Exhibit 10.1
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STOCKHOLDERS' AGREEMENT
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STOCKHOLDERS' AGREEMENT dated as of March 1, 2003, by and among HERITAGE
WORLDWIDE, INC., a Delaware corporation (the "Company"), GEM Global Yield Fund
("GEM"), a Nevis, West Indies entity, each of the other Restricted Stockholders
(as hereafter defined) listed on Schedule A to this Agreement, and MILO FINANCE
S.A., a Luxembourg limited liability entity ("MILO").
WHEREAS, the Stockholders (as hereinafter defined) currently own shares of
Common Stock (as hereinafter defined) of the Company,
WHEREAS, ten (10) Warrants (as hereinafter defined) to purchase additional
shares of Common Stock have been issued in the name of GEM and have been
delivered to the Escrow Agent pursuant to the Escrow Agreement (each as
hereinafter defined);
WHEREAS, the Escrow Agreement sets forth the terms upon which the Warrants
shall either be delivered to GEM or returned to the Company; and
WHEREAS, the parties agree that this Agreement is in the best interests of
the Company and the parties and will promote harmonious relationships among them
with respect to conduct of the business of the Company;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereby agree as follows:
1. Definitions. As used in this Agreement, the following capitalized
terms shall have the meanings ascribed to them below:
(a) "Acquisition Agreement" means that certain Acquisition
Agreement dated as of February 28, 2003, by and among the Company, POLY IMPLANTS
PROTHESES, S.A., a French limited liability company, GEM and certain other
parties.
(b) "Affiliate" means any Person Controlling, Controlled by or
under common Control (as hereinafter defined) with the relevant Person.
(c) "Block Transfer" means a sale by one or more Restricted
Shareholders (as hereinafter defined) to any Third Party (as hereinafter
defined) of more than 300,000 shares of Common Stock sold off the OTC Bulletin
Board or other exchange on which the Company's Common Stock is then traded.
(d) "Board of Directors" means the Board of Directors of the
Company.
(e) "Bona Fide Purchaser" means a Person that (i) is not an
Affiliate of a Selling Restricted Stockholder (as hereinafter defined); and (ii)
is not a Person acting in concert with or on behalf of a Selling Restricted
Stockholder or on behalf of an Affiliate thereof, and which purchases for its
own account;
(f) "By-Laws" means the By-Laws of the Company, as the same may
hereafter be amended from time to time, in accordance with the terms thereof and
as permitted or required hereby and/or by applicable law.
(g) "Certificate of Incorporation" means the Certificate of
Incorporation of the Company, as the same may hereafter be amended from time to
time, in accordance with the terms thereof and as permitted or required hereby
and by applicable law.
(h) "Control" means the direct or indirect beneficial ownership
of an equity interest of one Person in another Person, entitling or enabling the
owner of such interest, under then existing circumstances, to direct the
policies and operations of such other Person.
(i) "Encumbrance" or "Encumber" means or refers to any lien,
claim, charge, pledge, mortgage, encumbrance, security interest, preferential
arrangement, restriction on voting or alienation of any kind, adverse interest,
or the interest of a third party under any conditional sale agreement, capital
lease or other title retention agreement.
(j) "Person" means any individual, corporation, partnership,
trust or other entity of any nature whatsoever.
(k) "Law & Regs" means applicable law, regulations and rules,
including, without limitation and to the extent applicable, Delaware General
Corporation Law, HWWI's Certificate of Incorporation and By-Laws, Federal and
State Securities Law and Regulations and NASD Rules and Regulations.
(l) "Restricted Stockholder" means (i) GEM, an assignee of any
Warrant delivered to GEM pursuant to the Warrant Escrow Agreement, or an
assignee of any Common Stock obtained by the exercise of any such Warrant, and
(ii) each of the Persons named on Schedule A-1 hereto.
(m) "Restricted Stock Escrow Agent" means the Escrow Agent
appointed under, and signatory to Restricted Stock Escrow Agreement, as the same
may be replaced from time to time.
