Exhibit 2.1
Asset Purchase Agreement dated as of December 5, 2001 between
BTSL Technologies Limited and Silk Xxxxxxxxxx.Xxx, Inc.
ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT is made as of the 5th day of
December 2001, by and between BTSL Technologies Limited, an Irish
limited liability company ("Company"), and Silk Xxxxxxxxxx.Xxx, Inc., a
Florida corporation ("Buyer").
BACKGROUND
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Buyer desires to acquire certain specified assets of Company, and
Company desires to sell and assign such assets to Buyer, all on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants hereinafter set forth, the parties hereto, intending to be
legally bound, hereby agree as follows:
1. ACQUISITION TRANSACTION.
1.1 PURCHASE AND SALE OF ASSETS. On the Closing Date (as
hereinafter defined), upon the terms and conditions herein set forth.
Buyer agrees to purchase from Company, and Company agrees to sell,
transfer, convey and deliver to Buyer (or to a wholly owned subsidiary
of Buyer), all of the Acquired Assets at the Closing (as hereinafter
defined) in exchange for the Purchase Price set forth in section 1.3,
below (the "Transaction"). As used herein, "Acquired Assets" shall
mean only those assets listed in Exhibit "A" hereto, which shall be
delivered to Buyer in good condition and in good working order.
1.2 NO ASSUMPTION OF LIABILITIES. On the Closing Date,
Buyer will not assume or have any responsibility, however, with
respect to any obligation or liability of Company or relating to its
business or properties, whether liquidated or unliquidated, fixed or
contingent, arising by operation of law or otherwise.
1.3 PURCHASE PRICE. In exchange for the Acquired Assets,
Buyer agrees to (a) issue and deliver to Company sufficient common
shares of Buyer [approximately Twenty Million (20,000,000)] at the
Closing such that Company shall, after the Transaction, received ninety
percent (90%) of the issued and outstanding shares of Buyer on a fully
diluted basis; and (b) simultaneous with or prior to the Closing,
Buyer shall cause Xxxxxx Xxxxxxxx to reduce his holdings of Buyer
Convertible Preferred Stock such that he owns no more than 9.99% of
Buyer common shares on a converted basis after issuance of the
abovesaid approximately 20,000,000 common shares to Company; and .
Exhibit 2.1 - Pg. 1
2. REPRESENTATIONS AND WARRANTIES OF BUYER WITH RESPECT
TO BUYER. As material inducement to Company to enter into this
Agreement and to close hereunder, Buyer hereby makes the following
representations, warranties and agreements to and with Company:
2.1 Due Organization; Capitalization and Articles, Bylaws
and Records.
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Buyer is a corporation duly organized, validly existing and in
good standing under the laws of the State of Florida and has the full
corporate power and authority to own its properties, carry on its
business as it is now being conducted and perform its obligations
under all Contracts (as herein defined), and is duly qualified to do
business as a foreign corporation in the jurisdictions specified in
Part 2.1 of the Disclosure Schedule ("Disclosure Schedule" shall mean
the schedule (dated as of the date of the Agreement) attached hereto as
Exhibit "B" which is attached to the Agreement and incorporated in the
Agreement by reference), which constitutes all the jurisdictions in
which Company conducts any business. The authorized capital stock of
Company consists of FIFTY MILLION (50,000,000) shares of Preferred
Stock, $.001 par value per share, of which SIX MILLION FOUR HUNDRED
EIGHTY EIGHT THOUSAND ONE HUNDRED NINETEEN (6,488,119) shares are
presently issued and outstanding (of these shares of Preferred Stock,
1,900 are not convertible to common stock; 2,444,532 are convertible
on December 1, 2001; 4,042,687 are convertible on January 1, 2002; and
each of the convertible shares converts to one (1) share of common
stock ); and THREE HUNDRED MILLION (300,000,000) shares of Common
Stock, $.001 par value per share, of which approximately EIGHTY SEVEN
THOUSAND ONE HUNDRED THIRTY (87,130) shares are outstanding, free and
clear of all liens, encumbrances, security agreements options, claims,
charges and restrictions, all of which outstanding shares are validly
issued, fully paid and non-assessable. Buyer is a Section 12g
reporting company, under the Securities Exchange Act, which previously
traded on the OTC Bulletin Board under the symbol SILK.
There are no shares of Buyer's capital stock held in its
treasury. Other than as described in Buyer's report on Form 10-QSB for
the period ended February 28, 2001, filed with the Securities Exchange
Commission, there are no options, warrants, rights, shareholder
agreements or other instruments or agreements outstanding giving any
person the right to acquire any shares of capital stock of Buyer, nor
are there any commitments to issue or execute any such options,
warrants, rights, shareholder agreements or other instruments or
agreements. There are no outstanding stock appreciation rights or
similar rights measured with respect to any of Buyer's capital stock,
nor are there any instruments, or agreements giving anyone the right
to acquire any such rights. The minute books and stock records of
Buyer are complete and accurate and all signatures included therein
are the genuine signatures of the persons indicated as signing. True,
correct and complete copies of Buyer's minute books and stock records,
including Buyer's Articles of Incorporation and Bylaws and all
amendments to both, have been delivered to the Company. Buyer is not
in default under or in violation of any provision of its Articles of
Incorporation or its Bylaws. The books of account, stock records,
minute books and other records of Buyer are accurate, up-to-date and
complete, and have been maintained in accordance with sound and
prudent business practices.
Exhibit 2.1 - Pg. 2
2.2 Authority; Binding Nature of Agreements.
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1.1.1 Buyer has the absolute and unrestricted right,
power and authority to enter into and to perform its obligations under
this Agreement and all other agreements, certificates and instruments
contemplated to be executed and delivered by Buyer in connection with
this Agreement, and the execution, delivery and performance by Buyer
of this Agreement and such other agreements, certificates and
instruments have been duly authorized by all necessary action on the
part of Buyer and its shareholders, Board of Directors and officers.
Each of this Agreement and such other agreements, certificates and
instruments constitutes, or upon execution and delivery will
constitute, the legal, valid and binding obligation of Buyer,
enforceable against Buyer in accordance with its terms, except as
enforceability may be limited by bankruptcy and other similar laws
affecting creditors rights.
2.3 Non-Contravention; Consents. To the best knowledge of
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Company, neither the execution and delivery of any of this Agreement,
nor the consummation or performance of any of the transactions
contemplated hereby, will directly or indirectly (with or without
notice or lapse of time):
2.3.1 Contravene, conflict with or result in a
violation of (i) any of the provisions of Buyer's articles of
incorporation or Bylaws, or (ii) any resolution adopted by Buyer's
shareholders, Buyer's Board of Directors or any committee of Buyer's
Board of Directors;
2.3.2 Contravene, conflict with or result in a
violation of, or give any Governmental Body or other Person the right
to challenge any of the transactions contemplated hereby or to
exercise any remedy or obtain any relief under, any Legal Requirement
or any Order to which Buyer, or any of the assets owned or used by
Buyer, is subject;
2.3.3 Cause Company to become subject to, or to
become liable for the payment of, any Tax;
2.3.4 Contravene, conflict with or result in a
violation or breach of, or result in a default under, any provision of
any of the Contracts;
2.3.5 Give any Person the right to (i) declare a
default or exercise any remedy under any Contract, (ii) accelerate the
maturity or performance of any Contract, or (iii) cancel, terminate or
modify any Contract;
Exhibit 2.1 - Pg. 3
2.3.6 Give any Person the right to any payment by
Buyer or give rise to any acceleration or change in the award, grant,
vesting or determination of options, warrants, rights, severance payments
or other contingent obligations of any nature whatsoever of Buyer in favor
of any Person, in any such case as a result of the change in control of
Buyer or otherwise resulting from the transactions contemplated hereby;
2.4 Financial Statements.
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2.4.1 Buyer has delivered to the Company the
following financial statements and notes, which are included in Part 2.4
of the Disclosure Schedule (collectively, the "Financial Statements"):
(a) The unaudited balance sheets of Buyer
as of August 31, 2001 (the "Unaudited Interim Balance Sheet"), and related
unaudited statements of operations for the three months then ended;
and
(b) The Financial Statements are complete
and correct, in accordance with the books and records of Buyer, present
fairly and accurately the financial position of Buyer as of the
respective dates thereof and the results of operations and changes in
shareholder's equity and fund balance and cash flows of Buyer for the
respective periods covered thereby, and have been prepared in
conformity with GAAP applied on a consistent basis, subject, in the
case of the unaudited financial statements, to normal recurring year-
end adjustments, the effect of which will not be material, and the
absence of notes.
