SHARE PURCHASE AGREEMENT by and among WORLDSTAR ENERGY CORP., JEWEL STAR GROUP LIMITED and NATIONAL BASE INVESTMENT LIMITED Dated as of February 12, 2007
by and among
WORLDSTAR ENERGY CORP.,
JEWEL STAR GROUP LIMITED
and
NATIONAL BASE INVESTMENT LIMITED
Dated as of February 12, 2007
TABLE OF CONTENTS
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This SHARE PURCHASE AGREEMENT (this “Agreement”), dated as of February 12, 2007, is entered into by and among Worldstar Energy Corp. (“Worldstar”), a Nevada corporation, Jewel Star Group Limited, a BVI corporation (“Jewel”) and National Base Investment Limited (“National”), a BVI company and a wholly-owned subsidiary of Jewel.
W I T N E S S E T H:
WHEREAS:
(A) Jewel holds one issued and outstanding ordinary share (the “Share”) of National and WorldStar has agreed to buy and Jewel has agreed to sell the Share to Worldstar, on the terms and conditions and for the consideration described in this Agreement;
NOW, THEREFORE, in consideration of the mutual promises, covenants, representations and warranties made herein and of the mutual benefits to be derived herefrom, the parties hereto agree as follows:
PART 1
SALE AND PURCHASE OF THE SHARE
Sale and Purchase of the Shares
1.1 Subject to the terms and conditions hereof, Jewel will sell to Worldstar, and Worldstar will purchase from Jewel, the Share at a price of $8,860,000 (the “Purchase Price”), payable through the issuance of 30,000,000 Worldstar shares valued at $0.25 each plus $1,360,000 cash at the Closing in the manner set forth in §1.2.
Closing
1.2 The closing of the sale and purchase of the Share contemplated by §1.1 (the “Closing”) shall take place on or before February 28, 2007 (the “Closing Date”) at a location to be agreed upon by Worldstar and Jewel subject to the satisfaction or waiver of the conditions precedent set forth in Part 7 of this Agreement. At the Closing:
(a) Jewel will deliver or cause to be delivered to Worldstar, free and clear of any Lien, a certificate representing the Share, duly endorsed or accompanied by a stock power or other instrument of transfer duly executed for transfer to Worldstar together with any other documents or actions necessary to accomplish the foregoing;
(b) Worldstar will pay Jewel an amount equal to the Purchase Price, by delivery of one certificate for 30,000,000 Worldstar shares registered in the name of Jewel, plus wire
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transfer of immediately available funds to the account of Jewel designated on the Disclosure Schedule or otherwise in writing to Worldstar at least one Business Day prior to the Closing Date.
PART 2
REPRESENTATIONS AND WARRANTIES OF JEWEL
Jewel hereby represents and warrants to Worldstar as follows, as of the date hereof and as of the Closing Date:
Authorization, etc.
2.1 Jewel has full power, authority and capacity to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the purchase and sale of Shares contemplated hereby. The execution, delivery and performance of this Agreement by Jewel, and the consummation of the purchase and sale of the Share contemplated hereby, have been duly authorized by all requisite corporate action of Jewel and National. Jewel and National have duly executed and delivered this Agreement. This Agreement constitutes the legal, valid and binding obligation of Jewel and National enforceable against each party in accordance with its terms.
Title to Shares
2.2 As of Closing, Jewel owns, legally and beneficially, the Share. Upon the delivery of and payment for the Share at the Closing as provided for in this Agreement, Worldstar will acquire good and valid title to the Share free and clear of any Lien.
No Conflicts, etc.
2.3 The execution, delivery and performance of this Agreement by each Bulgan Entity, and the consummation of the purchase and sale of the Share contemplated hereby, do not and will not conflict with, contravene, result in a violation or breach of or default under (with or without the giving of notice or the lapse of time or both), create in any other Person a right or claim of termination or amendment, or require modification, acceleration or cancellation of, or result in the creation of any Lien (or any obligation to create any Lien) upon any of the properties or assets of any Bulgan Entity under, (a) any Law applicable to any Bulgan Entity or any of its properties or assets, (b) any provision of any of the Organizational Documents of such Bulgan Entity or (c) any Contract, or any other agreement or instrument to which any Bulgan Entity is a party or by which any of its properties or assets may be bound except, in the case of each of clauses (a), (b) and (c), as would not reasonably be expected to prevent or materially impair or delay the ability of Jewel to sell the Share and otherwise fulfill its obligations under this Agreement.
Corporate Status
2.4 (a) Jewel. Jewel is a corporation duly organized and validly existing under the laws
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of BVI, and has full power and authority to, conduct its business and to own or lease and to operate its properties as and in the places where such business is conducted and such properties are owned, leased or operated.
(b) National. National is a BVI limited liability company, duly organized, validly existing and in good standing under the laws of BVI. National is a wholly owned Subsidiary of Jewel, and has full power and authority to, conduct its business and to own or lease and to operate its properties as and in the places where such business is conducted and such properties are owned, leased or operated.
(c) Each of the other Bulgan Entities is duly incorporated and validly existing under the laws of the jurisdiction of incorporation as set forth in Schedule E.
Consents
2.5 All Governmental Approvals or other Consents required to be obtained by each Bulgan Entity in connection with the execution and delivery of this Agreement and the consummation of the purchase and sale of the Share contemplated hereby have been obtained.
