Exhibit 4
SHARE PURCHASE AGREEMENT (DESTINY SHARES)
THIS AGREEMENT made as of and dated for reference the 15th day of June, 1999
AMONG:
XXXXX XXXXXXXXXXX, businessman, of Suite 950, 000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Vendor")
AND:
EURO INDUSTRIES LTD., a Colorado corporation having its
registered and records offices at 0000, 00xx Xxxxxx, Xxxxxxx,
Xxxxxxxx, 00000, X.X.X. and having an office and place of
business at Xxxxx 000, 000 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx
Xxxxxxxx, X0X 0X0
(the "Purchaser")
AND:
DESTINY SOFTWARE PRODUCTIONS INC., a British Columbia company
having its registered and records offices at Suite 500 North
Tower, 0000 Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 3MI
(the "Company")
WITNESSES THAT WHEREAS:
A. The Vendor is the registered and beneficial owners of all the Shares;
B. The Vendor desires to sell the Shares to the Purchaser on the terms and
conditions set forth herein and the Purchaser desires to purchase the
Shares on the terms and conditions hereinafter set forth;
THEREFORE, in consideration of the premises, the mutual covenants and agreements
herein set forth, and the sum of $10 now paid by the Purchaser to each of the
Company and the Vendor (the receipt and sufficiency of which is hereby
acknowledged by each of the Company and the Vendor), the Company and the Vendor
hereby covenant and agree with the Purchaser as follows:
1.0 INTERPRETATION
1.1 Definitions In this Agreement, the following words and phrases shall
have the meanings set forth after each:
(a) "Assets" means all property and assets of the Company, real and
personal, tangible and intangible, and wheresoever situate,
including without limitation the assets described in the
Financial Statements and Schedule 1. I (a) hereto
(b) "Closing" means the completion of the transactions
contemplated by this Agreement, "Closing Time" means 2:00 p.m.
and "Closing Date" means June 15, 1999 or such other date as
may be agreed upon in writing by the parties hereto;
(c) "Directors" means those persons holding the positions of
directors of the Company on the Closing Date;
(d) "Financial Statements" means the Company's interim financial
statements dated May 28, 1999, consisting of a balance sheet
and statements of income, retained earnings and changes in
financial position, copies of which are attached hereto as
Schedule 1. I (d);
(e) "Lease" means that certain lease agreement for the lease of
premises located at Xxxxx 000, 000 Xxxx Xxxxxxxx Xxxxxx
pursuant to which the Company pays approximately $4,965 per
month for rent;
(f) "Material Contract" means a subsisting commitment, contract,
agreement, instrument, lease or other obligation to which the
Company is a party or by which it is bound, or to which it or
its assets are subject, pursuant to which the Company has
payment obligations exceeding $ 1,000 on the Closing Date or
which has a term of or will continue in existence for a period
in excess of one year after the Closing Date;
(g) "Person" includes an individual, corporation, body corporate,
partnership, joint venture, association, trust or
unincorporated organization or any trustee, executor,
administrator or other legal representative thereof;
(h) "Purchase Price" means US$600.00;
(i) "Shares" means I 00 common shares without par value in the
capital of the Company;
(j) "Vendor's Solicitors" means the law firm XxXxx Xxxxxx & Xxxx,
of 1300-11 00 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx
(Attention: Xx. Xxxxxxxx X. Xxxx);
1.2 Schedules The following are the schedules to this Agreement:
Schedule 1.1(a) Assets
Schedule 1.1(d) Financial Statement
Schedule 3.1(u) Material Contracts
Schedule 3.1(as) Banks, Trust Companies
1.3 Interpretation For the purposes of this Agreement, except as otherwise
expressly provided herein:
(a) "this Agreement" means this Agreement, including the Schedules
hereto, as it may from time to time be supplemented or amended
and in effect;
(b) all references in this Agreement to a designated "Section",
"paragraph", "subparagraph" or other subdivision, or to a
Schedule to this Agreement, unless otherwise specifically
stated;
(c) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole and not
to any particular Section, paragraph, subparagraph or other
subdivision or Schedule;
(d) the singular of any term includes the plural and vice versa a
and the use of any term is equally applicable to any gender
and, where applicable, a body corporate;
(e) the word "or" is not exclusive and the word "including" is not
limiting (whether or onto non-limiting language such as
"without limitation" or "but not limited to" or other words of
similar import is used with reference thereof);
(f) any words used herein shall, unless otherwise defined herein
or unless there is something in the subject matter or context
inconsistent therewith, have the meanings ascribed to such
words in the Company Act;
(g) all accounting there not otherwise defined have the meanings
assigned to them in accordance with generally accepted
accounting principles applicable in Canada and applied on a
basis consistent with prior years;
(h) except as otherwise provided, any reference to a statute
includes and is a reference to such statute and to the
regulations made pursuant thereto with all amendments made
thereto and in force from time to time, and to any statute or
regulations that may be passed with have the effect of
supplementing or superseding such statue or such regulations;
(i) where the phrase "to the best of the knowledge of" or phrases
of so similar import are used in this Agreement, it shall be a
requirement that the Person or Persons in respect of whom
the phrase is used shall have made such due enquiries as are
reasonably necessary to enable such Person to make the
statement or disclosure;
(j) the headings to the sections and subsections of this Agreement
are inserted for convenience only and do not form a part of
this Agreement and are not intended to interpret, define or
limit the scope, extent or intent of this Agreement or any
provision hereof,
(k) any reference to a corporate entity includes and is also a
reference to any corporate entity that is a successor to such
entity;
(1) the language in all parts of this Agreement shall in all cases
be construed as a whole and neither strictly for nor strictly
against any of the parties;
(m) the representations, warranties, covenants and agreements
contained in this Agreement shall not merge in the Closing and
shall continue in full force and effect from and after the
Closing Date;
(n) all references to money in this Agreement and in the Financial
Statements are or shall be to money in lawful money of Canada
unless otherwise specified herein; and if it is necessary to
convert money from another currency to lawful money of Canada,
such money shall be converted to lawful money of Canada as at
the Closing Date.
