SHARE PURCHASE AGREEMENT
THIS SHARE PURCHASE AGREEMENT is made as at the 1st day of
September, 2000.
AMONG:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, of ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, of ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇, of 880 - ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
(Collectively, the "Vendors")
OF THE FIRST PART
AND:
ECLIPSE ENTERTAINMENT GROUP, INC., a Nevada Corporation, of ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
(the "Purchaser")
OF THE SECOND PART
AND:
WESTAR ENTERTAINMENT, INC., a Nevada Corporation, of ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
(the "Corporation")
OF THE THIRD PART
WHEREAS:
The Vendors are the registered and beneficial owners of all the
issued and outstanding shares in the capital of the Corporation,
being 950,000 shares of common stock with a par value of $0.01
per share (the "Shares"), as more particularly set out in
Schedule 1;
The Corporation carries on the business of motion picture
production and distribution; and
The Vendors, as the registered and beneficial owners of the
Shares, have agreed to sell and the Purchaser has agreed to
purchase the Shares, on the terms and conditions contained in
this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of
the premises and the covenants and agreements contained in this
Agreement, the parties covenant and agree with each other as
follows:
PART 1
SCHEDULES
1.1 The following are the Schedules attached to and incorporated
in this Agreement by reference and deemed to be part of this
Agreement:
1. Schedule of Shareholders.
2. Financial Statements.
PART 2
DEFINITIONS
2.1 In this Agreement:
"Business" means the business of motion picture production and
distribution;
"Closing Date" means October 12, 2000 or such earlier or later
date as may be mutually agreed upon in writing by the parties;
"Financial Statements" means the financial statements of the
Corporation for the year ended December 31, 1999, and for the
period ended June 30, 2000 attached to this Agreement as Schedule
2; and
PART 3
PURCHASED SHARES AND PURCHASE PRICE
3.1 Subject to the terms and conditions of this Agreement and
based on representations and warranties of the Vendors set forth
in this Agreement, on the Closing Date the Vendors will sell,
assign and transfer to the Purchaser and the Purchaser will
purchase from the Vendors all (but not less than all) of the
Shares for One Hundred and Four Thousand Five Hundred dollars
($104,500) (the "Purchase Price"), payable to the Vendors on the
Closing Date as follows:
(a) by the issuance and delivery to the Vendors of One Hundred
Ninety Thousand (190,000) common shares of the Purchaser issued
at fifty cents ($0.50)) per share, which shares shall be free and
clear of any and all liens, charges, encumbrances and
assessments, save that they shall be restricted stock pursuant to
SEC Rule , such shares to be allocated to the Vendors
proportionately to their shareholdings of the Shares; and
(b) by the payment to the Vendors of the sum of Nine Thousand
Five Hundred Dollars ($9,500), such payment to be allocated to
the Vendors proportionately to their shareholdings of the Shares.
PART 4
VENDOR'S REPRESENTATIONS AND WARRANTIES
4.1 In order to induce the Purchaser to enter into and
consummate this Agreement, the Vendors jointly and severally
represent and warrant to and covenant with the Purchaser as
follows:
(a) the Corporation is a corporation duly incorporated and
organized under the laws of Nevada, is a private corporation and
is a valid and subsisting corporation in good standing with the
State of Nevada, and has the power and capacity to enter into
this Agreement and carry out its terms;
(b) the Corporation carries on its business primarily in the
State of California;
(c) the authorized capital of the Corporation is One Million
(1,000,000) shares of common stock with a par value of $0.01 per
share, of which only the Shares are issued and outstanding as
fully paid and non-assessable;
the Vendors own the Shares as legal and beneficial owners, free
and clear of all liens, claims, charges and encumbrances, and the
Vendors have no other interests, legal or beneficial, direct or
indirect, in any of the securities of the Corporation or its
assets or the Business.
