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AMENDED AND RESTATED AGREEMENT AND PLAN OF ACQUISITION
BY AND AMONG
LIVESTAR ENTERTAINMENT GROUP, INC.
A NEVADA CORPORATION,
1485684 ONTARIO LIMITED
AN ONTARIO CORPORATION,
AND
XX. XXXXXXXX XXXX
AN INDIVIDUAL.
Effective as of October 24th, 2003
AMENDED AND RESTATED AGREEMENT AND PLAN OF ACQUISITION
THIS AMENDED AND RESTATED AGREEMENT AND PLAN OF ACQUISITION (this
"Agreement") is made and entered into to be effective the 24th day of October,
2003, by and among LIVESTAR Entertainment Group Inc., a Nevada corporation
("LIVESTAR "), 1485684 Ontario Limited, an Ontario corporation doing business as
The Sequel Nightclub ("Sequel"), and Xx. Xxxxxxxx Xxxx, an individual ("Xx.
Xxxx").
PREMISES
A. This Agreement provides for the acquisition of Sequel by LIVESTAR,
with LIVESTAR acquiring 100% of the issued and outstanding capital shares and
the minimum of USD $200,000.00 (or CDN $256,000.00 as agreed to by the parties)
of certain shareholder Loans owed to Xx. Xxxx by Sequel in exchange for the
consideration set forth herein.
B. The board of directors of Sequel with respect to Sequel, and the board or
directors of LIVESTAR with respect to LIVESTAR, have determined, subject to the
terms and conditions set forth in this Agreement, that the acquisition of the
shares of Sequel by LIVESTAR contemplated hereby, is desirable and in the best
interests of the stockholders of Sequel and LIVESTAR. This Agreement is being
entered into for the purpose of setting forth the terms and conditions of the
proposed acquisition.
AGREEMENT
NOW, THEREFORE, on the stated premises and for and in consideration of the
mutual covenants and agreements hereinafter set forth and the mutual benefits to
the parties to be derived herefrom, it is hereby agreed as follows:
ARTICLE I
REPRESENTATIONS, COVENANTS AND WARRANTIES
OF SEQUEL AND XX. XXXX
As an inducement to and to obtain the reliance of LIVESTAR, Sequel and Xx.
Xxxx represent and warrant as follows:
SECTION 1.1 ORGANIZATION. Sequel is a corporation duly organized,
validly existing, and in good standing under the laws of the Province of Ontario
and has the corporate power and is duly authorized, qualified, franchised and
licensed under all applicable laws, regulations, ordinances and orders of public
authorities to own all of its properties and assets and to carry on its business
in all material respects as it is now being conducted including the right to
operate as a nightclub offering services to the public customary to that
industry. Included in Schedule 1.1 are complete and correct copies of the
articles of incorporation, bylaws and amendments thereto of Sequel as in effect
on the date hereof.
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The execution and delivery of this Agreement do not and the
consummation of the transactions contemplated by this Agreement in accordance
with the terms hereof will not violate any provision of Sequel's articles of
incorporation or bylaws. Sequel has full power, authority and legal right and
has taken all action required by law, its articles of incorporation, its bylaws
or otherwise to authorize the execution and delivery of this Agreement.
SECTION 1.2 CAPITALIZATION. All issued and outstanding shares of Sequel
(the "Sequel Shares") are legally issued, fully paid and nonassessable and are
not issued in violation of the preemptive or other rights of any person. Sequel
has no other securities, warrants or options issued other than as set forth in
the Schedule 1.2.
SECTION 1.3 SUBSIDIARIES. Sequel does not have any subsidiaries and does
not own, beneficially or of record, any shares of any other corporation.
SECTION 1.4 FINANCIAL INFORMATION. The books and records, financial
and otherwise, of Sequel are in all material respects complete and correct and
have been maintained in accordance with good business accounting practices.
Relevant thereto:
(a) Sequel has filed or is preparing to file all provincial, federal
and local income tax returns required to be filed by it from inception to the
date hereof, if any;
(b) the books and records, financial and others, of Sequel are in all
material respects complete and correct and have been maintained in accordance
with good business accounting practices.
Sequel will provide to LIVESTAR on or before 72 hours prior to the Closing Date
Financial Statements of Sequel for the year ended December 31, 2002 and interim
financial statements for the eight month period ended August 31, 2003 (the
"Interim Financial Statements") prepared by Xxxx Xxxxxx & Associates, Chartered
Accountants, to the level of Notice to Reader (collectively, the "Financial
Statements").
Xx. Xxxx represents and warrants that the Financial Statements will have been
prepared in accordance with Generally Accepted Accounting Principals on a basis
consistent with prior years, are correct and complete and present fairly the
assets, liabilities (whether accrued, absolute, conditional, contingent or
otherwise) and financial condition of Sequel as at the respective dates of the
Financial Statements and the sales, expenses, earnings, and results of
operations of Sequel for the respective periods covered by the Financial
Statements.
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SECTION 1.5 INFORMATION. The information concerning Sequel set forth
in this Agreement including any schedules is complete and accurate in all
material respects and does not contain any untrue statement of a material fact
or omit to state a material fact required to make the statements made, in light
of the circumstances under which they were made, not misleading.
SECTION 1.6 SHAREHOLDERS. Xx. Xxxx owns 100% of the issued and outstanding
capital shares of Sequel and 100% of all Shareholder Loans.
SECTION 1.7 SHAREHOLDER LOANS. The amount owing by Sequel to Xx. Xxxx as at
August 31, 2003 is no less than USD $500,000.00 (or CDN $641,000.00 as agreed to
by parties) (the "Shareholder Loans") as reflected in the Financial Statements
of which CDN $40,000.00 is to be paid by the Sequel on Closing as hereinafter
set out and a further amount of CDN $345,000.00 is to be paid by the Sequel
pursuant to the terms of a Promissory Note with specific payment terms. The
balance of the Shareholder Loans (a minimum of CDN $256,000.00) is to be
assigned and transferred to Livestar on Closing in exchange for the Livestar
Shares described in Section 3.4.
SECTION 1.8 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth in
this Agreement, the Schedules, or as otherwise disclosed to LIVESTAR:
(a) Except as reflected in the Financial Statements there has not been:
(i) any material adverse change in the business, operations, properties, assets
or condition of Sequel; or (ii) any damage, destruction or loss to Sequel
(whether or not covered by insurance) materially and adversely affecting the
business, operations, properties, assets or condition of Sequel; or (iii) any
material adverse change to the revenues and expenses that would be greatly lower
than those presented in the Financial Statements.