(n) "Restricted Stock Escrow Agreement" means the escrow
agreement among the Restricted Stockholders, MILO, and Xxxxxx Xxxxxxxxxx &
Xxxxxxxx, LLP, as Escrow Agent, and any authorized replacement for the
Restricted Stock Escrow Agent.
(o) "Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder, as the same may
be amended from time to time.
(p) "Stock" means the capital shares of the Company, consisting
of (i) common stock, $.001 par value ("Common Stock"); and (ii) the preferred
stock, $.001 par value ("Preferred Stock").
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(q) "Stockholder" means each of the Restricted Stockholders and
MILO, and any other Person who becomes, or is required to become a party to this
Agreement, and the term "Stockholders" means all such Persons, unless otherwise
expressly provided herein.
(r) "Third Party" means any Person other than a Restricted
Stockholder and any Affiliate of a Restricted Stockholder.
(s) "Transfer" means (i) a voluntary or involuntary sale,
assignment, exchange, transfer, conveyance or other disposition of a
Stockholders' Common Stock, and (ii) any agreement, contract or commitment to do
any of the foregoing.
(t) "Warrants" means each of the ten (10) five-year Warrants to
purchase Common Stock of the Company issued to GEM pursuant to the Acquisition
Agreement, each of which entitles the holder thereof to purchase one hundred
thousand (100,000) shares of Common Stock for one dollar ($1.00) per share, and
each of which is being delivered to the Warrant Escrow Agent simultaneously with
the execution of this Agreement and pursuant to the Warrant Escrow Agreement.
(u) "Warrant Escrow Agent" means the escrow agent named in the
Warrant Escrow Agreement (as hereinafter defined) and any successor thereto; (v)
"Warrant Escrow Agreement" means the Escrow Agreement among GEM, the Company,
MILO and Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP (as Escrow Agent), bearing even
date herewith.
2. Capitalization and Ownership.
(a) The Stockholders acknowledge that the Company is authorized
to issue fifty million (50,000,000) shares of Common Stock, and five million
(5,000,000) shares of Preferred Stock. As of the date hereof, an aggregate of
(i) sixteen million one hundred sixty-six thousand six hundred sixty-seven
(16,166,667) shares of Common Stock and, (ii) the Warrants, are issued and
outstanding and are held of record. There are no shares of Preferred Stock
issued or outstanding.
3. Election of Directors.
From and after the date hereof, at any annual or special
stockholders' meeting called for such purpose, or by written consent in lieu of
a meeting, if same is permitted under Law & Regs, the Stockholders shall vote
the Common Stock owned of record or beneficially by them to elect (a) to the
Board of Directors of the Company and maintain thereon (i) two nominees
designated by MILO, (ii) one nominee designated by GEM, for so long as the
Restricted Stockholders hold in the aggregate at least seven (7%) percent of the
issued and outstanding Common Stock of the Company, (iii) and enough
"independent" nominees who are agreeable to each of MILO and, for so long as the
Restricted Stockholders hold in the aggregate at least seven (7%) percent of the
issued and outstanding Common Stock of the Company, agreeable to GEM, in order
to comply with Law & Regs, and (b) at its request, up to two nominees of MILO to
each of the Company's audit committee and compensation committee. All such
directors shall hold office until their respective successors shall have been
elected and shall have qualified in accordance with the By-laws and applicable
law.
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4. Restrictions on Transfers.
(a) The Restricted Stockholders shall not Transfer to any Third
Party an aggregate of more than (i) one million (1,000,000) shares of Common
Stock at any time prior to the expiration of one hundred twenty (120) days after
the effective date of this Agreement, or (ii) one million five hundred thousand
(1,500,000) shares of Common Stock (including any shares referred to in Section
4(a)(i) above) at any time prior to the expiration of two hundred forty (240)
days after the effective date of this Agreement.