2.5 Liabilities.
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2.5.1 Buyer has no Liabilities, except for:
(a) liabilities reflected as part of the
Unaudited Interim Balance Sheet;
(b) liabilities (of the type required to be
reflected as current liabilities on a balance sheet prepared in
accordance with GAAP) incurred by Buyer in the ordinary course of
business since November 13, 2001, which are disclosed in Part 2.5 of
the Disclosure Schedule, none of which individually or in the aggregate
had or will have an material adverse effect on the business of Buyer or
its property, assets, financial condition, earnings, profits or
prospects; and
(c) Buyer's obligations under the Contracts
listed in Part 2.5 of the Disclosure Schedule and under Excluded
Contracts.
2.5.2 Part 2.5 of the Disclosure Schedule:
(a) provides an accurate and complete
breakdown and aging of Buyer's accounts payable as of November 13, 2001;
Exhibit 2.1 - Pg. 4
(b) provides an accurate and complete
breakdown of Buyer's long term debt (of which there is none) as of the
date of this Agreement; and
2.6 Absence of Changes.
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2.6.1 Except as set forth in Part 2.6 of the
Disclosure Schedule since August 31, 2001:
(a) To the best of Buyer's knowledge, there
has not been any material adverse effect in Buyer's business, condition,
assets, liabilities, operations, financial performance, results of
operations or prospects, and to Buyer's knowledge, no event has
occurred that likely would have an adverse effect on Buyer's business,
condition, assets, liabilities, operations, financial performance,
results of operations or prospects;
(b) To the best of Buyer's knowledge, Buyer
has not entered into any transaction of any kind or taken any other action
outside the ordinary course of business;
(c) To the best of Buyer's knowledge, Buyer
has not implemented any change affecting the banking and safe deposit
arrangements or powers of attorney or grants of agency in effect for
Buyer, any new bank accounts or safe deposit boxes opened for Buyer, or
any new powers of attorney or grants of agency executed or made by
Buyer;
(d) To the best of Buyer's knowledge, Buyer
has not failed to perform any of its obligations in any material respect or
suffering or permitting any default to exist under, or receipt of a
notice of termination, breach or default with respect to any contract
to which any of them is a party or by which it or any of its property
may be bound or affected;
(e) To the best of Buyer's knowledge, Buyer
has not transferred or granted any rights in or entered into any settlement
regarding its proprietary assets;
(f) To the best of Buyer's knowledge, Buyer
has used its best efforts to preserve its business organization intact, to
keep available the services of its employees and to preserve its
relationships with its customers, suppliers and others with whom it
deals; and
(g) To the best of Buyer's knowledge, Buyer
has not agreed or committed (in writing or otherwise), to take any of the
actions referred to in clauses "c" through "f" above.
Exhibit 2.1 - Pg. 5
2.7 Real Estate.
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2.7.1 To the best of Buyer's knowledge, Buyer has
no right, title or interest in, or any obligation or duty relating to, any
real estate or real property, except for its interest as a tenant,
lessee, subtenant or sublessee under the leases disclosed on Part 2.7
of the Disclosure Schedule (the "Leases");
2.7.2 (1) All written and oral leases or subleases
(collectively, the "Leases") of the Leased Properties are disclosed on
Part 2.7 of the Disclosure Schedule, including for each its date, the
name of the landlord (and owner if different than the landlord), the
name of the lessee and any sublessee, the location and use of the
property, the monthly base rental payment, any scheduled or formula
increases in base rent, a description of any provisions for tax or
expense pass-throughs, the amount of any security deposit, the lease
expiration date, all options to renew and whether there are any non-
disturbance agreements from mortgagees or paramount lessors; (2) Buyer
has delivered to the Company true and complete copies of all Leases,
all amendments and supplements thereto and all such non-disturbance
agreements; (3) Buyer is not in material default under any Lease, and
no event has occurred which, with the giving of notice or passage of
time or both, would constitute a material default by Buyer; and
(4) neither the execution or performance of this Agreement nor the
consummation of any of the transactions contemplated herein will
result in a breach of or constitute a default under any of the Leases.
2.8 Title to Assets. Except as set forth in Part 2.8 of
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the Disclosure Schedule, to the best of Buyer's knowledge, Buyer owns,
free and clear of Encumbrances:
2.8.1 All assets reflected on the Unaudited Interim
Balance Sheet (except for inventory sold by Buyer since August 31,
2001, in the ordinary course of business);
2.8.2 All assets acquired by Buyer since August 31,
2001 (except for inventory sold by Buyer since August 31, 2001, in the
ordinary course of business);
2.8.3 All assets referred to in Parts 2.9 and 2.10 of
the Disclosure Schedule and all of Buyer's rights under Contracts; and
2.8.4 All other assets reflected in Buyer's books and
records as being owned by Buyer.
2.9 Receivables.
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2.9.1 To the best of Buyer's knowledge, Part 2.9 of
the Disclosure Schedule provides an accurate and complete breakdown and
aging of all accounts and notes receivable and a list of all other
receivables of Buyer as of November 13, 2001;
Exhibit 2.1 - Pg. 6
2.9.2 Except as set forth in Part 2.9 of the
Disclosure Schedule, all existing accounts receivable of Buyer (including
those accounts receivable reflected on the Unaudited Interim Balance Sheet
that have not yet been collected and those accounts receivable that
have arisen since August 31, 2001, and have not yet been collected):
(a) Represent valid obligations of customers
of Buyer arising from bona fide transactions entered into in the ordinary
course of business;
(b) Are current and where known collection
problems exist, such problems have been disclosed;
2.10 Equipment, etc.
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2.10.1 Part 2.10 of the Disclosure Schedule
consists of Buyer's capital equipment and depreciation schedule,
which describes historical cost and depreciation information with
respect to all of Buyer's capital equipment, furniture, fixtures,
improvements and other tangible personal property. Part 2.10 also
accurately identifies all material tangible personal property leased
to Buyer;
2.10.2 Each material asset of Buyer:
(a) Is free of defects and deficiencies
and in good condition and repair, consistent with its age and intended use
(ordinary wear and tear excepted);
(b) Complies in all material respects
and, to Buyer's and each Shareholder's Knowledge, is being operated and
otherwise used in full compliance with all applicable Legal
Requirements;
(c) Is adequate for the uses to which it
is being put;
(d) Is adequate for the conduct of Buyer's
business in the manner in which such business is currently being
conducted;
(e) Has been maintained in accordance with
reasonable maintenance schedules;
(f) Is owned by Buyer free and clear of any
Encumbrance; and
(g) Is located at Buyer's principal business
office.