Taxes
2.6 Jewel hereby acknowledges and represents that neither Worldstar nor any Bulgan Entity will be required pursuant to any applicable Law to pay any Taxes or to act as withholding agent for Taxes due from any Bulgan Entity to any Governmental Authority in connection with the consummation of the purchase and sale of the Share contemplated by this Agreement.
Accuracy of Disclosure Schedule
2.7 The information about the Bulgan Entities contained in the Disclosure Schedule is true and correct in all material respects and does not omit to disclose any information needed to understand the current operation, assets and liabilities of the Bulgan Entities taken as a whole.
Survival of Representations and Warranties
2.8 Each of the representations and warranties of Jewel and National in this Agreement or in any schedule, instrument or other document delivered pursuant to this Agreement shall survive the Closing Date and shall continue in force thereafter.
PART 3
REPRESENTATIONS AND WARRANTIES OF WORLDSTAR
Worldstar represents and warrants to Jewel as follows, as of the date hereof and as of the Closing Date:
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Authorization, etc.
3.1 Worldstar has full corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the purchase and sale of Shares contemplated hereby. The execution, delivery and performance of this Agreement by Worldstar, and the consummation of the purchase and sale of the Share contemplated hereby, have been duly authorized by all requisite corporate action of Worldstar. Worldstar has duly executed and delivered this Agreement. This Agreement constitutes the legal, valid and binding obligation of Worldstar, enforceable against Worldstar in accordance with its terms.
No Conflicts, etc.
3.2 The execution, delivery and performance of this Agreement by Worldstar, and the consummation of the purchase and sale of the Share contemplated hereby, do not and will not conflict with, contravene, result in a violation or breach of or default under (with or without the giving of notice or the lapse of time, or both), create in any other Person a right or claim of termination or amendment, or require modification, acceleration or cancellation of, or result in or require the creation of any Lien (or any obligation to create any Lien) upon any of the properties or assets of Worldstar under (a) any Law applicable to Worldstar or any of its properties or assets, (b) any provision of any of the Organizational Documents of Worldstar, or (c) any Contract, or any other agreement or instrument to which Worldstar is a party or by which its properties or assets may be bound except, in the case of each of clauses (a), (b) and (c), as would not reasonably be expected to prevent or materially impair or delay the ability of Worldstar to purchase the Share and otherwise fulfill its obligations under this Agreement.
Corporate Status
3.3 Worldstar is company duly organized, validly existing and in good standing under the laws of Nevada and has full power and authority to conduct its business and to own or lease and to operate its properties as and in the place where such business is conducted and such properties are owned, leased or operated.
Public Disclosure
3.4 The public disclosures of Worldstar filed with the SEC are correct in all material respects. Worldstar has fewer than two million issued and outstanding shares and no obligations to issue shares in excess of this figure.
Consents
3.5 No Governmental Approvals or other Consents is required to be obtained by Worldstar in connection with the execution and delivery of this Agreement and the consummation of the purchase and sale of Shares contemplated hereby have been obtained.
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Survival of Representations and Warranties of Worldstar
3.6 Each of the representations and warranties of Worldstar in this Agreement or in any schedule, instrument or other document delivered pursuant to this Agreement shall survive the Closing Date and shall continue in force thereafter.
PART 4
COVENANTS OF THE BULGAN ENTITIES
Further Actions
| 4.1 |
(a) Each Bulgan Entity shall use reasonable efforts to take or cause to be taken all actions, and to do or cause to be done all other things, necessary, proper or advisable in order for such Bulgan Entity to fulfill and perform its obligations in respect of this Agreement, or otherwise to consummate and make effective the purchase and sale of the Share and the Bulgan Reorganization. |
(b) Each Bulgan Entity shall, as promptly as practicable, (i) make, or cause to be made, all filings and submissions required under any Law applicable to such Bulgan Entity, and give such reasonable undertakings as may be required in connection therewith, and (ii) use reasonable efforts to obtain or make, or cause to be obtained or made, all Governmental Approvals and Consents necessary to be obtained or made by such Bulgan Entity, in each case in connection with this Agreement or the consummation of the purchase and sale of the Share contemplated hereby.
(c) Each Bulgan Entity shall coordinate and cooperate with Worldstar in exchanging such information and supplying such reasonable assistance as may be reasonably requested by Worldstar in connection with the filings and other actions contemplated by §5.1.
(d) At all times prior to the Closing Date, each Bulgan Entity shall promptly notify Worldstar in writing of any fact, condition, event or occurrence that could reasonably be expected to result in the failure of any of the conditions contained in §7.1 and §7.2 to be satisfied, promptly upon becoming aware of the same.
Payment of Taxes
4.2 Jewel shall pay all Taxes due or payable to any Governmental Authority in BVI incurred or to be incurred in connection with the sale and transfer of the Share by Jewel to Worldstar hereunder and in connection with any sale and transfer of the Share to Jewel.