(b) Pursuant to the Restricted Stock Escrow Agreement, the
Restricted Stockholders shall deposit with Restricted Stock Escrow Agent all the
shares of HWWI Common Stock currently owned by them of record or beneficially,
to be held and delivered in accordance with the Restricted Stock Escrow
Agreement.
(c) No Warrant shall be Transferred by any holder thereof without
the consent of MILO. No Restricted Stockholder shall Transfer to any Third Party
any shares of Common Stock issued in connection with the exercise of the
Warrants at any time during the two year period following the date of this
Agreement. If and when any such Common Stock is issued during such two-year
period, the certificates therefor shall be delivered to the Restricted Stock
Escrow Agent to be dealt with and delivered in accordance with the Restricted
Stock Escrow Agreement.
(d) Notwithstanding anything to the contrary contained herein,
any Restricted Stockholder may, at any time, offer to Transfer any or all of its
Common Stock to the Company at such price, and on such terms and conditions as
the offering Restricted Stockholder shall determine. Such offer may be accepted
or declined by the Company, as its Board, in its sole discretion determines.
5. Block Transfers of Shares of Stock.
(a) No Block Transfer of Common Stock may be made by any
Restricted Stockholder to any Third Party other than as provided in this Section
5.
(b) If one or more of the Restricted Stockholders, alone or
together, shall desire at any time to effect a Block Transfer of Common Stock
(the "Offered Shares") and shall receive a purchase offer from a Bona Fide
Purchaser (any such offer being hereinafter referred to as a "Purchase Offer"),
then, within five (5) days thereafter, such Restricted Stockholder(s) (the
"Selling Restricted Stockholders") shall give notice to the Company and to MILO
of the terms and conditions of such Purchase Offer, specifying the names of the
Selling Restricted Stockholders and the number of Offered Shares each intends to
sell ("Notice of Purchase Offer"). Such Notice shall be accompanied by a true
and complete copy of all documents embodying any or all of such terms and
conditions, which documents shall be deemed part of such Notice of Purchase
Offer.
(c) If the Selling Restricted Stockholders timely give a Notice
of Purchase Offer, then MILO shall have the option to participate in such Block
Transfer by substituting one share of Common Stock owned by MILO for each share
of Common Stock proposed to be sold by the Selling Restricted Stockholders (each
a "Substitute Share"), up to fifty percent (50%) of the shares of Common Stock
to be purchased pursuant to the Purchase Offer as specified therein. Such option
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("Participation Option") may only be exercised by a notice to such effect given
to the Selling Restricted Stockholders and to the Company within ten (10) days
following receipt of the Notice of Purchase Offer by MILO, stating the number of
such Substitute Shares MILO intends to sell ("Notice of Participation").
(d) If such Notice of Participation is not timely given, then the
Selling Restricted Shareholders shall sell the number of shares of Common Stock
specified in the Notice of Purchase Offer in accordance with such Purchase
Offer, provided that they must do so within five (5) days following the last day
on which MILO may give Notice of Participation. If such sale is not timely
consummated, then no Block Transfer shall occur pursuant to the Purchase Offer
and the Common Stock owned by the Selling Restricted Stockholders shall continue
to be subject to this Agreement as if no Purchase Offer had been made.
(e) If a timely Notice of Participation is given, then within
five (5) days following the receipt thereof by the last of the Selling
Restricted Stockholders to receive such Notice of Participation, the Selling
Restricted Stockholders shall give Notice to the Company and to MILO which shall
state which of Selling Restricted Stockholders named in the Notice of Purchase
Offer shall continue to be Selling Restricted Stockholders and the number of
shares of Common Stock which each is to sell pursuant to the Purchase Offer,
after deducting from the aggregate number of shares of Common Stock to be sold
by them, as stated in the Notice of Purchase Offer, the aggregate number of
Substitute Shares ("Notice of Reduction") If no Notice of Reduction is timely
given, then no Block Transfer shall occur pursuant to the Purchase Offer, and
the Common Stock owned by the Selling Restricted Stockholders shall continue to
be subject to this Agreement as if no Purchase Offer had been made.