Exhibit 2.1 - Pg. 7
2.11 Tax Matters.
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2.11.1 To the best of Buyer's knowledge, except as
set forth in Part 2.11 of the Disclosure Schedule, each Tax required
to have been paid, or claimed by any Governmental Body to be payable,
by Buyer (whether pursuant to any Tax Return or otherwise) has been
duly paid in full on a timely basis. Any Tax required to have been
withheld or collected by Buyer has been duly withheld and collected,
and (to the extent required) each such Tax has been paid to the
appropriate Governmental Body;
2.11.2 To the best of Buyer's knowledge, Part 2.11
of the Disclosure Schedule accurately identifies all Tax Returns
required to be filed by or on behalf of Buyer with any Governmental
Body with respect to any taxable period ending on or before the
Closing Date ("Buyer Returns"). All Buyer Returns (including monthly
payroll returns) (i) have been or will be filed when due, and
(ii) have been, or will be when filed, accurately and completely
prepared in full compliance with all applicable Legal Requirements.
All amounts shown on Buyer Returns to be due on or before the Closing
Date, and all amounts otherwise payable in connection with Buyer
Returns on or before the Closing Date, have been or will be paid on or
before the Closing Date. Buyer has delivered to the Company accurate
and complete copies of Buyer Returns (other than monthly payroll
returns) filed by Buyer;
2.11.3 To the best of Buyer's knowledge, except as
disclosed in Part 2.11 of the Disclosure Schedule, Buyer's liability
for unpaid Taxes for all periods ending on or before the date of the
Unaudited Interim Balance Sheet does not, in the aggregate, exceed the
amount of the current liability accruals for Taxes (excluding reserves
for deferred taxes) reported in the Unaudited Interim Balance Sheet;
2.11.4 To the best of Buyer's knowledge, Part 2.11
of the Disclosure Schedule accurately identifies each examination or
audit of any Buyer Return that has been conducted by any Governmental
Body. Buyer has delivered to the Company accurate and complete copies
of all audit reports and similar documents (to which Buyer has access)
relating to Buyer Returns. Except as set forth in Part 2.11 of the
Disclosure Schedule, no extension or waiver of the limitation period
applicable to any of Buyer Returns has been granted (by Buyer or any
other Person), and no such extension or waiver has been requested from
Buyer;
2.11.5 To the best of Buyer's knowledge, except as
set forth in Part 2.14 of the Disclosure Schedule, no claim or other
Proceeding is pending or has been threatened against or with respect
to Buyer in respect of any Tax. There are no unsatisfied Liabilities
for Taxes (including liabilities for interest, additions to tax and
penalties thereon and related expenses) with respect to any notice of
deficiency or similar document received by the Selling Shareholder or
Buyer. Buyer has not entered into or become bound by any agreement or
consent pursuant to Sec. 341(f) of the Internal Revenue Code of 1986,
as amended (the "Code"). Buyer has not been, and will not be, required
to include any adjustment in taxable income for any tax period (or
portion thereof) pursuant to Sec. 481 or 263A of the Code or any
comparable provision under state or foreign Tax laws as a result of
transactions or events occurring, or accounting methods employed,
prior to the Closing;
Exhibit 2.1 - Pg. 8
2.11.6 To the best of Buyer's knowledge, there is
no agreement, plan, arrangement or other Contract covering any
employee or independent contractor or former employee or independent
contractor of Buyer that, individually or collectively, could give
rise directly or indirectly to the payment of any amount that would
not be deductible pursuant to Sec. 280G or Sec. 162 of the Code;
2.11.7 To the best of Buyer's knowledge, Buyer is
not, and has never been, a party to or bound by any tax indemnity
agreement, tax sharing agreement, tax allocation agreement or similar
Contract;
2.11.8 To the best of Buyer's knowledge, Buyer is
not a United States real property holding corporation within the
meaning of Sec. 897(c)(2) of the Code and has not been a United States
real property holding corporation within the applicable period
specified in Sec. 897(c)(1)(A)(ii) of the Code;
2.11.9 To the best of Buyer's knowledge, except as
set forth in Part 2.11 of the Disclosure Schedule (Buyer's Unaudited
Financial Statements as of August 31, 2001) , Buyer has no net
operating losses or other tax attributes presently subject to
limitation under Code Secs. 382, 383 or 384 or the federal consolidated
return regulations;
2.11.10 To the best of Buyer's knowledge, all Taxes
required to be withheld from employees, deemed employees or other
persons up to and through the Closing Date will have been withheld and
timely deposited prior to the Closing;
2.11.11 To the best of Buyer's knowledge, the
requirements of Sec. 274 of the Code (disallowance of certain
entertainment and similar expenses) have been complied with in all
material respects;
2.11.12 To the best of Buyer's knowledge, no non-
deductible expenses have been deducted on the federal income Tax Return
for any year open to audit by the Internal Revenue Service;
2.11.13 To the best of Buyer's knowledge, except as
set forth in Part 2.11 of the Disclosure Schedule, no Internal Revenue
Service or state, county or local tax audit is currently in progress;
2.11.14 To the best of Buyer's knowledge, Buyer is
not a party to any safe harbor lease within the meaning of Sec. 168(f)(8)
of the Code, as in effect prior to amendment by the Tax Equity and
Fiscal Responsibility Act of 1982. Buyer has not participated in an
international boycott as defined in Code Sec. 999. Buyer does not have a
permanent establishment in any foreign country, as defined in any
applicable Tax treaty or convention between the United States of
America and such foreign country, and Buyer is not a party to any
joint venture, partnership or other agreement, contract or arrangement
Exhibit 2.1 - Pg. 9
(either in writing or verbally, formally or informally) which could be
treated as a partnership for federal income tax purposes;
2.12 Contracts.
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2.12.1 To the best of Buyer's knowledge,
part 2.12 of the Disclosure Schedule identifies each material Contract
(the "Contracts"). Except as identified in Part 2.15 of the Disclosure
Schedule, all material Contracts are in writing. Buyer has delivered to
Buyer accurate and complete copies of all written material Contracts
identified in Part 2.12 of the Disclosure Schedule, including all
amendments thereto;
2.12.2 To the best of Buyer's knowledge, each
Contract is valid and in full force and effect, and is enforceable by
Buyer in accordance with its terms;
2.12.3 To the best of Buyer's knowledge, except
as set forth in Part 2.11 of the Disclosure Schedule:
(a) no person acting for Buyer has violated
or breached, or declared or committed any default under, any Contract;
(b) no event has occurred, and no
circumstance or condition exists, that likely would (with or without notice
or lapse of time) (A) result in a violation or breach of any of the
provisions of any Contract, (B) give any Person the right to declare a
default or exercise any remedy or hinder any Contract, (C) give any Person
the right to accelerate the maturity or performance of any Contract, or
(D) give any Person the right to cancel, terminate or modify any
Contract;
(c) Buyer has not waived any of its rights
under any Contract.
2.12.4 To the best of Buyer's knowledge, each
Person against which Buyer has or may acquire any rights under any
Contract is solvent and is able to satisfy all of such Person's current
and future monetary obligations and other obligations and Liabilities
to Buyer;
2.12.5 To the best of Buyer's knowledge, except
as set forth in Part 2.12 of the Disclosure Schedule:
(a) Buyer has never guaranteed or otherwise
agreed to cause, insure or become liable for, and has never pledged any
of its assets to secure, the performance or payment of any obligation
or other Liability of any other Person except in the ordinary course of
business; and
(b) Buyer has never been a party to or bound
by (A) any joint venture agreement, partnership agreement, profit sharing
agreement, cost sharing agreement, loss sharing agreement or similar
Contract, or (B) any Contract that creates or grants to any Person, or
provides for the creation or grant of, any stock appreciation right,
phantom stock right or similar right or interest.