(b) Except as reflected in the Financial Statements or in any schedules
hereto, Sequel has not: (i) amended its articles of incorporation or bylaws;
(ii) declared or made, or agreed to declare or make, any payment of dividends or
distributions of any assets of any kind whatsoever to stockholders or purchased
or redeemed or agreed to purchase or redeem any of its capital stock; (iii)
waived any rights of value which in the aggregate are extraordinary or material
considering the business of Sequel; (iv) made any material change in its method
of management, operation or accounting; (v) entered into any other material
transaction; (vi) made any accrual or arrangement for or payment of bonuses or
special compensation of any kind or any severance or termination pay to any
present or former officer or employee; (vii) increased the rate of compensation
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payable or to become payable by it to any of its officers or directors or any of
its employees whose monthly compensation exceeds $5,000; or (viii) made any
increase in any profit sharing, bonus, deferred compensation, insurance,
pension, retirement or other employee benefit plan, payment or arrangement made
to, for, or with its officers, directors or employees;
(c) Except as reflected in the Financial Statements or in any schedules
hereto, Sequel has not: (i) granted or agreed to grant any options, warrants or
other rights for its stocks, bonds or other corporate securities calling for the
issuance thereof; (ii) borrowed or agreed to borrow any funds or incurred or
become subject to, any material obligation or liability (absolute or contingent)
except liabilities incurred in the ordinary course of business; (iii) paid any
material obligation or liability (absolute or contingent) other than current
liabilities reflected in or shown on the most recent Sequel balance sheet and
current liabilities incurred since that date in the ordinary course of business;
(iv) sold or transferred, or agreed to sell or transfer, any of its assets,
properties or rights (except assets, properties or rights not used or useful in
its business which, in the aggregate have a value of less than $5,000); (v) made
or permitted any amendment or termination of any contract, agreement or license
to which it is a party if such amendment or termination is material, considering
the business of Sequel; or (vi) issued, delivered or agreed to issue or deliver
any stock, bonds or other corporate securities, including debentures (whether
authorized and unissued or held as treasury stock); and
(d) to the best knowledge of Sequel, it has not become subject to any law or
regulation which materially and adversely affects, or in the future may
adversely affect, the business, operations, properties, assets or condition of
Sequel.
SECTION 1.9 TITLE AND RELATED MATTERS. Sequel has good and marketable
title to and is the sole and exclusive owner of all of its properties,
inventory, interests in properties and assets, real and personal (collectively,
the "Assets") which are reflected in the Financial Statement or acquired after
that date (except properties, interests in properties and assets sold or
otherwise disposed of since such date in the ordinary course of business), free
and clear of all liens, pledges, charges or encumbrances except: (a) statutory
liens or claims not yet delinquent; and (b) such imperfections of title and
easements as do not and will not, materially detract from or interfere with the
present or proposed use of the properties subject thereto or affected thereby or
otherwise materially impair present business operations on such properties (c)
any equipment leases, security interests and encumbrances reflected in the
Financial Statements, including Financing Statements registered in favour of Mr.
Xxx Xxxxx and First Choice Communications Inc. which are to be discharged on or
immediately following Closing and a Financing
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Statement to be registered in
favour of Xx. Xxxx on Closing to secure repayment of the outstanding sum of CDN
$345,000.00 owed to him by the Sequel on Closing, as set out herein and a
Financing Statement registered on behalf of the Minister of Finance (Ontario)
which is to be discharged on or immediately following Closing. Except as set
forth herein or in the Schedules, Sequel owns free and clear of any liens,
claims, encumbrances, royalty interests or other restrictions or limitations of
any nature whatsoever any and all procedures, techniques, marketing plans,
business plans, methods of management or other information utilized in
connection with Sequel's business. No third party has any right to, and Sequel
has not received any notice of infringement of or conflict with asserted rights
of others with respect to any product, technology, data, trade secrets,
know-how, proprietary techniques, trademarks, service marks, trade names or
copyrights which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a materially adverse effect on the
business, operations, financial conditions or income of Sequel or any material
portion of its properties, assets or rights.
SECTION 1.10 LITIGATION AND PROCEEDINGS. Except as set forth in Schedule
1.9, to the best of Sequel's knowledge and belief, there are no actions, suits,
proceedings or investigations pending or threatened by or against Sequel or
affecting Sequel or its properties, at law or in equity, before any court or
other governmental agency or instrumentality, domestic or foreign or before any
arbitrator of any kind that would have a material adverse effect on the
business, operations, financial condition or income of Sequel. Sequel does not
have any knowledge of any default on its part with respect to any judgment,
order, writ, injunction, decree, award, rule or regulation of any court,
arbitrator or governmental agency or instrumentality or of any circumstances
which, after reasonable investigation, would result in the discovery of such a
default.
SECTION 1.11 CONTRACTS.
(a) Except as included in Schedule 1.10, there are no material
contracts, agreements, franchises, license agreements or other commitments to
which Sequel is a party or by which it or any of its assets, products,
technology or properties are bound;
(b) except as included or described in the Schedules or reflected in the
Financial Statements, Sequel is not a party to any oral or written: (i)
contract for the employment of any officer or employee which is not terminable
on thirty (30) days or less notice; (ii) profit sharing, bonus, deferred
compensation, stock option, severance pay, pension benefit or retirement plan,
agreement or arrangement; (iii) agreement, contract or indenture relating to the
borrowing of
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money; (iv) guaranty of any obligation, other than one on which
Sequel is a primary obligor, for collection and other guaranties of obligations,
which, in the aggregate do not exceed more than one year or providing for
payments in excess of $5,000 in the aggregate; (v) consulting or other similar
contracts with an unexpired term of more than one year or providing for payments
in excess of $5,000 in the aggregate; (vi) collective bargaining agreements;
(vii) agreement with any present or former officer or director of Sequel; or
(viii) contract, agreement or other commitment involving payments by it of more
than $5,000 in the aggregate; and
(c) to Sequel's knowledge, all contracts, agreements, franchises, license
agreements and other commitments to which Sequel is a party or by which its
properties are bound and which are material to the operations of Sequel taken as
a whole, are valid and enforceable by Sequel in all respects, except as limited
by bankruptcy and insolvency laws and by other laws affecting the rights of
creditors generally and except as otherwise provided in Section 1.13 hereof.
SECTION 1.12 MATERIAL CONTRACT DEFAULTS. To the best of Sequel's
knowledge and belief, Sequel is not in default in any material respect under the
terms of any outstanding contract, agreement, lease or other commitment which is
material to the business, operations, properties, assets or condition of Sequel,
including the premises lease and all equipment leases, and there is no event of
default in any material respect under any such contract, agreement, lease or
other commitment in respect of which Sequel has not taken adequate steps to cure
any such a default. There is a dispute between the Sequel and the lanlord as to
payment of approximately $7000.00 claimed by the landlord. The payment of such
disputer amount shall be the sole responsibility of the Sequel after Closing.