Further Assurances
4.3 Following the Closing Date, each Bulgan Entity shall, from time to time, execute and deliver such additional instruments, documents, conveyances or assurances and take such other actions as shall be necessary, or otherwise reasonably be requested by Worldstar, to
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confirm and assure the rights and obligations provided for in this Agreement and render effective the consummation of the purchase and sale of the Share contemplated hereby, or otherwise to carry out the intent and purposes of this Agreement (which include the transfer by Jewel to Worldstar of the ownership and intended benefits of the Share in the manner contemplated by §1.2) ..
PART 5
COVENANTS OF WORLDSTAR
Further Actions
| 5.1 |
(a) Worldstar shall use reasonable efforts to take or cause to be taken all actions, and to do or cause to be done all other things, necessary, proper or advisable in order for Worldstar to fulfill and perform its obligations in respect of this Agreement, or otherwise to consummate and make effective the purchase and sale of the Share contemplated hereby. |
(b) Worldstar shall, as promptly as practicable, (i) make, or cause to be made, all notices, filings and submissions required under any Law applicable to Worldstar, and give such reasonable undertakings as may be required in connection therewith, and (ii) use reasonable efforts to obtain or make, or cause to be obtained or made, all Governmental Approvals and Consents necessary to be obtained or made by Worldstar, in each case in connection with this Agreement or the consummation of the purchase and sale of the Share contemplated hereby.
(c) Worldstar shall coordinate and cooperate with Jewel in exchanging such information and supplying such reasonable assistance as may be reasonably requested by Jewel in connection with the filings and other actions contemplated by §4.1.
(d) At all times prior to the Closing Date, Worldstar shall promptly notify each Bulgan Entity in writing of any fact, condition, event or occurrence that could reasonably be expected to result in the failure of any of the conditions contained in §7.1 and §7.3 to be satisfied, promptly upon becoming aware of the same.
Further Assurances
5.2 Following the Closing Date, Worldstar shall from time to time, execute and deliver such additional instruments, documents, conveyances or assurances and take such other actions as shall be necessary, or otherwise reasonably be requested by Jewel, to confirm and assure the rights and obligations provided for in this Agreement and render effective the consummation of the purchase and sale of the Share contemplated hereby, or otherwise to carry out the intent and purposes of this Agreement.
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PART 6
COVENANTS OF WORLDSTAR AND THE BULGAN ENTITIES
Confidentiality
6.1 Each party shall maintain the confidentiality of Confidential Information in accordance with procedures adopted by such party in good faith to protect confidential information of third parties delivered to such party, provided that such party may deliver or disclose Confidential Information to (i) such party’s representatives, Affiliates, shareholders, limited partners, members of its investment committees, advisory committees, and similar bodies, and Persons related thereto, who are informed of the confidentiality obligations of this §6.1, (ii) any Governmental Authority having jurisdiction over such party to the extent required by applicable Law or (iii) any other Person to which such delivery or disclosure may be necessary or appropriate (A) to effect compliance with any Law applicable to such party, or (B) in response to any subpoena or other legal process, provided that, in the cases of clauses (ii) and (iii) above, the disclosing party shall provide each other party with prompt written notice thereof so that the appropriate party may seek (with the cooperation and reasonable efforts of the disclosing party) a protective order, confidential treatment or other appropriate remedy, and in any event shall furnish only that portion of the information which is reasonably necessary for the purpose at hand and shall exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such information to the extent reasonably requested by any other party.
Publicity
6.2 Except as may be required by applicable Law, none of the parties hereto shall issue a publicity release or announcement or otherwise make any public disclosure concerning this Agreement or the purchase and sale of the Share contemplated hereby or the Other Transactions, without prior written approval of Worldstar and Jewel. If any announcement is required by applicable Law to be made by any party hereto, prior to making such announcement such party will deliver a draft of such announcement to the other parties and shall give the other parties an opportunity to comment thereon.
PART 7
CONDITIONS PRECEDENT
Conditions to Obligations of Each Party
7.1 The obligations of each party to consummate the purchase and sale of the Share contemplated hereby shall be subject to the fulfillment on or prior to the Closing Date of the following conditions:
(a) No Injunction, etc. Consummation of the purchase and sale of the Share contemplated hereby shall not have been restrained, enjoined or otherwise prohibited or made illegal by any applicable Law, including any order, injunction, decree or judgment
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of any court or other Governmental Authority in any material respect; and no such Law that would have such an effect shall have been promulgated, entered, issued or determined by any court or other Governmental Authority to be applicable to this Agreement. No action or proceeding shall be pending or threatened by any Governmental Authority on the Closing Date before any court or other Governmental Authority to restrain, enjoin or otherwise prevent the consummation of the purchase and sale of the Share contemplated hereby in any material respect.
(b) Satisfactory Due Diligence. Each of the parties hereto shall be satisfied with the results of its due diligence investigations into the business, financial and legal status of each party hereto and of the Bulgan Entities. Each of the parties shall provide full access to its records in connection with the other party’s due diligence reviews and in addition National shall provide all information about the Bulgan Entities that Worldstar may request.
(c) Other Transactions. The Other Transactions shall have been consummated on or prior to the Closing Date.
