SHARE PURCHASE AGREEMENTPurchase and Sale Agreement |
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CIGNUS VENTURES INC. | 8275 S Eastern Avenue, Suite 200, Las Vegas, NV | CIGNUS VENTURES INC | CITIGLOBAL LTD | PRIVATE LTD | SMARTLINX ACQUISITION CORP | SMARTLINX VOIP NETWORKS PRIVATE LIMITED. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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THIS AGREEMENT is dated for reference as of the 20th day of August, 2009. AMONG:
OF THE FIRST PART AND:
OF THE SECOND PART AND:
OF THE THIRD PART AND:
OF THE FOURTH PART AND:
OF THE FIFTH PART A. The Purchaser has offered to purchase all of the issued and outstanding shares of the Company; B. The Vendor has agreed to sell to the Purchaser all of the issued and outstanding shares of the Company held by the Vendor on the terms and conditions set forth herein; C. As additional consideration for the sale of the shares of the Company to the Purchaser, the Principal Shareholder has agreed to transfer to the Vendor certain shares of the Purchaser; and D. The parties wish to enter into this Agreement in order to record the terms and conditions of the agreement among them the parties. NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the foregoing and of the sum of $1.00 paid by the Purchaser to the Vendor and to the Company, the receipt of which is hereby acknowledged, the parties hereto agree each with the other as follows: 1. INTERPRETATION 1.1 Where used herein or in any amendments or Schedules hereto, the following terms shall have the following meanings:
1.2 All dollar amounts referred to in this Agreement are in United States funds, unless expressly stated otherwise. 1.3 The following schedules are attached to and form part of this Agreement:
2. SHARE EXCHANGE AND PURCHASE OF SHARES 2.1 The Vendor hereby covenants and agrees to sell, assign and transfer to the Purchaser, and the Purchaser covenants and agrees to purchase from the Vendor, the Company Shares. 2.2 In consideration for the sale of the Company Shares by the Vendor to the Purchaser, Cignus shall:
2.3 As additional consideration for the Vendor entering into this Agreement and completing the sale of the Company Shares to the Purchaser, the Principal Shareholder agrees to transfer the Principal Shares (10,000,000 shares in the common stock of the Purchaser) to the Vendor on the Closing Date for and at an aggregate price of $10,000. 2.4 The Vendor acknowledges that the Cignus Shares are “restricted securities” within the meaning of the Securities Act and will be issued to the Vendor in accordance with Regulation S of the Securities Act. Any certificates representing the Cignus Shares will be endorsed with the following legend in accordance with Regulation S of the Securities Act:
2.5 The Vendor acknowledges that the Cignus Warrants and the securities to be issued upon their exercise are “restricted securities” within the meaning of the Securities Act and will be issued to the Vendor in accordance with Regulation S of the Securities Act. Any certificates representing the Cignus Warrants will be endorsed with the following legend in accordance with Regulation S of the Securities Act:
3. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE VENDOR The Company and the Vendor jointly and severally covenant with and acknowledge, represent and warrant to Cignus, the Purchaser and the Principal Shareholder as follows, and acknowledge that Cignus, the Purchaser and the Principal Shareholder relying upon such covenants, acknowledgements, representations and warranties in connection with the purchase by the Purchaser of the Company Shares, the issuance by Cignus of the Cignus Shares and the Cignus Warrants and the transfer by the Principal Shareholder of the Principal Shares: 3.1 The Company has been duly incorporated and organized, is a validly existing company with limited liability and is in good standing under the laws of India; it has the corporate power to own or lease its property and to carry on the Business; it is duly qualified as a company with limited liability to do business and is in good standing with respect thereto in each jurisdiction in which the nature of the Business or the property owned or leased by it makes such qualification necessary; and it has all necessary licenses, permits, authorizations and consents to operate its Business in accordance with the terms of its business plan. 3.2 The total share capital of the Company consists of 1,500,000 equity shares, with a par value of Rs 10, of which 10,000 equity shares are issued and outstanding. 3.3 The Vendor is the legal, beneficial and recorded owner of the Company Shares, and has good and marketable title thereto, free and clear of all mortgages, liens, charges, security interests, adverse claims, pledges, encumbrances and demands whatsoever. 3.4 No person, firm or corporation has any agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase from the Vendor of any of the Company Shares. 3.5 No person, firm or corporation has any agreement or option, including convertible securities, warrants or convertible obligations of any nature, or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase, 3.6 The Company does not have any subsidiaries or agreements of any nature to acquire any subsidiary or to acquire or lease any other business operations and will not prior to the Closing Date acquire, or agree to acquire, any subsidiary or business without the prior written consent of the Purchaser. 