the Vendors have the power and capacity and due and sufficient
right and authority to enter into this Agreement on the terms and
conditions set forth in this Agreement and to transfer the legal
and beneficial title to and ownership of the Shares to the
Purchaser;
the signing and delivery of this Agreement and the completion of
the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action on the part of the
Vendors and the Corporation;
no person, firm or corporation has any agreement or option or any
right capable of becoming an agreement for the purchase of the
Shares or any other shares in the capital of the Corporation or
for the purchase, subscription or issuance of any of the unissued
shares in the capital of the Corporation;
(h) the Corporation has the corporate power to own the assets
and properties owned by it and to carry on the Business and is
duly qualified to carry on the Business;
(i) the Corporation holds all licenses and permits required for
carrying on the Business in the manner in which it has heretofore
been carried on and all such licenses and permits are in good
standing;
(j) the Financial Statements attached as Schedule 2 are true and
correct in every material respect and present fairly the assets,
liabilities and financial position of the Corporation as at
December 31, 1999 and for the period from January 1, 2000 to June
30, 2000, and the results of its operations to those dates, in
accordance with generally accepted accounting principles applied
on a consistent basis;
(k) there are no liabilities, contingent or otherwise, of the
Corporation which are not disclosed or reflected in Schedule 2,
the Corporation has not guaranteed, or agreed to guarantee, any
debt, liability or other obligation of any person, firm or
corporation, and there are no liabilities of any other party
capable of creating a lien or charge on any of the assets of the
Corporation;
(l) the Corporation is not indebted to the Vendors or any
affiliate, director or officer of the Corporation except as shown
on the Financial Statements;
(m) no dividends or other distribution on any shares in the
capital of the Corporation have been made, declared or authorized
since June 30, 2000;
(n) no payments of any kind have been made or authorized since
June 30, 2000 to or on behalf of the Vendors or to or on behalf
of any of the officers, directors or shareholders of the
Corporation;
(o) from June 30, 2000 to the Closing Date;
i) there has not been and there will not be any material
adverse change in the financial position or condition of the
Corporation or any damage, loss or other change in circumstances
materially affecting the Business or property of the Corporation
or its right or capacity to carry on business;
ii) the Corporation has not and will not have waived or
surrendered any right of material value;
iii) the Corporation has not and will not have discharged or
satisfied or paid any lien or encumbrance or obligation or
liability;
iv) the Business of the Corporation has been and will be carried
on in ordinary course;
v) no capital expenditures have been or will be authorized or
made; and
vi) the Corporation has not altered its Charter documents.
(p) the Corporation does not have any collective agreements,
pension plans, profit sharing plans, bonus plans, group insurance
or similar plans, undertakings or arrangements;
(q) the Corporation does not have any contracts, agreements or
arrangements, whether oral, written or implied, with its
employees, lessees, licensees, managers, accountants, suppliers,
agents, distributors, officers, directors, lawyers or others that
it cannot terminate on less than one month's notice;
(r) there is no basis for and there are no actions, suits,
judgments, investigations or proceedings outstanding or pending
or to the knowledge of the Vendors threatened against or
affecting the Corporation or its assets or before or by any
federal, state, municipal or other governmental department,
commission, board, bureau or agency;
(s) the Corporation 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;
(t) the Corporation has good and marketable title to and
possession of its properties and assets, subject to no mortgage,
pledge, deed of trust, lien, conditional sale agreement,
encumbrance or charge;
(u) the Corporation has not experienced nor is it or the Vendors
aware of any occurrence or event which has had, or might
reasonably be expected to have, a materially adverse effect on
the Business or the results of its operations;
(v) neither the Vendors nor any officer, director, employee or
affiliate of the Corporation are now indebted or under obligation
to the Corporation on any account;
(w) all tax returns and reports of the Corporation required by
law to be filed before the date of this Agreement have been filed
and are substantially true, complete and correct. All taxes and
other government charges which are due and owing to the Closing
Date to the knowledge of the Vendors have been or will have been
paid by the Closing Date;
(x) the Corporation has made adequate provision for taxes
payable by the Corporation for which tax returns are not yet
required to be filed and there are no agreements, waivers, or
