STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") has been made and entered
into as of this 19th day of October 2006, between the shareholders of
Meepo Investment Consortium (Pty) Ltd ("Sellers"), and The African
Diamond Company, Inc., a Nevada Corporation (the "Purchaser").
R E C I T A L S:
A. The parties hereto desire to effect a stock sale (the "Stock
Sale") pursuant to which Purchaser will purchase from the Sellers fifty
one percent of the outstanding common stock (the "Transferred Shares")
of Meepo Investment Consortium (Pty) Ltd (the "Company"), (the "Company
Stock"), to be purchased by Purchaser for the consideration set forth
herein. The Transferred Shares represent all of the issued and
outstanding stock of the Companies. The balance of the forty nine
percent of Meepo Investment Consortium (Pty) Ltd held by The African
diamond Company BVI will be transferred directly to The African Diamond
Company, Inc., (the "Purchaser").
B. Pursuant to the Stock Sale, the Sellers will sell, and Purchaser
will purchase, the Transferred Shares.
NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained herein, the parties hereto agree as follows and do thereby
adopt this Agreement.
ARTICLE I.
DEFINITIONS
The terms defined in this Article (except as otherwise expressly
provided in this Agreement) for all purposes of this Agreement shall
have the respective meanings specified in this Article.
"Affiliate" shall mean any entity controlling or controlled by another
person, under common control with another person, or controlled by any
entity which controls such person.
"Agreement" shall mean this Agreement, and all the exhibits, schedules
and other documents attached to or referred to in the Agreement, and
all amendments and supplements, if any, to this Agreement.
"Closing" shall mean the closing of the Transaction at which the
Closing Documents shall be exchanged by the parties, except for those
documents or other items specifically required to be exchanged at a
later time.
"Closing Date" shall mean October 31st 2006 plus any extension as
provided herein, or such other date as agreed in writing to by the
parties on which the Closing occurs.
"Closing Documents" shall mean the papers, instruments and documents
required to be executed and delivered at the Closing pursuant to this
Agreement.
"Code" shall mean the Internal Revenue of 1986, or any successor law,
and regulations issued by the Internal Revenue Service pursuant to the
Internal Revenue Code or any successor law.
"Encumbrance" shall mean any charge, claim, encumbrance, community
property interest, condition, equitable interest, lien, option, pledge,
security interest, right of first refusal, or restriction of any kind,
including any restriction on use, voting (in the case of any security),
transfer, receipt of income, or exercise of any other attribute of
ownership other than (a) liens for taxes not yet due and payable, or
(b) liens that secure the ownership interests of lessors of equipment.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"GAAP" shall mean United States generally accepted accounting
principles applied in a manner consistent with prior periods.
"Investment Letter" shall mean the investment letter in the form
attached hereto as Appendix A.
"Material Adverse Effect" means any change (individually or in the
aggregate) in the general affairs, management, business, goodwill,
results of operations, condition (financial or otherwise), assets,
liabilities or prospects (whether or not the result thereof would be
covered by insurance) that would be material and adverse to the
designated party.
"Ordinary Course of Business" shall mean actions consistent with the
past practices of the designated party which are similar in nature and
style to actions customarily taken by the designated party and which do
not require, and in the past have not received, specific authorization
by the Board of Directors of the designated party.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Taxes" shall include federal, state and local income taxes, capital
gains tax, value-added taxes, franchise, personal property and real
property taxes, levies, assessments, tariffs, duties (including any
customs duty), business license or other fees, sales, use and any other
taxes relating to the assets of the designated party or the business of
the designated party for all periods up to and including the Closing
Date, together with any related charge or amount, including interest,
fines, penalties and additions to tax, if any, arising out of tax
assessments.
"Transaction" shall mean the Stock Sale contemplated by this Agreement.
The following appendices and schedules are attached to and form part of
this Agreement:
APPENDICES
Description
Appendix A Investment Letter
SCHEDULES
Description
Schedule 2.1 Selling Shareholder's Share Ownership
Schedule 3.1.12 Purchaser SEC Documents
ARTICLE II.
THE TRANSACTION
2.1. Stock Sale. Subject to the terms and conditions of the Closing
Documents, the Sellers hereby agree to sell, transfer and deliver to
Purchaser, and Purchaser hereby agrees to purchase and accept, the
Transferred Shares, in consideration for the delivery of 16,000,000
(sixteen million) common shares of the Purchaser (the "Purchase Price")
by Purchaser to Sellers to be distributed pro-rata based on share
ownership of Meepo Investment Consortium (Pty) Ltd. As per schedule
2.1. plus 80% (eighty percent) of the first 12 months profit from
operations, commencing from date the recovery plant is fully
operational, up to a maximum of R 10 million (ten million rand). These
payments will be made quarterly in arrears, beginning December 31,
2006.
