmwave Technologies Inc.
(the "Company") as set out in Schedule "B" hereto (the "Purchased Shares");
AND WHEREAS Exchangeco is a wholly-owned subsidiary of WACI;
AND WHEREAS the Vendors have agreed to sell and Exchangeco has agreed to
purchase all of the Purchased Shares on the terms and conditions set out in this
Agreement;
NOW THEREFORE THIS AGREEMENT WITNESSES THAT, in consideration of the
premises, covenants, terms, conditions representations and warranties
hereinafter set forth, the Parties agree each with the other as follows:
ARTICLE 1 - PURCHASE AND SALE OF SHARES
1.1 Purchase and Sale. Subject to the conditions and upon the terms hereinafter
set forth, Exchangeco agrees to purchase and the Vendors agree to sell to
Exchangeco all of their right, title and interest in and to the Purchased
Shares.
1.2 Purchase Price. The purchase price for the Purchased Shares shall consist of
an aggregate of 4,500,000 Exchangeable Shares to be issued to the Vendors as set
out in Schedule "B" hereto.
SHARE EXCHANGE AGREEMENT
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1.3 Support Agreement; Voting And Exchange Agency Agreement. On or before
Closing, WACI and Exchangeco shall enter into the Support Agreement in the form
attached hereto as Schedule "E". Such Support Agreement and Voting and Exchange
Agency Agreement are incorporated herein by reference thereto and the Vendors,
jointly and severally, shall each have all rights and remedies of enforcement of
the Support Agreement and the Voting and Exchange Agency Agreement to the same
full force and effect as each party thereto. On or before Closing, WACI,
Exchangeco and ▇▇▇▇▇ - ▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ - ▇▇▇▇▇ LLP, as Agent, shall enter into
the Voting And Exchange Agency Agreement, in the form attached hereto as
Schedule "G".
1.4 Accounting Consequences. It is intended by the parties hereto that the
purchase and sale of the Purchased Shares under this Agreement shall qualify for
accounting treatment as a purchase under U.S. generally-accepted accounting
principles.
1.5 Tax Treatment.
(a) It is intended that the transactions contemplated in this Agreement shall
generally constitute (i) a taxable exchange for United States federal
income tax purposes (not qualifying under Sections 368 or 351 of the
United States Internal Revenue Code of 1986, as amended) to persons who
are otherwise subject to taxation in the United States on the sale or
exchange of Purchased Shares, and (ii) a tax deferred reorganization for
Canadian federal income tax purposes for owners of Purchased Shares who
are residents of Canada for Canadian federal income tax purposes who
receive Exchangeable Shares as a consequence of the purchase and sale of
the Purchased Shares. At the option of each Vendor who is resident in
Canada, Exchangeco covenants and agrees to elect, jointly with each such
Vendor if applicable (referred to in this section as an "Electing
Vendor"), in accordance with the provisions of subsection 85(1) of the Tax
Act (and the corresponding provisions of any applicable provincial tax
legislation) in the prescribed form and within the prescribed time for the
purposes of the Tax Act, and shall therein agree to elect in respect of
the Purchased Shares of the Electing Vendor such amount as the Electing
Vendor's proceeds of disposition thereof as the Electing Vendor may
determine, subject to the provisions of subsection 85(1) of the Tax Act.
Each of the Electing Vendors and Exchangeco agree to execute all such
documents and forms to make the election contemplated in this section.
(b) The Vendors, with their professional advisors, have made a bona fide
determination that the Purchased Shares are shares of a "qualified small
business corporation" as defined in subsection 110.6(1) of the Tax Act as
of the date hereof. Based on such determination, it is the desire and
intention of the Vendors and Exchangeco that the "agreed amount" for the
transfer of each Vendors' portion of the Purchased Shares (the "Vendor's
Shares") be the lesser of the fair market value of the Vendor's Shares and
the aggregate of the Vendor's adjusted cost base thereof plus an amount
equal to the Vendor's unused capital gain deduction as provided in
subsection 110.6(2.1) of the Tax Act. However, it is agreed between each
of the Vendors and Exchangeco that should any competent taxing authority
at any time issue or propose to issue any assessment or assessments that
would impose any liability for tax (other than the alternative minimum tax
provided for in
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section 127.5 of the Tax Act) on the basis that a Vendor's Shares are not
"qualified small business shares", or that the capital gain of a Vendor
resulting from the within transaction is not otherwise eligible for the
exemption pursuant to subsection 110.6(2.1) of the Tax Act, and if all
appeals requested by a Vendor have been exhausted, then the "agreed
amount" shall be adjusted nunc pro tunc pursuant to the provisions of this
paragraph to be such amount as will eliminate such liability for tax
(except for the alternative minimum tax as provided for section 127.5 of
the Tax Act), provided that such adjustment shall not result in any
additional Exchangeable Shares being issued to the Vendors.