other arrangements providing for an extension of time for the
filing of any tax return by or payment of any tax, governmental
charge, or deficiency by the Corporation, and, to the Vendor's
knowledge, there are no contingent tax liabilities or any grounds
that would prompt a re-assessment;
(y) the Corporation has not before the date of this Agreement
acquired any property from a person with whom it was not dealing
at arm's length for proceeds less than the fair market value;
(z) all material transactions of the Corporation have been
promptly and properly recorded or filed in or with its respective
books and records, and the minute books of the Corporation
contain all records of the meetings and proceedings of
shareholders and directors of the Corporation;
(aa) the only present directors and officers of the Corporation
are as follows:
Name Position
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ President
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Treasurer
▇▇▇▇ ▇. ▇▇▇▇▇ Secretary
▇▇▇▇▇ ▇▇▇▇▇▇
(bb) the signing and performance of this Agreement will not be in
violation of the Charter documents of the Corporation or any
agreement to which the Vendors or the Corporation are a party and
will not give any person or corporation any right to terminate or
cancel any agreement or any right, license or other benefit
enjoyed by the Corporation and will not result in the creation or
imposition of any lien, encumbrance or restriction of any nature
in favour of a third party upon or against the assets of the
Corporation or the Shares, or in the violation of any law or
regulation or any order or decree of any court or tribunal to
which the Vendors or the Corporation are subject or which could
materially affect the Business or the Corporation or prevent the
due and valid transfer of the Shares as provided in this
Agreement;
(cc) the Corporation maintains such insurance against loss or
damage to its assets and with respect to public liability as is
reasonably prudent for a corporation such as the Corporation;
(dd) the Corporation does not own, directly or indirectly, any
shares or interests in any other corporation or firm; and
(ee) this Agreement has been duly executed and delivered by the
Vendors and the Corporation and is a legal, valid and binding
obligation of the Vendors and the Corporation enforceable in
accordance with its terms.
PART 5
COVENANTS OF THE PARTIES
5.1 The Vendors and the Corporation covenant and agree with the
Purchaser as follows:
(a) from the date of this Agreement to the Closing Date, the
Vendors and the Corporation will permit the Purchaser and its
auditors, counsel and other authorized persons, to make such
investigation of the properties and assets of the Corporation and
of its financial and legal condition as the Purchaser deems
necessary or advisable to familiarize itself with such
properties, assets or other matters and to have full access to
the Business and the Corporation, including all working papers
(internal and external) and details of accounts and inventories
prepared, obtained or used in connection with the preparation of
the Financial Statements;
(b) from the date of this Agreement to the Closing Date, the
Vendors will cause the Corporation to and the Corporation will:
i) carry on the Business in the ordinary and normal course, in
a prudent, businesslike and efficient manner and substantially in
accordance with the procedures and practices in effect on the
date of this Agreement;
ii) maintain insurance on the assets of the Corporation as they
are insured on the date of this Agreement;
iii) use its best efforts to preserve and maintain the goodwill
of the Business; and
iv) take reasonable care to protect and safeguard the
Corporation's assets.
(c) from the date of this Agreement to the Closing Date, the
Corporation will not, and the Vendors will not permit the
Corporation to, without the prior consent in writing of the
Purchaser:
i) purchase or sell, consume or otherwise dispose of any of the
Corporation's assets in connection with the Business, except in
the ordinary course of business;
enter into any contract or assume or incur any liability relating
to or in any way affecting the Business except in the ordinary
course of business;
issue, or enter into any agreement to issue, any securities of
the Corporation, including without limitation shares, warrants,
options, convertible securities, or rights to purchase shares;
redeem, purchase, or otherwise acquire or commit to acquire any
of the Corporation's shares;
amend its Charter documents;
effect any subdivision, consolidation, or reclassification of the
Corporation's shares;
settle any accounts receivable of a material nature at less than
face value net of the reserve for that account;
waive or surrender any material right in connection with the
Business;
discharge, satisfy or pay any lien, encumbrance, obligation or
liability in connection with the Business except in the ordinary
course of Business;
make or agree to make any payment to any director, officer,
employee, or agent of the Corporation except in the normal course
of business; and
make any capital expenditures or commitment for any capital
expenditures in connection with the Business.