There is also a dispute as to the Sequel's share of increased insurance premiums
incurred by the landlord with respect to the building. To the best of Xx. Xxxx'x
knowledge and belief, the share requested by the landlord is not in accordance
with the terms of the premises lease. If any such amounts are payable, they
shall be the sole responsibility of the Sequel after Closing. The foregoing
contingencies are herein referred to as the ("Landlord Contingencies").
SECTION 1.13 NO CONFLICT WITH OTHER INSTRUMENTS. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument to which Sequel is a
party or to which any of its properties or operations are subject, except that
the consent of the landlord of the Sequel business premises and the consent of
any equipment lessors may be required on or before Closing. Livestar
acknowledges that
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as of the date hereof the landlord has not provided the
required consent to the transfer of the Sequel Shares to Livestar and has
adopted the position that the renewal right set out in the premises lease has
not been validly exercised on account of, among other things, the Landlord
Contingencies, To the best knowledge and of belief of Xx. Xxxx, the position of
the landlord is without merit, due to the fact the Sequel and Xx. Xxxx has
performed, to the best of their knowledge, all necessary actions under the lease
to obtain written consent and that Livestar should be successful in the
attainment of the required consent. Livestar agrees that in the event the said
written consent and a written acknowledgment from the landlord to the effect
that the renewal right has been validly exercised is not obtained prior to
closing, Livestar will complete the transactions contemplated herein and will at
its or Sequel's sole discretion and expense, use best efforts to obtain written
consent and written acknowledgement as soon as possible after Closing. Xx. Xxxx
agrees to provide all ongoing assistance and support as may be requested by
Livestar or Sequel in attainment of the aforementioned written consent.
Livestar acknowledges that as of the date hereof the Sequel has not obtained
renewal of the Lease that expires March 31, 2004. The Sequel and Xx. Xxxx
represent they have performed all duties under the lease to effect a renewal
and, to the best of their knowledge, any position of the landlord after Closing
against a renewal are without merit and that Livestar should be successful in
the attainment of the required lease renewal. Livestar acknowledges it is aware
of and understands the Option to renew clause of the lease stated as the
following:
If the Tenant has not committed any breach of any term or condition of this
Lease, and is not then committing any breach of any term of condition of this
Lease, then the Tenant shall have this Lease by notice in writing given to the
Landlord at least six (6) months prior to the end of the Term for a period of
five (5) years upon the same terms and conditions contained in this Lease, save
and except that there shall be no further option to renew, and save and except
that Basic Rent shall be payable during the renewal term in an amount to be
negotiated by the parties, acting in good faith, based on the fair market rent
which would be paid by a Tenant for comparable premises in the vicinity of the
Building. If the amount of Basic Rent cannot be agreed upon, at least one (1)
month prior to the end of the Term, the option to renew hereunder shall be
arbitrated under the Ontario Arbitration Act.
Xx. Xxxx agrees to provide all ongoing assistance and support as may be
requested by Livestar or the Sequel in attainment of the aforementioned option
to renew provision of the lease.
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SECTION 1.14 GOVERNMENTAL AUTHORIZATIONS. To the best of Sequel's and
Xx. Xxxx'x knowledge, Sequel has all licenses including liquor licenses,
franchises, permits or other governmental authorizations legally required to
enable Sequel to conduct its business in all material respects as conducted on
the date hereof. Except for compliance with provincial, federal and state
securities and corporation laws, as hereinafter provided, no authorization,
approval, consent or order of, or registration, declaration or filing with, any
court or other governmental body is required in connection with the execution
and delivery by Sequel of this Agreement and the consummation by Sequel of the
transactions contemplated hereby, except that the approval of the Alcohol and
Gaming Commission of Ontario ("AGCO") will be required for the transfer of the
liquor license in connection with the transfer of ownership of the Sequel Shares
from Xx. Xxxx to LIVESTAR . The parties will on Closing execute and deliver a 90
day carry over agreement with respect to the existing Sequel Liquor License.
SECTION 1.15 COMPLIANCE WITH LAWS AND REGULATIONS. To the best of Sequel's
and Xx. Xxxx'x knowledge, Sequel has complied and is in compliance with all
applicable statutes and regulations of any provincial, federal, or other
governmental entity or agency thereof, except to the extent that noncompliance
would not materially and adversely affect the business, operations, properties,
assets or condition of Sequel or would not result in Sequel's incurring any
material liability.
SECTION 1.16 INSURANCE. All of the insurable properties owned either
directly or indirectly by Sequel are insured for Sequel's benefit under valid
and enforceable policies issued by insurers of recognized responsibility.
SECTION 1.17 APPROVAL OF AGREEMENT The board of directors of Sequel has
authorized the execution and delivery of this Agreement by Sequel and have
approved the transactions contemplated hereby.
SECTION 1.18 MATERIAL TRANSACTIONS OR AFFILIATIONS. Except for the
Shareholder Loans there exists no material contract, agreement or arrangement
between Sequel or any predecessor and any person who was at the time of such
contract, agreement or arrangement an officer, director or person owning of
record, or known by Sequel to own beneficially, ten percent (10%) or more of the
issued and outstanding common shares of Sequel and which is to be performed in
whole or in part after the date hereof. In all of such transactions, the amount
paid or received, whether in cash, in services or in kind, has been during the
full term thereof, and is required to be during the unexpired portion of the
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term thereof, no less favorable to Sequel than terms available from otherwise
unrelated parties in arms-length transactions. There are no commitments by
Sequel, whether written or oral, to lend any funds to, borrow any money from or
enter into any other material transactions with, any such affiliated person.
SECTION 1.19 LABOR RELATIONS. Sequel has never had a work stoppage
resulting from labor problems. To the best knowledge of Sequel, no union or
other collective bargaining organization is organizing or attempting to organize
any employee of Sequel.
SECTION 1.20 SPECIAL WARRANTIES. The financial position of Sequel as
reflected in the Financial Statements is accurate in all material respects.
Sequel is not subject to any litigation and is in compliance with all regulatory
requirements including tax filings and compliance with liquor license permits.
SECTION 1.21 DEBTS AT CLOSING. At the time of Closing, Sequel will not have
any debts or liabilities other than debts and obligations reflected in the
Financial Statements, ordinary trade debts accrued from August 31, 2003 to and
including the Closing Date and equipment lease obligations.