1.6 Securities Law Exemptions and Resale Restrictions. The sale of the Purchased
Shares and the issuance of the Exchangeable Shares to the Vendors shall be made
in reliance on the exemptions from registration and prospectus filing
requirements contained in applicable provisions of Canadian Securities Law. The
issuance of the WACI Shares to the Vendors on the exchange of their Exchangeable
Shares shall be made in reliance on an exemption order from the relevant
Canadian Securities Regulators (if necessary) and the exemption from the
registration requirements of U.S. Securities Law contained in Regulation S
promulgated under the U.S. Securities Act of 1933, as amended. The Vendors
hereby acknowledge that as a result:
(a) any Exchangeable Shares or WACI Shares that they receive pursuant to this
Agreement will be subject to resale restrictions in accordance with
applicable Canadian Securities Law and U.S. Securities Law and that as a
result:
(i) the certificates representing such Exchangeable Shares or WACI
Shares will be affixed with the following legend describing such
restrictions:
THE SECURITY OR SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE
OFFERED OR SOLD TO ANY PERSON EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. THE HOLDER HEREOF AGREES THAT: (1) IT WILL NOT RESELL OR
OTHERWISE TRANSFER THE SHARES EVIDENCED HEREBY EXCEPT (A) IN AN
OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF
REGULATION S OR (B) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR
ANOTHER THEN AVAILABLE EXEMPTION UNDER THE SECURITIES ACT AND STATE
SECURITIES LAWS OR, (C) IN A TRANSACTION THAT DOES NOT REQUIRE
REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE LAWS,
OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER); (2) PRIOR TO ANY SUCH
TRANSFER, IT WILL FURNISH TO THE COMPANY OR ITS AGENTS SUCH
CERTIFICATIONS, LEGAL OPINIONS, OR OTHER INFORMATION AS THE COMPANY
OR
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SUCH AGENTS MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR
STATE SECURITIES LAWS; AND (3) IT WILL DELIVER TO EACH PERSON TO
WHOM THE COMMON STOCK EVIDENCED HEREBY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
and
(ii) the certificates representing the Exchangeable Shares will be
affixed with legend describing such restrictions, including, without
limitation, the following:
THE CLASS B SHARES REPRESENTED HEREBY ARE SUBJECT TO THE RIGHTS,
PRIVILEGES, TERMS, CONDITIONS AND RESTRICTIONS AS SET FORTH IN THE
SHARE EXCHANGE AGREEMENT, THE SUPPORT AGREEMENT AND THE VOTING AND
EXCHANGE AGENCY AGREEMENT, RESPECTIVELY, COPIES OF EACH OF WHICH ARE
ON FILE AT THE REGISTERED OFFICE OF THE COMPANY. THE SHARES
REPRESENTED HEREBY CANNOT BE SOLD, PLEDGED, TRANSFERRED OR OTHERWISE
DEALT WITH OTHER THAN PURSUANT TO A PROSPECTUS OR REGISTRATION
STATEMENT FILED WITH THE RELEVANT CANADIAN SECURITIES REGULATORS OR
PURSUANT TO AN EXEMPTION THEREFROM PROVIDED UNDER APPLICABLE
CANADIAN SECURITIES LAW.
(b) in some provinces of Canada, the Exchangeable Shares cannot be exchanged
for the WACI Shares unless an appropriate exemption from the prospectus
requirements in Canadian Securities Law is available or the relevant
Canadian Securities Regulators issue a discretionary relief order
permitting the exchange;
(c) the resale exemptions provided under Canadian Securities Law and U.S.
Securities Law may not be generally available because of the conditions
and limitations of such exemptions, and that Exchangeco and WACI are under
no obligation to take any action other than commercially reasonable
actions to make any of said exemptions available to the Vendors; and
(d) only WACI can register the WACI Shares or file a prospectus or
registration statement to qualify the WACI Shares for immediate resale and
WACI has made representations to the Vendors that it will do so only in
accordance with the registration rights provisions set forth below.
1.7 Securities Law Compliance. The Vendors hereby agree that they shall not
sell, pledge, transfer or otherwise deal with the Exchangeable Shares or the
WACI Shares without obtaining a favourable opinion of WACI counsel or such other
evidence as may be required by Exchangeco or WACI, that the proposed dealing
will not be in violation of U.S. Securities Law.
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1.8 Registration Rights. WACI at its sole cost and expense shall file one
registration statement with the U.S. Securities and Exchange Commission (the
"Registration Statement") covering 900,000 WACI Shares underlying the
Exchangeable Shares, in accordance with the allocations among the Vendors and
their respective assignees set forth on Schedule "F" attached hereto, no later
than ninety (90) days after the Closing. Each of the Vendors agrees to cooperate
with WACI in the preparation and filing of the Registration Statement and in the
furnishing of information concerning the Vendor for inclusion therein,
including, without limitation, any efforts by WACI to establish the exemption
under the Securities Act of the sale of the Securities to the Vendor and
respective assignees. Each Vendor agrees and acknowledges that such Registration
Statement shall be filed by WACI on the basis of commercially reasonable efforts
and there can be no assurance that such Registration Statement will be declared
effective by the Securities and Exchange Commission. Each Vendor furthermore
acknowledges and agrees that the Registration Statement may not be exclusive to
the Vendor (or assignee) and WACI, as well as other shareholders of WACI, may,
at the sole discretion of WACI, include and register other shares of WACI's
common stock and/or other securities thereon.
ARTICLE 2 - CLOSING MATTERS
2.1 Date, Time and Place of Closing. The Closing shall take place at the Closing
Time on the Closing Date at the offices of WACI or such place as the Parties may
agree on.
2.2 Mutual Conditions of Closing. The Parties shall be obliged to complete the
purchase and sale of the Purchased Shares only if each of the conditions
precedent set out in Part 1 of Schedule "C" hereto have been satisfied in full
at or before the Closing Time. Each of such conditions precedent is for the
benefit of each of the Parties, and the Parties may by mutual consent waive any
of them in whole or in part in writing.
2.3 Conditions for WACI's and Exchangeco's Benefit. WACI and Exchangeco shall
not be obliged to complete the purchase of the Purchased Shares or the issuance
of the WACI Shares and Exchangeable Shares unless each of the conditions set out
in Part 2 of Schedule "C" shall have been satisfied on or before the Closing
Date. Each of such conditions precedent is for the exclusive benefit of WACI and
Exchangeco and they may waive any of such conditions in whole or in part in
writing.