(e) the Corporation and the Vendors will, on the Closing Date,
take all necessary steps and proceedings as approved by counsel
for the Purchaser to permit the Shares to be duly and regularly
transferred to the Purchaser and registered in its name, free and
clear of any liens, charges and encumbrances; and
(f) the Vendors will cause all directors and officers of the
Corporation to resign to be replaced by nominees of the
Purchaser, such resignations to be effective as at the Closing
Date.
PART 6
CONDITIONS OF CLOSING
6.1 The obligations of the Purchaser under this Agreement are
subject to the following conditions for the exclusive benefit of
the Purchaser being fulfilled in all material respects in the
reasonable opinion of the Purchaser on the Closing Date or waived
by the Purchaser at or before the Closing Date:
the Purchaser shall have completed due diligence to its
satisfaction in respect of the Corporation, its assets and
financial condition, and the Business;
the representations and warranties of the Vendors contained in
this Agreement shall be true and correct as of the date of this
Agreement and on and as of the Closing Date;
the Vendors shall have performed or complied with all covenants
and agreements in this Agreement agreed to be performed or caused
to be performed by them respectively on or before the Closing
Date;
the title of the Corporation to the assets listed in Schedule 3
free and clear of liens, charges and encumbrances, the legality
of the incorporation and organization of the Corporation, the due
creation and issuance as fully paid and non-assessable of the
Shares, all corporate proceedings of the Corporation, its
shareholders and directors, the right of the Corporation to carry
on the Business and all other matters which in the opinion of
counsel for the Purchaser are material in connection with the
transactions of purchase and sale contemplated in this Agreement
shall be subject to the favourable opinion of such counsel and
all relevant records and information shall be supplied to such
counsel for that purpose;
no material loss or destruction of or damage to any of the assets
of the Corporation shall have occurred between the date of this
Agreement and the Closing Date, and the Corporation shall not
have experienced any event or condition or have taken any action
of any kind materially adversely affecting the Business, except
pursuant to the Asset Purchase Agreement;
no action or proceeding shall be pending or threatened by any
person, corporation, firm, governmental authority, regulatory
body or agency to enjoin or prohibit:
i) the purchase and sale of the Shares and other assets
contemplated by this Agreement or the right of the Purchaser to
own the Shares; or
ii) the right of the Corporation to conduct its operations and
carry on the Business in the normal course as the Business and
its operations have been carried on in the past.
the parties to this Agreement shall have obtained all consents
and approvals necessary to complete the purchase and sale of the
Shares, including without limitation the approvals of the
directors and shareholders of the Corporation and the Purchaser;
and
the Vendors shall have delivered all documents to be delivered by
it under section 6.2 of this Agreement.
If any of the conditions in this Article 6.1 are not fulfilled or
waived, the Purchaser on the Closing Date may rescind this
Agreement by notice in writing to the Vendors. In such event,
the Purchaser shall be released from all obligations under this
Agreement, and the Vendors will also be released unless the
Vendors have breached any of their representations, warranties,
covenants or agreements in this Agreement. Any conditions in
this Article 6.1 may be waived in whole or in part without
prejudice to any right or rescission in the event of the non-
fulfillment of any other condition or conditions. A waiver will
be binding only if it is in writing.