The parties acknowledge that immediately following Closing, Sequel will be
indebted (i) Xx Xxxx in the amount of CDN $345,000.00 as evidenced by the
Promissory Note to be issued by Sequel on Closing in respect thereof and, as set
out in Section 3.2 hereof, will be indebted to Livestar for the balance of the
Shareholder Loans owing to Xx Xxxx plus any additional direct loan advances from
Livestar to Sequel as contemplated herein. Contingent liabilities for retail
sales tax, goods and services tax and income tax not due as of the Closing Date
will be accrued on the Closing Financial Statements described in Section 4.10
and LIVESTAR will cause the Sequel to pay such amounts as and when due.
SECTION 1.22 AFFIRMATION OF SHAREHOLDERS LOANS.
All amounts owed to Xx. Xxxx represent actual advances from him to the Sequel
or amounts paid by him on behalf of the Sequel or amounts owed to Xx. Xxxx for
services rendered to Sequel and are bona fide debt obligations of the Sequel.
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES OF LIVESTAR
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As an inducement to, and to obtain the reliance of Sequel and Xx. Xxxx,
LIVESTAR represents and warrants as follows:
SECTION 2.1 ORGANIZATION. LIVESTAR is a corporation duly organized,
validly existing and in good standing under the laws of the state of Nevada and
has the corporate power and is duly authorized, qualified, franchised and
licensed under all applicable laws, regulations, ordinances and orders of public
authorities to own all of its properties and assets and to carry on its business
in all material respects as it are now being conducted. The execution and
delivery of this Agreement does not and the consummation of the transactions
contemplated by this Agreement in accordance with the terms hereof will not,
violate any provision of LIVESTAR's articles of incorporation or bylaws.
LIVESTAR has taken all action required by law, its articles of incorporation,
its bylaws or otherwise to authorize the execution and delivery of this
Agreement. LIVESTAR has full power, authority and legal right and has taken all
action required by law, its articles of incorporation, bylaws or otherwise to
consummate the transactions herein contemplated.
SECTION 2.2 CAPITALIZATION. The authorized capitalization of LIVESTAR
consists of 250,000,000 shares of common stock, par value $0.0001 per share and
200,000,000 shares of preferred stock par value $0.0001 per share. As of July
7, 2003 there are 94,794,923 common shares of LIVESTAR issued and outstanding
and 105,499,073 fully diluted.
SECTION 2.3 FINANCIAL STATEMENTS.
(a) Included in the XXXXX data base of the Securities and Exchange
Commission are the audited balance sheets of LIVESTAR for the fiscal years ended
December 31, 2002 and 2001, and the related statements of operations and
deficit, changes in stockholders' equity and cash flows for the years then
ended, and the unaudited balance sheet and related statement of operations and
deficit, changes in stockholders' equity and cash flow for the three month
period ended March 31, 2003.
(b) All such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved. The LIVESTAR balance sheets present fairly as of their
respective dates the financial condition of LIVESTAR. LIVESTAR did not have as
of the date of any of such LIVESTAR balance sheets, any liabilities or
obligations (absolute or contingent) which should be reflected in a balance
sheet or the notes thereto prepared in accordance with generally accepted
accounting principles other than as listed herein, and all assets reflected
therein are properly
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reported and present fairly the value of the assets of
LIVESTAR, in accordance with generally accepted accounting principles. The
statements of operations and deficit, changes in stockholders' equity and cash
flow reflect fairly the information required to be set forth therein by
generally accepted accounting principles.
(c) The books and records, financial and others, of LIVESTAR are in all
material respects complete and correct and have been maintained in accordance
with good business accounting practices.
(d) To the best of LIVESTAR's knowledge, LIVESTAR has no liabilities with
respect to the payment of any federal, provincial, state, county, local or other
taxes (including any deficiencies, interest or penalties).
SECTION 2.4 INFORMATION. The information concerning LIVESTAR as set
forth in this Agreement is accurate in all material respects and does not
contain any untrue statement of a material fact or omit to state a material fact
required to make the statements made, in light of the circumstances under which
they were made, not misleading.
SECTION 2.5 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as described
herein:
(a) LIVESTAR has not: (i) amended its articles of incorporation or
bylaws; (ii) waived any rights of value which in the aggregate are extraordinary
or material considering the business of LIVESTAR; (iii) made any material change
in its method of management, operation or accounting; or (iv) made any accrual
or arrangement for or payment of bonuses or special compensation of any kind or
any severance or termination pay to any present or former officer or employee;
(b) to the best knowledge of LIVESTAR, it has not become subject to any law
or regulation which materially and adversely affects, or in the future may
adversely affect, the business, operations, properties, assets or condition of
LIVESTAR .
SECTION 2.6 LITIGATION AND PROCEEDINGS. There are no actions, suits or
proceedings pending or, to the best of LIVESTAR's knowledge and belief,
threatened by or against or affecting LIVESTAR, at law or in equity, before any
court or other governmental agency or instrumentality, domestic or foreign, or
before any arbitrator of any kind that would have a material adverse effect on
the business, operations, financial condition, income or business prospects of
LIVESTAR except as described in its filings with the Securities and Exchange
Commission.
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SECTION 2.7 NO CONFLICT WITH OTHER INSTRUMENTS. The execution of this
Agreement and the consummation of the transactions contemplated by this
Agreement will not result in the breach of any term or provision of, or
constitute an event of default under, any material indenture, mortgage, deed of
trust or other material contract, agreement or instrument to which LIVESTAR is a
party or to which any of its properties or operations are subject.
SECTION 2.8 GOVERNMENTAL AUTHORIZATIONS. To the best of LIVESTAR 's
knowledge, LIVESTAR has all licenses, franchises, permits and other governmental
authorizations that are legally required to enable it to conduct its business
operations in all material respects as conducted on the date hereof. Except for
compliance with federal and state securities or corporation laws, no
authorization, approval, consent or order of, or registration, declaration or
filing with, any court or other governmental body is required in connection with
the execution and delivery by LIVESTAR of the transactions contemplated
hereby.
SECTION 2.9 COMPLIANCE WITH LAWS AND REGULATIONS. To the best of LIVESTAR
's knowledge and belief, LIVESTAR has complied with all applicable statutes and
regulations of any federal, state, provincial or other governmental entity or
agency thereof, except to the extent that noncompliance would not materially and
adversely affect the business, operations, or condition of LIVESTAR or would not
result in LIVESTAR 's incurring any material liability. Further, LIVESTAR is,
as of the date of this Agreement, a "reporting company" under Section 12 of the
Securities Exchange Act of 1934, as amended, and is current in filing all
reports required to be filed pursuant to said Act.