2.4 Conditions for the Vendors' Benefit. The Vendors shall not be obliged to
complete the sale of the Purchased Shares unless each of the conditions set out
in Part 3 of Schedule "C" shall have been satisfied on or before the Closing
Date. Each of such conditions precedent is for the exclusive benefit of the
Vendors and the Vendors may waive any of them in whole or in part in writing.
2.5 Failure to Satisfy Condition. If any condition set forth in Schedule "C" is
not satisfied at the Closing Time, or if it becomes apparent that any such
condition cannot be satisfied at the Closing Time, any Party entitled to the
benefit of such condition (the "First Party") may terminate this Agreement by
notice in writing to the other Parties and in such event:
(a) unless the other Parties can show that the condition or conditions which
have not been satisfied and for which the First Party has terminated this
Agreement are reasonably
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capable of being performed or caused to be performed by the First Party or
have not been satisfied by reason of a default by the First Party
hereunder, the First Party shall be released from all obligations
hereunder; and
(b) unless the First Party can show that the condition or conditions which
have not been satisfied and for which the First Party has terminated this
Agreement are reasonably capable of being performed or caused to be
performed by the other Party or have not been satisfied by reason of a
default by the other Party hereunder, then the other Party shall also be
released from all obligations hereunder.
2.7 Deliveries on Closing. On the Closing Date:
(a) Exchangeco will deliver to or to the direction of the Vendors certificates
representing the Exchangeable Shares in accordance with section 2.2.
above;
(b) the Vendors will deliver to or to the direction of Exchangeco certificates
representing their Purchased Shares duly signed off for transfer, together
with all other documentation required to transfer title to their Purchased
Shares to or to the direction of Exchangeco, provided that if there are no
certificates representing the Purchased Shares, the Vendors shall each
deliver to Exchangeco, or as directed by Exchangeco, an executed stock
power of attorney or other document evidencing the transfer of the
Purchased Shares from the Vendors to or to the direction of Exchangeco;
and
(c) WACI and Exchangeco shall execute and deliver the Support Agreement and
the Voting and Exchange Agency Agreement.
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Vendors. The Vendors each hereby
severally represent and warrant to Exchangeco and WACI as set out in Part 1 of
Schedule "D" and acknowledge that Exchangeco and WACI are relying on these
representations and warranties in entering into this Agreement and performing
their obligations under the same.
3.2 Representations and Warranties of WACI. WACI represents and warrants to the
Vendors as set out in Part 2 of Schedule "D" and acknowledges that the Vendors
are relying on these representations and warranties in entering into this
Agreement and performing their obligations under the same.
3.3 Representations and Warranties of Exchangeco. Exchangeco represents and
warrants to the Vendors as set out in Part 3 of Schedule "D" and acknowledges
that the Vendors are relying on these representations and warranties in entering
into this Agreement and performing their obligations under the same.
3.4 Survival of Representations and Warranties. All representations and
warranties contained in this Agreement shall survive the Closing for a period of
two (2) years from the
Closing Date, after which time, if no claim shall have been made against a Party
with respect to
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any incorrectness in or breach of any representation or warranty, that Party
shall have no further liability under this Agreement with respect to that
representation or warranty.
3.5 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 4 - INDEMNIFICATION
4.1 Mutual Indemnification for Breaches of Covenant or Warranty. Subject to the
limitation period set out in section 3.4, above, each of WACI and Exchangeco
hereby covenant and agree with the Vendors and each of the Vendors hereby
severally covenant and agree with WACI and Exchangeco (the parties covenanting
and agreeing to indemnify another party under this Article 4 are hereinafter
individually referred to as "Indemnifying Party" and the parties that are being
indemnified by another Party under this Article 4 are hereinafter individually
referred to as the "Indemnified Party") to indemnify and save harmless the
Indemnified Party, effective as and from the Closing Time, from and against any
Claims which may be made or brought against the Indemnified Party and/or which
it may suffer or incur as a result of, or arising out of any non-fulfillment of
any covenant, obligation or agreement on the part of the Indemnifying Party
under this Agreement or any incorrectness in or breach of any representation or
warranty of the Indemnifying Party contained in this Agreement.
(i) Without limiting the foregoing provisions of indemnification but
for purposes of clarity, the Vendors shall indemnify and hold harmless
WACI and Exchangeco in regard to any and all Claims affecting WACI and/or
Exchangeco, pertaining to the litigation referred to as ANRITSU COMPANY, a
California Corporation, Plaintiff, vs. SHIKATRONICS mmWAVE S.A. de .V., a
Mexican company, mmWAVE TECHNOLOGIES, a Canadian company, ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, an individual, and DOES 1 through 25, inclusive, Defendants,
referenced as Case No. 1 04 CV 014187 in the Superior Court Of California
County Of Santa ▇▇▇▇▇.
(ii) Without limiting the foregoing provisions of indemnification
but for purposes of clarity, WACI and Exchangeco, jointly and severally,
shall indemnify and hold harmless each of the Vendors in regard to any and
all Claims arising in connection with any and all prior transactions of
Exchangeco, and such indemnity granted by Exchangeco and WACI herewith
shall cover, without limitation, any and all tax liability of the Vendors
arising in connection with any sale or exchange of Exchangeable Shares
arising or related to any and all such Claims, if at the time any such tax
liability is due and payable any of the Vendors are unable to sell the
exchanged WACI Shares to pay such liability, as a result of restrictions
pursuant to U.S. Securities Law.