Exhibit 2.1 - Pg. 10
2.12.6 To the best of Buyer's knowledge, the
performance of the Contracts will not result in any violation of or
failure to comply with any Legal Requirement;
2.12.7 To the best of Buyer's knowledge, except
as identified in Part 2.12 of the Disclosure Schedule, no Person is
materially renegotiating, or has the contractual right to materially
renegotiate, any amount paid or payable to Buyer under any Contract or
any other term or provision of any Contract;
2.12.8 To the best of Buyer's knowledge, the
Contracts identified in Part 2.12 of the Disclosure Schedule and the
Excluded Contracts collectively constitute all of the Contracts
necessary to enable Buyer to conduct its business in the manner in
which its business is currently being conducted and in the manner in
which its business is proposed to be conducted;
2.12.9 To the best of Buyer's knowledge, except
as set forth in Part 2.12 of the Disclosure Schedule: (i) the Contracts
of Buyer, including but not limited to those described in Part 2.12 of
the Disclosure Schedule, are legally valid, binding and enforceable
agreements of Buyer, except as enforceability may be limited by
bankruptcy and other similar laws affecting creditors rights, and, to
the Knowledge of Buyer and each Shareholder, the other parties thereto;
Buyer is not and, to the Knowledge of Buyer and each Shareholder, no
other party to any such Contract is in violation of or in default under
such Contracts and no event or circumstances have occurred which
constitute, or after notice or lapse of time or both would constitute,
a violation or default thereunder on the part of Buyer or, to the
Knowledge of Buyer, any other party thereto or result in a right to
accelerate or loss of rights; and such Contracts will continue to be
binding in accordance with their terms after the Closing, assuming any
Consents listed in Part 2.12 of the Disclosure Schedule are obtained;
(ii) Buyer has fulfilled all obligations required pursuant to each
Contract to have been performed by it, and Buyer has no reason to
believe that Buyer will not be able to fulfill all of its obligations
under the Contracts which remain to be performed after the date hereof,
and (iii) none of the payments required to be made under any Contract
has been prepaid by more than 30 days prior to the due date of such
payment thereunder and the estimated cost to complete any Contract of
Buyer, plus expenses incurred by them on that Contract, will not exceed
the total Contract price.
2.13 Proprietary Assets.
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2.13.1 Attached as Part 2.13 of the Disclosure
Schedule is (i) a description of all Proprietary Assets owned by,
licensed to or used in the business of Buyer together with a
designation of ownership, and (ii) a listing of all agreements or
arrangements which affect the ownership or use of any Proprietary
Asset. Except as set forth in Part 2.13 of the Disclosure Schedules,
Buyer is, or upon consummation of the transactions contemplated hereby
Exhibit 2.1 - Pg. 11
will be, the owner of all right, title and interest in and to each such
Proprietary Asset free and clear of all Encumbrances or has the right
to use, free and clear of royalties or any claims or rights of others,
such Proprietary Assets;
2.13.2 To the best of Buyer's knowledge, Buyer has
taken all measures and precautions necessary to protect the
confidentiality and value of each Proprietary Asset identified or
required to be identified in Part 2.13 of the Disclosure Schedule;
2.13.3 To the best of Buyer's knowledge, Buyer is
not infringing, and has not at any time infringed or received any
notice or other communication (in writing or otherwise) of any actual,
alleged, possible or potential infringement of, any Proprietary Asset
owned or used by any other Person. To the best Knowledge of Buyer and
each Shareholder, no other Person is infringing, and no Proprietary
Asset owned or used by any other Person infringes or conflicts with,
any Proprietary Asset owned or used by Buyer;
2.13.4 To the best of Buyer's knowledge, the
Proprietary Assets identified in Part 2.13 of the Disclosure Schedule
constitute all of the Proprietary Assets necessary to enable Buyer to
conduct its business in the manner in which its business is currently
being conducted;
2.13.5 To the best of Buyer's knowledge, Buyer has
not licensed or sublicensed any party to use any of the Proprietary
Assets;
2.13.6 To the best of Buyer's knowledge, there are
no Orders pending against or affecting the Proprietary Assets;
2.13.7 To the best of Buyer's knowledge, there is
no unexpired valid patent on products or processes that Buyer uses in
manufacturing its products that Buyer is not entitled to use;
2.13.8 To the best of Buyer's knowledge, neither
the Selling Shareholder nor any officer, director or employee of Buyer
or, to the Knowledge of Buyer or any Shareholder, any third party has
an interest in any of the Proprietary Assets;
2.13.9 To the best of Buyer's knowledge, there is
no governmental restriction or limitation, domestic or foreign, on the
manner in which any of the Proprietary Assets may be used.
2.14 Proceedings; Orders.
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2.14.1 To the best of Buyer's knowledge, except as
set forth in Part 2.14 of the Disclosure Schedule, there is no pending
Proceeding, and no Person has threatened to commence any Proceeding:
Exhibit 2.1 - Pg. 12
(a) That involves Buyer or that otherwise
relates to or likely would affect Buyer's business or any of the assets
owned or used by Buyer (whether or not Buyer is named as a party
thereto); or
(b) That challenges, or that may have the
effect of preventing, delaying, making illegal or otherwise interfering
with, any of the transactions contemplated hereby.
2.14.2 To the best of Buyer's knowledge, except as
set forth in Part 2.14 of the Disclosure Schedule, no event has
occurred, and no claim, dispute or other condition or circumstance
exists, that likely would directly or indirectly give rise to or serve
as a basis for Commencement of any such Proceeding;
2.14.3 To the best of Buyer's knowledge, except as
set forth in Part 2.14 of the Disclosure Schedule, no Proceeding has
ever been commenced by or against Buyer, and no Proceeding otherwise
involving or relating to Buyer has been pending or threatened at any
time;
2.14.4 To the best of Buyer's knowledge, except as
disclosed in Part 2.14 of the Disclosure Schedule, each Proceeding
listed in Part 2.14 of the Disclosure Schedule is fully covered by
existing policies of insurance; and
2.14.5 To the best of Buyer's knowledge, except as
disclosed in Part 2.14 of the Disclosure Schedule, Buyer is not a party
to any Proceeding as a party plaintiff, nor is Buyer presently
contemplating the initiation of any such Proceeding.
2.15 Bank Accounts.
--------------
To the best of Buyer's knowledge, Part 2.15 of the Disclosure
Schedule accurately sets forth, with respect to each account maintained
by or for the benefit of Buyer at any bank or other financial
institution: (a) the name and location of the institution at which such
account is maintained; (b) the name in which such account is maintained
and the account number of such account; (c) a description of such
account, and the purpose for which such account is used; (d) the
current balance in such account; and (e) the names of all individuals
authorized to draw on or make withdrawals from such account and a
description of the authority of each such individual with respect
thereto.
To the best of Buyer's knowledge, there are no safe deposit boxes
or similar arrangements maintained by or for the benefit of Buyer.
2.16 Compliance with Legal Requirements.
-----------------------------------
2.16.1 To the best of Buyer's knowledge:
Exhibit 2.1 - Pg. 13
(a) Buyer is in full compliance, in all
material respects with each Legal Requirement that is applicable to it or
to the conduct of its business or the ownership or use of any of its assets;
(b) No event has occurred, and no condition
or circumstance exists, that likely would (with or without notice or lapse
of time) constitute or result directly or indirectly in any material
violation by Buyer of, or a failure on the part of Buyer to comply
with, any Legal Requirement; and
(c) Buyer has not received, at any time,
any notice or other communication (in writing or otherwise) from any
Governmental Body or any other Person regarding (i) any actual,
alleged, possible or potential violation of, or failure to comply with,
any Legal Requirement, or (ii) any actual, alleged, possible or
potential obligation on the part of Buyer to undertake, or to bear all
or any portion of the cost of, any cleanup or any remedial, corrective
or response action of any nature.
