ASSET PURCHASE AGREEMENT BETWEEN IBSG INTERNATIONAL.INC., a Florida corporation AND GALAXY FIVE (PTY), LTD., a corporation incorporated under the laws of the South African government, Johannesburg DATED March 18, 2006
EXHIBIT
2.2
BETWEEN
IBSG
▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇.,
a
Florida corporation
AND
GALAXY
FIVE (PTY), LTD.,
a
corporation incorporated under the laws of the South African government,
Johannesburg
DATED
March
18, 2006
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This
ASSET PURCHASE AGREEMENT (the "Agreement")
is
made and entered into as of 18th
day of
March, 2006 by and among and IBSG INTERNATIONAL, Inc. a Florida corporation
and
its affiliates, (“IGII”),
and
GALAXY FIVE (PTY) LTD., a corporation incorporated under the laws of the South
African government, Johannesburg and its affiliates (“GFL”).
PRELIMINARY
STATEMENT:
WHEREAS,
GFL is
a company that is primarily as a Business Consultant firm working with Global
Eagle Strategic Empowerment Alliance Systems designated as a black empowered
firm in South Africa whose principle share holder is BAE Systems; and who has
various projects in Africa; and
WHEREAS,
IGII is
a fully reporting public company presently listed on the NASD OTC Bulletin
Board; and
WHEREAS,
GFL is
desirous of acquiring the asset known as the CAC contract in Nigeria and all
associated Asset from IGII in exchange for payments and other enumerated
consideration, subject to the terms and conditions stated herein;
and
WHEREAS,
the
parties intend to memorialize the purchase and sale of the Asset from IGII
to
GFL upon the terms and subject to the conditions set forth herein.
NOW,
THEREFORE,
in
consideration of the mutual covenants and premises contained herein, and for
other good and valuable consideration, the receipt and adequacy of which are
hereby conclusively acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
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ARTICLE
I
SALE
AND PURCHASE OF IGII’S ASSET
AND
PURCHASE PRICE
SECTION
1.1 Sale
of ASSET.
Upon
the terms and subject to the conditions set forth in this Agreement, and in
accordance with applicable law, at the Closing on the Closing Date (as those
terms are defined in Section 2.1 hereof), IGII agrees to sell, assign, transfer,
convey and deliver to GFL, and GFL agrees to purchase and acquire all of IGII’s
right, title and interest in and to the asset known as the CAC contract in
Nigeria and all associated Asset as listed on Attachment
A and
incorporated herein (the “Asset”).
SECTION
1.2 Purchase
Price.
The
purchase price to be paid by GFL for the Asset is
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3.
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A
payment of One Million Dollars ($1,000,000) for each year of the
life of
the Asset, but no less than four (4) years, payable pursuant to the
terms
listed on Schedule
A
herein (the “Purchase
Price”);
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4.
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An
additional payment of Fifteen Million Dollars ($15,000,000), such
payment
to be generated from the additional revenue arising from the Asset
over
and above the license fees under the South African project (the
“Additional
Purchase Price”).
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ARTICLE
II
CLOSING
DATE AND DELIVERIES AT CLOSING
SECTION
2.1 Closing
Date The
closing of the transactions contemplated by this Agreement (the “Closing”),
unless expressly determined herein, shall be held at the offices of IGII at
10:00 A.M. EST local time, on March 18, 2006, or on such other date and at
such
other place as may be mutually agreed by the parties, including closing by
facsimile with originals to follow. The date of the Closing is sometimes
referred to herein as the “Closing
Date.”
SECTION
2.2 Deliveries
by IGII.
In
addition to and without limiting any other provision of this Agreement, IGII
agrees to deliver, or cause to be delivered, to GFL, at or prior to Closing,
the
following:
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(d)
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The
Asset; and
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(e)
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such
other documents or certificates as shall be reasonably requested
by GFL or
its counsel.
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SECTION
2.3 Deliveries
by GFL. In
addition to and without limiting any other provision of this Agreement, GFL
agrees to deliver, or cause to be delivered to IGII, at or prior to Closing,
the
following:
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(c)
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The
Purchase Price required to be delivered on or before Closing pursuant
to
Section 1.2 hereof; and
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(d)
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such
other documents or certificates as shall be reasonably requested
by IGII
or its counsel.
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SECTION
2.4 Further
Assurances.