SECTION 2.10 APPROVAL OF AGREEMENT. The board of directors of LIVESTAR have
authorized the execution and delivery of this Agreement by LIVESTAR and have
approved the transactions contemplated hereby.
SECTION 2.11 SPECIAL WARRANTIES. LIVESTAR warrants: (i) that it is subject
to the reporting requirements of Section 12(g) of the Securities Exchange Act of
1934 and that it is current in filing all required reports pursuant to such
requirements; (ii) that its public filings with the Securities and Exchange
Commission disclose in all material respects its financial position and material
contracts; and (iii) its shares are listed on the OTC Bulletin Board under the
symbol "LSTA".
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ARTICLE III
ACQUISITION CONSIDERATION AND PROCEDURE
SECTION 3.1 PURCHASE CONSIDERATION. The total purchase price of the
Sequel Shares by LIVESTAR is US$10.00 the legal sufficiency and receipt of which
is hereby acknowledged. (Unless designated otherwise, all monetary amounts
stated in this Agreement shall be in US dollars even if not specifically
designated as such in each instance.) The consideration for the purchase from
Xx. Xxxx of the amount of minimum of CDN $256,000.00 of Shareholder Loans
representing the portion of the Shareholder Loans of the minimum CDN $641,000.00
owed to him by Sequel is US $200,000.00 which shall be paid and satisfied in
full by the issuance by Livestar to Xx. Xxxx or as he may direct of 1,000,000
shares of preferred stock of LIVESTAR as described in Sections 3.4 and 3.6
herein.
SECTION 3.2 CASH ADVANCES TO SEQUEL BY LIVESTAR.
LIVESTAR shall advance to the Sequel U.S.$35,609.00 on the Closing Date. The
$35,609.00 shall be paid by bank draft or certified check. The US $35,609.00
(which the parties agree has a CDN dollar equivalent of $47,000.00 will be
applied as follows: a) CDN. $40,000.00 to Xx. Xxxx such that on Closing the
Promissory Note issued by Sequel to Xx Xxxx will be CDN $345,000.00; b) CDN
$6,000.00 to the Minister of Finance (Ontario) in repayment of outstanding
retail sales tax arrears such that the claim for lien filed by the Ministry of
Finance may be discharged on or immediately following Closing and; c) CDN
$1,000.00 to the Minister of Finance in respect of the application fees for
transfer of the existing liquor license.
Livestar agrees that the $345,000.00 owed to Xx. Xxxx will be evidenced by a
Promissory Note to be issued by Sequel on Closing. The Promissory Note will be
on terms acceptable to Livestar and Xx. Xxxx. Sequel will, on Closing, issue a
general security agreement in favour of Xx. Xxxx as continuing collateral
security for the sum of $345,000 owing to Xx. Xxxx by Sequel as of Closing.
In the event Xx. Xxxx shall exercise any rights as secured creditors of Sequel,
the provisions of Sections 3.4, 3.6, and 4.2 hereof shall continue to apply.
Livestar agrees to fund, advance to Sequel and/or direct and/or cause Sequel to
pay, all amounts that may be required by Sequel to repay the its principal sum
of $345,000 owed to Xx. Xxxx pursuant to the Promissory Note.
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SECTION 3.3 DELIVERY OF SEQUEL SHARES. Upon Closing Xx. Xxxx shall
deliver to LIVESTAR a certificate or certificates duly executed for transfer,
representing 100% of the issued and outstanding capital shares of Sequel (the
"Sequel Shares") and an absolute assignment of the Shareholder Loans less CDN
$40.000.00 payable on Closing and less CDN $345,000.00 evidenced by the
Promissory Note.
SECTION 3.4 DELIVERY OF LIVESTAR SHARES. On Closing, if not already
executed, LIVESTAR shall deliver to Xx. Xxxx, as a deposit the sum of
$200,000.00 in the form of share certificates representing 1,000,000 shares of
preferred stock of LIVESTAR (the "LIVESTAR Shares"). The LIVESTAR Shares shall
have the rights and preferences set forth in Section 3.6. The LIVESTAR Shares
shall be issued at the declared value of $0.20 per share. The LIVESTAR Shares
shall be issued to Xx. Xxxx or one or more corporations designated by Xx. Xxxx
in writing. Notwithstanding any other provision or provisions of this
Agreement, the issuance of the LIVESTAR Shares pursuant to this Section 3.4 is
nonrefundable and LIVESTAR shall continue to be bound by its obligations under
this section 3.4 and under Section 3.6 and 4.2 hereof, in event the purchase and
sale contemplated is not completed for any reason.
SECTION 3.5 DIRECTORS OF SEQUEL. Upon Closing, Xx. Xxxx and his nominees
will resign as directors and officers of Sequel and will be replaced with
nominees of LIVESTAR which may include Xx. Xxxx as set forth in Section 4.7
hereof. Prior to Closing, Xx. Xxxx shall have full business management
authority over Sequel and the operations of its assets in a manner consistent
with past practice.
SECTION 3.6 RIGHTS AND PREFERENCES OF LIVESTAR SHARES. The LIVESTAR Shares
shall be issued from a series of preferred shares designated by the LIVESTAR
directors as Series A Convertible Preferred Stock. The LIVESTAR Shares shall
have the following rights and preferences:
The class of Series A Convertible Preferred Stock, $0.0001 par value per share,
of LIVESTAR Entertainment Group Inc. shall be referred to hereinafter in this
Section 3.6 as "Series A Stock".
The holders of outstanding shares of Series A Stock shall have conversion rights
as follows:
14
Any shares of Series A Stock may, at the option of the holder, be converted at
any time into such number of fully paid and non-assessable shares of common
stock at a ratio of forty shares of common stock for every share of Series A
Stock.
If the shares of common stock issuable upon the conversion of shares of Series A
Stock shall be changed into the same or a different number of shares of any
class or classes of stock, whether by capital reorganization, reclassification
or otherwise, then and in each such event, the holder of each share of Series A
Stock shall have the right thereafter to convert such share into the kind and
amount of shares of stock and other securities and property receivable upon such
reorganization, reclassification or other change by holders of the number of
shares of common stock into which such share of Series A Stock might have been
converted immediately prior to such reorganization, reclassification or change.
Without limiting the generality of the forgoing, upon the reverse split, if any,
of the common shares of LIVESTAR, an anti-dilution right will exist in the
Series A Stock so that the percentage ownership of common stock of LIVESTAR into
which the Series A Stock was convertible immediately prior to the split will be
equal to the percentage ownership of common stock of LIVESTAR into which the
Series A Stock is convertible following the split.