2.0 SALE AND PURCHASE OF SHARES
---------------------------
2.1 Based on and relying on the representations and warranties set forth in
Sections 3 and 4, on the Closing Date the Purchaser will purchase the Shares and
will pay the Purchase Price therefore, and the Vendor will sell and transfer the
Shares to the Purchaser free and clear of all liens, charges, security
interests, encumbrances and adverse claims whatsoever, all on the terms and
conditions hereinafter set forth.
2.2 The Closing of the sale and purchase of the Shares shall take place at the
offices of the Vendor's Solicitors at 1300-1 1 00 Xxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, B.C., at the Closing Time on the Closing Date.
2.3 At the Closing the Vendor will deliver or cause to be delivered to the
Purchaser the documents set forth in subsection 5.1(e) hereof and such other
documents as the Purchaser may reasonably require to perfect the purchase and
sale contemplated hereby.
2.4 The Pur6haser will pay and satisfy the Purchase Price at the Closing by
issuing 600,000 common shares with a par value of $0.001 (United States funds)
each to and in the name of the Vendor at a deemed price of $0.001 (United States
funds) each.
3.0 REPRESENTATIONS AND WARRANTIES
------------------------------
3.1 Vendor's' Representations and Warranties In order to induce the Purchaser to
enter into and consummate this Agreement, the Vendor and the Company jointly and
severally represent and warrant to
and covenant with the Purchaser, with the intent that the Purchaser shall rely
upon same in purchasing the Shares, as follows:
(a) Organization and Good Standing of the Company - The Company is
duly incorporated and is validly existing and in good standing
with respect to the filing of annual returns under the laws of
the jurisdiction in which it was incorporated, and has all
necessary corporate power, authority and capacity to own its
property and Assets and to carry on its business as presently
conducted; and neither the nature of the business of the Company
nor the location or character of the property owned or leased by
it requires that the Company be registered or otherwise
qualified or to be in good standing in any other jurisdiction;
(b) Capitalization of Company - The authorized capital of the
Company consists of 10,000 common shares without par value,
and the Shares constitute all of the issued and outstanding
share capital of the Company;
(c) Title - The Vendor is the legal and beneficial owner of and
has good and marketable title to all of the Shares, free of
all liens, charges, security interests, encumbrances and
adverse claims whatsoever, and all of the Shares have been
duly and validly allotted and issued and are outstanding as
fully paid and non-assessable shares in the capital of the
Company;
(d) Absence of Options, etc. - No Person has any agreement, option
or right, contingent or absolute, or any arrangement capable
of becoming an agreement, option or right, or which with the
passage of time or the occurrence of any event could become an
agreement, option or right, at law or in equity:
(i) to require the Company to allot or issue any further
or other shares in its capital or any other security
convertible or exchangeable into shares in its
capital, or to convert or exchange any currently
outstanding securities into or for shares in the
capital of the Company;
(ii) for the issue or allotment of any of the authorized
but unissued shares in the capital of the Company;
(iii) to require the Company to purchase, redeem or
otherwise acquire any of the Shares; or
(iv) to acquire the Shares or any of them, or to require
the Vendor to sell, transfer, assign, pledge, charge,
mortgage or in any other way dispose of or encumber
any of the Shares other than pursuant to this
Agreement;
(e) Authority -The Vendor has due and sufficient right and authority to
enter into this Agreement on the terms and conditions herein set forth
and to transfer legal and beneficial title and ownership of the Shares
to the Purchaser;
(f) Agreement Valid - This Agreement constitutes a legal, valid and binding
obligation of the Vendor, the Vendor is not a party to or bound by or
subject to any indenture, mortgage, lease, agreement, instrument,
statute, regulation, order, judgment, decree or law which would be
violated, contravened or breached by or under which any default would
occur as a result of
the execution and delivery by the Vendor of this Agreement or the
performance by the Vendor of any of the terms hereof, including without
limitation any triggering event under any law governing the division of
assets, and there is no shareholders' agreement between the Vendor and
the Company;
(g) Residency of Vendor - The Vendor is not a "non-resident" of Canada
within the meaning of Section 116 of the Income Tax Act;
(h) Absence of Undisclosed Liabilities - Except to the extent previously
disclosed to the Purchaser in writing, the Company does not and will
not at the Closing Time have any outstanding indebtedness or any
liabilities or obligations (whether accrued, absolute, contingent or
otherwise);
(i) Financial Statements - The Financial Statements:
(i) are in accordance with the books and accounts of the
Company as at May 28, 1999;
(ii) are true and correct, and present fairly the
financial position of the Company, including its
assets and liabilities, as at May 28, 1999;
(iii) have been prepared in accordance with generally
accepted accounting principles applicable in Canada
and on a basis consistent with prior years; and
since May 28, 1999, there has not been:
(i) any one or more changes in the condition or
operations of the business, assets or financial
affairs of the Company which are, individually or in
the aggregate, materially adverse; or
(ii) any damage, destruction or loss, labour trouble or
other event, development or condition, of any
character (whether or not covered by insurance) which
is not generally known or which has not been
disclosed in writing to the Purchaser, which has or
may materially and adversely affect the business,
Assets or future prospects of the Company;
Accuracy of Records - All material financial transactions of the
Company have been accurately recorded in the books and records of the
Company and such books and records fairly present the financial
position and the corporate affairs of the Company, including without
limitation all material contracts and all material financial
transactions;
(k) Absence of Unusual Transactions - Since May 28, 1999, the Company has not:
(i) transferred, assigned, sold or otherwise disposed of
any of its assets;
(ii) incurred or assumed any obligation or liability
(absolute or contingent) except loans totaling
approximately $108,461;
(iii) issued or sold any shares in its capital stock or any
warrants, bonds, debentures or other corporate