ARTICLE 5 - INTERPRETATION AND GENERAL
5.1 Definitions. Where used in this Agreement and the recitals and any schedules
hereto, each of the following words will have the meanings ascribed to them in
Schedule "A" hereto.
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5.2 Interpretation. In this Agreement, except as otherwise expressly provided:
(a) all references in this Agreement to a designated "paragraph" or other
subdivision or to a Schedule is to the designated paragraph or other
subdivision of, or Schedule, to this Agreement;
(b) the words "herein", "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular
paragraph or other subdivision or Schedule;
(c) the headings are for convenience only and do not form a part of this
Agreement and are not intended to interpret, define, or limit the scope,
extent or intent of this Agreement or any provision hereof;
(d) the singular of any term includes the plural, and vice versa, the use of
any term is equally applicable to any gender and, where applicable, a body
corporate, the word "or" is not exclusive and the word "including" is not
limited (whether or not non-limited language, such as "without limitation"
or "but not limited" or words of similar import, are used with reference
thereto);
(e) any accounting term not otherwise defined has the meanings assigned to it
in accordance with generally accepted accounting principles applicable to
the United States of America;
(f) any reference to a statute includes and is a reference to that statute and
to the regulations made pursuant thereto, with all amendments made thereto
and in force from time to time, and to any statute or regulations that may
be passed which has the effect of supplementing or superseding that
statute or regulations; and
(g) any other term defined within the text of this Agreement has the meaning
so ascribed.
5.3 Schedules. The following are the Schedules to this Agreement:
Schedule Description
-------- -----------
A Definitions
B Shareholdings
C Conditions of Closing
D Representations and Warranties
E Support Agreement
F Registration Rights Allocations
G Voting And Exchange Agency Agreement
5.4 Entire Agreement. This Agreement, together with the Schedules and other
documents to be delivered pursuant to this Agreement, constitutes the entire
agreement between the Parties pertaining to the matters contemplated herein and
supersedes all prior agreements, understandings, negotiations and discussions,
whether oral or written, and there are no warranties, representations
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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.
5.5 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
personally or by courier to the addressee at the address appearing on the first
page hereof or to such other address as may be given in writing by the Party.
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.
5.6 Time of Essence. Time shall be of the essence in all respects of this
Agreement.
5.7 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.
5.8 Transaction Expenses. Each Party to this Agreement will bear all costs and
expenses incurred by it in negotiating this Agreement and in closing and
carrying out the transactions contemplated by this Agreement. All costs and
expenses related to satisfying any condition or fulfilling any covenant
contained in this Agreement will be borne by the party whose responsibility it
is to satisfy the condition or fulfil the covenant in question.
5.9 Amendment. No supplement, modification, waiver or termination of this
Agreement shall be binding unless executed in writing by both Parties.
5.10 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.
5.11 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.
5.12 Enurement. 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.
5.13 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Nevada without giving effect to
provisions of conflicts of law thereto. Each Party irrevocably submits to the
non-exclusive jurisdiction of the courts of the Province of Ontario with respect
to any matter arising hereunder or related hereto.
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5.14 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.
5.15 Independent Legal Advice. Each of the Vendors acknowledges that (i) he has
been advised to seek independent legal counsel in respect of this Agreement and
the other agreements and documents referred to herein and the matters
contemplated herein. To the extent that any Vendor declines to receive
independent legal counsel in respect of this Agreement, such Vendor hereby
waives the right, should a dispute later develop, to rely on its lack of
independent legal counsel to avoid its obligations, to seek indulgences from the
other Parties hereto, or to otherwise attack, in whole or in part, the integrity
of this Agreement and the documents related thereto.
5.16 Counterparts. This Agreement may be executed by the Parties in one or more
counterparts by original or 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.
[Signature Page Follows]
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IN WITNESS WHEREOF the parties have duly executed this Agreement on the day and
year first above written.
WIRELESS AGE MMWAVE TECHNOLOGIES INC.
COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Title: Chief Financial Officer Title: President
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SCHEDULE "A"
DEFINITIONS
Where used in this Agreement and the recitals and any schedules hereto, each of
the following words will have the following meanings:
(a) "Agreement" means this agreement, including the preamble and the schedules
hereto, as it may from time to time be supplemented or amended in effect;
(b) "Bulletin Board" means the Over-the-Counter Bulletin Board, an
over-the-counter securities market operated by the National Association of
Securities Dealers.
(c) "Business Day" means a day other than a Saturday or Sunday, on which
Canadian chartered banks are open for the transaction of domestic business
in Toronto, Ontario and Regina, Saskatchewan;
(d) "Canadian Securities Law" means the securities laws of any province or
territory of Canada in which recipients of any shares issued or
transferred under this Agreement may reside, and the regulations, rules
and policies promulgated thereunder, both as amended from time to time.
(e) "Canadian Securities Regulators" means the securities commissions or other
Governmental Authorities authorized to administer and enforce securities
laws in any province or territory of Canada.
(f) "Claim" means any claims, demands, actions, causes of action, damages,
losses, costs, fines, penalties, interest, liabilities and expenses,
including, without limitation, reasonable legal fees and other expenses
reasonably incurred in connection with any of the foregoing.
(g) "Closing" means the completion of the purchase of the Purchased Shares by
Exchangeco in accordance with the terms and conditions of this Agreement.
(h) "Closing Date" means the date hereof, or such earlier or later date as the
Parties may agree on.
(i) "Closing Time" means 2:00 p.m. (Toronto time) on the Closing Date, or such
earlier or later time on the Closing Date as the Parties may agree to.