6.2 On the Closing Date, the Vendors shall deliver to the
Purchaser:
all books, records, book accounts, lists of suppliers and all
other documents, files, records and other data, financial or
otherwise, relating to the Corporation's assets and the
Business;
all corporate records of the Corporation and its corporate seal;
certified copies of resolutions of the directors and,
shareholders of the Corporation authorizing the execution and
delivery of this Agreement, approving the transactions
contemplated hereby, the transfer of the Shares, the cancellation
of the certificates representing the Shares in the names of the
Vendors, and the issue of a new share certificate in the name of
the Purchaser;
a duly executed share certificate representing the Shares in the
name of the Purchaser; and
resignations in writing of all current directors and officers of
the Corporation and appointments of new directors and officers of
the Corporation as nominated by the Purchaser, evidenced by duly
signed resolutions of the Corporation's directors.
6.3 On the Closing Date, the Purchaser shall deliver to the
Vendors share certificates of the Purchaser in the aggregate
number of 200,000 shares and cheques in the aggregate amount of
$10,000 payable by the Purchaser to the Vendors all as provided in
Schedule 1.
PART 7
CLOSING ARRANGEMENTS
7.1 The closing shall take place on the Closing Date at the
offices of the Purchaser in Los Angeles, California.
PART 8
GENERAL
8.1 The Vendors acknowledge and agree that the Purchaser has
entered into this Agreement relying on the representations,
warranties, covenants and agreements and other terms and
conditions of this Agreement and that no information which is now
known, which may become known or which could upon investigation
have become known to the Purchaser or the Corporation or any of
their present or future officers, directors or professional
advisors in any way limit or extinguish any rights any of them
may have against the Vendors.
8.2 The representations, warranties, covenants and agreements of
the Vendors contained in this Agreement shall survive the closing
of the transactions contemplated by this Agreement and shall
remain in full force and effect.
8.3 The Vendors covenant and agree to indemnify and save
harmless the Purchaser and the Corporation from any loss,
damages, liabilities, costs and expenses (including without
limitation any tax liability) suffered by the Purchaser or the
Corporation directly or indirectly as a result of or arising out
of any misrepresentation, breach of warranty, or non-fulfillment
of any covenant or agreement of the Vendors contained in this
Agreement.
8.4 Any notice, direction or other instrument required to be
given under this Agreement shall be in writing and may be given
by mailing the same postage prepaid or delivering the same
addressed as follows:
To the Vendors:
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
To the Purchaser:
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
To the Corporation:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
or such other address as a party may specify by notice and shall
be deemed to have been received, if delivered, on the date of
delivered if it is a business day and otherwise on the next
succeeding business day and, if mailed, on the fifth business day
following posting of the notice except if there is a postal
dispute, in which case all communications shall be delivered.
8.5 Time shall be of the essence of this Agreement.
8.6 Each of the parties will execute and deliver such further
documents and instruments and do such acts and things as may,
before or after the Closing Date, be reasonably required by
another party to carry out the intent and meaning of this
Agreement and to assure to the Purchaser the Shares.
8.7 This Agreement shall be construed and enforced in accordance
with, and the rights of the parties shall be governed by, the
laws of California.
This Agreement shall enure to the benefit of and be binding upon
the parties and respective successors and assigns.
IN WITNESS WHEREOF this Agreement has been executed by the parties.
/s//s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Witness ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s//s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Witness ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Witness ▇▇▇▇ ▇. ▇▇▇▇▇
ECLIPSE ENTERTAINMENT GROUP, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
WESTAR ENTERTAINMENT, INC.
By: /s/ Franco Columub
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
SCHEDULE 1
Shareholders
Number of Eclipse Shares Cash to
Name and Address of Shareholder Westar Shares to be received be received
held
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 425,000 85,000 $4,250.00
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Art Birzneck 425,000 85,000 $4,250.00
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ 100,000 20,000 $1,000.00
▇▇▇ - ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
950,000 190,000 $9,500.00