securities or issued, granted or delivered any right,
option or other commitment for the issuance of any
such or other securities;
(iv) paid any obligation or liability (absolute or
contingent) other than current liabilities in the
ordinary and normal course of business;
(v) declared or made, or committed itself to make, any
payment of any dividend or other distribution in
respect of any of its assets or its shares or
purchased or redeemed any of its shares or split,
consolidated or reclassified any of its shares;
(vi) entered into any material commitment or transaction
not in the ordinary and usual course of its business;
(vii) waived or surrendered any right of substantial value;
(viii) made any gift of money or of any property or assets
to any person;
(ix) purchased or leased any real or personal property
otherwise than pursuant to the Lease;
(x) amended or changed or taken any action to amend or
change its constating documents;
(xi) paid or agreed to pay any wage, salary, management
fee, pension, bonus, share of profits or other
similar benefit to any director, employee or officer
or former director, employee or officer of the
Company;
(xii) made payments of any kind to or on behalf of the
Vendor or any affiliate or associate of the Vendor or
under any management agreement with the Company, save
and except business-related expenses in the ordinary
course of business;
(xiii) mortgaged, pledged, subjected to lien, granted a
security interest in or otherwise encumbered any of
its Assets;
(xiv) made or authorized any capital expenditures;
(xv) authorized or agreed or otherwise have become
committed to do any of the foregoing;
(xvi) had exercised against it, in whole or in part, any
right, option or commitment for the issuance of any
of its securities, including without limitation, any
directors or employee stock options;
(xvii) carried on business other than in the ordinary
course;
(l) Title to Assets - The Company has good and marketable title to
all of its Assets free and clear of all liens, charges,
encumbrances, security interests and adverse claims
whatsoever, and none of the Company's Assets are in the
possession of or under the control of any other person;
(m) Assets - The Company has previously provided to the Purchaser
in writing a true and complete list of all Assets owned by the
Company and all other personal and real property, and all
fixtures, in the possession or custody of the Company which,
as of the Closing Date, will be leased or held by the Company
under lease, license or similar arrangement, and accurately
describes such Assets, leases, licenses and other similar
arrangements;
(n) No Agreement - There is no agreement, option, understanding or
commitment, or any right or privilege capable of becoming an
agreement, for the purchase from the Company of its business
or any of its Assets other than in the usual and ordinary
course of the Company's business, and the Company is not a
party to or bound by any contract or commitment to pay any
royalty, licence fee or management fee otherwise than as
previously disclosed to the Purchaser;
(o) Condition of Assets - All plant, machinery, facilities and
equipment used by the Company in connection with its business
are in good operating condition and in a good state of
maintenance and repair for plant, machinery, facilities and
equipment of similar age relative to the standards of
maintenance and repair maintained by other companies carrying
on similar business in Canada;
(p) Personal Property Leases - The Company has no leases, licenses
or similar arrangements in respect of personal property;
(q) Work Orders - There are no outstanding work orders or similar
requirements issued by any building, fire, health, labour or
police authorities or from any other federal, provincial or
municipal authority and there are no matters under discussion
with any such authorities relating to work orders or similar
requirements;
(r) Real Property - The Company is not party to or bound by any
leases of real property (written or oral) other than the
Lease, and the Lease is free and clear of any and all liens,
charges and encumbrances of any nature and kind whatsoever;
(s) Real Property Lease Payments - All rental and other payments
required to be paid by the Company pursuant to the Lease have
been duly and regularly paid and the Company is not in default
of any provision of the Lease;
(t) Material Contracts - Schedule 3. 1 (u) to this Agreement is a
true and correct description of each Material Contract of the
Company, and other than as set forth in the schedules to this
Agreement, the Company is not party to or bound by any
Material Contract or commitment, whether oral or written;
(u) Material Contracts in Full Force - The Material Contracts are
all in full force and effect and unamended, no material
default exists in respect thereof on the part of any of the
other parties thereto, and the Vendor is not aware of any
intention on the part of any of the other parties to such
Material Contracts to terminate or materially alter any such
Material Contracts;
(v) Bonding, etc. - The Company has not provided bonding or other
financial security arrangements in connection with any
contracts, arrangements or transactions with any person;
(w) Employees, Etc. - The Company is not a party to or bound by
any contract of employment, contract of service or contract
for service, or any pension plan, commission arrangement,
profit sharing plan, bonus plan or other similar arrangement,
whether oral, written or implied, except its arrangement with
the Vendor;
(x) Other Service Contracts - The Company does not have any
contracts, agreements, pension plans, severance packages,
commission arrangements, profit sharing plans, bonus plans or
other similar arrangements, whether oral, written or implied,
with lessors, lessees, licensees, managers, accountants,
suppliers, agents, distributors, officers, directors, lawyers
or others that cannot be terminated without penalty on not
more than one-week's notice;
(y) Liability For Employee Damages - The Company is not now liable
for any damages to any former employee, including without
limitation damages resulting from any violation of any
applicable employment law or employment agreement, and the
Company is not now liable or aware of any potential liability
to any current or former employee;
(z) Absence of Other Interest - The company does not own shares in
other securities of, or have an interest in the assets or
business of, any other Person, but pursuant to an agreement of
even date herewith made with Xx Xxxxx, Wonderfall Productions
Inc. ("Wonderfall"), the Company has agreed to purchase all of
the issued and outstanding shares in the capital of
Wonderfall, subject, inter alia, to the completion of the
transactions contemplated by this Agreement, for $20,000.