2.2. Securities Law Matters.
2.2.1. Private Offering. The Parties understand that the
Transferred Shares to be acquired and delivered to the Sellers pursuant
to the terms of this Agreement will not be registered under the
Securities Act, but will be transferred in reliance upon exemptions
available for private transactions, and that each is relying upon the
truth and accuracy of the representations set forth in the Investment
Letter signed by each of the Sellers and delivered concurrently with
the execution of this Agreement. Each certificate representing the
Transferred Shares in the name of the Sellers pursuant to the terms of
this Agreement shall bear the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED PURSUANT TO THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, AND
MAY NOT BE TRANSFERRED UNLESS THEY ARE SO REGISTERED
OR, IN THE OPINION OF COUNSEL ACCEPTABLE TO THIS
CORPORATION, SUCH TRANSFER IS EXEMPT FROM REGISTRATION.
2.3 Permission from Reserve Bank .The seller must obtain
permission, for this transaction, from the Reserve Bank of South
Africa
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1. Representations and Warranties of the Sellers. The Sellers hereby
represent and warrant to Purchaser that:
3.1.1. Organization of the Company; Foreign Qualification.
The Company is duly organized, validly existing, and in good standing
under the laws of South Africa and have all requisite corporate power,
franchises, and licenses to own their property and conduct the business
in which they are engaged. The Company and the Sellers have the full
power and authority (corporate or otherwise) to execute, deliver and
perform their respective obligations under this Agreement and the
Closing Agreements to which it is a party. A complete set of the all
the Companies' corporate records, including its Certificate of
Incorporation, Bylaws, minutes, transfer records, will have been
delivered or made available to Purchaser.
3.1.2. Capitalization; Ownership of Transferred Shares.
3.1.2.1. Meepo Investment Consortium (Pty) Ltd has an
authorized capital stock consisting of 1,000 shares of common
stock, par value R1.00 (one rand) per share, of which 1,000
shares are issued and zero shares of preferred stock of which
no shares are outstanding. All of the shares of Company Stock
have been validly issued, fully paid, are non-assessable, and
were issued in compliance with any preemptive or similar
rights and in compliance with applicable federal and state
securities laws. All shares held by the Sellers were legally
and validly issued in compliance with appropriate and
applicable securities laws.
3.1.2.2. The Company does not have any outstanding
subscriptions, options, preferred stock, rights, warrants,
convertible securities or other agreements or commitments to
issue, or contracts or any other agreements obligating the
Company to issue, or to transfer from treasury, any shares of
its capital stock or membership interests, as applicable, of
any class or kind, or securities convertible into such stock
or interests. No persons who are now holders of Company
Stock, and no persons who previously were holders of Company
Stock, are or ever were entitled to preemptive rights other
than persons who exercised or waived those rights.
3.1.2.3. There is no outstanding vote, plan, pending
proposal or right of any person to cause any redemption of
Company Stock. Neither the Company nor any of its Affiliates,
is under any obligation, contract or other arrangement to
register (or maintain the registration of) any of its or
their securities under federal or state securities laws.
3.1.2.4. Neither the Company nor the Sellers is a
party to any agreement, voting trust, proxy or other
agreement or understanding of any character, whether written
or oral, with any other stockholders of the Company with
respect to or concerning the purchase, sale or transfer or
voting of the Company Stock or any other security of the
Company.
3.1.2.5. Neither the Company nor the Sellers has any
legal obligations, absolute or contingent, to any other
person or entity to sell the assets, or any capital stock or
any other security of the Company or any of its subsidiaries
or affect any merger, consolidation or other reorganization
of the Company or any of its subsidiaries or to enter into
any agreement with respect thereto, except pursuant to this
Agreement.
3.1.2.6. The Sellers are the sole beneficial and
record holders of the Transferred Shares. The Sellers hold
the Transferred Shares free and clear of any Encumbrance of
any kind whatsoever. The Transferred Shares represent all of
the issued and outstanding common stock of the Company.
3.1.3. Subsidiaries. The Company does not have any
subsidiaries (whether held directly or indirectly) or any
equity investment in any corporation, partnership, joint
venture or other business.
3.1.4. Real Estate.
The real estate consists of 100% (one hundred percentum) the
rights from a contractors agreement to recover diamonds from
the claim of the Kamfersdam dump, Kimberly, South Africa. The
company is awaiting approval of it application for the mining
rights to the ▇▇▇▇▇ ▇▇▇▇▇▇▇ Oval dump.
3.1.5. Authority Relative to the Closing Documents;
Enforceability. The Sellers are not suffering from any legal
disability which would: (a) prevent them from executing, delivering or
performing their obligations under the Closing Documents or
consummating the Transaction, (b) make such execution, delivery,
performance or consummation voidable or subject to necessary
ratification, and (c) require the signature or consent of any third
party in connection therewith for the Transaction to be binding and
enforceable against the Sellers and their property. The Closing
Documents have been duly and validly executed and delivered by the
Sellers and each constitutes the legal, valid and binding obligation of
the Sellers, enforceable against them in accordance with their
respective terms, except insofar as the enforcement thereof may be
limited by the Insolvency/Equity Exceptions.