(f) If a Notice of Reduction is timely given, then the Selling
Restricted Stockholders shall sell that number of shares specified in the Notice
of Reduction and MILO shall sell that number of shares of Common Stock specified
in its Notice of Participation. Any such sale must be consummated within five
(5) days following receipt of the Notice of Reduction. If the sale of such
Common Stock is not timely consummated because the Selling Restricted
Stockholders shall fail or refuse to consummate such sale, then no Block
Transfer shall occur pursuant to the Purchase Offer and the Common Stock owned
by the Selling Restricted Stockholders shall continue to be subject to this
Agreement as if no Purchase Offer had been made.
(g) Notwithstanding the foregoing, if the Selling Restricted
Shareholders are ready, willing and able to timely sell the shares of Common
Stock specified in the Purchase Offer (as modified by any Notice of Reduction),
but MILO shall wrongfully fail or refuse to timely sell to the Bona Fide
Purchaser the shares of Common Stock it is to sell, as specified in the Notice
of Participation, then each Selling Restricted Stockholder shall timely sell to
the Bona Fide Purchaser the shares specified in the Notice of Purchase Offer
and, in addition, each Selling Restricted Shareholder may at the same time sell
to the Bona Fide Purchaser that number of shares of Common Stock which is the
difference between the number specified in Notice of Purchase Offer and the
number specified in the Notice of Reduction.
(h) For the purposes of this Section 5 all proposed sales by all
Selling Restricted Stockholders pursuant to a Purchase Offer shall be
aggregated, to determine whether this Section 5 is applicable and to determine
the number of Substitute Shares.
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(i) Nothing herein shall prevent the Restricted Stockholders and
MILO from agreeing with a Bona Fide Purchaser to increase the number of shares
in the Block Transfer to include more shares of either or both the Selling
Restricted Stockholders and MILO.
6. After-Acquired Shares. All of the provisions of this Agreement
shall apply to all Common Stock of the Company now owned or which may be issued
or Transferred hereafter to a Restricted Stockholder in consequence of any
additional issuance, purchase, assignment, exchange or reclassification of
shares of capital stock, corporate reorganization, or any other form of
recapitalization, or consolidation, or merger, or share split, or share
dividend, or which are acquired by a Restricted Stockholder in any other manner,
except for Common Stock acquired on the open market.
7. Injunctive Relief; Specific Performance. Inasmuch as the Common
Stock is not readily marketable and, in any event, is unique, irreparable damage
would result if this Stockholders' Agreement is not specifically enforced. The
parties hereto intend that the rights and obligations of the parties hereto
should be enforceable in a court of equity by a decree of specific performance
and/or by injunction, and in furtherance thereof, agree that appropriate
injunctive relief temporary and/or permanent may be applied for and granted in
connection therewith without the necessity of posting any bond.
8. Certificate of Incorporation; By-Laws. Within five days following
the request of the Majority Shareholders, each of the Restricted Stockholders
shall consent to and approve, take any action and execute any document which may
from time to time be necessary or advisable in order to make any of the
provisions of this Agreement, or any of the amendments thereto, valid and
enforceable under the applicable laws as now or hereafter enacted or to
facilitate the transactions contemplated hereby, including, without limitation,
any amendment of the Certificate of Incorporation or By-Laws of the Company.
Each Restricted Stockholder shall not take or consent to any action, execute or
approve the execution of any document, which would be inconsistent with any
provision hereof, including, without limitation, any amendment to the
Certificate of Incorporation or By-laws.
9. Duration of Agreement. The rights and obligations of each
Restricted Stockholder under this Agreement shall terminate as to such
Restricted Stockholder upon the earliest to occur of (i) the transfer of all
shares of Common Stock owned by such Restricted Stockholder in accordance with
this Agreement or (ii) the Company having consummated a public offering with
gross proceeds of not less than $10,000,000.