Conditions to Obligations of Worldstar
7.2 The obligation of Worldstar to consummate the purchase and sale of the Share contemplated hereby shall be subject to the fulfillment on or prior to the Closing Date of the following additional conditions, which each Bulgan Entity agrees to cause to be fulfilled:
(a) Representations, Performance
(i) The representations and warranties of the Bulgan Entities contained in Part 2 (i) shall be true and correct in all material respects at and as of the date hereof,(ii) shall be repeated and shall be true and correct in all material respects on and as of the Closing Date with the same effect as though made on and as of the Closing Date, except in the case of each of clauses (i) and (ii) as would not reasonably be expected to prevent or materially impair or delay the ability of Jewel to sell the Share and otherwise fulfill its obligations under this Agreement.
(ii) Each Bulgan Entity shall have in all material respects duly performed and complied with all agreements, covenants and conditions required by this Agreement to be performed or complied with by such Bulgan Entity prior to or on the Closing Date, except as would not reasonably be expected to prevent or materially impair or delay the ability of Jewel to sell the Share and otherwise fulfill its obligations under this Agreement.
(b) Corporate and Other Proceedings. All corporate, partnership and other proceedings of each Bulgan Entity in connection with the purchase and sale of the Share contemplated by this Agreement, and all documents and instruments incident thereto, shall be satisfactory in form and substance to Worldstar and its counsel in their reasonable judgment, and Worldstar and its counsel shall have received all such documents and instruments, or copies thereof, certified if requested, as may be reasonably requested.
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(c) Completion of $5.5 million Financing. WorldStar shall have received the proceeds of the sale of 22 million common shares at $0.25 each from investors who have agreed that the proceeds can be used to complete the transaction contemplated hereby.
(d) Legal Opinions. WorldStar shall have received legal opinions which are satisfactory to it, acting reasonably, that confirm that Bulgan Mongolia owns the Licenses, is owned by Bulgan Gold which is, in turn, as to 52% owned by Bulgan GIL, which in turn is owned as to 98% by National, all in accordance with the organization chart attached as Schedule E.
(e) Financial Statements. Worldstar shall have received audited Financial Statements for each of the Bulgan Entities which as of December 31, 2006 show only nominal assets and liabilities except for Bulgan Gold which shall show the financial effects of the Bulgan Gold Shareholder’s Agreement.
Conditions to Obligations of the Bulgan Entities
7.3 The obligation of each Bulgan Entity to consummate the Bulgan Reorganization contemplated hereby shall be subject to the fulfillment, on or prior to the Closing Date, of the following additional conditions, which Worldstar agrees to cause to be fulfilled:
(a) Representations, Performance, etc.
(i) The representations and warranties of Worldstar contained in Part 3 (i) shall be true and correct in all material respects at and as of the date hereof, (ii) shall be repeated and shall be true and correct in all material respects on and as of the Closing Date with the same effect as though made at and as of such time, except in the case of each of clauses (i) and (ii) as would not reasonably be expected to prevent or materially impair or delay the ability of Worldstar to purchase the Share and otherwise fulfill its obligations under this Agreement.
(ii) Worldstar shall have in all material respects duly performed and complied with all agreements, covenants and conditions required by this Agreement to be performed or complied with by it prior to or on the Closing Date, except as would not reasonably be expected to prevent or materially impair or delay the ability of Worldstar to purchase the Share and otherwise fulfill its obligations under this Agreement.
PART 8
TERMINATION
Termination
8.1 This Agreement may be terminated at any time prior to the Closing Date:
(a) By the written agreement of Worldstar and Jewel;
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(b) By Jewel or Worldstar by written notice to the other party if the Other Transaction Agreements shall have terminated in accordance with their terms or the conditions in §7.1(a), 7.1(b)or 7.1(c) are not met by the Closing Date; or
(c) By Worldstar if there shall have been a material breach of any covenant or agreement on the part of the Bulgan Entities contained in this Agreement such that the condition set forth in §7.2(a)(i) or §7.2(a)(ii) would not be satisfied and which shall not have been cured within 30 days following written notice of such breach; provided that Worldstar shall not have the right to terminate this Agreement pursuant to this §8.1(c) if Worldstar is then in material breach of any of its covenants or agreements contained in this Agreement such that the Closing condition set forth in §7.2(a)(i) or §7.2(a)(ii) would not be satisfied; or
(d) By Jewel if there shall have been a material breach of any covenant or agreement on the part of Worldstar contained in this Agreement such that the condition set forth in §7.3(a)(i) and §7.3(a)(ii) would not be satisfied and which shall not have been cured within 30 days following written notice of such breach; provided that Jewel shall not have the right to terminate this Agreement pursuant to this §8.1(d) if any Bulgan Entity is then in material breach of any of its covenants or agreements contained in this Agreement such that the Closing condition set forth in §7.2(a)(i) or §7.2(a)(ii) would not be satisfied.
Effect of Termination
8.2 In the event of the termination of this Agreement pursuant to the provisions of §8.1, this Agreement shall become void and have no effect, without any liability to any Person in respect hereof or of the purchase and sale of the Share contemplated hereby on the part of any party hereto, or any of its directors, officers, representatives, stockholders or Affiliates, except as specified in §4.2, §6.1, §6.2, §8.2, §10.1 and §10.3 and except for any liability resulting from such party’s breach of this Agreement prior thereto.