(j) "Company" means mmwave Technologies Inc., a corporation incorporated under
the Canada Business Corporations Act.
(k) "Constating Documents" means (i) the articles or certificate of
incorporation and the bylaws of a corporation; (ii) any charter or similar
document adopted or filed in connection with the creation, formation, or
organization of a Person and (iii) any amendment to any of the foregoing.
-12-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
(l) "Encumbrance" means any mortgage, charge, pledge, hypothecation,
debenture, lien, security interest, encumbrance, claim, option, right of
first refusal, community of property or restriction of any kind, including
any restriction on the use, voting, transfer, receipt of income, or
exercise of any other attribute of ownership, regardless of form and
whether consensual or arising by operation of law.
(m) "Exchangeable Shares" means Class B Shares of Exchangeco bearing the
rights, privileges and restrictions described in Schedule "A" to the
Support Agreement.
(n) "Exchangeco" means 1588102 Ontario Inc.
(o) "Governmental Authority" means any applicable Canadian or U.S. federal,
provincial, state or municipal government, agency, ministry, commission,
crown corporation, department, inspector, official or body of any kind
exercising or entitled to exercise any administrative, executive,
judicial, legislative, police, regulatory or taxing authority or power of
any nature.
(p) "material" means, when used with respect to an obligation, contract,
liability or any other matter, that the obligation, contract, liability or
such other matter is of such a nature as to be substantially likely to be
considered important to a reasonable investor in making an investment
decision, including a decision to purchase, hold or sell securities of the
Person in question.
(q) "Material Adverse Change" a material adverse change in or a material
adverse effect on the businesses, assets, operations, results of
operations or financial condition of a Person and its subsidiaries (if
any) taken as a whole, provided that any adverse effects arising from or
relating to the following matters (individually and in the aggregate)
shall be excluded in determining whether such a material adverse effect
has occurred: (i) general economic conditions or conditions (including
conditions in financial markets) generally prevailing in the industry or
market segment in which the corporate entity and its subsidiaries conduct
their respective businesses, (ii) the announcement or pendency of the
transactions contemplated in this Agreement or the closing or pendency of
any transaction of the Parties which was publicly announced as of the date
of this Agreement; and (iii) the taking by any Party of any action (or
omission by any Party to take any action) at the request of or with the
permission of the other Parties; provided, further, that a decline in the
public trading price of WACI Shares shall not by itself constitute a
Material Adverse Change.
(r) "Ordinary Course of Business", with respect to an action taken by a
Person, means:
(i) an action consistent with the past practices of such Person and
taken in the ordinary course of the normal operations of such
Person;
(ii) an action not required to be authorized by the board of directors of
such
-13-
Person (or by any Person or group of Persons exercising similar
authority) and not required to be specifically authorized by the
parent company (if any) of such Person; and
(iii) an action similar in nature and magnitude to actions customarily
taken, without any authorization by the board of directors (or by
any Person or group of Persons exercising similar authority), in the
ordinary course of the normal day-to-day operations of other Persons
that are in the same line of business as such Person.
(s) "Parties" means the parties to this Agreement and "Party" means any one of
them.
(t) "Person" means any individual, corporation (including any non-profit
corporation), body corporate, partnership, limited partnership, limited
liability company, joint venture, society, association, trust,
unincorporated organization, Governmental Authority or other entity, or
any trustee, executor, administrator, or other legal representative.
(u) "Purchased Shares" means Class A Common shares of the Company held by the
Vendors as set out in Schedule "B" hereto.
(v) "SEC" means the U.S. Securities and Exchange Commission;
(w) "Support Agreement" means the exchangeable share support agreement to be
entered into by WACI and Exchangeco on or before Closing.
(x) "Tax Act" means the Income Tax Act (Canada), as amended from time to time.
(y) "U.S. Securities Law" means the United States Securities Act of 1933 and
the United States Securities Exchange Act of 1934, the securities laws of
any State of the United States of America, and the regulations, rules and
policies promulgated thereunder, all as amended from time to time.
(z) "Voting and Exchange Agency Agreement" means the voting and exchange
agency agreement to be entered into by WACI, Exchangeco and ▇▇▇▇▇ -
▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ - ▇▇▇▇▇ LLP on or before Closing.
(aa) "WACI" means Wireless Age Communications, Inc.
(bb) "WACI Shares" means shares in the common stock of ▇▇▇▇.
# # #
-▇▇-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
SCHEDULE "B"
SHAREHOLDINGS
---------------------------------------------------------------------------------------------
Name of Shareholder Number of Number of Exchangeable
Purchased Shares Held Shares to be Received
---------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ 380 270,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ 380 270,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 380 270,000
---------------------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc. 1,520 1,080,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc. 1,520 1,080,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Holdings Inc. 1,520 1,080,000
---------------------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 0 25,000
---------------------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 0 25,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 0 10,000
---------------------------------------------------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 0 10,000
---------------------------------------------------------------------------------------------
2066292 Ontario Ltd. 0 380,000
---------------------------------------------------------------------------------------------
TOTAL 5,700 4,500,000
---------------------------------------------------------------------------------------------
# # #
-15-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
SCHEDULE "C"
CONDITIONS OF CLOSING
1. Mutual Conditions of Closing. The Parties shall be obliged to complete the
purchase and sale of the Purchased Shares only if each of the following
conditions precedent have been satisfied in full at or before the Closing Time:
(a) 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.
(b) 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.