10. Representations and Warranties. Each Restricted Stockholder and
MILO represents and warrants to the other parties hereto as follows:
(a) The execution, delivery and performance of this Agreement by
such Stockholder will not violate any provision of law, any order of any court
or other agency of government, or any provision of any indenture, agreement or
other instrument to which such Stockholder or any of its properties or assets is
bound, or conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any such indenture, agreement or other
instrument, or result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of the properties or assets of
such Restricted Stockholder.
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(b) This Agreement has been duly executed and delivered by such
Stockholder and constitutes the legal, valid and binding obligation of such
Stockholder, enforceable in accordance with its terms.
(c) Such Stockholder understands that the Company is a public
company the shares of which are publicly traded but are not currently listed on
any exchange. Although the Company's business plan contemplates listing its
stock on the NASDAQ, no guarantees and no assurances have been given that such
listing will be accomplished or if accomplished, whether such listing will occur
in the foreseeable future.
(d) Such Stockholder has acquired the Common Stock it now owns,
and any shares thereof hereinafter required (except in one or more open-market
transactions) for such Stockholders' own account, for investment and not with a
view to the sale or distribution thereof or the granting of any participation
therein. No Stockholder has a present intention of distributing or selling to
others any of its Common Stock or of granting any participation therein. No
Stockholder has any agreement or other arrangement, formal or informal, with any
person to sell, transfer, pledge or otherwise dispose of any such shares of
Common Stock now or hereafter owned or that would guarantee to such Stockholder
any profit, or protect such Stockholder against loss with respect to or in
connection with the Common Stock and no such Restricted Stockholder has any
plans to enter into any such agreement or arrangement. (e) The representations,
warranties and agreements contained in this Section 10 are true and correct and
shall survive the execution and delivery of this Agreement.
11. Governing Law and Jurisdiction. This Agreement shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be governed by, and construed and enforced in accordance
with, the laws of the State of New York applicable to contracts to be made and
performed entirely within the state and no defense given or allowed by the laws
of any other state or country shall be interposed in any action or proceeding
herein, unless such defense is also given or allowed by the laws of the State of
New York and not waived hereby. The courts of the State of New York shall have
exclusive jurisdiction over all controversies or disputes relating to, arising
out of, or with respect to the interpretation, performance or breach of this
Agreement. The parties consent to personal jurisdiction in the courts of such
state and agree that process may be served upon them in any such action by
registered mail at the address set forth below their signature hereon (as such
address may be changed from time to time as provided in Section 14 hereof), or
as otherwise permitted by New York law.
12. WAIVER OF TRIAL BY JURY. THE PARTIES HERETO, HAVING FULLY
CONSIDERED THE CONSEQUENCES THEREOF, DO HEREBY WAIVE TRIAL BY JURY IN ANY
PROCEEDING, CONTROVERSY OR DISPUTE RELATING TO OR ARISING OUT OF THIS AGREEMENT.
13. Benefits of Agreement. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors,
permitted assigns, legal representatives and heirs. Except for the foregoing,
there shall be no third party beneficiaries of this Agreement.
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14. Notices, etc. All notices, requests, demands, consents,
approvals and other communications required or permitted to be given hereunder
shall be in writing and shall be given personally, sent by facsimile
transmission or sent by prepaid air courier to the party at its address or fax
number given below its signature to this Agreement. Any notice so given shall be
deemed to have been given when received. Any notice required to be given
hereunder to an Investor may also be given to the designated representative of
such Investor. A copy of any notice given hereunder shall be simultaneously sent
to counsel for the respective parties, as follows:
If to counsel for the Company or MILO:
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxx X. Xxxxxx/Xxxxxxx Xxxxxxxx
Fax: (000) 000-0000
If to counsel for GEM and the Restricted Stockholders:
Xxxxxx Gottbetter & Xxxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxxxx
Fax: (000) 000-0000
Any party hereto, or counsel for any party hereto, may change the
address and/or fax number for notices intended for it by giving a notice
complying with this Section to the parties hereto and to the other counsel, but
such notice shall not be effective until actually received.