IGII
and GFL, shall, upon request, on or after the Closing Date, cooperate with
each
other by furnishing any additional information, executing and delivering any
additional documents and/or other instruments and doing any and all such things
as may be reasonably required by the parties or their counsel to consummate
or
otherwise implement the transactions contemplated by this Agreement, including
but not limited to an accounting of the revenues generated from the Asset,
such
obligation to cease upon full payment of the additional purchase price and
an
accounting of finances as long as GFL is obligated to pay the Purchase Price.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF IGII
IGII
represents and warrants to GFL (which warranties and representations shall
survive the Closing regardless of what examinations, inspections, audits and
other investigations GFL has heretofore made or may hereinafter make with
respect to such warranties and representations) as follows:
SECTION
3.1 Organization
and Qualification.
IGII is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Florida, and has the requisite corporate power and
authority to own, lease and operate its properties and to carry on its business
as it is now being conducted and is duly qualified to do business in any other
jurisdiction by virtue of the nature of the businesses conducted by it or the
ownership or leasing of its properties, except where the failure to be so
qualified will not, when taken together with all other such failures, have
a
material adverse effect on the business, operations, properties, Asset,
financial condition or results of operation of IGII and its subsidiaries, if
any, taken as a whole. (Any such material adverse effect being hereinafter
referred to as "IGII
Material Adverse Effect").
SECTION
3.2 Authority.
IGII
has all requisite corporate power and authority, to execute and deliver this
Agreement, to perform his obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by IGII and the consummation of the transactions contemplated hereby have been
duly authorized by all necessary corporate action and no other corporate
proceedings on the part of IGII is necessary to authorize this Agreement or
to
consummate the transactions contemplated hereby except as disclosed in this
Agreement. This Agreement has been duly executed and delivered by IGII and
constitutes the legal, valid and binding obligation of IGII enforceable against
IGII in accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium, or other similar laws affecting the
enforcement of creditors' rights generally and general principles of equity.
IGII holds all licenses, certificates, permits, franchises and rights from
all
appropriate federal, state or other public authorities necessary for the conduct
of its business and the use of the Asset and all such licenses, certificates,
permits, franchises and rights will inure to the benefit of GFL upon
consummation of the transactions contemplated by this Agreement.
SECTION
3.3 No
Conflict; Required Filings and Consents. The
execution and delivery of this Agreement by IGII does not, and the performance
by IGII of its obligations hereunder will not: (i) conflict with or violate
the
Articles of Incorporation or By-Laws of IGII; (ii) conflict with, breach or
violate any federal, state, foreign or local law, statute, ordinance, rule,
regulation, order, judgment or decree (collectively, "Laws")
in
effect as of the date of this Agreement and applicable to IGII; or (iii) result
in any breach of, constitute a default (or an event that with notice or lapse
of
time or both would become a default) under, give to any other entity any right
of termination, amendment, acceleration or cancellation of, require payment
under, or result in the creation of a lien or encumbrance on any of the
properties or Asset of IGII pursuant to, any note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise or other instrument
or
obligation to which IGII is a party or by IGII or any of its properties or
Asset
is bound. Excluding from the foregoing are such violations, conflicts, breaches,
defaults, terminations, accelerations, creations of liens, or incumbency that
would not, in the aggregate, have a IGII Material Adverse Effect.
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SECTION
3.4 Litigation.
There is
no suit, action, proceeding (in bankruptcy or otherwise), claim or investigation
pending or threatened against, or affecting, IGII and there exists no basis
or
grounds for any such suit, action, proceeding, claim or investigation,
individually or in the aggregate, if resulting in a judgment, would have a
materially adverse effect on the Asset or the right of IGII to consummate the
transactions contemplated hereby.
SECTION
3.5 Ownership
of Asset.
IGII
has good and marketable title to the Asset, free and clear of any liens, claims,
charges, options, rights of tenants or other encumbrances. IGII has not received
any notice of violation of any applicable zoning regulation, ordinance or law,
or other law, regulation or requirement relating to the operations and
properties of IGII’s business, whether owned or leased, and there is no such
violation or grounds therefor which could adversely affect the Asset. Except
pursuant to this Agreement, IGII is not a party to any contract or obligation
whereby there has been granted to anyone an absolute or contingent right to
purchase, obtain or acquire any rights in the Asset.
SECTION
3.6 Full
Disclosure.