Before any holder of shares of Series A Stock shall be entitled to convert the
same into shares of common stock, such holder shall surrender the certificate or
certificates therefore, duly endorsed, at the principal executive office of the
corporation or of any transfer agent for such shares, and shall give written
notice by mail, postage prepaid, to the corporation at its principal executive
office, of the election to convert the same and shall state therein the name or
names in which the certificate or certificates for shares of common stock are to
be issued. The corporation shall, as soon as practicable thereafter, issue and
deliver at such office to such holder of shares of Series A Stock, a certificate
or certificates for the number of shares of common stock to which each holder
shall be entitled as aforesaid. Such conversion shall be deemed to have been
made immediately prior to the close of business on the date of such surrender of
the certificate or certificates representing the shares of Series A Stock to be
converted, and the person or persons entitled to receive the shares of common
stock issuable upon such conversion shall be treated for all purposes as the
record holder or holders of such shares of common stock as of such date.
In the event some but not all of the shares of Series A Stock represented by a
certificate or certificates surrendered by a holder are converted, the
corporation shall execute and deliver to the holder or to such other
15
person as
the holder may request in writing, at the expense of the corporation, a new
certificate representing the number of shares of Series A Stock which were not
converted.
If at any time, or from time to time, there shall be a reorganization,
recapitalization, transfer of assets, consolidation, merger, dissolution,
issuance or sale of securities of the corporation (the, "Corporate
Transaction"), provisions shall be made so that the holders of the Series A
Stock shall thereafter be entitled to receive, upon conversion of their Series A
Stock, such shares or other securities or property of the corporation or
otherwise to which a holder of the common stock deliverable upon conversion of
the Series A Stock would have been entitled upon such Corporate Transaction. In
any such case, appropriate adjustment shall be made in the application of the
provisions of this paragraph with respect to the rights of the holders of the
Series A Stock after the Corporate Transaction, to the end that the provisions
of this paragraph shall be applicable after the Corporate Transaction in as
nearly equivalent a manner as may be practicable.
Dividends shall be declared and set aside out of funds or assets of LIVESTAR
legally available therefore for any shares of Series A Stock only upon
resolution of the Board of Directors. If the Board of Directors declares a
dividend payable upon shares of common stock, the holders of Series A Stock
shall be entitled to dividends per the shares of Series A Stock as would be
declared payable on the number of shares of common stock into which the shares
of Series A Stock held by each holder thereof could be converted.
The corporation will not, by amendment of its Articles of Incorporation or
through any reorganization, recapitalization, transfer of assets, consolidation,
merger, dissolution, issuance or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms
to be observed or performed hereunder by the corporation, but will at all times
in good faith assist in the carrying out of all the provisions of this section
and in the taking of all such action as may be reasonably necessary or
appropriate in order to protect the conversion rights of the holders of the
Series A Stock against impairment.
No fractional shares shall be issued upon conversion of shares of Series A
Stock. In lieu of fractional shares, the corporation shall pay cash equal to
such fraction multiplied by the then fair market value of the shares of common
stock, as determined by the board of directors.
16
The corporation shall at all times reserve and keep available out of its
authorized but unissued shares of common stock solely for the purpose of
effecting the conversion of the shares of Series A Stock, such number of its
shares of common stock as shall from time to time be sufficient to effect the
conversion of all outstanding shares of Series A Stock; and if at any time, the
number of authorized, but unissued and unreserved, shares of common stock shall
not be sufficient to effect the conversion of all then outstanding shares of
Series A Stock, the corporation will take such corporate action as may, in the
opinion of its counsel, be necessary to increase its authorized, but unissued
and unreserved, shares of common stock to such number of shares as shall be
sufficient for such purposes. Such common shares held for conversion shall be
registered for sale with the Securities and Exchange Commission as set forth in
Section 4.1 herein, which registration shall be kept effective by LIVESTAR for a
reasonable period of time as determined by LIVESTAR in consultation with the
holder of the Series A Stock or the common stock in which it was converted.
The holders of record of outstanding shares of Series A Stock shall be entitled
to cast on any matter to be voted upon by the holders of common stock of the
corporation, that number of votes which the number of shares of common stock
into which such outstanding Series A Stock is then convertible would be entitled
to cast.
ARTICLE IV
SPECIAL COVENANTS
SECTION 4.1 AVAILABILITY OF RULE 144. Each of the parties acknowledge
that the LIVESTAR Shares and any common shares, into which the LIVESTAR Shares
are converted prior to the registration thereof, will be "restricted
securities," as that term is defined in Rule 144 as promulgated pursuant to the
Securities Act
SECTION 4.2 OPTION TO REDEEM LIVESTAR SHARES. In the event a default is
declared in the payment of the consideration discussed in Section 3.2 and the
default is not cured within ten (10) days, a first right option shall
automatically issue for the redemption by LIVESTAR of the LIVESTAR Shares at a
redemption price of $0.60 USD per share. If prior to that time, some or all of
the LIVESTAR Shares have been converted into common shares, a first right option
shall automatically issue for the redemption by LIVESTAR of the common shares
into which any LIVESTAR Shares were converted at a redemption price of $0.015
USD per share. Any such purchase for redemption will be
17
completed within twenty
(20) days after date of exercise of such election and the purchase price thereof
paid in full by certified cheque. The option for redemption shall exist for (6)
six months from the date of default.
SECTION 4.3 CHANGE OF CONTROL. If prior to Closing there is a change in
control of LIVESTAR whereby LIVESTAR is purchased and/or controlled by another
entity or persons not contemplated at the present time, or if Xxx Xxxxxxx ceases
to be an officer and a director of LIVESTAR (each a "change of control event"),
Xx. Xxxx shall have the right to unilaterally declare this Agreement null and
void and cancel the transactions contemplated by this Agreement except that the
provision of Sections 3.2, 3,4, 3.6, and 4.2 hereof shall continue in full force
and effect.
SECTION 4.4 LIQUOR LICENSE. Upon Closing, LIVESTAR will file an application
with the Alcohol and Gaming Commission (Ontario) at its expense for approval to
the liquor license transfer to LIVESTAR. The parties to this Agreement agree to
individually and collectively make reasonably diligent effort to supply
information and documentation as necessary to obtain approval of the liquor
license transfer.