2. Conditions for WACI's and Exchangeco's Benefit. WACI and Exchangeco shall not
be obliged to complete the purchase of the Purchased Shares or the issuance of
the WACI Shares and Exchangeable Shares unless each of the following conditions
shall have been satisfied or waived on or before the Closing Time:
(a) Accuracy of Representations - The representations and warranties of the
Vendors set forth in section 3.1 of this Agreement and Part 1 of Schedule
"D" thereto shall be true and correct as of the Closing Time.
(b) Performance of Obligations - The Vendors shall have performed all of the
obligations hereunder to be performed by him at or prior to the Closing,
and shall not be in breach of any provision of this Agreement.
(c) No Material Changes - There shall have been no Material Adverse Change in
the business, assets, liabilities, prospects, operations of the Company,
and the Company shall not have sold or pledged any assets, issued any
shares or entered into any transactions outside the Ordinary Course of
Business.
(d) Waiver of Dividend Rights - ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇
Holdings Inc. and ▇▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc. shall have waived their right
to the dividend described in 3(e) below.
3. Conditions for the Vendors' Benefit. The Vendors shall not be obliged to
complete the sale of the Purchased Shares unless each of the following
conditions shall have been satisfied or waived on or before the Closing Time:
-16-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
(a) Accuracy of Representations - The representations and warranties of WACI
and Exchangeco set forth in sections 3.2 and 3.3 of this Agreement and
Parts 2 and 3 of Schedule "D" thereto shall be true and correct as of the
Closing Time.
(b) Performance of Obligations - WACI and Exchangeco shall have performed all
of the obligations hereunder to be performed by them at or prior to the
Closing, and shall not be in breach of any provision of this Agreement.
(c) Release of Guarantees - the bankers of the Company shall have delivered
written releases of the guarantees given by certain of the Vendors
pertaining to the Company's line of credit, such releases to be
satisfactory in form and content to the Vendors.
(d) Reduction and Payment of Shareholders' Advances - The Company shall have
acknowledged in writing its indebtedness to the Vendors in the aggregate
amount of $602,293.45 and shall have repaid 50% of same on or prior to
Closing. The Company shall further confirm that the balance of the
indebtedness shall bear interest in accordance with the terms of the
existing promissory notes and shall be repaid over the next twenty-four
months in quarterly instalments of principal and interest.
(e) Declaration of Dividend - The Company shall have declared a dividend equal
to five percent (5%) of the Company's profits in the fiscal year ending as
of December 31, 2004, such dividend to be payable to the shareholders of
record of the Company as of February 28, 2005 by no later than five days
after the accountants of the Company complete the financial statements and
file its tax returns for such fiscal year.
(f) ▇▇▇▇▇▇ Employment Agreements - WACI shall have entered into employment
agreements (and an indemnity agreement for ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇) with each
of ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇, satisfactory in form and content
to ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇, respectively.
(g) WACI and its directors shall have executed and delivered to ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ a side letter undertaking agreement regarding his nomination and
support as a director of WACI, satisfactory in form and content to ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇.
# # #
-▇▇-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
SCHEDULE "D"
REPRESENTATIONS AND WARRANTIES
Part 1. Representations and Warranties of the Vendors. The Vendors hereby
severally represent and warrant to Exchangeco and WACI as follows, and
acknowledge that Exchangeco and WACI are relying on these representations and
warranties in entering into this Agreement and performing their obligations
under the same:
(a) Capacity and Authority - If the Vendor is a corporation, the Vendor (i)
has been duly formed and is a valid and subsisting corporation, (ii) has
the necessary corporate capacity and authority to own the Purchased
Shares, to execute and deliver this Agreement and to observe and perform
its covenants and obligations hereunder, (iii) has taken all necessary
corporate action in respect and (iv) the individual signing this Agreement
on behalf of the Vendor has the authority to do so and to bind the Vendors
by their signature. If the Vendor is a natural person, he or she has
attained the age of majority, is legally competent and has the capacity to
(i) own the Purchased Shares and (ii) execute this Agreement and to take
all actions required pursuant thereto.
(b) Title to Purchased Shares - Each particular Vendor is the sole legal and
beneficial owner of the Purchased Shares set out opposite its name in
Schedule "B" hereto with good and marketable title thereto, free and clear
of any Encumbrances.
(c) No Option - No Person has any agreement, warrant, option or right, or a
right capable of becoming an agreement for, the purchase of the Purchased
Shares, or the purchase of any other securities of the Company.
(d) Absence of Conflict - No Vendor is 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
Purchased Shares 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 a Vendor (if
not an individual), any court or administrative order or process, any
agreement or instrument to which a Vendor is party or by which it is
bound.
(e) Residence - Each Vendor is a resident, within the meaning of the Tax Act,
of the jurisdiction set out under their name in Schedule "B" hereto.
(f) Binding Agreement - This Agreement constitutes a legal, valid and binding
obligation of each Vendor enforceable against the Vendor in accordance
with its terms except as may be limited by laws of general application
affecting the rights of creditors.
-18-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
(g) Bankruptcy / Liquidation - No proceedings have been taken, are pending or
have been authorized, and no receiver or trustee has been appointed for a
Vendor by the Vendor or by any other person in respect to the bankruptcy,
insolvency, liquidation, dissolution or winding up of a Vendor.
(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 a Vendor) commenced, pending or threatened against or
relating to a Vendor which may result in the imposition of a Encumbrance
on the Purchased Shares or which may prevent, delay, make illegal or
otherwise interfere with the consummation of the transactions contemplated
in this Agreement.
(i) Due Incorporation of the Company - The Company is a corporation duly
incorporated and validly existing under the laws of its jurisdiction of
incorporation.
(j) Share Capital of the Company - The only issued and outstanding shares of
the Company are 5,700 Class A Common shares and the Purchased Shares are
all validly issued and outstanding as fully paid and non-assessable
shares.