PART 9
DEFINITIONS
Terms Generally
9.1 The words “hereby,” “herein,” “hereof,” “hereunder” and words of similar import refer to this Agreement as a whole and not merely to the specific section, paragraph or clause in which such word appears. All references herein to Sections shall be deemed references to Sections of this Agreement unless the context shall otherwise require. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The definitions given for terms in this Part 9 and elsewhere in this Agreement shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. Except as otherwise expressly provided herein, all references to “dollars” or “US$” shall be deemed references to the lawful money of the United States of America.
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Certain Terms
9.2 Whenever used in this Agreement, the following terms shall have the respective meanings given to them below or in the Sections indicated below:
Affiliate: of a Person means a Person that directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the first Person, including but not limited to a Subsidiary of the first Person, a Person of which the first Person is a Subsidiary, or another Subsidiary of a Person of which the first Person is also a Subsidiary.
Agreement: means this Agreement with all Schedules.
Bulgan Entities: means National, Bulgan GIL, Bulgan Gold and Bulgan Mongolia, together.
Bulgan GIL: means Bulgan Gold Investment Limited, a Hong Kong company.
Bulgan Gold Shareholder’s Agreement: means the December 18, 2006 Agreement involving the Bulgan Reorganization and which is attached as Schedule D.
Bulgan Gold: means Bulgan Gold (Hong Kong) Limited, a Hong Kong company.
Bulgan Mongolia: means Bulgan Gold LLC, a Mongolian company and holder of State Registration Certificate No. 9011045098.
Bulgan Reorganization: means the carrying out of the transactions contemplated by this Agreement, together with the Other Transactions.
Business Day: any day that is not a Saturday, Sunday or other day on which banks are required or authorized by Law to be closed in Nevada, Hong Kong or Mongolia.
Claimant: as defined in §10.3(b) .
Closing Date: as defined in §1.2.
Closing: as defined in §1.2.
Confidential Information: information regarding this Agreement and the Other Transaction Agreements including the terms, status and existence thereof, provided that such Confidential Information does not include information that (a) was publicly known or otherwise known to such receiving party prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by such receiving party or any Person acting on such party’s behalf, or (c) otherwise becomes known to such receiving party other than through disclosure by the delivering party or any Person with a duty to keep such information confidential.
Consent: any consent, approval, authorization, waiver, permit, grant, franchise, concession, agreement, license, certificate, exemption, order, registration, declaration, filing, report or notice of, with or to any Person.
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Contract: all loan agreements, indentures, letters of credit (including related letter of credit applications and reimbursement obligations), mortgages, security agreements, pledge agreements, deeds of trust, bonds, notes, guarantees, surety obligations, warranties, licenses, franchises, permits, powers of attorney, purchase orders, leases, and other agreements, contracts, instruments, obligations, offers, commitments, arrangements and understandings, written or oral.
Control (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of a person, whether through the ownership of voting securities, by contract or credit arrangement, as trustee or executor, or otherwise.
Governmental Approval: any Consent of, with or to any Governmental Authority.
Governmental Authority: any nation or government, any state or other political subdivision thereof; any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including, without limitation, any government authority, agency, department, board, commission or instrumentality of any nation or any political subdivision thereof; any court, tribunal or arbitrator; and any self-regulatory organization.
ICC: as defined in §10.3(b) .
Jewel: as defined in the first paragraph of this Agreement.
Law: all applicable provisions of all (a) constitutions, treaties, statutes, laws, codes, rules, regulations, ordinances or orders of any Governmental Authority, (b) Governmental Approvals and (c) orders, decisions, injunctions, judgments, awards and decrees of or agreements with any Governmental Authority.
Licenses: means the 50 mineral exploration licenses granted to Bulgan Mongolia in December 2006 and more particularly described on Schedule ▇.
▇▇▇▇: any mortgage, pledge, deed of trust, hypothecation, right of others, claim, security interest, encumbrance, burden, title defect, title retention agreement, lease, sublease, license, occupancy agreement, easement, covenant, condition, encroachment, voting trust agreement, interest, option, right of first offer, negotiation or refusal, proxy, lien, charge or other restrictions or limitations of any nature whatsoever, including but not limited to such Liens as may arise under any Contract.
Loan and Share Pledge Agreement: means the agreement whereby Worldstar has lent to Bulgan GIL funds to facilitate the Bulgan Reorganization.
National Base: means National Base Investment Limited.
Organizational Documents: as to any Person, its certificate or articles of incorporation, bylaws and other organizational documents.
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Other Transaction Agreements: the Bulgan Gold Shareholder’s Agreement, the Loan and Share Pledge Agreement and the Subscription Agreements.
Other Transactions: the transactions contemplated by the Other Transaction Agreements.
Person: any natural person, firm, partnership, association, corporation, company, trust, business trust, Governmental Authority or other entity.
Purchase Price: as defined in §1.1.
Register of Members: as defined in §1.2.
Request: as defined in §10.3(b) .
Respondent: as defined in §10.3(b) .
Schedules: means the following schedules which are attached hereto and form part of this Agreement
Schedule A - Disclosure
Schedule
Schedule B - List of Licenses
Schedule C - Mongolian Legal Counsel Opinion
Schedule D - Bulgan Gold Shareholders’ Agreement
Schedule E -
Post-Closing Organizational Chart
Share: as defined in the recitals of this Agreement.
Subscription Agreement: means the agreements under which Worldstar is to raise $5.5 million as a condition to the Closing in order to fund the Bulgan Reorganization.