2.17 Environmental Matters.
----------------------
2.17.1 Buyer is in compliance in all material
respects with all applicable Environmental Laws. Buyer has not received
any notice or other communication (in writing or otherwise) that
alleges that Buyer is not in compliance with any Environmental Law, and
there are no circumstances that likely would prevent or interfere with
Buyer's compliance with any Environmental Law in the future;
2.17.2 No investigation made and no environmental
assessments obtained by Buyer shall limit or invalidate any
representation or warranty made by or disclosures required under this
Agreement; and
2.17.3 Buyer has not retained or assumed, either
contractually, by operation of law or otherwise, the liability of any
other person under any Environmental Law.
2.18 Brokers.
--------
No broker or finder has acted for Buyer in connection with this
Agreement or the transactions contemplated hereby, and no broker or
finder is entitled to any brokerage or finder's or similar fees or
other commissions in respect of such transactions based in any way on
agreements, arrangements or understandings made by or on behalf of
Buyer.
2.19 Full Disclosure.
----------------
2.19.1 To the best of Buyer's knowledge, none of the
representations and warranties of any Buyer in the Agreement or the
Disclosure Schedule Updates contains or will contain any untrue
statement of material fact or omits or will omit to state any fact
necessary to make any of the representations, warranties or statements
contained therein not misleading;
Exhibit 2.1 - Pg. 14
2.19.2 To the best of Buyer's knowledge, as of the
date of this Agreement, Buyer has provided the Company and the
Company's Representatives with full and complete access to all of
Buyer's records and other documents and data requested by them.
3. CONDUCT OF THE BUSINESS OF BUYER PENDING CLOSING. Between
the date hereof and the Closing hereunder, Buyer shall:
3.1 Not take or suffer or permit any action which would
render untrue any of the representations or warranties of
Buyer herein contained, and not omit to take any action,
the omission of which would render untrue any such
representation or warranty;
3.2 Conduct its Business in a good and diligent manner in
the ordinary and usual course;
3.3 Not enter into any contract, agreement, commitment or
arrangement with any party, other than contracts for the sale of
merchandise or services and contracts for the purchase of materials,
services and supplies in the ordinary and usual course of its Business,
and not amend, modify or terminate any Buyer Agreement without the
prior written consent of Company; and
3.4 Use its best efforts to preserve its business
organization intact, to keep available the services of its employees
and to preserve its relationships with customers, suppliers and others
with whom it deals;
4. CONDITIONS PRECEDENT TO COMPANY'S OBLIGATION
TO CLOSE. The following shall be conditions precedent to the
obligation of Company to close hereunder, any of which may be waived in
whole or in part by Company:
4.1 Each of the representations and warranties of Buyer
contained in this Agreement is now and, except as to those
expressly limited to the date hereof or some other
specific date, at all times after the date of this
Agreement to and including the time of Closing shall be,
true and correct individually and collectively in all
material respects, provided that any references to
materiality in any representation and warranty shall be
disregarded for purposes of this provision;
4.2 Each of the agreements, covenants and undertakings of
Buyer contained in this Agreement, except for those calling for
performance after Closing, will have been fully performed and complied
with both individually and collectively in all material respects at or
before Closing;
4.3 All actions, proceedings, instruments and documents
required to enable Buyer to perform this Agreement or matters incident
thereto (other than matters for which Company is responsible under the
terms of this Agreement), and all other legal matters not relating to a
Exhibit 2.1 - Pg. 15
default by Company of its obligations hereunder, shall have been duly
taken, satisfied, executed or delivered, as the case may be, to the
reasonable satisfaction of Company;
4.4 All documents required to be delivered by the Company
at or prior to Closing shall have been delivered or shall be tendered
at the time and place of Closing;
4.5 The parties shall prepare and mutually agree, at the
Closing, on the terms of a Management Agreement between
the parties whereby Company shall manage and operate the
assets and business opportunities contained in the
Acquired Assets on behalf of Buyer.
4.6 After the Closing, and prior to a contemplated
application to list Buyer's common shares on the American
Stock Exchange, Buyer will take all necessary steps to
effect an approximately 2:1 reverse split-up of its
outstanding common stock. The parties shall consider
measures to prevent the current shareholders of Buyer
common stock from being further diluted by this
contemplated stock split after the Closing.
4.7 After the Closing, the current operations of Buyer
will be transferred to another newly formed wholly owned
subsidiary and shall be operated by Buyer's current
management. Xxxxxx Xxxxxxxx shall enter into an
Employment Agreement, satisfactory to him and Buyer's
Board of Directors , to operate the subsidiary.
4.8 At the Closing, the present Board of Directors of
Buyer shall be increased to a number of five, one whom
shall be appointed by Buyer, and the others by the
Company.
4.9 Upon Closing, Buyer will use its best efforts to be in
compliance with all its requirements as a Section 12g
publicly traded company subject to the Securities
Exchange Act, including, but not limited to filing forms
10-KSB, 10-QSB, and 8-K, or any other relevant filing;
and will have completed all reasonable steps to reinstate
the trading of Buyer common shares on the OTC Bulletin
Board.
4.10 Buyer has provided a written confirmation from its
current auditor that, upon receipt of $30,000, the
auditor shall complete and release to Buyer audited
financial statements for inclusion in Buyer's Form 10KSB
for the period ended May 31, 2001, and shall also
complete and release the quarterly statements for
inclusion in Buyer's Form 10QSB up to August 31, 2001.
Upon release of the 10QSB statements the balance of
approximately $20,000 shall be paid to the auditor
immediately.
Exhibit 2.1 - Pg. 16
4.11 Upon the Closing Company understands that a further
$200,000 is required immediately by Buyer to pay expenses,
increase accounts receivable and inventory. Company
undertakes to loan or cause a third party to timely loan
to Buyer the sums described in Sections 4.10 and 4.11.
5. REPRESENTATIONS AND WARRANTIES OF COMPANY WITH RESPECT
TO COMPANY. As material inducement to Buyer to enter into this
Agreement and to close hereunder, Company hereby makes the
following representations, warranties and agreements to and with
Buyer:
5.1 Due Organization; Capitalization and Articles, Bylaws
and Records.
-----------------------------------------------------
Company is a limited liability company duly organized, validly
existing and in good standing under the laws of Ireland and has the
full corporate power and authority to execute and deliver this
Agreement and to perform its obligations here this Agreement.
5.2 Authority; Binding Nature of Agreements.
----------------------------------------
5.2.1 Company has the absolute and unrestricted
right, power and authority to enter into
and to perform its obligations under this
Agreement and all other agreements,
certificates and instruments contemplated
to be executed and delivered by Company in
connection with this Agreement, and the
execution, delivery and performance by
Company of this Agreement and such other
agreements, certificates and instruments
have been duly authorized by all necessary
action on the part of Company and its Board
of Directors and officers. Each of this
Agreement and such other agreements,
certificates and instruments constitutes,
or upon execution and delivery will
constitute, the legal, valid and binding
obligation of Company, enforceable against
Company in accordance with its terms,
except as enforceability may be limited by
bankruptcy and other similar laws affecting
creditors rights.