No
representation or warranty made by IGII in this Agreement and no certificate
or
document furnished or to be furnished to GFL pursuant to this Agreement contains
or will contain any untrue statement of a material fact, or omits or will omit
to state a material fact necessary to make the statements contained herein
or
therein not misleading.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF GFL
GFL
represents and warrants to the IGII (which warranties and representations shall
survive the Closing regardless of what examinations, inspections, audits and
other investigations IGII has heretofore made or may hereinafter make with
respect to such warranties and representations) as follows:
SECTION
4.1 Organization
and Qualification.
GFL is
duly organized, validly existing and in good standing under the laws of the
Jurisdiction of Incorporation, and has the requisite corporate power and
authority to own, lease and operate its properties and to carry on its business
as it is now being conducted.
SECTION
4.2 Authority.
GFL has
all requisite corporate power and authority to execute and deliver this
Agreement, to perform the obligations hereunder and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by GFL and the consummation of the transactions contemplated hereby have been
duly authorized by all necessary corporate action and no other corporate
proceedings on the part of GFL is necessary to authorize this Agreement or
to
consummate the transactions contemplated hereby. This Agreement has been duly
executed and delivered by GFL and constitutes the legal, valid and binding
obligation of GFL enforceable against GFL in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium, or
other similar laws affecting the enforcement of creditors' rights generally
and
general principles of equity.
SECTION
4.3 No
Conflict; Required Filings and Consents.
The
execution and delivery of this Agreement by GFL does not, and the performance
by
GFL of its obligations hereunder will not: (i) conflict with or violate the
Articles of Incorporation or By-Laws of GFL; or (ii) conflict with, breach
or
violate any Laws in effect as of the date of this Agreement and applicable
to
GFL.
SECTION
4.4 Successors,
Assigns and Designees.
GFL
makes no representations or warranties about any of its shareholders,
successors, assigns and/or designees who may receive or become the beneficiary
of any of the rights and/or obligations set forth hereunder.
SECTION
4.5 Brokers.
No
broker, finder or investment banker is entitled to any brokerage, finder's
or
other fee or commission in connection with the transactions contemplated by
this
Agreement based upon arrangements made by or on behalf of GFL.
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SECTION
4.6 Full
Disclosure.
No
representation or warranty made by GFL in this Agreement and no certificate
or
document furnished or to be furnished to IGII pursuant to this Agreement
contains or will contain any untrue statement of a material fact, or omits
or
will omit to state a material fact necessary to make the statements contained
herein or therein not misleading.
ARTICLE
V
CONDITIONS
PRECEDENT TO IGII’S OBLIGATIONS
The
obligation of the IGII to consummate the transactions contemplated hereby shall
be subject to the fulfillment, on or prior to Closing Date, of the following
conditions:
SECTION
5.1 No
Termination.
This
Agreement shall not have been terminated pursuant to Article 7
hereof.
SECTION
5.2 Representations
True and Correct.
The
representations and warranties of GFL contained in this Agreement shall be
true
and correct in all material respects on and as of the Closing Date with the
same
force and effect as if made on as of the Closing Date.
SECTION
5.3 Compliance
with Covenants.
GFL
shall have performed and complied in all material respects with all covenants,
agreements, and conditions required by this Agreement to be performed or
complied by it prior to or at the Closing Date.
SECTION
5.4 No
Adverse Proceedings. On
the
Closing Date, no action or proceeding shall be pending by any public authority
or individual or entity before any court or administrative body to restrain,
enjoin, or otherwise prevent the consummation of this Agreement or the
transactions contemplated hereby or to recover any damages or obtain other
relief as a result of the transactions proposed hereby.
ARTICLE
VI
CONDITIONS
PRECEDENT TO GFL’S OBLIGATIONS
The
obligation of GFL to consummate the transactions contemplated hereby shall
be
subject to the fulfillment, on or prior to Closing Date unless specified
otherwise, of the following conditions:
SECTION
6.1 No
Termination.
This
Agreement shall not have been terminated pursuant to Article 7
hereof.
SECTION
6.2 Representations
True and Correct.
The
representations and warranties of IGII contained in this Agreement shall be
true
and correct in all material respects on and as of the Closing Date with the
same
force and effect as if made on as of the Closing Date.
SECTION
6.3 Compliance
with Covenants.
IGII
shall have performed and complied in all material respects with all covenants,
agreements, and conditions required by this Agreement to be performed or
complied by it prior to or at the Closing Date.
SECTION
6.4 No
Adverse Proceedings. On
the
Closing Date, no action or proceeding shall be pending by any public authority
or individual or entity before any court or administrative body to restrain,
enjoin, or otherwise prevent the consummation of this Agreement or the
transactions contemplated hereby or to recover any damages or obtain other
relief as a result of the transactions proposed hereby.