(aa) Absence of Guarantees - The Company is not a party to or bound
by any guarantee, indemnification, surety or similar
obligation, and the Company has no indemnity or contingent or
indirect obligation with respect to the obligation of any
other Person (including any obligation to service the debt of
or otherwise acquire an obligation of another Person or to
supply funds to, or otherwise maintain any working capital or
other balance sheet condition of any other Person);
(ab) Absence of Conflicting Agreements - The Company is not party
to, bound by or subject to any indenture, mortgage, lease,
agreement, instrument, judgment or decree which would be
violated or breached by, or under which default would occur or
which could be terminated, cancelled or accelerated, in whole
or in part, as a result of the execution and delivery of this
Agreement or the consummation of any of the transactions
provided herein;
(ac) Insurance - The Company does not maintain any policies of
insurance in force;
(ad) Litigation - There is no basis for and there are no actions,
suits, litigation, investigation, arbitration proceeding,
governmental proceeding or other proceedings (including
appeals and applications for review) outstanding, pending,
threatened against or involving, affecting or possibly
affecting the Vendor, the Company, the Shares or the Assets,
or any judgment, decree, injunction, rule or order of any
court, governmental department, commission, agency, officer,
instrumentality or arbitrator, which, if determined adversely
to the Vendor or the Company, as the case may be, might
adversely affect the ability of the Vendor to enter into this
Agreement or to consummate the transactions contemplated
hereby, or adversely affect title to any of the Assets or the
Shares, or the Company's ability to dispose of the Assets or
any of them, in its sole discretion;
(ae) Breach of Law - The Company is not in breach of any laws,
ordinances, statutes, regulations, by-laws, orders or decrees
to which it is subject or which apply to it and which may
materially adversely affect its business, assets or affairs,
or the Shares or the ability of the Purchaser to resell the
Shares;
(af) Copies of Agreements, Etc. - True, correct and complete copies
of all mortgages, leases, material contracts, agreements,
instruments and other documents listed in the Schedules to
this Agreement have been delivered to the Purchaser;
(ag) Corporate Records - To the best of the knowledge and belief of
the Vendor, the Company has kept the records required to be
kept by the Company Act and any other applicable corporate
legislation, and such records are kept in the Company's minute
book and are complete and accurate;
(ah) Absence of Approvals Required - No authorization, approval,
order, license, permit or consent of any governmental
authority, regulatory body or court, and no registration,
declaration or filing by the Vendor or the Company with any
such governmental authority, regulatory body or court is
required in order for the Vendor:
(i) to incur the obligations expressed to be incurred by
the Vendor pursuant to this Agreement;
(ii) to execute and deliver all of the documents and
instruments to be delivered by the Vendor pursuant to
this Agreement;
(iii) to duly perform and observe the terms and provisions
of this Agreement; and
(iv) to render this Agreement legal, valid, binding and
enforceable in accordance with its terms;
(ai) Permits and Licenses - The Company holds all permits,
licenses, consents and authorities issued by any government or
governmental authority, or any municipal, regional or other
authority, or any subdivision thereof, including, without
limitation, any governmental department, commission, bureau,
board or administrative agency, which are necessary or
desirable in connection with the conduct and operation of the
Company's business and the ownership or leasing of its assets
and the conduct and operation of the Company's business as the
same are now owned, leased, conducted or operated is not in
breach of or in default under any term or condition of any
thereof;
(aj) Filings - The Company:
(i) has duly filed in a timely manner:
(A) all income tax returns required to be filed and all
such returns; and
(B) all goods and services tax forms, sales tax forms,
corporation capital tax forms and returns, and all
other reports and information required to be filed
with all applicable government authorities, agencies
or regulatory bodies;
and all of such forms have been completed accurately and
correctly in all respects
(ii) has paid all assessments and reassessments and all
other taxes, governmental charges (including all
federal, provincial and local taxes, assessments,
reassessments or other imposts in respect of its
income, business, assets or property) and all
interest, fines and penalties thereon with respect to
the Company for all previous fiscal years and all
required installments for the current fiscal year;
(iii) has provided adequate reserves for all taxes for the
periods covered by, and such reserves are reflected
in the materials previously supplied by the Vendor to
the Purchaser;
(iv) has withheld from each payment made to each of its
employees the amounts required to be withheld
pursuant to applicable laws or regulations, and has
paid the same to the proper receiving authorities,
except for amounts collected but not yet required to
be paid to such receiving authorities;
(v) the Company has paid all goods and services taxes and all
sales taxes collected by it to the proper receiving
authority, except for amounts so collected but not yet
required to be paid to such receiving authority;
and there is no agreement, waiver or other arrangement providing
for an extension of time with respect to the filing of any tax
return, or payment of any tax, governmental charge or deficiency
by the Company nor is there any action, suit, proceeding,
investigation or claim now threatened or pending against the
Company in respect of, or discussions underway with any
governmental authority relating to, any such tax or governmental
charge or deficiency;
(ak) Additional Tax Matters - The Company has not:
(i) made any tax election with respect to the acquisition
or disposition of any property;
(ii) acquired or had the use of any property from a person
with whom it was not dealing at arms length other
than at fair market value; or
(iii) disposed of anything to a person with whom it was not
dealing at arm's length for proceeds less than the
fair market value thereof;
(al) Absence of Contingent Tax Liabilities - The Company has no
contingent tax liabilities, nor are there any grounds which
would prompt a reassessment by any taxing authority, including
aggressive treatment of income and expenses in filing earlier
tax returns;
(am) Statements Attached to Tax Returns - The financial statements
and schedules attached to the corporate income tax returns as
filed by the Company for each of its taxation
years reflect and disclose all transactions to which the
Company was party as required by applicable taxation laws and
all of the transactions to which the Company was or is a party
are reflected or disclosed in such financial statements and
schedules and the corporate income tax returns and schedules
have been duly and accurately completed as required by such
laws;
(an) Trade Marks, etc. - The Company has no trade marks, trade
names, trade secrets, patents and copyrights, domestic or
foreign, registered or unregistered, and no trade marks are
required for the proper carrying on of the Company's business;
(ao) Indebtedness to Vendor - Except for the payment of salaries
and reimbursement for out-of-pocket expenses in the ordinary
course and except for amounts reflected in the Financial
Statements and other Schedules hereto, the Company will not at
Closing be indebted to the Vendor or any director, officer or
employee of the Company or any affiliate or associate of any
of them, on any account whatsoever;
(ap) No Withheld Information - No information relating to the
Company or its business which is known to the Vendor or which
on reasonable inquiry ought to be known to the Vendor, and
which would materially affect a purchaser for value of the
Shares or their decision to purchase the Shares, has been
withheld from the Purchaser;
(aq) Compliance with Laws - The business of the Company is not
being conducted in contravention of any law, rule or
regulation, or any order of any court or other body having
jurisdiction, and the Shares have been allotted and issued to
the Vendor, and will be sold and transferred to the Purchaser,
in compliance with all applicable laws, rules and regulations;
(ar) Conduct of Business - Except as otherwise contemplated or
permitted by this Agreement, during the period from the date
of this Agreement to the Closing Time, the Vendor will cause
the Company to conduct the Company's business in the ordinary
and normal course thereof and not, without the prior written
consent of the Purchaser, enter into any transaction which
would constitute a breach of the representations, warranties
or agreements contained herein;
(as) Banking - Schedule 3. 1 (as) is a true and complete list
showing:
(i) the name and location of each bank, trust company or
other institution with which the Company has an
account or safety deposit box, and the names or
designations of all persons authorized to draw
thereon or to have access thereto; and
(ii) the name of each person holding a general or special
power of attorney from the Company and the terms
thereof;
(at) No other Knowledge - The Vendor has no information or
knowledge of any facts relating to the Company or its
business which, if known to the Purchaser, might reasonably
be expected to deter the Purchaser from completing the
transactions contemplated hereby;
and the Vendor and the Company jointly and severally covenant, represent and
warrant to and in favour of and with the Purchaser that all of the
representations and warranties set forth in this Section 3.1 shall be true and
correct at the Closing Time as if made on that date.