5.2.2 Company has the absolute and unrestricted
right, power and capacity to enter into and
to perform their respective obligations
under this Agreement and all other
agreements, certificates and instruments
contemplated to be executed and delivered
Exhibit 2.1 - Pg. 17
by Company in connection with this
Agreement, and the execution, delivery and
performance by Company of this Agreement
and such other agreements, certificates and
instruments have been duly authorized by
all necessary action on the part of Company
and Shareholder. Each of this Agreement and
such other agreements, certificates and
instruments constitutes, or upon execution
and delivery will constitute, the legal,
valid and binding obligation of Company,
enforceable against Company in accordance
with its terms, except as enforceability
may be limited by bankruptcy and other
similar laws affecting creditors rights.
5.3 Non-Contravention; Consents. To the best knowledge of
----------------------------
Company, neither the execution and delivery of any of
this Agreement, nor the consummation or performance of
any of the transactions contemplated hereby, will
directly or indirectly (with or without notice or lapse
of time):
5.3.1 Contravene, conflict with or result in a
violation of (i) any of the provisions of
Company's articles of incorporation or
Bylaws, or (ii) any resolution adopted by
Company's Board of Directors or any
committee of Company's Board of Directors;
5.3.2 Contravene, conflict with or result in a
violation of, or give any governmental body
or other person the right to challenge any
of the transactions contemplated hereby or
to exercise any remedy or obtain any relief
under, any legal requirement or any order
to which Company, or any of the assets
owned or used by Company, is subject;
5.4 No Undisclosed Liabilities. The Acquired Assets are
---------------------------
not subject to any claims, demands, liens (both general
and charging), agreements, contracts, covenants,
promises, suits, actions or cross-actions, causes of
action, obligations, controversies, disputes, debts,
costs, fees, expenses, losses, damages (both compensatory
and exemplary or punitive), judgments, orders, wrongful
acts, and liabilities of whatever kind or nature in law,
equity, or otherwise, fixed or contingent.
Exhibit 2.1 - Pg. 18
5.5 Title to Assets. To the best of Company's knowledge,
----------------
Company owns all of the Acquired Assets owns, free and
clear of all claims, demands, or liens and the Acquired
Assets are not subject to any lien or other encumbrance or
claim or to any option or other right in favor of a third
party; except for the provisions of this Agreement, there
are no monies owing or obligations outstanding with
respect to any of the Acquired Assets; and no consent or
approval by or notice to any third party is required in
connection with the sale of the Acquired Assets to Buyer
pursuant to this Agreement. Further, except for those
rights sold to Buyer under this Agreement, Company does
not own or have any rights in or to any patent, copyright,
trademark, service xxxx or other right pertaining to any
of the Acquired Assets.
5.6 No Litigation. There is no litigation or claim
--------------
pending or threatened with respect to any of the Acquired
Assets.
6. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE. The
following shall be conditions precedent to the obligation of Buyer to close
hereunder, any of which may be waived in whole or in part by Buyer:
6.1 Each of the representations and warranties of Company
contained in this Agreement is now and, except as to those
expressly limited to the date hereof or some other
specific date, at all times after the date of this
Agreement to and including the time of Closing shall be,
true and correct individually and collectively in all
material respects, provided that any references to
materiality in any representation and warranty shall be
disregarded for purposes of this provision;
6.2 Each of the agreements, covenants and undertakings of
Company contained in this Agreement, except for those
calling for performance after Closing, will have been
fully performed and complied with both individually and
collectively in all material respects at or before
Closing;
7. Closing.
--------
7.1 Closing Date. The closing of the transactions provided
-------------
for in this Agreement (herein sometimes called the
"Closing") shall take place at Buyer's offices at 000 X.
Xxxxxxxx Xxx, Xxxxx 000, Xxxxxx Xxxxx, Xxxxxxx, on
December 5, 2001, or at such other place and time as
shall be agreed to between the Presidents of Buyer and
of Company. The date and time of Closing is sometimes
herein called the "Closing Date;"
Exhibit 2.1 - Pg. 19
7.2 Deliveries by Company at Closing. At Closing, Company
---------------------------------
will deliver or cause to be delivered to Buyer (or to a
wholly owned subsidiary of Buyer) the following:
7.2.1 All of the Acquired Assets listed in Exhibit A;
7.2.2 Bills of Sale for each of the Acquired
Assets listed in Exhibit A;
7.2.3 The Certificate of the Secretary or an
Assistant Secretary of Company, dated the
Closing Date, that the necessary corporate
action by the Board of Directors of Company
has been taken to authorize the consummation
by Company of the transactions provided for
herein;
7.3 Deliveries by Buyer at Closing. At the Closing, Buyer
-------------------------------
will deliver or cause to be delivered to Shareholder the
following:
7.3.1 The Certificate of the Secretary or an
Assistant Secretary of Buyer, dated the
Closing Date, that the necessary corporate
action by the shareholders and the Board of
Directors of Buyer has been taken to
authorize the consummation by Buyer of the
transactions provided for herein;
7.4 Certificates for an aggregate number of shares
[approximately Twenty Million (20,000,000)] of validly
issued, fully paid and non-assessable Buyer Common Stock
registered in the name of the Company such that Company
shall, after the Transaction, received ninety percent
(90%) of the issued and outstanding shares of Buyer on a
fully diluted basis.
7.5 Waiver by Parties of Closing Items. Each of the
parties hereto expressly acknowledges the right of any of
the parties to waive any conditions or obligations of the
other parties to that party, including, without
limitation, items to be delivered at Closing and any
conditions precedent to the Closing.
8. FURTHER ASSURANCES. Buyer agrees to execute and deliver all
such other instruments and take all such other action as any party may
reasonably request from time to time, before or after Closing and
without payment of further consideration, in order to effectuate the
transactions provided for herein. The parties shall cooperate fully
Exhibit 2.1 - Pg. 20
with each other and with their respective counsel and accountants in
connection with any steps required to be taken as part of their
respective obligations under this Agreement, including, without
limitation, the preparation of financial statements and tax returns.
9. TERMINATION.
9.1 This Agreement may be terminated at any time prior to
the Closing Date:
9.1.1 By the written agreement of Buyer and
Company;
9.1.2 By Buyer by written notice to the other
parties if (i) the representations and
warranties of Company shall not have been
true and correct in all respects (in the
case of a representation or warranty
containing a materiality qualification) or
in all material respects (in the case of a
representation or warranty without a
materiality qualification) as of the date
when made.
9.2 In the event of the termination of this Agreement
pursuant to Section 9, this Agreement shall become void,
without any liability to any party in respect hereof or of
the transactions contemplated hereby on the part of any
party hereto, or any of its directors, officers,
employees, agents, consultants, representatives, advisers,
stockholders or Affiliates, except for any liability
resulting from such party's breach of this Agreement.
9.3 In the event Buyer accepts the $30,000 loan payment
described hereinabove in Section 4.10, notwithstanding
anything to the contrary in this Section 9, Buyer shall
not have any right of termination pursuant to this
Agreement.
10. MISCELLANEOUS.
10.1 Controlling Law. This Agreement is to be construed in
----------------
accordance with and governed by the internal laws of the
State of Florida without giving effect to any choice of
law rule that would cause the application of the laws of
any jurisdiction other than the internal laws of the State
of Florida to the rights and duties of the parties.
10.2 Notices. All notices, requests, demands and other
--------
communications required or permitted under this Agreement
shall be in writing and shall be deemed to have been duly
given, made and received only (i) when personally
delivered, or (ii) on the day specified for delivery when
deposited with a courier service such as Federal Express
for delivery to the intended addressee, or (iii) three (3)
Exhibit 2.1 - Pg. 21
days following the day when deposited in the United States
mails, registered or certified mail, postage prepaid,
return receipt requested, addressed as set forth below:
If to: Company
BTSL Technologies Limited
0 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxx
with a copy, given in the manner prescribed above, to:
LAW OFFICES OF XXXX X. XXXX
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to Buyer:
Silk Xxxxxxxxxx.Xxx, Inc.