(k) Shareholders of the Company - Schedule "B" hereto contains a complete and
accurate list of each registered holder of issued and outstanding
Purchased Shares and sets out the residence or principal place of business
of each holder.
(l) Purchased Shares Validly Issued - The Purchased Shares have been validly
issued and are outstanding as fully paid and non-assessable.
(m) EACH VENDOR: (I) ACKNOWLEDGES THAT INVESTMENT IN THE SECURITIES OF WACI IS
HIGHLY SPECULATIVE AND INVOLVES A VERY HIGH DEGREE OF RISK AND SHOULD NOT
BE MADE UNLESS THE VENDOR IS PREPARED TO, AND CAN AFFORD TO, LOSE THE
ENTIRE INVESTMENT; (II) HAS SUFFICIENT KNOWLEDGE, SOPHISTICATION AND
EXPERIENCE IN BUSINESS AND FINANCE TO CAPABLY EVALUATE INFORMATION
CONCERNING WACI, (III) HAS HAD AN OPPORTUNITY TO REVIEW WACI'S PUBLICLY
FILED REPORTS, AND TO ASK DETAILED QUESTIONS AND RECEIVE SATISFACTORY
ANSWERS FROM REPRESENTATIVES OF WACI, (IV) HAS HAD ADEQUATE OPPORTUNITY TO
REQUEST AND REVIEW ANY AND ALL OTHER DOCUMENTS INFORMATION RELEVANT TO
VENDOR'S CONSIDERATION OF INVESTMENT IN THE WACI SECURITIES AND HAS
OTHERWISE OBTAINED SUFFICIENT INFORMATION FROM WACI TO EVALUATE THE MERITS
AND RISKS OF AN INVESTMENT IN WACI; (V) HAS INDEPENDENTLY CONSIDERED AND
DISCUSSED SUCH PROSPECTIVE INVESTMENT WITH THE VENDOR'S BUSINESS,
-19-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
LEGAL, TAX AND FINANCIAL ADVISERS AS TO THE SUITABILITY OF SUCH INVESTMENT
WITH RESPECT TO THE VENDOR'S PARTICULAR FINANCIAL SITUATION, AND (VI) ON
THE BASIS OF THE FOREGOING, EACH VENDOR HAS DETERMINED THAT INVESTMENT IN
THE SECURITIES OFFERED HEREBY IS A SUITABLE INVESTMENT.
Part 2. Representations and Warranties of WACI. WACI represents and warrants to
the Vendors as follows and acknowledges that the Vendors are relying on these
representations and warranties in entering into this Agreement and performing
their obligations under the same:
(a) Due Incorporation - WACI is a corporation duly incorporated and validly
existing under the laws of the State of Nevada.
(b) Capacity and Authority - WACI has the power and capacity and good and
sufficient right and authority to enter into this Agreement, the Support
Agreement and the Voting and Exchange Agency Agreement on the terms and
conditions herein set forth, to perform its obligations under this
Agreement, the Support Agreement and the Voting and Exchange Agency
Agreement. The execution and delivery of this Agreement, the Support
Agreement and the Voting and Exchange Agency Agreement and the completion
of the transaction contemplated herein has been duly and validly
authorized by all necessary corporate action on the part of WACI.
(c) Binding Agreement - This Agreement, the Support Agreement and the Voting
and Exchange Agency Agreement constitute a legal, valid and binding
obligation of WACI enforceable against WACI in accordance with its terms
except as may be limited by laws of general application affecting the
rights of creditors.
(d) Absence of Conflict - WACI 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
Purchased Shares or WACI Shares as a consequence of the execution and
delivery of this Agreement, the Support Agreement and the Voting and
Exchange Agency Agreement or the consummation of the transactions
contemplated in this Agreement, the Support Agreement and the Voting and
Exchange Agency 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 WACI, any court or administrative order or process, any
agreement or instrument to which WACI is party or by which it is bound.
(e) Bankruptcy / Liquidation - No proceedings have been taken, are pending or
have been authorized, and no receiver or trustee has been appointed for
WACI by WACI or by any other person in respect to the bankruptcy,
insolvency, liquidation, dissolution or winding up of WACI.
-20-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
(f) 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 WACI) commenced, pending or threatened against or relating to
WACI which may result in the imposition of a Encumbrance on the
Exchangeable Shares or the WACI Shares or which may prevent, delay, make
illegal or otherwise interfere with the consummation of the transactions
contemplated in this Agreement. To the knowledge of WACI, no director or
officer of WACI, is or has been the subject of any action involving a
claim of violation of or liability under federal or state securities laws
or a claim of breach of fiduciary duty. There has not been, and to the
knowledge of WACI, there is not pending or contemplated, any investigation
by the SEC involving WACI or any current or former director or officer of
WACI.
(g) Capitalization - The capitalization of WACI is as described in Schedule
"D" Part II Disclosure Annex G attached hereto. WACI has not issued any
capital stock other than set forth on such Disclosure Annex. No Person has
any right of first refusal, preemptive right, right of participation, or
any similar right to participate in the transactions contemplated by this
Agreement and its Schedules. Except as a result of the purchase and sale
of the Purchased Shares, there are no outstanding options, warrants,
script rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible
into or exchangeable for, or giving any Person any right to subscribe for
or acquire, any WACI Shares, or contracts, commitments, understandings or
arrangements by which WACI is or may become bound to issue additional WACI
Shares, or securities or rights convertible or exchangeable into shares of
Common Stock, save as disclosed in WACI's most recent disclosure filings
with the SEC. The issue of the WACI Shares upon exchange of the
Exchangeable Shares will not obligate WACI to issue WACI Shares or other
securities to any Person (other than each Vendor) and will not result in a
right of any holder of WACI securities to adjust the exercise, conversion,
exchange or reset price under such securities.