SECTION 4.5 ACQUISITION COSTS. All reasonable costs incurred and paid by
Xx. Xxxx necessary to accomplish the transactions set forth in this Agreement
shall be reimbursed to Xx. Xxxx by LIVESTAR as long as they were pre-approved by
LIVESTAR. All such costs shall be repaid to Xx. Xxxx on Closing or as soon as
possible after Closing. Such costs shall include reimbursement for legal costs
incurred by Sequel and Xx. Xxxx in connection with the transactions contemplated
by this Agreement to a maximum of CDN$18,000.00 plus disbursements and gst.
SECTION 4.6 SEQUEL DIVIDENDS. LIVESTAR is not entitled to either the
payment or to the accrual of any dividends on the Sequel Shares until after
Closing.
SECTION 4.7 MANAGEMENT AGREEMENT. LIVESTAR shall as soon as possible after
Closing enter into a management agreement with Xx. Xxxx whereby Xx. Xxxx shall
be engaged as the President and CEO of Sequel for a term of years to be
determined and to be paid a salary to be determined. Under the management
agreement, Xx. Xxxx shall also be entitled to receive as a bonus equal to a
percentage of the net revenues of Sequel calculated on a quarterly basis.
SECTION 4.8 OPERATIONS AGREEMENT. Sequel shall on Closing enter into an
operations agreement with LIVESTAR outlining standards
18
and procedures by which
Sequel will operate as a subsidiary of LIVESTAR and pursuant to which LIVESTAR
shall be paid management fees for services provided to Sequel. LIVESTAR shall
not be entitled to receive any management fees, however, until after Closing.
SECTION 4.9 AUDITED FINANCIAL STATEMENTS. The parties to this Agreement
understand that LIVESTAR is required to provide Audited Financial Statements of
Sequel in conformity with the guidelines of Item 310 of Regulation S-B
promulgated under the Securities Act of 1933 within 75 days of Closing (the
"Audited Financial Statements"). In addition, the parties to this Agreement
agree to individually and collectively make reasonably diligent effort to supply
information and documentation as necessary to meet the Audited Financial
Statements requirements set forth in this Section 4.9. The cost of completing
the Audited Financial Statements shall be the sole responsibility of LIVESTAR.
The Closing Financial Statements shall be subject to the review and approval of
the parties hereto.
SECTION 4.10 CLOSING FINANCIAL STATEMENTS. The accountant of Sequel will
as soon as possible after Closing complete the Closing Financial Statements of
Sequel for the period January 1, 2003 to the Closing Date prepared to the level
of Notice to Reader (the "Closing Financial Statements") and will circulate them
to the parties for their review and approval. The cost of completing the
Closing Financial Statements shall be the sole responsibility of the Sequel.
SECTION 4.11 HOLDING OF SEQUEL SHARES. On Closing and thereafter,
LIVESTAR shall have the option of holding the Sequel Shares in a subsidiary of
LIVESTAR which is either now existing or newly created for that purpose.
LIVESTAR also has the right to assign this Agreement to a subsidiary of LIVESTAR
to be formed specifically for the acquisition contemplated herein, except that
any such assignment shall not extend to any obligations of LIVESTAR under
Sections 3.2, 3.4, 3.6 or 4.2.
ARTICLE V
MISCELLANEOUS
SECTION 5.1 BROKERS AND FINDERS. The parties each agree to indemnify
the other against any claim by any third person for any commission, brokerage or
finder's fee or other payment with respect to this Agreement or the transactions
contemplated hereby based on any alleged agreement or understanding between the
indemnifying party and
19
such third person, whether express or implied from the
actions of the indemnifying party.
SECTION 5.2 LAW. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Nevada.
SECTION 5.3 NOTICES. Any notices or other communications required or
permitted hereunder shall be sufficiently given if personally delivered to it or
sent by registered mail or certified mail, postage prepaid, or by overnight
courier addressed as follows:
If to Sequel or Xx. Xxxx: 00 Xxxxxxxxx Xxx.
Xxxxxxx, Xxxxxx X0X 188
If to LIVESTAR: 0xx xxxxx 00 X. 0xx Xxxxxx
Xxxxxxxxx, XX X0X 0X0
or such other addresses as shall be furnished in writing by any party in the
manner for giving notices hereunder, and any such notice or communication shall
be deemed to have been given as of the date so delivered, mailed, or couriered.
SECTION 5.4 ATTORNEYS' FEES. In the event that any party institutes
any action or suit to enforce this Agreement or to secure relief from any
default hereunder or breach hereof, the breaching party or parties shall
reimburse the non-breaching party or parties for all costs, including reasonable
attorneys' fees, incurred in connection therewith and in enforcing or collecting
any judgment rendered therein.
SECTION 5.5 CONFIDENTIALITY. Each party hereto agrees with the other
parties that, unless and until the acquisition contemplated by this Agreement
has been consummated, they and their representatives will hold in strict
confidence all data and information obtained with respect to another party or
any subsidiary thereof from any representative, officer, director or employee,
or from any books or records or from personal inspection, of such other party,
and shall not use such data or information or disclose the same to others,
except: (i) to the extent such data is a matter of public knowledge or is
required by law to be published; (ii) to the extent that such data or
information must be used or disclosed in order to consummate the transactions
contemplated by this Agreement; and (iii) as permitted by Section 5.16 herein.
SECTION 5.6 SCHEDULES; KNOWLEDGE. Each party is presumed to have full
knowledge of all information set forth in the other party's Schedules delivered
pursuant to this Agreement.
20
SECTION 5.7 THIRD PARTY BENEFICIARIES. This contract is solely among
Sequel, Xx. Xxxx and LIVESTAR and, except as specifically provided, no director,
officer, stockholder, employee, agent, independent contractor or any other
person or entity shall be deemed to be a third party beneficiary of this
Agreement.
SECTION 5.8 ENTIRE AGREEMENT This Agreement represents the entire agreement
between the parties relating to the subject matter hereof. This Agreement alone
fully and completely expresses the agreement of the parties relating to the
subject matter hereof. There are no other courses of dealing, understandings,
agreements, representations or warranties, written or oral, except as set forth
herein. This Agreement may not be amended or modified, except by a written
agreement signed by all parties hereto.
SECTION 5.9 SURVIVAL. Except as otherwise provided herein, the
representations and warranties of the respective parties shall survive the
consummation of the transactions herein contemplated for a period of one year
after the Closing Date. The covenants of the parties shall survive Closing until
satisfied in full.
SECTION 5.10 COUNTERPARTS FACSIMILE EXECUTION. For purposes of this
Agreement, a document (or signature page thereto) signed and transmitted by
facsimile machine or telecopier is to be treated as an original document. The
signature of any party thereon, for purposes hereof, is to be considered as an
original signature, and the document transmitted is to be considered to have the
same binding effect as an original signature on an original document. At the
request of any party, a facsimile or telecopy document is to be re-executed in
original form by the parties who executed the facsimile or telecopy document.