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ARTICLE
VII
TERMINATION,
AMENDMENT AND WAIVER
SECTION
7.1 Termination.
This
Agreement may be terminated at any time prior to the Effective
Time:
(a) by
mutual
written consent of GFL and IGII; or
(b) by
IGII
upon a material breach of any representation, warranty, covenant or agreement
on
the part of GFL set forth in this Agreement, or GFL upon a material breach
of
any representation, warranty, covenant or agreement on the part of IGII set
forth in this Agreement, or if any representation or warranty of IGII or GFL,
respectively, shall have become untrue, in either case such that any of the
conditions set forth in Article V or Article VI hereof would not be satisfied
(a
“Terminating
Breach"),
and
such breach shall, if capable of cure, not have been cured within ten (10)
days
after receipt by the party in breach of a notice from the non-breaching party
setting forth in detail the nature of such breach; or
(c) by
either
IGII or GFL, if there shall be any court order which has become final and
nonappealable, except if the party seeking to terminate this Agreement pursuant
to this Section 7.1(c) has not complied with its obligations under Section
6 or
7 respectively.
SECTION
7.2 Effect
of Termination.
In the
event of the termination of this Agreement pursuant to Section 7.1(a) or 7.1(c)
hereof, there shall be no liability on the party of IGII or GFL or any of their
respective officers, directors, agents or other representatives and all rights
and obligations of any party hereto shall cease, except as expressed
herein.
SECTION
7.3 Amendment.
This
Agreement may be amended by the parties hereto any time prior to the Closing
Date by an instrument in writing signed by the parties hereto.
SECTION
7.4 Waiver.
At any
time prior to the Closing Date, IGII or GFL, as appropriate, may: (a) extend
the
time for the performance of any of the obligations or other acts of other party
or; (b) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto which have been made to
it
or them; or (c) waive compliance with any of the agreements or conditions
contained herein for its or their benefit. Any such extension or waiver shall
be
valid only if set forth in an instrument in writing signed by the party or
parties to be bound hereby.
ARTICLE
VIII
POST
CLOSING COVENANTS
SECTION
8.1 Post-Closing
Covenants of IGII.
(d) IGII
will
continue to maintain the license, provide system support and provide assistance
to the Company for collection of outstanding receivables.
SECTION
8.2 Post-Closing
Covenants of GFL.
(a)
GFL
will
continue employ the Asset and ensure the continuing generation of revenues
necessary to satisfy the obligations of GFL in this Agreement. In the event
GFL
cannot provide written assurances of performance that GFL can satisfy their
obligations under this Agreement, after a written request by IGII, then,
notwithstanding that the Purchase Price and Additional Purchase Price
obligations will remain and IGII shall be entitled to all other legal remedies,
the Asset will be returned to IGII.
(e) GFL
will
maintain such books and records to ensure satisfaction of their obligations
under this Agreement. In the event the financial records of GFL are insufficient
to determine GFL’s obligations under the Additional Purchase Price obligation,
IGII, may, at its own expense, audit the books and records of GFL at such
reasonable time as IGII determines.
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ARTICLE
IX
GENERAL
PROVISIONS
SECTION
9.1 Transaction
Costs.
Except
as otherwise provided herein, each of the parties shall pay all of his or its
costs and expenses (including attorney fees and other legal costs and expenses
and accountants’ fees and other accounting costs and expenses) incurred by that
party in connection with this Agreement.
SECTION
9.2 Indemnification.
IGII
agrees to defend and hold GFL and its officers and directors harmless against
and in respect of any and all claims, demands, losses, costs, expenses,
obligations, liabilities or damages, including interest, penalties and
reasonable attorney’s fees, that it shall incur or suffer, which arise out of,
result from or relate to any breach of this Agreement or failure by the IGII
to
perform with respect to any of its representations, warranties or covenants
contained in this Agreement or in any exhibit or other instrument furnished
or
to be furnished under this Agreement.
SECTION
9.3 Indemnification.
GFL
agrees to defend and hold IGII harmless against and in respect of any and all
claims, demands, losses, costs, expenses, obligations, liabilities or damages,
including interest, penalties and reasonable attorney’s fees, that it shall
incur or suffer, which arise out of, result from or relate to any breach of
this
Agreement or failure by GFL to perform with respect to any of its
representations, warranties or covenants contained in this Agreement or in
any
exhibit or other instrument furnished or to be furnished under this
Agreement.