3.7 The Company will not, without the prior written consent of the Purchaser, issue any additional shares or ownership interest in the Company from and after the date hereof to the Closing Date or create any options, warrants or rights for any person to subscribe for or acquire any unissued shares in the capital of the Company or ownership interest in the Company. 3.8 The Company is not a party to or bound by any guarantee, warranty, indemnification, assumption or endorsement or any other like commitment of the obligations, liabilities (contingent or otherwise) or indebtedness of any other person, firm or corporation. 3.9 The books and records of the Company fairly and correctly set out and disclose in all material respects, in accordance with generally accepted accounting principles, the financial position of the Company as at the date hereof, and all material financial transactions of the Company relating to the Business have been accurately recorded in such books and records. 3.10 The Company Financial Statements present fairly the assets, liabilities (whether accrued, absolute, contingent or otherwise) and the financial condition of the Company as at the date thereof and there will not be, prior to the Closing Date, any material increase in the liabilities of the Company other than increases arising as a result of carrying on the Business in the ordinary and normal course. 3.11 The entering into of this Agreement and the consummation of the transactions contemplated hereby will not result in the violation of any of the terms and provisions of the constating documents or bylaws of the Company or of any indenture, instrument or agreement, written or oral, to which the Company or the Vendor may be a party. 3.12 The entering into of this Agreement and the consummation of the transactions contemplated hereby will not, to the best of the knowledge of the Company and the Vendor, result in the violation of any law or regulation of India or of any states in which they are resident or in which the Business is or at the Closing Date will be carried on or of any local laws, municipal bylaws or ordinances to which the Company or the Business may be subject. 3.13 This Agreement has been duly authorized, validly executed and delivered by the Company and the Vendor. 3.14 The Business has been carried on in the ordinary and normal course by the Company since the date of the Company Financial Statements and will be carried on by the Company in the ordinary and normal course after the date hereof and up to the Closing Date. 3.15 No capital expenditures in excess of $5,000 have been made or authorized by the Company since the date of the Company Financial Statements and no capital expenditures in excess of $5,000 will be made or authorized by the Company after the date hereof and up to the Closing Date without the prior written consent of the Purchaser. 3.16 Except as disclosed in the Schedules hereto, the Company is not a party to any written or oral employment, service, consulting or pension agreement, and, the Company does not have any employees or consultants who cannot be dismissed on not more than one months notice without further liability. 3.17 The Company does not have outstanding any bonds, debentures, mortgages, notes, loans or other indebtedness, and the Company is not under any agreement to create or issue any bonds, debentures, mortgages, notes or other indebtedness, except liabilities incurred in the ordinary course of business. 3.18 Except as disclosed in the Schedules hereto, the Company is not the owner or lessee of, and is not under any agreement to own or lease, any real property. 3.19 Except as disclosed in the Schedules hereto, the Company owns, possesses and has good and marketable title to its undertaking, property and assets, and without restricting the generality of the foregoing, all those assets described in the balance sheet included in the Company Financial Statements, free and clear of any and all mortgages, liens, pledges, charges, security interests, encumbrances, actions, claims or demands of any nature whatsoever or howsoever arising. 3.20 The Company has its property insured against loss or damage by all insurable hazards or risks on a replacement cost basis and such insurance coverage will be continued in full force and effect to and including the Closing Date; to the best of the knowledge of the Company and the Vendor, the Company is not in default with respect to any of the provisions contained in any such insurance policy and has not failed to give any notice or present any claim under any such insurance policy in due and timely fashion. 3.21 The Company does not have any outstanding material agreements, contracts or commitments, whether written or oral, of any nature or kind whatsoever, including, but not limited to, employment, service, consulting or pension agreements, other than those agreements expressly listed in the Schedules hereto or otherwise expressly disclosed in this Agreement. 3.22 Except as provided in the Schedules hereto, there are no actions, suits or proceedings (whether or not purportedly on behalf of the Company), pending or threatened against or affecting the Company or affecting the Business, at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign and neither the Company nor the Vendor are aware of any existing ground on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success. 