No party may raise the use of a facsimile machine or telecopier machine as a
defense to the enforcement of the Agreement or any amendment or other document
executed in compliance with this Section.
SECTION 5.11 AMENDMENT OR WAIVER. Every right and remedy provided herein
shall be cumulative with every other right and remedy, whether conferred herein,
at law, or in equity, and may be enforced concurrently herewith, and no waiver
by any party of the performance of any obligation by the other shall be
construed as a waiver of the same or any other default then, theretofore, or
thereafter occurring or existing. This Agreement may be amended by a writing
signed by all parties hereto, with respect to any of the terms contained herein,
and any term or condition of this Agreement may be waived or the time for
performance hereof may be extended by a writing signed by the party or parties
for whose benefit the provision is intended.
21
SECTION 5.12 INCORPORATION OF RECITALS. All of the recitals hereof are
incorporated by this reference and are made a part hereof as though set forth at
length herein.
SECTION 5.13
EXPENSES. Except as expressly set forth herein, each party
shall bear all of their respective costs and expenses incurred in connection
with the negotiation of this Agreement and in the consummation of the
transactions provided for herein and the preparation therefore.
SECTION 5.14 HEADINGS; CONTEXT. The headings of the sections and paragraphs
contained in this Agreement are for convenience of reference only and do not
form a part hereof and in no way modify, interpret or construe the meaning of
this Agreement.
SECTION 5.15 BENEFIT. This Agreement shall be binding upon and shall inure
only to the benefit of the parties hereto, and their permitted assigns
hereunder. This Agreement shall not be assigned by any party without the prior
written consent of the other party.
SECTION 5.16 PUBLIC ANNOUNCEMENTS. LIVESTAR shall have the right to issue
press releases regarding this Agreement and the business operations of Sequel.
LIVESTAR shall also have the right to make other public disclosure in accordance
with its reporting requirements with the Securities and Exchange Commission and
its duties as a listed company on the OTC Bulletin Board.
SECTION 5.17 SEVERABILITY. In the event that any particular provision or
provisions of this Agreement shall for any reason hereafter be determined to be
unenforceable, or in violation of any law, governmental order or regulation,
such unenforceability or violation shall not affect the remaining provisions of
this Agreement, which shall continue in full force and effect and be binding
upon the parties hereto.
SECTION 5.18 NO STRICT CONSTRUCTION. The language of this Agreement shall
be construed as a whole, according to its fair meaning and intendment, and not
strictly for or against either party hereto, regardless of who drafted or was
principally responsible for drafting the Agreement or terms or conditions hereof
SECTION 5.19 EXECUTION KNOWING AND VOLUNTARY. In executing this Agreement,
the parties severally acknowledge and represent that each: (a) has fully and
carefully read and considered this Agreement; (b) has been or has had the
opportunity to be fully apprised by its attorneys of the legal effect and
meaning of this document and all terms
23
and conditions hereof; and (c) is
executing this Agreement voluntarily, free from any influence, coercion or
duress of any kind.
SECTION 5.20 DEFAULT. Should any party to this Agreement be considered to
be in default under the terms and conditions of this Agreement by any other
party to this Agreement, the non-defaulting party shall give the defaulting
party written notice of the alleged default. The party alleged to be in default
shall then have ten (10) within which to cure the default. This Section 5.20
shall not apply to a default by LIVESTAR to pay the advances under Section 3.2,
which default provisions for nonpayment are well defined elsewhere in this
Agreement.
SECTION 5.21 CLOSING. The transactions contemplated under this Agreement
shall close upon payment of the cash advances assuming concurrent delivery of
the Sequel Shares and an absolute assignment of the Shareholder Loans to
LIVESTAR and the prior delivery of the LIVESTAR Shares to Xx. Xxxx or his
designees (the "Closing"). The Closing shall take place on October 24, 2003.
Any duty or responsibility of any party to this Agreement called for in this
Agreement that is not performed prior to Closing shall survive the Closing,
including without limitation, the joint duties to support the transfer of the
liquor license and to complete necessary audits and financial statements.
SECTION 5.22 CLOSING DOCUMENTS. The parties hereto agree that certain
of the following Closing documents maybe executed subsequently to the Closing
Date. The parties hereto agree to not unreasonably withhold execution. The
closing Documents are:
- Absolute Assignment
- Promissory Note
- Non Merger Covenant
- Security Agreement
- Certificate as to Representations and Warranties (from Livestar to 1485684
Ontario Limited and Xxxxxx Xxxxxxxx and Xxxxxx
- Certificate as to Representations and Warranties (from Xxxxxxxx Xxxx to
Livestar and Xxxx Xxxxxxxxxxx
- Release (of Xxxxxxxx Xxxx by Sequel)
- Release (of Sequel by Xxxxxxxx Xxxx)
23
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and entered into as of the date first above written.
1485684 Ontario Limited, an Ontario corporation
By: /S/ Xxxxxxxx Xxxx
------------------------------------
Xxxxxxxx Xxxx
Its: CEO
LIVESTAR Entertainment Group, Inc., a Nevada corporation
By: /s/ Xxx Xxxxxxx
-------------------------------------
Xxx Xxxxxxx
Its: CEO
/s/ Xxxxxxxx Xxxx
-------------------------------------------
Xxxxxxxx Xxxx, Individual
24
SCHEDULES
---------
SCHEDULE 1.1
Articles of Incorporation of Sequel
Bylaws of Sequel
SCHEDULE 1.2
The authorized capitalization of Sequel consists of an unlimited number of
shares of common shares and an unlimited number of Class A special shares. As
of the date hereof there are 100 common shares of Sequel issued and outstanding.
SCHEDULE 1.9
The Sequel was charged with allowing underaged customers onto its premises.
Under the AGCO act the Sequel should have shown due diligence when checking
customers identification prior to admittance to its facilities.
The Sequel is confident it followed all protocol of the AGCO requirements. The
Sequel was offered a settlement by the AGCO of seven days suspension. This was
rejected by The Sequel and its solicitors who have requested a heating to argue
its case. The Sequel is confident it has a good defense and should not face
suspension.
SCHEDULE 1.10
1. Premises Lease Agreement dated March 31, 1994
2. Lease Amendment and Consent to Assignment of Lease dated September 26,
2001.
3. Sound and Lighting Lease Agreement dated November 3, 2001
4. P.O.S./Inventory Control System Lease Agreement dated November 28, 2001
and subsequent renewal dated June 4, 2002.
5. Liquor License granted from the AGCO dated April 29, 2002
25