Subsidiaries: each corporation or other Person in which a Person owns or controls, directly or indirectly, share capital or other equity interests representing more than 50% of the outstanding voting stock or other equity interests.
Tax: any federal, state, local or foreign income, alternative, minimum, accumulated earnings, personal holding company, franchise, share capital, profits, windfall profits, gross receipts, sales, use, value added, transfer, registration, stamp, premium, excise, customs duties, severance, environmental, real property, personal property, ad valorem, occupancy, license, occupation, employment, payroll, social security, disability, unemployment, workers’ compensation, withholding, estimated or other similar tax, duty, fee, assessment or other governmental charge or deficiencies thereof (including all interest and penalties thereon and additions thereto).
Worldstar: means Worldstar Energy, Corp. a Nevada company which has its common shares listed on the OTC Bulletin Board.
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PART 10
MISCELLANEOUS
Expenses
10.1 E xcept as set forth below in this §10.1 or as otherwise specifically provided for in this Agreement, each Bulgan Entity, on the one hand, and Worldstar, on the other hand, shall bear their respective expenses, costs and fees (including attorneys’ fees) in connection with the purchase and sale of the Share contemplated hereby, including the preparation, execution and delivery of this Agreement and compliance herewith, whether or not the purchase and sale of the Share contemplated hereby shall be consummated; provided that for the avoidance of doubt, any Tax or other expense associated with the transfer of the Share contemplated hereby shall be borne solely by Jewel.
Notices
10.2 All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if
| (a) |
delivered personally, | ||
| (b) |
sent by next-day or overnight mail or delivery, or | ||
| (c) |
sent by email, as follows: | ||
| (i) |
if to Worldstar, | ||
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c/o ▇▇▇▇ ▇▇▇▇▇▇, President | |||
|
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ | |||
|
▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇.▇▇ | |||
| (ii) |
if to Jewel, | ||
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▇▇▇▇▇▇▇ ▇▇▇ | |||
|
Attention: ▇.▇. ▇▇▇ | |||
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▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇.▇▇ | |||
(or, in each case, at such other address as may be specified in writing to the other parties hereto in accordance with this §10.2. )
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All such notices, requests, demands, waivers and other communications shall be deemed to have been received (i) if by personal delivery on the day after such delivery, (ii) if by next-day or overnight mail or delivery, on the day delivered, (iii) if by facsimile, on the next day following the day on which such facsimile was sent, provided that a copy is also sent by another method described herein.
Governing Law and Dispute Resolution
10.3 (a) This Agreement shall be governed in all respects, including as to validity, interpretation and effect, by the laws of the State of Nevada.
(b) Dispute Resolution
(i) Any dispute, controversy or claim arising out of, relating to, or in connection with this Agreement, or the breach, termination or validity hereof, shall be finally settled exclusively by arbitration. The arbitration shall be conducted in accordance with the rules of the International Chamber of Commerce (the “ICC”) in effect at the time of the arbitration, except as they may be modified by mutual agreement of the parties. The seat of the arbitration shall be Singapore, provided, that, the arbitrators may hold hearings in such other locations as the arbitrators determine to be most convenient and efficient for all of the parties to such arbitration under the circumstances. The arbitration shall be conducted in the English language.
(ii) The arbitration shall be conducted by three arbitrators. The party (or the parties, acting jointly, if there are more than one) initiating arbitration (the “Claimant”) shall appoint an arbitrator in its request for arbitration (the “Request”). The other party (or the other parties, acting jointly, if there are more than one) to the arbitration (the “Respondent”) shall appoint an arbitrator within 30 days of receipt of the Request and shall notify the Claimant of such appointment in writing. If within 30 days of receipt of the Request by the Respondent, either party has not appointed an arbitrator, then that arbitrator shall be appointed by the ICC. The first two arbitrators appointed in accordance with this provision shall appoint a third arbitrator within 30 days after the Respondent has notified Claimant of the appointment of the Respondent’s arbitrator or, in the event of a failure by a party to appoint, within 30 days after the ICC has notified the parties and any arbitrator already appointed of the appointment of an arbitrator on behalf of the party failing to appoint. When the third arbitrator has accepted the appointment, the two arbitrators making the appointment shall promptly notify the parties of the appointment. If the first two arbitrators appointed fail to appoint a third arbitrator or so to notify the parties within the time period prescribed above, then the ICC shall appoint the third arbitrator and shall promptly notify the parties of the appointment. The third arbitrator shall act as Chair of the tribunal.
(iii) The arbitral award shall be in writing, state the reasons for the award, and be final and binding on the parties. The award may include an award of costs, including reasonable attorneys’ fees and disbursements. In addition to monetary
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damages, the arbitral tribunal shall be empowered to award equitable relief, including, but not limited to, an injunction and specific performance of any obligation under this Agreement. The arbitral tribunal is not empowered to award damages in excess of compensatory damages, and each party hereby irrevocably waives any right to recover punitive, exemplary or similar damages with respect to any dispute, except insofar as a claim is for indemnification for an award of punitive damages awarded against a party in an action brought against it by an independent third party. The arbitral tribunal shall be authorized in its discretion to grant pre-award and post-award interest at commercial rates. Any costs, fees or taxes incident to enforcing the award shall, to the maximum extent permitted by Law, be charged against the party resisting such enforcement. Judgment upon the award may be entered by any court having jurisdiction thereof or having jurisdiction over the relevant party or its assets.