3.23 The Company is not in material default or breach of any contracts, agreements, written or oral, indentures or other instruments to which it is a party and there are no facts, which, after notice or lapse of time or both, that would constitute such a default or breach, and all such contracts, agreements, indentures or other instruments are now in good standing and the Company is entitled to all benefits thereunder. In particular, the Company’s agreement dated January 27, 2009 with Bharat Sanchar Nigam Limited is in good standing. 3.24 The Company has the right to use all of the intellectual property necessary to conduct the Business, including, but not limited to, the patents, trademarks, trade names and copyrights both domestic and foreign, set out in the Schedules hereto. 3.25 To the best of the knowledge of the Company and the Vendor, the conduct of the Business does not infringe upon the patents, trademarks, trade names or copyrights, domestic or foreign, of any other person, firm or corporation. 3.26 To the best of the knowledge of the Company and the Vendor, the Company is conducting, and will conduct, the Business in compliance with all applicable laws, rules and regulations of each jurisdiction in which the Business is, or will be, carried on, the Company is not in material breach of any such laws, rules or regulations and is, or will be on the Closing Date, fully licensed, registered or qualified in each jurisdiction in which the Company owns or leases property or carries on, or proposes to carry on, the Business to enable the Business to be carried on as now conducted and its property and assets to be owned, leased and operated, and all such licenses, registrations and qualifications are or will be on the Closing Date valid and subsisting and in good standing and that none of the same contains or will contain any provision, condition or limitation which has or may have a materially adverse effect on the operation of the Business. 3.27 All facilities and equipment owned or used by the Company in connection with the Business are in good operating condition and are in a state of good repair and maintenance. 3.28 Except as disclosed in the Company Financial Statements and the Schedules hereto, and except for salaries incurred in the ordinary course of business since the date thereof, the Company has no loans or indebtedness outstanding which have been made to or from directors, former directors, officers, shareholders and employees of the Company or to any person or corporate body not dealing at arm's length with any of the foregoing, and will not, prior to closing, pay any such indebtedness unless in accordance with budgets agreed in writing by the Purchaser. 3.29 The Company and the Vendor have made full disclosure to Cignus, the Purchaser and the Principal Shareholder of all aspects of the Business and has made all of its books and records available to the representatives of Cignus, the Purchaser and the Principal Shareholder in order to assist Cignus, the Purchaser and the Principal Shareholder in the performance of its due diligence searches and no material facts in relation to the Business have been concealed by the Company or the Vendor. 3.30 There are no material liabilities of the Company of any kind whatsoever, whether or not accrued and whether or not determined or determinable, in respect of which the Company or the Purchaser may become liable on or after the consummation of the transaction contemplated by this Agreement, other than liabilities which may be reflected on the Company Financial Statements, liabilities disclosed or referred to in this Agreement or in the Schedules attached hereto, or liabilities incurred in the ordinary course of business and attributable to the period since the date of the Company Financial Statements, none of which has been materially adverse to the nature of the Business, results of operations, assets, financial condition or manner of conducting the Business. 3.31 The total liabilities of the Company do not exceed $150,000. As at March 31, 2009, the Company was indebted to Nettlinx Limited in the amount of $137,608, bearing interest at a rate of six percent (6%) per annum. 3.32 The Memorandum of Association, Articles of Association and other constating documents of the Company in effect with the appropriate corporate authorities as at the date of this Agreement will remain in full force and effect without any changes thereto as at the Closing Date. 3.33 The directors and officers of the Company are as follows:
3.34 The Vendor is not a “U.S. Person” as defined by Regulation S of the Securities Act and is not acquiring the Cignus Shares, the Cignus Warrants and the Principal Shares for the account or benefit of such a U.S. Person. 3.35 The Vendor represents and warrants to Cignus, the Purchaser and the Principal Shareholder that it is acquiring the Cignus Shares, the Cignus Warrants and the Principal Shares for investment purposes only, with no present intention of dividing its interest with others or reselling or otherwise disposing of any or all of the Cignus Shares, the Cignus Warrants and the Principal Shares. 3.36 The Vendor was not in the United States at the time the offer to acquire the Cignus Shares, the Cignus Warrants and the Principal Shares was received. 4. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND CIGNUS The Purchaser and Cignus covenant with and represent and warrant to the Vendor and the Company as follows and acknowledge that the Vendor are relying upon such covenants, representations and warranties in entering into this Agreement: 4.1 The Purchaser has been duly incorporated and organized and is validly subsisting under the laws of the State of Nevada; it has the corporate power to own or lease its properties and to carry on its business as now being conducted by it; and it is duly qualified as a corporation to do business and is in good standing with respect thereto in each jurisdiction in which the nature of its business or the property owned or leased by it makes such qualification necessary. 4.2 Cignus has been duly incorporated and organized and is validly subsisting under the laws of the State of Nevada; it is a reporting issuer under the Exchange Act and is in good standing with respect to all filings required to be made under such statutes with the SEC; it has the corporate power to own or lease its properties and to carry on its business as now being conducted by it; and it is duly qualified as a corporation to do business and is in good standing with respect thereto in each jurisdiction in which the nature of its business or the property owned or leased by it makes such qualification necessary. 4.3 The authorized capital of Cignus consists of 200,000,000 shares with a par value of $0.001 per share, 100,000,000 shares of which are common stock and 100,000,000 shares of which are preferred stock. There are 16,000,000 shares of common stock currently issued and outstanding as fully paid and non-assessable shares and no shares of preferred stock issued and outstanding. 4.4 No person, firm or corporation has any agreement or option, including convertible securities, warrants or convertible obligations of any nature, or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of Cignus or the Purchaser. 4.5 Except for Cignus completing a private placement of 2,500,000 units at a price of $0.02 per unit, with each unit consisting of one share of Cignus’ common stock and one share purchase warrant exercisable at $0.02 per share, Cignus and the Purchaser will not, without the prior written consent of the Vendor, issue any additional shares from and after the date hereof to the Closing Date or create any options, warrants or rights for any person to subscribe for any unissued shares in the capital of Cignus and the Purchaser. 4.6 The directors and officers of the Purchaser are as follows:
4.7 The directors and officers of Cignus are as follows:
4.8 The Cignus Audited Financial Statements present fairly the assets, liabilities (whether accrued, absolute, contingent or otherwise) and the financial condition of Cignus as at the date thereof. 4.9 The Cignus Unaudited Financial Statements present fairly the assets, liabilities (whether accrued, absolute, contingent or otherwise) and the financial condition of Cignus as of the date thereof and there will not be, prior to the Closing Date, any material increase in the liabilities of Cignus. 4.10 There have been no material adverse changes in the financial position or condition of Cignus or damage, loss or destruction materially affecting the business or property of Cignus from the date of the Cignus Unaudited Financial Statements to the Closing Date except as may be disclosed by Cignus in Current Reports on Form 8-K filed with the SEC. 4.11 Cignus and the Purchaser have made full disclosure to the Vendor of all material aspects of Cignus and the Purchaser’s business and has made all of its books and records available to the representatives of the Vendor in order to assist the Vendor in the performance of its due diligence searches and no material facts in relation to Cignus and the Purchaser’s business have been concealed by Cignus and the Purchaser. 4.12 Neither Cignus nor the Purchaser is a party to or bound by any agreement or guarantee, warranty, indemnification, assumption or endorsement or any other like commitment of the obligations, liabilities (contingent or otherwise) or indebtedness of any other person, firm or corporation. 4.13 Except as disclosed in the Schedules attached hereto, there are no actions, suits or proceedings (whether or not purportedly on behalf of Cignus or the Purchaser), pending or threatened against or affecting Cignus, the Purchaser or their business, at law or in equity, or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign and Cignus and the Purchaser are not aware of any existing ground on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success. 4.14 Cignus' common shares are quoted on the FINRA OTC Bulletin Board and Cignus is not in breach of any regulation, by-law or policy of, or any of the terms and conditions of its quotation on the FINRA OTC Bulletin Board applicable to Cignus or its operations. 4.15 Neither Cignus nor the Purchaser currently have any employees and is not party to any collective agreements with any labour unions or other association of employees. 4.16 Other than the Purchaser and CVI Exploration Ltd., Cignus does not have any subsidiaries or agreements of any nature to acquire any subsidiary or to acquire or lease any other business operations and will not prior to the Closing Date acquire, or agree to acquire, any subsidiary or business without the prior written consent of the Company. 