15. Gender. The use herein of neuter, masculine or feminine
gender is intended to be and shall comprehend all the other genders unless
clearly inappropriate.
16. Modification. Except as otherwise provided herein, neither
this Agreement nor any provision hereof shall be modified, changed, waived,
discharged or terminated except by (a) an instrument in writing signed by the
party against whom the enforcement of any modification, change, discharge,
waiver or termination is sought, or (b) by the agreement of all of the parties
hereto.
17. Entire Agreement. This Agreement constitutes the entire
agreement among the parties hereto with respect to its subject matter, and
supersedes any and all prior agreements or understandings, oral or written,
among any or all of the undersigned relating to such matter.
18. Signatures; Counterparts. Telefacsimile transmissions of any
executed original document and/or retransmission of any executed telefacsimile
transmission shall be deemed to be the same as the delivery of an executed
original. At the request of any party hereto, each other party hereto shall
confirm telefacsimile transmissions by executing duplicate original documents
and delivering the same to such requesting party. This Agreement may be executed
in any number of counterparts and by the parties hereto in separate
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counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
19. Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
20. Severability. If any one or more of the provisions contained
in this Agreement, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired, unless the
provisions held invalid, illegal or unenforceable shall materially impair the
benefits of the remaining provisions of this Agreement. The parties hereto
further agree to replace such invalid, illegal or unenforceable provision of
this Agreement with a valid, legal and enforceable provision that will achieve,
to the extent possible, the economic, business and other purposes of such
invalid, illegal or unenforceable provision.
[Balance of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.
HERITAGE WORLDWIDE, INC.
By: -----------------------------
Name:
Title:
Address:
Fax No.:
[FIRST OF THREE SIGNATURE PAGES TO STOCKHOLDERS' AGREEMENT]
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On behalf of itself and the other entities specified on Schedule A:
GEM Global Yield Fund
By: -----------------------------
Name:
Title:
Address: 00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax No.: (000) 000-0000
GEM SINGAPORE LTD.
By: -----------------------------
Name:
Title:
Address: 00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax No.: (000) 000-0000
GLOBAL STRATEGIC HOLDINGS LTD.
By: -----------------------------
Name:
Title:
Address: 00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax No.: (000) 000-0000
[SECOND OF THREE SIGNATURE PAGES TO STOCKHOLDERS' AGREEMENT]
11
OCEAN STRATEGIC HOLDINGS LTD.
By: -----------------------------
Name:
Title:
Address: 00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax No.: (000) 000-0000
MILO FINANCE S.A.
By: -----------------------------
Authorized Signatory
Name: Alain Serijol
Title: Authorized Signatory
Address: 0 xxx Xxxx Xxxxxxx
XX 0000 Xxxxxxxxxx,
Xxxxxxxxxx
Fax No.:
[THIRD OF THREE SIGNATURE PAGES TO STOCKHOLDERS' AGREEMENT]
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SCHEDULE A
NAMES AND ADDRESSES
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OF RESTRICTED STOCKHOLDERS
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GEM Global Yield Fund Ltd.
00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax: (000) 000-0000
GEM Singapore, Ltd.
00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax: (000) 000-0000
GEM Strategic Holdings Ltd.
00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax: (000) 000-0000
Global Strategic Holdings Ltd.
00 Xxxxxxxx Xx.
Xxxxxx X0X0XX
Fax: (000) 000-0000
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EXHIBIT A
MAJORITY STOCKHOLDERS OF HERITAGE WORLDWIDE, INC.
CONSTITUTING 82.3% OF ISSUED OUTSTANDING COMMON STOCK
Name of Stockholder Number of Shares
--------------------- ------------------
GEM Global Yield Fund Ltd. 499,500
GEM Singapore, Ltd. 499,500
Ocean Strategic Holdings Ltd. 499,500
Global Strategic Holdings Ltd. 499,500
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