000 x. xxxxxxxx Xxxxxx #000
Xxxxxx Xxxxx, Xxxxxxx 00000
Attention: President
Any party may alter the address to which communications or copies
are to be sent by giving notice of such change of address to the other
parties in conformity with the provisions of this Section for the
giving of notice.
Notice by mail shall be by courier service guaranteeing delivery
within five (5) days of its receipt of a notice if transmitted from
outside the continental United States.
Any party may alter the address to which communications or copies
are to be sent by giving notice of such change of address to the other
parties in conformity with the provisions of this Section for the
giving of notice.
10.3 Exhibits and Schedules. All Exhibits and Schedules
-----------------------
attached hereto are hereby incorporated by reference into,
and made a part of, this Agreement.
10.4 Binding Nature of Agreement; No Assignment. This
-------------------------------------------
Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective, successors and
assigns.
Exhibit 2.1 - Pg. 22
10.5 Assignments Prohibited. Company shall not assign or
-----------------------
suffer or permit an assignment, by operation of law or
otherwise, of its rights or obligations under or interest
in this Agreement without the prior written consent of the
other party. For purposes of this Subsection, the term
"assignment" shall be deemed to include a merger in which
Buyer is not the surviving entity, a consolidation or
division of Company, a sale of all or substantially all of
the assets of Buyer, or a change of control resulting from
a sale or repurchase of shares or similar transaction
involving Buyer. A "change of control" shall be deemed to
have occurred as a result of a merger or other transaction
in which Buyer is the surviving entity if some or all of
the shareholders of Buyer immediately prior to the
transaction do not have sufficient voting power entitling
them to elect at least a majority of the directors of the
corporation immediately following the transaction. In the
event of a breach of this provision, the non-breaching
party shall have the option, in addition to any other
remedy available at law or in equity, to terminate this
Agreement at any time after the breach occurs.
10.6 No Third-Party Beneficiaries. The terms and provisions
-----------------------------
of this Agreement are intended solely for the benefit of
each party hereto and its respective successors and
assigns, and it is not the intention of the parties to
confer third-party beneficiary rights upon any other
person.
10.7 Waiver of Counsel. Buyer was not represented by
------------------
counsel in this Transaction and waived legal review of the
Transaction.
10.8 Execution in Counterparts. This Agreement may be
--------------------------
executed in any number of counterparts, each of which
shall be deemed to be an original as against any party
whose signature appears thereon, and all of which shall
together constitute one and the same instrument. If
executed in multiple counterparts, this Agreement shall
become binding when two or more counterparts hereto,
individually or taken together, bear the signatures of all
of the parties reflected hereon as the signatories.
Facsimile counterpart signatures to this Agreement shall
be acceptable at the Closing if the originally executed
counterpart is delivered within a reasonable time
thereafter.
10.9 Provisions Separable. The provisions of this Agreement
---------------------
are independent of and separable from each other, and no
provision shall be affected or rendered invalid or
unenforceable by virtue of the fact that any other
provision may be invalid or unenforceable in whole or in
part for any reason. (Comment: Some courts may decline
to narrow or otherwise rewrite a provision that is
determined to be unenforceable as written, notwithstanding
the final sentence in the above provision.)
Exhibit 2.1 - Pg. 23
10.10 Entire Agreement. This Agreement together with the
-----------------
related agreements referred to herein contains the entire
understanding among the parties hereto with respect to the
subject matter hereof, and supersedes all prior and
contemporaneous agreements and understandings, inducements
or conditions, express or implied, oral or written. The
express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with
any of the terms hereof.
10.11 Amendments and Modifications. This Agreement may not be
-----------------------------
amended or modified other than by an agreement in writing
signed by all of the parties.
10.12 Section Headings. The Section and Subsection headings
-----------------
in this Agreement and the recitals at the beginning of
this Agreement are for convenience only; they form no part
of this Agreement and shall not affect its interpretation.
10.13 Interpretation. When a reference is made in this
---------------
Agreement to a Section, Exhibit or Schedule, such
reference shall be to a Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise indicated.
The table of contents and headings contained in this
Agreement and the recitals at the beginning of this
Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include," "includes" or
"including" are used in this Agreement, they shall be
deemed, as the context indicates, to be followed by the
words "but [is] [are] not limited to." Where specific
language is used to clarify or illustrate by example a
general statement contained herein, such specific language
shall not be deemed to modify, limit or restrict the
construction of the general statement which is being
clarified or illustrated. The language in this Agreement
has been chosen by the parties to express their mutual
intent, and no rule of strict construction shall be
applied against any party. The words "herein," "hereof,"
"hereunder" and words of like import shall refer to this
Agreement as a whole including its Schedules and Exhibits,
unless the context clearly indicates to the contrary (for
example, that a particular Section or Exhibit is the
intended reference).
10.14 Expenses of the Parties. Each party shall bear the
------------------------
expenses incurred by such party in connection with the
negotiation and execution of this Agreement and the
consummation of the transactions contemplated hereby.
10.15 Statutory References. A reference in this Agreement to
---------------------
a statute or statutory provision shall mean such statute
or statutory provision as it has been amended through the
date as of which the particular Agreement provision is to
Exhibit 2.1 - Pg. 24
take effect, or to any successor statute or statutory
provision relating to the same subject as the statutory
provision referred to in this Agreement, and to any then
applicable rules or regulations promulgated thereunder.
10.16 Waiver of Jury Trial. THE PARTIES HEREBY EXPRESSLY
---------------------
WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BROUGHT BY OR AGAINST EITHER OF THEM RELATING
TO THIS AGREEMENT. BECAUSE DISPUTES ARISING IN CONNECTION
WITH COMPLEX TRANSACTIONS ARE MORE QUICKLY AND
ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON,
THE PARTIES PREFER, BASED ON THE ADVICE OF THEIR COUNSEL,
THAT ANY DISPUTE BE RESOLVED BY A JUDGE APPLYING
APPLICABLE LAW.
10.17 Jurisdiction; Service of Process. Any action or
---------------------------------
proceeding seeking to enforce any provision of, or based
on any right arising out of, this Agreement may shall be
brought against any of the parties only in the courts of
the State of Florida, Palm Beach County, or, if it has or
can acquire the necessary jurisdiction, in the United
States District Court for the District including Palm
Beach County, and each of the parties consents to the
exclusive jurisdiction of such courts (and of the
appropriate appellate courts) in any such action or
proceeding and irrevocably waives any objection to venue
laid therein. Process in any action or proceeding referred
to in the preceding sentence may be served on any party
anywhere in the world.
10.18 Enforcement. The parties agree that irreparable damage
------------
would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their
specific terms or were otherwise breached. Accordingly, it
is agreed that the parties shall be entitled to seek an
injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and
provisions of this Agreement in any court of the United
States located in the State of Florida or in any Florida
state court, this being in addition to any other remedy to
which they are entitled at law or in equity. In addition,
each of the parties hereto (a) consents to the personal
jurisdiction of any federal court located in the State of
Florida or of any Florida state court in the event any
dispute arises out of this Agreement or any of the
transactions contemplated by this Agreement, (b) agrees
that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any
such court, and (c) agrees that it will not bring any
action relating to this Agreement or any of the
transactions contemplated by this Agreement in any court
other than a federal or state court sitting in the State
of Florida.