(iv) In order to facilitate the comprehensive resolution of related disputes, and upon request of any party to the arbitration proceeding, the arbitration tribunal may, within 90 days of its appointment, consolidate the arbitration proceeding with any other arbitration proceeding involving any of the parties relating to this Agreement and the Other Transaction Agreements. The arbitration tribunal shall not consolidate such arbitrations unless it determines that (x) there are issues of fact or law common to the proceedings, so that a consolidated proceeding would be more efficient than separate proceedings, and (y) no party would be prejudiced as a result of such consolidation through undue delay or otherwise. In the event of different rulings on this question by the arbitration tribunal constituted hereunder and any tribunal constituted under the Other Transaction Agreements, the ruling of the tribunal constituted under this Agreement will govern, and that tribunal will decide all disputes in the consolidated proceeding.
(v) The parties agree that the arbitration shall be kept confidential and that the existence of the proceeding and any element of it (including but not limited to any pleadings, briefs or other documents submitted or exchanged, any testimony or other oral submissions, and any awards) shall not be disclosed beyond the tribunal, the ICC, the parties, their counsel and any person necessary to the conduct of the proceeding, except as may be lawfully required in judicial proceedings relating to the arbitration or otherwise, or as required by NASDAQ rules or the rules of any other quotation system or exchange on which the disclosing party’s securities are listed or applicable Law.
(vi) The costs of arbitration shall be borne by the losing party unless otherwise determined by the arbitration award.
(vii) All payments made pursuant to the arbitration decision or award and any judgment entered thereon shall be made in United States dollars, free from any deduction, offset or withholding for Taxes.
(viii) Notwithstanding this §10.3(b) or any other provision to the contrary in this Agreement, no party shall be obligated to follow the foregoing arbitration
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procedures where such party intends to apply to any court of competent jurisdiction for an interim injunction or similar equitable relief against any other party, provided there is no unreasonable delay in the prosecution of that application.
Binding Effect
10.4 This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.
Assignment
10.5 This Agreement shall not be assignable or otherwise transferable by any party hereto without the prior written consent of the other parties hereto, and any purported assignment or other transfer without such consent shall be void and unenforceable.
Third Party Beneficiaries
10.6 It is expressly agreed by the parties hereto that shall be a third party beneficiary of all of the terms of this Agreement and shall be entitled to enforce its rights as such under this Agreement.
Amendment; Waivers, etc.
10.7 No amendment, modification or discharge of this Agreement, and no waiver hereunder, shall be valid or binding unless set forth in writing and duly executed by the party against whom enforcement of the amendment, modification, discharge or waiver is sought. Any such waiver shall constitute a waiver only with respect to the specific matter described in such writing and shall in no way impair the rights of the party granting such waiver in any other respect or at any other time. Neither the waiver by any of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure by any of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, shall be construed as a waiver of any other breach or default of a similar nature, or as a waiver of any of such provisions, rights or privileges hereunder. The rights and remedies herein provided are cumulative and none is exclusive of any other, or of any rights or remedies that any party may otherwise have at law or in equity. The rights and remedies of any party based upon, arising out of or otherwise in respect of any inaccuracy or breach of any representation, warranty, covenant or agreement or failure to fulfill any condition shall in no way be limited by the fact that the act, omission, occurrence or other state of facts upon which any claim of any such inaccuracy or breach is based may also be the subject matter of any other representation, warranty, covenant or agreement as to which there is no inaccuracy or breach. The representations and warranties of Worldstar shall not be affected or deemed waived by reason of any investigation made by or on behalf of Jewel (including but not limited to by any of its advisors, consultants or representatives) or by reason of the fact that Jewel or any of such advisors, consultants or representatives knew or should have known that any such representation or warranty is or might be inaccurate.
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Entire Agreement
10.8 This Agreement constitutes the entire agreement and supersede all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof.
Severability
10.9 If any provision, including any phrase, sentence, clause, section or subsection, of this Agreement is invalid, inoperative or unenforceable for any reason, such circumstances shall not have the effect of rendering such provision in question invalid, inoperative or unenforceable in any other case or circumstance, or of rendering any other provision herein contained invalid, inoperative, or unenforceable to any extent whatsoever.
Headings
10.10 The headings contained in this Agreement are for purposes of convenience only and shall not affect the meaning or interpretation of this Agreement.
Counterparts
10.11 This Agreement may be executed in several counterparts, each of which shall be deemed an original and all of which shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first above written.