3.2 Other Representations. All statements contained in any certificate or other
instrument delivered by or on behalf of the Vendor pursuant hereto or in
connection with the transactions contemplated hereby shall be deemed to be
representations and warranties by the Vendor and the Company hereunder, as the
case may be.
3.3 Survival The representations and warranties of the Vendor and the Company
contained in this Agreement shall survive the Closing and the payment of the
Purchase Price and, notwithstanding the Closing and the payment of the Purchase
Price, notwithstanding any investigations or enquiries made by the Purchaser
prior to the Closing and notwithstanding the waiver of any condition by the
Purchaser, the representations, warranties, covenants and agreements of the
Vendor and the Company shall (except where otherwise specifically provided in
this Agreement) survive the Closing and shall continue in full force and effect
for a period of three years from the Closing Date for all matters except income
tax liability or other tax matters. With respect to income tax liability of the
Company or other tax matters, the representations, warranties, covenants and
agreements of the Vendor and the Company shall survive the Closing and continue
in full force and effect for three years after the Closing Date.
3.4 Reliance The Vendor and the Company acknowledge and agree that the Purchaser
has entered into this Agreement relying on the warranties and representations
and other terms and conditions of this Agreement notwithstanding any independent
searches or investigations that may be undertaken by or on behalf of the
Purchaser and that no information which is now known or should be known or which
may hereafter become known to the Purchaser or its officers, directors or
professional advisers shall limit or extinguish the Purchaser's right to
indemnification hereunder.
4.0 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
-----------------------------------------------
4.1 Representations and Warranties In order to induce the Vendor to enter into
and to consummate the transactions contemplated by this Agreement, the Purchaser
hereby represents and warrants to the Vendor that:
(a) Authority Relative to Agreement - The Purchaser has all
necessary corporate power, authority and capacity to enter
into this Agreement and to perform its obligations hereunder,
and the execution and delivery of this Agreement has been duly
authorized by all necessary corporate action on the part of
the Purchaser;
(b) Binding Agreement - This Agreement will, when delivered,
constitute a valid and binding obligation of the Purchaser;
(c) No Breach - The Purchaser is not a party to, bound by or
subject to any indenture, mortgage, lease, agreement,
instrument, statute, regulation, order, judgment, decree or
law which would be violated, contravened or breached by or
under which any default would occur as a result of the
execution and delivery by the Purchaser of this Agreement or
the performance by the Purchaser of any of the terms hereof;
and
(d) Financing - The Purchaser has the ability to obtain financing
for the business of the Company in an amount not less than
$595,950 by issuing shares at prices not less than $1.50
(United States funds);
and the Purchaser covenants, represents and warrants with and in favour of the
Vendor that all of the representations and warranties set forth in this Section
4.1 shall be true and correct at the Closing Time as if made on that date.
4.2 Survival The representations and warranties of the Purchaser contained in
this Agreement shall survive the Closing and the purchase of the Shares and,
notwithstanding the Closing and the purchase of the Shares, the representations
and warranties of the Purchaser shall continue in full force and effect for the
benefit of the Vendor for a period of two years from the Closing Date.
4.3 Reliance The Purchaser acknowledges and agrees that the Vendor has entered
into this Agreement relying on the warranties and representations and other
terms and conditions of this Agreement notwithstanding any independent searches
or investigations that may be undertaken by or on behalf of the Vendor and that
no information which is now known or should be known or which may hereafter
become known to the Vendor or his professional advisers shall limit or
extinguish the right to indemnification hereunder.
5.0 CONDITIONS PRECEDENT
--------------------
5.1 All obligations of the Purchaser under this Agreement are subject to the
fulfillment, on or before the Closing Date, of each of the following conditions:
(a) Truth and Accuracy of Representations of the Vendor at Closing
- The representations and warranties of the Vendor made in
Article 3 shall be true and correct in all material respects
as at the Closing and with the same effect as if made at and
as of the Closing and the Vendor has complied in all material
respects with his obligations and covenants hereunder;
(b) Performance of Obligations - The Vendor shall have caused the
Company to have performed and complied with all the
obligations to be performed and complied with by the Company;
(c) Absence of Injunctions, etc. - No injunction or restraining
order of any Court or administrative tribunal of competent
jurisdiction shall be in effect prohibiting the transactions
contemplated hereby and no action or proceeding shall have
been instituted or be pending before any Court or
administrative tribunal to restrain or prohibit the
transactions between the parties contemplated hereby;
(d) Absence of Change of Conditions - No event shall have occurred
or condition or state of facts of any character shall have
arisen or legislation (whether by statute, rule, regulation,
by-law or otherwise) shall have been introduced which might
reasonably be expected to have a materially adverse effect
upon the financial condition, results of operations or
business prospects of the Company;
(e) Closing Documentation - The Purchaser shall have received from
the Vendor and, where applicable, the Company the following
closing documentation:
(i) share certificates representing the Shares issued in
the name of the Vendor, duly endorsed for transfer to
the Purchaser;
(ii) a certified copy of resolutions of the directors of
the Company authorizing the transfer of the Shares,
the registration of the Shares in the name of the
Purchaser and the issuance of the share certificates
representing the Shares registered in the name of the
Purchaser;
(iii) share certificates registered in the name of the
Purchaser, signed by a director-of the Company,
representing the Shares;
(iv) a certified copy of the register of members of the
Company showing the Purchaser as the registered owner
of the Shares and the sole shareholder of the
Company;
(v) all other necessary consents, waivers (including
waivers of pre-emptive rights), and authorizations
required to enable the transfer of the Shares to the
Purchaser as provided for in this Agreement;
(vi) all such instruments of transfer, duly executed,
which, in the opinion of the Purchaser acting
reasonably, are necessary to effect and evidence the
transfer of the Shares to the Purchaser free and
clear of all liens, charges and encumbrances
whatsoever;
(f) Due Diligence - The Purchaser's due diligence procedures having
confirmed to the satisfaction of the Purchaser, acting
reasonably, the accuracy of the Financial Statements; and
(g) Legal Opinion - The Purchaser having received an opinion
satisfactory to it and to the Purchaser's Solicitors from the
Vendor's Solicitors as at the Closing Date as to the due
incorporation of the Company, as to the good standing of the
Company and as to the due authorization, execution and delivery
of this Agreement by the Vendor.