Exhibit 2.1 - Pg. 25
10.19 Recovery of Fees by Prevailing Party. In the event of a
-------------------------------------
lawsuit to enforce or interpret the provisions of this
Agreement, the prevailing party shall pay the other party
reasonable attorneys' fees and other costs and expenses
including expert witness fees in such amount as the court
shall determine. In addition, such non-prevailing party
shall pay reasonable attorneys' fees incurred by the
prevailing party in enforcing, or on appeal from, a
judgment in favor of the prevailing party. The preceding
sentence is intended by the parties hereto to be severable
from the other provisions of this Agreement and to survive
and not be merged into such judgment.
10.20 Duty of Cooperation. Each party shall cooperate in good
--------------------
faith with the other parties generally, and in particular
will make available, as the other parties reasonably
request, management decisions, liaison personnel,
information, approvals and acceptances so that the other
parties may properly perform their obligations under this
Agreement.
10.21 Survival of Agreements, Representations, etc. All
---------------------------------------------
warranties, representations, agreements and covenants made
by a party herein or in any certificate or other
instrument [required to be] delivered by or on behalf of a
party in connection with this Agreement, shall be
considered to have been relied upon by the other party and
shall survive the Closing under this Agreement regardless
of any investigation made by any party [or information
about any breach known to any party prior to the Closing;
shall continue in full force and effect; and shall provide
a basis for the remedies provided for herein or otherwise
available to the non-breaching party. No representation or
warranty contained herein shall be deemed to have been
waived, affected or impaired by any investigation made by
or knowledge of any party to this Agreement. All
statements in any such certificate or other instrument
[delivered at or in connection with the Closing shall
constitute representations and warranties of the party
making such delivery. Each agreement, representation and
warranty contained herein is independent of all other
agreements, representations and warranties contained
herein (whether or not covering an identical or a related
subject matter) and must be independently and separately
complied with and satisfied. Exceptions or qualifications
to any agreement, representation or warranty contained
herein shall not be construed as exceptions or
qualifications to any agreement, other warranty or
representation.
10.22 Time of the Essence. With regard to all dates and time
--------------------
periods set forth or referred to in this Agreement, time
is of the essence.
10.23 Confidentiality; Publicity. The parties acknowledge
---------------------------
that the transaction described herein is of a confidential
nature and shall not be disclosed prior to the Closing
Exhibit 2.1 - Pg. 26
except to consultants, advisors and Affiliates, or as
required by law. The parties shall not make any public
disclosure of the terms of this Agreement prior to the
Closing, except as required by law. The parties shall
endeavor to make only those press releases or other public
disclosures as are required by law; provided, however,
that no press release or other public disclosure shall be
made without a minimum of 24 hours prior consultation with
the other parties.
10.24 Construction. The construction of this Agreement shall
-------------
not take into consideration the party who drafted or whose
representative drafted any portion of this Agreement, and
no canon of construction shall be applied that resolves
ambiguities against the drafter of a document. The parties
acknowledge that they were advised by competent counsel
that each has chosen to represent such party and each
party has had a full opportunity to comment upon and
negotiate the terms of this Agreement. The language used
in this Agreement shall be deemed to be [is] the language
chosen by the parties hereto to express their mutual
intent as a result of arm's length bargaining.
10.25 Independent Contractor. For any services provided
-----------------------
hereunder, or under any other arrangement arising out of
this Agreement, each party is acting as an independent
contractor and not as an agent of any other party hereto
and nothing in this Agreement shall be construed as
creating a partnership, joint venture or similar
relationship of any kind between among the parties hereto.
No party shall hold itself out as having authority to
create binding obligations for any other party.
10.26 Conflicting Agreements. No party hereto shall enter
-----------------------
into any other agreement nor shall any party incur any
obligations that are inconsistent with the provisions of
this Agreement.
Exhibit 2.1 - Pg. 27
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
"BUYER"
SILK XXXXXXXXXX.XXX, INC.
By: ________________________________
Xxxxxx Xxxxxxxx, Chief
Executive Officer, Sole Director
and Principal Shareholder
"COMPANY"
BTSL TECHNOLOGIES LIMITED
By: _________________________________
Xxxxxxx Xxxxxxx, Director
Exhibit 2.1 - Pg. 28
EXHIBIT A
---------
(Acquired Assets)
1. Patent Assignment and Know-How Transfer Agreement in the
science of gas, chemical engineering and research. The Company
is obligated to pay to the transferor, in a personal services
contract, 200,000 Class B $5.00 Stated Value Convertible
Preferred Shares, for the implementation and commercial
exploitation of the technologies to service the Company's
acquired agreement.
2. Contract for the disposal of 500,000 tons of certain products.
The Company has agreed to pay to the contracting party, on a
performance basis, 1,000,000 Class B $5.00 Stated Value
Convertible Preferred Shares. This performance-based contract
allows the Company to implement its proprietary science and
technology.
3. 100% of the shares of an Irish operating company with the
name Oxygen Technology Manufacturing Limited (OTS). This company will
sell and operate specialist oxygen generating systems.
4. 100% of the shares of an Irish manufacturing company with
the name Oxygen Technology Manufacturing Limited. This company will
manufacture oxygen-generating equipment as required by OTS. A
manufacturing joint venture is expected to be completed between this
company and another Irish-based engineering company, which is going
to manufacture for us on a subcontract basis.
5. 100% of the shares of an Irish operating company called
Gasification Technology Limited. This company will supply and operate
gasification units combined with electricity generation equipment.
6. 100% of the shares of an Irish manufacturing company with
the name Gasification Manufacturing Limited. A manufacturing joint
venture is expected to be completed between this company and
another Irish-based engineering company. The joint venture
agreement is expected to be for the manufacture and co
financing of up to 50% of the cost (approximately 500,000 Irish Pounds)
of the first machine on a sub-contract basis.
7. The Company has received a third party commitment to raise
$5,000,000 on a best efforts basis for the Buyer upon
concluding the Transaction.
Exhibit 2.1 - Pg. 29
EXHIBIT B
---------
(Disclosure Schedules)
2.1 States in Which Buyer is Qualified to do Business as a
Foreign Corporation: None
2.2 [Intentionally Omitted].
2.3 [Intentionally Omitted].
2.4 Financial Statements: see Unaudited Financial Statements at
March 31, 2001 as Contained in Buyer's Form 10QSB for
period ended February 28, 2001 and incorporated by
reference herein; and Unaudited Financial Statements at
August 31, 2001 attached hereto
2.5 List of Liabilities: see List of Liabilities provided as of
November 13, 2001 attached hereto
2.6 Material Changes: None
2.7 Leases: Same as Part 2.12 above
2.8 Encumbered Assets: see Unaudited Financial Statements at
August 31, 2001 attached hereto at Part 2.4
2.9 Receivables: see List of Receivables provided as of
November 13, 2001 attached hereto
2.10 Equipment: see Unaudited Financial Statements at August 31,
2001 attached hereto at Part 2.4
2.11 Outstanding Tax Obligations: see Unaudited Financial
Statements at August 31, 2001 attached hereto at Part 2.4
2.12 Material Contracts: see descriptions and exhibits in: Buyer's
Form 10QSB for period ended February 28, 2001; Buyer's Form 10KSB
for period ended May 31, 2000; Buyer's Form 10SB and Amendments;
all of which are incorporated by reference herein.
2.13 Proprietary Assets: Same as Part 2.12 above
2.14 Legal Proceedings: Same as Part 2.12 above
2.15 Bank Accounts: Sole account in name of Silk Xxxxxxxxxx.Xxx,
Inc. with SunTrust Bank, South Florida; account number
Exhibit 2.1 - Pg. 30
0489002027865; located at West Delray Branch office; signatories
are Xxxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxxxx, each with full
authority; account balance as of November 15, 2001 is $15,600.
2.16 Legal Requirements Not Complied With: None
Exhibit 2.1 - Pg. 31