WORLDSTAR ENERGY CORP.
| By: "▇▇▇▇▇▇▇ ▇▇▇▇▇▇" |
| Authorized Signatory |
| Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ |
| Title: CEO/CFO/Director |
JEWEL STAR GROUP LIMITED
| By: "TAY Thai Seng" |
| Authorized Signatory |
| Name: TAY Thai Seng (▇▇▇▇▇▇▇) |
| Title: Director |
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NATIONAL BASE INVESTMENT LIMITED
| By: "TAY Thai Seng" |
| Authorized Signatory |
| Name: TAY Thai Seng (▇▇▇▇▇▇▇) |
| Title: Director |
SCHEDULE A
DISCLOSURE SCHEDULE
| 1. | JEWEL STAR GROUP LIMITED |
||
| a) | Business address – 2091, Gahood Villa, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ |
||
| b) | i) |
Shareholder - TAY Thai Seng ( 1 share of US$1.00 ) | |
| ii) | Director – TAY Thai Seng |
||
| c) | Authorized Share Capital – 50,000 shares of US$1.00 each |
||
| d) | Contracts & Agreements - None |
||
| e) | Bank Account - to be provided in writing prior to closing |
||
| f) | Only assets is 100% of shares of National Base Investment Limited |
||
| g) | Other business or operations – None |
||
| h) | Employees - None |
||
| 2. | NATIONAL BASE INVESTMENT LIMITED |
||
| a) | Business address – 2091, Gahood Villa, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ |
||
| b) | i) |
Shareholder - Jewel Star Group Limited ( 1 share of US$1.00 ) | |
| iii) | Director – TAY Thai Seng |
||
| c) | Authorized Share Capital – 50,000 shares of US$1.00 each |
||
| d) | Contracts & Agreements - None |
||
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| e) |
Bank Account – None | |
| f) |
Only assets is 98 shares of Bulgan Gold Investment Limited | |
| g) |
Other business or operations – None | |
| h) |
Employees - None |
| 3. |
BULGAN GOLD INVESTMENT LIMITED |
| a) |
Business address – 2091, Gahood Villa, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ |
| b) |
i) Shareholder - TAY Thai Seng ( 1 share of HK$1.00 ) |
| ii) |
National Base Investment Limited ( 49 shares of HK$1.00 each ) | ||
| iv) |
Director – TAY Thai Seng | ||
| c) | Authorized Share Capital – HK$10,000 divided into 10,000 shares of HK$1.00 each |
||
| d) | Contracts & Agreements – |
||
| 1) | Loan Agreement with Bulgan Gold (HK) Ltd. for advancing US$3,714,286.00 to Bulgan Gold (HK) Ltd. |
||
| 2) | Loan and Pledge Agreement with Worldstar for obtaining US$3,640,000 from Worldstar. |
||
| 3) | Loan Agreement with Tay Thai Seng for obtaining US$74,286 from Tay Thai Seng. |
||
| e) | Bank Account - to be provided in writing prior to closing |
||
| Authorised Signatory: TAY Thai Seng |
|||
| f) | Only asset is 52 shares (out of 100) of Bulgan Gold (Hong Kong) Limited |
||
| g) | Other business and operations – None |
||
- 3 -
| h) |
Employees – None |
| 4. |
BULGAN GOLD (HONG KONG) LIMITED |
| a) |
Business address – ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇.▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ |
| b) |
i) Shareholders - |
| 1) |
▇▇▇▇▇▇▇▇ ▇▇▇▇ (18 shares of HK$1.00 each ) | |
| 2) |
RADNAABAZAR Bazar (30 shares of HK$1.00 each ) | |
| 3) |
Bulgan Gold Investment Limited (52 shares of HK$1.00 each) |
| ii) |
Directors – | ||
| 1) |
▇▇▇▇▇▇▇▇ ▇▇▇▇ | ||
| 2) |
RADNAABAZAR Bazar | ||
| 3) |
▇▇▇▇▇ ▇▇▇▇ Thong | ||
| 4) |
TAY Thai Seng | ||
| c) | Share Capital – HK$10,000 divided into 10,000 shares of HK$1.00 each |
||
| d) | Contracts & Agreements |
||
| 1) | Bulgan Gold Shareholder’s Agreement. |
||
| 2) | Loan Agreement with Radnaabazar Bazar for obtaining US$2,142,857 from Radnaabazar Bazar. |
||
| 3) | Loan Agreement with Bulgan Gold Investment Limited for obtaining US$3,714,286 from Bulgan Gold Investment Limited. |
||
| 4) | Loan Agreement with ▇▇▇▇▇▇▇▇ ▇▇▇▇ for obtaining US$1,285,714 from ▇▇▇▇▇▇▇▇ ▇▇▇▇. |
||
| e) | Bank Account - to be provided in writing prior to closing |
||
| f) | Only asset is 100% of Bulgan Gold LLC |
||
| g) | Other business and operations – None |
||
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| h) |
Employees - None |
| 5. |
BULGAN GOLD LLC |
| a) |
Business Address – B-1, “Greenhouse” building, Chinggis Avenue, the 1st horoo, Khan- Uul District, Ulaanbataar, Mongolia |
| b) |
1) Shareholder – Bulgan Gold Hong Kong Limited |
| 2) Directors – Radnaabazaar BAZAR |
||
| c) | Share Capital – 100 shares with a par value of US$100 per share |
|
| d) | Contracts and Agreements – None |
|
| e) | Bank Account - to be provided in writing prior to closing |
|
| f) | Only asset is 50 Licenses |
|
| g) | Other business and operations – None |
|
| h) | Employees - None |
SCHEDULE B
LIST OF LICENSES
See Exhibit A to Schedule C
to this Agreement
SCHEDULE C
MONGOLIAN LEGAL COUNSEL OPINION
SCHEDULE D
BULGAN GOLD SHAREHOLDERS’ AGREEMENT