5.2 The conditions set forth in this Article 5 are for the exclusive benefit of
the Purchaser and may be waived by the Purchaser in writing in whole or in part
on or before the Closing Date. Notwithstanding any such waiver, the completion
of the purchase and sale contemplated by this Agreement by the Purchaser shall
not prejudice or affect in any way the rights of the Purchaser in respect of the
warranties and representations of the Vendor set forth in Article 3 of this
Agreement, and the representations and warranties of the Vendor set forth in
Article 3 of this Agreement shall survive the Closing and payment of the
Purchase Price.
5.3 The Vendor covenants and agrees to forthwith, upon request, execute and
deliver, or cause to be executed and delivered, such further and other deeds,
documents, assurances and instructions as may reasonably be required by the
Purchaser or its counsel.
5.4 The obligation of the Vendor to complete the sale of Shares hereunder shall
be subject to the satisfaction of or compliance with, at or before the Closing
Time, each of the following conditions precedent:
(a) Truth and Accuracy of Representations of the Purchaser at
Closing Time - All of the representations and warranties of
the Purchaser set forth in Article 4 hereof shall be true and
correct in all material respects as at the Closing Time and
with the same effect as if made at and as of the Closing Time;
(b) Purchase Price - The Purchase Price shall have been paid in
accordance with Article 2.
5.5 The conditions set forth in this Article 5 are for the exclusive benefit of
the Vendor and may be waived by the Vendor in writing in whole or in part on or
before the Closing Date. Notwithstanding any such waiver, completion of the
purchase and sale contemplated by this Agreement by the Vendor shall not
prejudice or affect in any way the rights of the Vendor in respect of the
warranties and representations of the Purchaser set forth in Article 4 of this
Agreement, and the representations and warranties of the Purchaser set forth in
Article 4 of this Agreement shall survive for a period of two years from the
date hereof.
6.0 BUY-BACK PROVISIONS
-------------------
6.1 Vendor's Buy-Back Option The Purchaser hereby grants to the Vendor the right
and option (the "Destiny Buy-back Option") to purchase all of the Shares back
from the Purchaser for US$600.00 in the aggregate on the following terms and
conditions:
(a) the Destiny Buy-back Option will be exercisable if and only if
Closing occurs and the Company has not, within 60 days next
following Closing, received at least $250,000 from private
placements of its shares after Closing at prices not less than
US$1.50 per share;
(b) the Destiny Buy-back Option will become exercisable sixty days
after Closing;
(c) the Destiny Buy-back Option will be exercisable from and after
the time specified in clause 6. 1 (b) to and including the
120th day next following the Closing Date, and will expire at
the end of that period;
(d) the Destiny Buy-back Option may be exercised by notice in
writing to the Purchaser accompanied by payment of the
exercise price in the form of cash, a certified cheque or a
bank draft; and
(e) the Destiny Buy-back Option may be assigned by the Vendor by
notice in writing to the Purchaser if the proposed assignee
agrees in writing to be bound by the terms of this Agreement,
including without limitation section 6.2.
6.2 If the Vendor exercises the Destiny Buy-back Option, the Vendor will pay
to the Purchaser an amount equal to the legal (on a solicitor and own
client basis) and out-of-pocket expenses incurred by the Purchaser in
connection with the negotiation, drafting, execution and delivery of
this Agreement and the performance of the Purchaser's rights and
obligations hereunder, including
without limitation reasonable out-of-pocket expenses incurred by the
Purchaser to obtain equity financing after Closing.
7.0 EXAMINATIONS AND WAIVERS
------------------------
7.1 Access for Investigation The Company and the Vendor shall permit the
Purchaser and its employees, agents, legal counsel, accountants and other
representatives, between the date hereof and the Closing Date, to have access
during normal business hours to the premises and to all books, accounts, records
and other data of the Company (including, without limitation, all corporate,
accounting and tax records and any electronic or computer-accessed data) and to
the properties and assets of the Company; and the Company will furnish and
require that the Company's principal bankers, appraisers and independent
auditors and other advisors furnish to the Purchaser such financial data and
other information with respect to the business and Assets of the Company as the
Purchaser shall from time to time reasonably request to enable confirmation of
the matters warranted in Article 3 hereof.
7.2 Non-disclosure of Purchase Price Before and after Closing, the Vendor will
not disclose the Purchase Price, except as reasonably required for income tax
and other reporting requirements.
8.0 INDEMNITIES
-----------
8.1 Indemnification of Purchaser by Vendor Subject to the limitations set out in
paragraph 8.2:
(a) the Vendor covenants and agrees with the Purchaser to
indemnify the Purchaser against all liabilities, claims,
demands, actions, causes of action, damages, losses, costs and
expenses (including legal fees on a solicitor and his own
client basis) suffered or incurred by the Purchaser, directly
or indirectly, by reason of or arising out of-
(i) any warranties or representations on the part of the
Vendor set forth in Section 3.1 being untrue;
(ii) any breach of any agreement, term or covenant on the
part of the Vendor made or to be observed or
performed pursuant hereto;
(a) the Company covenants and agrees with the Purchaser to
indemnify the Purchaser against all liabilities, claims,
demands, actions, causes of action, damages, losses, costs and
expenses (including legal fees on a solicitor and his own
client basis) suffered or incurred by the Purchaser, directly
or indirectly, by reason of or arising out of-
(i) any warranties or representations on the part of the
Vendor set forth in Section 3.2 being untrue;
(ii) any breach of any agreement, term or covenant on the
part of the vendor made or to be observed or
performed pursuant hereto;
which liabilities, claims, demands, actions, cause s of action, damages, losses,
costs and expenses are collectively referred to as the "Purchaser's Losses".