(h) SEC Reports; Financial Statements - Except as set forth on Schedule "D"
Part II Disclosure Annex H attached hereto, WACI has filed all reports
required to be filed by it under U.S. Securities Law for the two years
preceding the date hereof (or such shorter period as WACI was required by
law to file such material) (the foregoing materials, including the
exhibits thereto, being collectively referred to herein as the "SEC
Reports") on a timely basis or has received a valid extension of such time
of filing and has filed any such SEC Reports prior to the expiration of
any such extension. As of their respective dates, the SEC Reports complied
in all material respects with the requirements of U.S. Securities Law and
the rules and regulations of the SEC promulgated thereunder, as
applicable, and none of the SEC Reports, when filed, contained any untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order
-21-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
to make the statements therein, in light of the circumstances under which
they were made, not misleading. Except as set forth on Disclosure Schedule
H attached hereto, The financial statements of WACI included in the SEC
Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the SEC with respect thereto
as in effect at the time of filing.
(i) Listing and Maintenance Requirements - WACI has not, in the 12 months
preceding the date hereof, received notice from any trading market on
which the WACI Shares is or has been listed or quoted to the effect that
WACI is not in compliance with the listing or maintenance requirements of
such trading market. WACI is, and has no reason to believe that it will
not in the foreseeable future continue to be, in compliance with all such
listing and maintenance requirements.
Part 3. Representations and Warranties of Exchangeco. Exchangeco and WACI
jointly and severally represent and warrant to the Vendors as follows and
acknowledges that the Vendors are relying on these representations and
warranties in entering into this Agreement and performing their obligations
under the same:
(a) Due Incorporation - Exchangeco is a corporation duly incorporated and
validly existing under the laws of its jurisdiction of incorporation.
(b) Capacity and Authority - Exchangeco has the power and capacity and good
and sufficient right and authority to enter into this Agreement, Support
Agreement and the Voting and Exchange Agency Agreement on the terms and
conditions herein set forth, to perform its obligations under this
Agreement, Support Agreement and the Voting and Exchange Agency Agreement.
The execution and delivery of this Agreement, Support Agreement and the
Voting and Exchange Agency Agreement and the completion of the transaction
contemplated herein has been duly and validly authorized by all necessary
corporate action on the part of Exchangeco.
(c) Binding Obligation - This Agreement, Support Agreement and the Voting and
Exchange Agency Agreement have been duly executed and delivered by
Exchangeco and constitute a valid and binding obligations on its part.
(d) Absence of Conflict - Exchangeco 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
Exchangeable Shares as a consequence of the execution and delivery of this
Agreement, Support Agreement and the Voting and Exchange Agency Agreement
or the consummation of the transactions contemplated in this Agreement,
Support Agreement and the Voting and Exchange Agency Agreement.
Exchangeco's execution of this Agreement, Support Agreement and the Voting
and Exchange Agency Agreement and the consummation of transactions
contemplated herein do not and will not conflict with, or result in a
-22-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
breach of, or constitute a default under the terms or conditions of any
Constating Documents Exchangeco, any court or administrative order or
process, any agreement or instrument to which Exchangeco is party or by
which it is bound.
(e) Bankruptcy / Liquidation - No proceedings have been taken, are pending or
have been authorized, and no receiver or trustee has been appointed for
Exchangeco by Exchangeco or by any other person in respect to the
bankruptcy, insolvency, liquidation, dissolution or winding up of
Exchangeco.
(f) 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 Exchangeco) commenced, pending or threatened against or
relating to Exchangeco which may result in the imposition of a Encumbrance
on the Exchangeable Shares or which may prevent, delay, make illegal or
otherwise interfere with the consummation of the transactions contemplated
in this ▇▇▇▇▇▇▇▇▇.
# # #
-▇▇-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
SCHEDULE "E"
SUPPORT AGREEMENT
[Attached]
-24-
SHARE EXCHANGE AGREEMENT
--------------------------------------------------------------------------------
SCHEDULE "F"
REGISTRATION RIGHTS ALLOCATIONS
--------------------------------------------------------------------------------
Name of Shareholder Number of Shares with
Registration Rights
--------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ 33,750
--------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ 62,500
--------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 270,000
--------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc. 33,750
--------------------------------------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ Holdings Inc. 5,000
--------------------------------------------------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Holdings Inc. 405,000
--------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 25,000
--------------------------------------------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 25,000
--------------------------------------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 10,000
--------------------------------------------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 10,000
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2066292 Ontario Ltd. 20,000
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TOTAL 900,000
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-1-
SHARE EXCHANGE AGREEMENT
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SCHEDULE "D" PART II DISCLOSURE ANNEX G
CAPITALIZATION OF WACI
The number of authorized shares of Common Stock, $0.001 par value, is
100,000,000 shares. As of March 1, 2005, 23,831,046 shares of Common Stock are
issued and outstanding and 24,014,379 shares of Common Stock would be deemed to
be outstanding on a fully diluted basis giving effect to all warrants, options
and other instruments exercisable or convertible into shares of Common Stock.
The number of authorized shares of Preferred stock, $0.001 par value, is
10,000,000 shares. No shares of Preferred Stock are issued or outstanding.
-2-
SHARE EXCHANGE AGREEMENT
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SCHEDULE "G"
Voting And Exchange Agency Agreement
[Attached]
-1-