SECTION
9.4 Notices.
All
notices and other communications hereunder shall be in writing and shall be
deemed to have been given (i) on the date they are delivered if delivered in
person; (ii) on the date initially received if delivered by facsimile
transmission followed by registered or certified mail confirmation; (iii) on
the
date delivered by an overnight courier service; or (iv) on the third business
day after it is mailed by registered or certified mail, return receipt requested
with postage and other fees prepaid, to the addresses provided by each party
to
the other parties.
SECTION
9.5 Headings.
The
table of contents and headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of
this Agreement.
SECTION
9.6 Severability.
If any
term or other provision of this Agreement is invalid, illegal or incapable
of
being enforced by any rule of law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon
such
determination that any such term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith
to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the extent possible.
SECTION
9.7 Entire
Agreement.
This
Agreement (together with the Schedules, Exhibit, certificates and documents
referred to herein) constitute the entire agreement of the parties and supersede
all prior agreements and undertakings, both written and oral, between the
parties, or any of them, with respect to the subject matter hereof.
SECTION
9.8 Binding
Effect.
All the
terms and provisions of this Agreement, whether so expressed or not, shall
be
binding upon, inure to the benefit of, and be enforceable by the parties and
their respective administrators, executors, legal representatives, heirs,
successors and assignees.
SECTION
9.9 Preparation
of Agreement.
This
Agreement shall not be construed more strongly against any party regardless
of
who is responsible for its preparation. The parties acknowledge each contributed
and is equally responsible for its preparation.
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SECTION
9.10 Governing
Law.
This
Agreement shall be governed by, and construed in accordance with, the laws
of
the State of Florida, without giving effect to applicable principles of
conflicts of law.
SECTION
9.11 Securities
and Exchange Commission filings. GFL
agrees and acknowledges that this Agreement shall be disclosed in the
appropriate filing with the Securities and Exchange Commission.
SECTION
9.12 Further
Assurances, Cooperation.
Each
party shall, upon reasonable request by the other party, execute and deliver
any
additional documents necessary or desirable to complete the merger pursuant
to
and in the manner contemplated by this agreement. The parties hereto agree
to
cooperate and use their respective best efforts to consummate the transactions
contemplated by this agreement.
SECTION
9.13 Survival The
representations, warranties, covenants and agreements made herein shall survive
the Closing of the transaction contemplated hereby.
SECTION
9.14 Assignment
This
Agreement shall not be assigned by operation of law or otherwise, except with
the written consent of the other party.
SECTION
9.14 Third
Parties
Nothing
in this Agreement, whether express or implied, is intended to confer any rights
or remedies under or by reason of this Agreement on any persons other than
the
parties hereto and their respective administrators, executors, legal
representatives, heirs, successors and assignees. Nothing in this Agreement
is
intended to relieve or discharge the obligation or liability of any third
persons to any party to this Agreement, nor shall any provision give any third
persons any right of subrogation or action over or against any party to this
Agreement.
SECTION
9.15 Failure
or Indulgence Not Waiver; Remedies Cumulative.
No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty, covenant or
agreement herein, nor shall nay single or partial exercise of any such right
preclude other or further exercise thereof or of any other right. All rights
and
remedies existing under this Agreement are cumulative to, and not exclusive
of,
any rights or remedies otherwise available.
SECTION
9.16 Counterparts.
This
Agreement may be executed in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when executed shall
be
deemed to be an original, but all of which taken together shall constitute
one
and the same agreement.
[SIGNATURES
ON FOLLOWING PAGE]
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IN
WITNESS WHEREOF,
the GFL
and IGII have executed this Agreement as of the date first above
shown.
| IGII | GFL | ||
| IBSG INTERNATIONAL, Inc. | GALAXY FIVE (PTY), LTD. | ||
| a Florida corporation |
a corporation incorporated under the laws of
the
South African government,
Johannesburg
|
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| /s/ | /s/ | ||
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| Name Title |
Name Title |
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ATTACHMENT
A
ASSET
-11-
EXHIBIT
A
PAYMENT
CONDITIONS
Purchase
Price
A
payment
of US$1,000,000 (the initial payment) will be paid by the Company to IGII within
20 days from execution of this agreement. Future payments will be paid on the
anniversary date of this Agreement.
Additional
Purchase Price
The
US$15
million from the South African project will be generated over the next 12 months
from the signing of the final Agreement.
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