8.2 Vendor's Limitations The indemnity obligations of the Vendor pursuant to
Section 8.1 shall be limited in the following respects:
(a) the Vendor shall be liable for Purchaser's Losses in respect
of which a claim for indemnity is made by the Purchaser on or
before the applicable expiry dates for the survival of the
Vendor's representations and warranties as set out in
paragraph 3.4; and
(b) the Vendor's indemnity obligations shall be limited to the
Purchase Price.
8.3 Indemnification of Vendor Subject to the limitations set out in paragraph
8.2, the Purchaser covenants and agrees with the Vendor to indemnify the Vendor
against all liabilities, claims, demands, actions, causes of action, damages,
losses, costs or expenses (including legal fees on a solicitor and his own
client basis) suffered or incurred by the Vendor, directly or indirectly, by
reason of or arising out of-
(a) any warranties or representations on the part of the Purchaser
set forth in Section 4.1 of this Agreement being untrue;
(b) a breach of any agreement, term or covenant on the part of the
Purchaser made or to be observed or performed pursuant hereto;
which liabilities, claims, demands, actions, causes of action, damages, losses,
costs and expenses are collectively referred to as "Vendor's Losses".
8.4 Limitation The indemnity obligations of the Purchaser pursuant to paragraph
8.4 shall be limited in that the Purchaser shall only be liable for Vendor's
Losses in respect of which a claim for indemnity is made by the Vendor within
two years of the Closing Date;
8.5 Claims Under Vendor's Indemnity If any claim is made by any Person against
the Purchaser in respect of which the Purchaser may incur or suffer damages,
losses, costs or expenses that might reasonably be considered to be subject to
the indemnity obligation of the Vendor as provided in paragraph 8.1, the
Purchaser will notify the Vendor as soon as reasonably practicable of the nature
of such claim and the Vendor shall be entitled (but not required) to assume the
defence of any suit brought to enforce such claim. The defence of any such claim
(whether assumed by the Vendor or not) shall be through legal counsel and shall
be conducted in a manner acceptable to the Purchaser and the Vendor, acting
reasonably, and no settlement may be made by the Vendor or the Purchaser without
the prior written consent of the others. If the Vendor assumes the defence of
any claim, then the Purchaser and the Purchaser's counsel shall co-operate with
the Vendor and his counsel in the course of the defence, such co-operation to
include using reasonable best efforts to provide or make available to the Vendor
and his counsel documents and information and witnesses for attendance at
examinations for discovery and trials. The reasonable legal fees and
disbursements and other costs of such defence shall, from and after such
assumption, be home by the Vendor. If the Vendor assumes the defence of any
claim and the Purchaser retains additional counsel to act on its behalf, the
Vendor and his counsel shall co-operate with the Purchaser and its counsel, such
co-operation to include using reasonable best efforts to provide or make
available to the Purchaser and its counsel documents and information and
witnesses for attendance at examinations for discovery and trials. All fees and
disbursements of such additional counsel shall be paid by the Purchaser. If the
Vendor and the Purchaser are or become parties to the same action, and the
representation of all parties by the same counsel would be inappropriate due to
a conflict of interest, then the Purchaser and the Vendor shall be represented
by separate counsel and, subject to the indemnity
obligations of the Vendor as set out in Section 8. 1, the costs associated with
the action shall be home by the party incurring such costs.
8.7 Claims Under Purchaser's Indemnity If any claim is made by any Person
against the Vendor in respect of which the Vendor may incur or suffer damages,
losses, costs or expenses that might reasonably be considered to be subject to
the indemnity obligation of the Purchaser as provided in paragraph 8.4, the
Vendor will notify the Purchaser as soon as reasonably practicable of the nature
of such claim and the Purchaser shall be entitled (but not required) to assume
the defence of any suit brought to enforce such claim. The defence of any such
claim (whether assumed by the Purchaser or not) shall be through legal counsel
and shall be conducted in a manner acceptable to the Vendor and the Purchaser,
acting reasonably, and no settlement may be made by the Purchaser or the Vendor
without the prior written consent of the others. If the Purchaser assumes the
defence of any claim, the Vendor and the Vendor's counsel shall co-operate with
the Purchaser and its counsel in the course of the defence, such co-operation to
include using reasonable best efforts to provide or make available to the
Purchaser and its counsel documents and information and witnesses for attendance
at examinations for discovery and trials. The reasonable legal fees and
disbursements and other costs of such defence shall be home by the Purchaser. If
the Purchaser assumes the defence of any claim and the Vendor retains additional
counsel to act on his behalf, then the Purchaser and its counsel shall
co-operate with the Vendor and their counsel, such co-operation to include using
reasonable best efforts to provide or make available to the Vendor and his
counsel documents and information and witnesses for attendance at examinations
for discovery and trials. All fees and disbursements of such additional counsel
shall be paid by the Vendor. If the Purchaser and the Vendor are to become
parties to the same action, and the representation of all parties by the same
counsel would be inappropriate due to a conflict of interest, then the Vendor
and the Purchaser shall be represented by separate counsel and, subject to the
indemnity obligations of the Purchaser as set out in paragraph 8.4, the costs
associated with the action shall be home by the party incurring such costs.
9.0 GENERAL
-------
9.1 Expenses All costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such expenses.
9.2 Time Time shall be of essence hereof.
9.3 Notices Any notice or other writing required or permitted to be given
hereunder or for the purposes hereof shall be sufficiently given if delivered or
telecopied to the party to whom it is given or if mailed, by prepaid registered
mail, addressed to such party at:
(a) if to the Purchaser at:
Xxxxx 000, 000 Xxxx Xxxxxx Xxxxxxxxx, X.X., X0X 0X0
Fax: (000) 000-0000
(b) if to the Vendor at:
Xxxxx 000, 000 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, X.X., X0X 0X0
Fax: (000) 000-0000
with a copy to the Vendors' Solicitors at:
13 00, 0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X., X0X 0X0
Fax: (000) 000-0000
or at such other address as the party to whom such writing is to be given shall
have last notified to the party giving the same in the manner provided in this
section. Any notice mailed as aforesaid shall be deemed to have been given and
received on the fifth business day next following the date of its mailing unless
at the time of mailing or within five business days thereafter there occurs a
postal interruption which could have the effect of delaying the mail in the
ordinary course, in which case any notice shall only be effectively given if
actually delivered or sent by telecopier. Any notice delivered or telecopied to
the party to whom it is addressed shall be deemed to have been given and
received on the day it was delivered; provided that if such day is not a
business day then the notice shall be deemed to have been given and received on
the business day next following such day.