4.17 The business of Cignus and the Purchaser now and until the Closing Date will be carried on in the ordinary and normal course after the date hereof and upon to the Closing Date and no material transactions shall be entered into until the Closing Date without the prior written consent of the Vendor. 4.18 No liability, cost or expense will be incurred or payable by Cignus or the Purchaser in connection with the disposition of any of its properties. 4.19 Neither Cignus nor the Purchaser is indebted to any of its directors or officers nor are any of Cignus or the Purchaser’s directors or officers indebted to them. 4.20 Cignus and the Purchaser has good and marketable title to its properties and assets as set out in Cignus Audited Financial Statements and such properties and assets are not subject to any mortgages, pledges, liens, charges, security interests, encumbrances, actions, claims or demands of any nature whatsoever or howsoever arising. 4.21 The Corporate Charter, Articles of Incorporation and Bylaws and any other constating documents of Cignus and the Purchaser in effect with the appropriate corporate authorities as at the date of this Agreement will not have been materially changed as at the Closing Date. 4.22 Except for liabilities accrued in connection with legal, auditing and accounting expenses for the preparation of this Agreement and in order to complete the closing of the transactions contemplated therein, there are no material liabilities of Cignus and the Purchaser of any kind whatsoever, whether or not accrued and whether or not determined or determinable, in respect of which Cignus, the Purchaser or the Company may become liable on or after the consummation of the transaction contemplated by this Agreement, other than liabilities which may be reflected on the Cignus Audited Financial Statements, liabilities disclosed or referred to in this Agreement or in the Schedules attached hereto, or liabilities incurred in the ordinary course of business and attributable to the period since the date of the Cignus Audited Financial Statements, none of which has been materially adverse to the nature of Cignus or the Purchaser's business, results of operations, assets, financial condition or manner of conducting Cignus or the Purchaser's business. 4.23 The total liabilities of CVI Exploration Ltd., a wholly-owned subsidiary of Cignus, do not exceed $1,000 and CVI Exploration Ltd. is in the process of being dissolved by the Registrar of Companies. 4.24 The entering into of this Agreement and the consummation of the transactions contemplated hereby will not result in the violation of any of the terms and provisions of the constating documents or bylaws of Cignus or the Purchaser or of any indenture, instrument or agreement, written or oral, to which Cignus or the Purchaser may be a party. 4.25 The entering into of this Agreement and the consummation of the transactions contemplated hereby will not, to the best of the knowledge of Cignus, result in the violation of any law or regulation of the United States or the State of Nevada or of any local government bylaw or ordinance to which Cignus, the Purchaser or their business may be subject. 4.26 This Agreement has been duly authorized, validly executed and delivered by Cignus or the Purchaser. 4.27 Neither Cignus nor the Purchaser have contracts with any officers, directors, accountants, lawyers or others which cannot be terminated with not more than one month's notice. 4.28 No agreement has been made with Cignus or the Purchaser in respect of the purchase and sale contemplated by this Agreement that could give rise to any valid claim by any person against the Company or the Vendor for a finder's fee, brokerage commission or similar payment. 4.29 Cignus, the Purchaser and the Principal Shareholder were given the opportunity to inspect and carry out due diligence searches on the Company and the Vendor. 5. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE PRINCIPAL SHAREHOLDER The Principal Shareholder covenants with and represents and warrants to the Vendor and the Company as follows and acknowledges that the Vendor is relying upon such covenants, representations and warranties in entering into this Agreement: 5.1 The Principal Shares are owned by the Principal Shareholder as the beneficial and recorded owner with good and marketable title thereto, free and clear of all mortgages, liens, charges, security interests, adverse claims, pledges, encumbrances and demands whatsoever. 5.2 The Principal Shares shall indemnify and hold the Company and the Vendor harmless from any liabilities arising from CVI Exploration Inc. 6. ACTS IN CONTEMPLATION OF CLOSING 6.1 The Company covenants and agrees with Cignus, the Purchaser and the Principal Shareholder to, prior to or on the Closing Date, deliver to Cignus and the Purchaser those audited and unaudited financial statements of the Company as are required by Regulation S-K of the SEC in order to permit Cignus to make the SEC filings required in respect of the purchase and sale of the shares of the Company in accordance with this Agreement, inclu | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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