9.4 Governing Law This Agreement shall be governed by and construed in
accordance with the laws of the Province of British Columbia and the parties
hereto submit and attorn to the jurisdiction of the Courts of the Province of
British Columbia.
9.5 Severability If any one or more of the provisions contained in this
Agreement should be invalid, illegal or unenforceable in any respect in any
jurisdiction, the validity, legality and enforceability of such provision or
provisions shall not in any way be affected or impaired thereby in any
jurisdiction and the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired
thereby, unless in either case as a result of such determination this Agreement
would fail in its essential purpose.
9.6 Entire Agreement This Agreement constitutes the entire agreement between the
parties hereto and supersedes all prior agreements and understandings, oral or
written, by and between any of the parties hereto with respect to the subject
matter hereof.
9.7 Further Assurances The parties hereto shall with reasonable diligence do all
such things and provide all such reasonable assurances as may be required to
consummate the transactions contemplated hereby, and each party hereto shall
provide such further documents or instruments required by the other party as may
be reasonably necessary or desirable to effect the purpose of this Agreement and
carry out its provisions whether before or after the Closing Date.
9.8 Enurement This Agreement and each of the terms and provisions hereof shall
enure to the benefit of and being upon the parties hereto and their respective
heirs, executors, administrators, personal representatives, successors and
assigns.
9.9 Counterparts This Agreement may be executed in as many counterparts as may
be necessary or by facsimile and each such agreement or facsimile so executed
shall be deemed to be an original and
such counterparts together shall constitute one and the same instrument. IN
WITNESS WHEREOF the parties have duly executed this Agreement as of the day and
year first above written.
The corporate seal of EURO INDUSTRIES
LTD. was hereunto affixed in the presence of-
---------------------------------------- ----------------------------------
Authorized Signatory XXXXXX PARENTE
---------------------------------------- ----------------------------------
Position
SIGNED, SEALED AND DELIVERED in the Presence of:
---------------------------------------- ----------------------------------
Signature of Witness XXXXX XXXXXXXXXXX
----------------------------------------
Address
----------------------------------------
Occupation
The corporate seal of DESTINY SOFTWARE
PRODUCTIONS INC. was hereunto affixed in
the presence of:
---------------------------------------- ----------------------------------
Authorized Signatory, XXXXX XXXXXXXXXXX
----------------------------------------
Position
This is page 22 of a Share Purchase Agreement dated 1999 among Xxxxxx
Xxxxxxxxxxx as vendor, Euro
DESTINY ASSETS:
o 4 computers AMD K62,128 Mb
o 1 Compaq server rack
o Misc. Office Furniture and workstations
o 1 imac
o all source code and libraries, artwork,, specifications, music and
other audio from software developed by Destiny
o all rights to: Creepers (DOS), Creepers (Amiga), Solitaire's Journey
(Amiga), Origanmo (DOS), Blood Bowl (DOS), Time Out Sports Baseball
(Windows), Time Out Sports Basketball (Windows), Dark Seed II
(Windows), Dark Seed II (Mac), Sports Illustrated Baseball (Windows)
o Skygames prototype, Seuss Crane prototype
o Internet casino prototype
o Internet tools: chat planet, email client, telnet client, internet
phone
o Radio Destiny receiver, Destiny Station broadcaster, Destiny MP3 player
o Audio compression technology (DNY format)
o Video compression technology (in development)
Schedule 1. I (d)
Financial Statements of Destiny Software Productions Ltd.
Destiny Software Productions Inc.
Balance Sheet
As of May 28,1999
May 28,'99
ASSETS
Current Assets
Chequing/Savings
1080 - Royal Bank 0000000 -12,350.68
Total Chequing/Savings -12,350.68
Other Current Assets
1580 - Prepaid Expenses 13,273.50
Total Other Current Assets 13,273.50
Total Current Assets 922.82
Fixed Assets
1610 - Computer Hardware NET
1612 - Computer Hardware 18,691.22
Total 1610 - Computer Hardware NET 18,691.22
1620 - Computer Software NET
1622 - Computer Software 2,845.75
Total 1620 - Computer Software NET 2,845.75
1630 - Furniture & Equipment NET
1632 - Furniture & Equipment 7,656.39
Total 1630 - Furniture & Equipment NET 7,656.39
1640. Leasehold Improvements NET
1642 - Leasehold Improvements 674.00
Total 1640 - Leasehold Improvements NET 674.00
Total Fixed Assets 29,867.36
Other Assets
1700 - DTMB
1725 - DTMB Marketing 6,582.88
Total 1700 - DTMB 6,582.88
1750 - MP3
1765 - MP3 Interface Design 2,000.00
1776 - MP3 - Programming 7,015.34
Total 1750 - MP3 9,015.34
1800 - WEB Clip
1815 - WEB Clip - Programming 2,655.00
Total 1800 - WEB Clip 2,655.00
Total Other Assets 18,253.22
TOTAL ASSETS 49,043.40
LIABILITIES & EQUITY
Liabilities
Current Liabilities
Credit Cards
2010 - Royal Bank LOC 1,435.00
2020 - Royal Bank VISA -107.25
Total Credit Cards 1,327.75
Other Current Liabilities
2090 - AP and Accrued Liabilities 3,858.00
2210 - GST Owing (Refund) -4,023.52
Total Other Current Liabilities -165.52
Total Current Liabilities 1,162.23
Long Term Liabilities
2300 - Due to Shareholder 55.00
2310 - Shareholder Loans lu8,461.00
Total Long Term Liabilities 108,516.00
Total Liabilities 109,678.23
Schedule 3.1(u)
Material Contracts
None
Schedule 3.1(as)
Banking Information
Royal Bank of Canada
00000 Xxxx Xxxxxx Xxxxxxx
Xxxxxx, X.X.
Account No. 000-000-0
Authorized Signatory: Xxxxx Xxxxxxxxxxx