3.1.6. Title to Assets. The Company has good and marketable
title free and clear of any Encumbrance in and to all of the assets and
properties identified to Purchaser.
3.1.7. Material Contracts. Except as disclosed to Purchaser,
the Company is not a party to or bound by any agreement or contract.
3.1.8. Compliance with Other Instruments; Consents. Neither
the execution of any Closing Document nor the consummation of the
Transaction will conflict with, violate or result in a breach or
constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default), or result in a termination of, or
accelerate the performance required by, or result in the creation of
any Encumbrance upon any assets of the Company under any provision of
the Articles of Incorporation, Bylaws, indenture, mortgage, lien,
lease, agreement, contract, instrument, order, judgment, decree,
statute, ordinance, regulation or any other restriction of any kind or
character to which the Company is bound.
3.1.9. Litigation. There are no legal, administrative,
arbitration or other proceedings or claims pending against the Company,
nor is the Company subject to any existing judgment which might affect
the financial condition, business, property or prospects of the
Company; nor has the Company received any inquiry from an agency of the
federal or of any state or local government about the Transaction, or
about any violation or possible violation of any law, regulation or
ordinance affecting its business or assets.
3.1.10. Taxes. The Company either: (a) has timely filed with
the appropriate taxing authority all Tax and information returns
required to have been filed by the Company or (b) has timely filed for
any required extensions with regard to such returns. All Taxes of the
Company have been paid (or estimated Taxes have been deposited) to the
extent such payments are required prior to the date hereof or accrued
on the books of the Company. The returns were correct when filed.
There are no pending investigations of the Company concerning any Tax
returns by any federal, state or local Taxing authority, and there are
no federal, state, local or foreign Tax liens upon any of the Company's
assets.
3.1.11. Compliance with Law and Government Regulations. The
Company is in compliance with, and is not in violation of, applicable
federal, state, local or foreign statutes, laws and regulations
(including without limitation, any applicable environmental, building,
zoning or other law, ordinance or regulation) affecting the Company or
its properties or the operation of its business. The Company is not
subject to any order, decree, judgment or other sanction of any court,
administrative agency or other tribunal.
3.1.12. Trade Names and Rights. The Company does not own any
trademarks, trademark registrations or applications, trade names,
service marks, copyrights, copyright registrations or applications. No
person owns any trademark, trademark registration or application,
service ▇▇▇▇, trade name, copyright or copyright registration or
application, the use of which is necessary or contemplated in
connection with the operation of the Company's business.
3.1.13. Accuracy of Financial Statements. The Company and
Sellers have delivered audited financial statements of the Company for
the year ended February 28, 2005 ("Financial Statements"). The Company
and Sellers also represent and warrant that the Financial Statements
fully and fairly present in all material respects the financial
position of the Company as at February 28, 2005. The books and records
of the Company fully and fairly reflect in all material respects all of
its transactions, properties, assets and liabilities. The Company and
Sellers represent and warrant that there has been no material adverse
change in the financial condition of the Company from that stated in
the financial statements.
3.1.14 Full Disclosure. None of the representations and
warranties made by the Sellers herein, or in any Closing Document
furnished or to be furnished by them hereunder contain or will contain
any untrue statement of material fact, or omits any material fact, the
omission of which would be misleading.
3.2. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to Sellers that:
3.2.1. Organization of Purchaser; Foreign Qualification.
Purchaser is duly organized, validly existing, and in good standing
under the laws of the state of Nevada and has all requisite corporate
power, franchises, and licenses to own its property and conduct the
business in which it is engaged. Purchaser has the full power and
authority (corporate or otherwise) to execute, deliver and perform its
obligations under this Agreement and the Closing Agreements to which it
is a party. A complete set of Purchaser's corporate records, including
its Certificate of Incorporation, Bylaws, minutes, transfer records,
have been delivered or made available to Sellers. Purchaser is duly
qualified and in good standing as a foreign corporation in every
jurisdiction in which such qualification is necessary, except to the
extent the failure to be so qualified is not reasonably expected to
result in a Material Adverse Effect.
3.2.2. Capitalization; Ownership of Transferred Shares.
3.2.2.1. Purchaser has an authorized capital stock
consisting of 50,000,000 shares of common stock, par value
$0.001 per share, of which 24,624,000 are issued and
outstanding and 20,000,000 shares of preferred stock of which
no shares are outstanding. All of the shares of Company
Stock have been validly issued, fully paid, are non-
assessable, and were issued in compliance in compliance with
applicable federal and state securities laws. All shares
held by the Sellers were issued in compliance with federal
and state securities laws.
3.2.2.2. Purchaser does not have any outstanding
subscriptions, options, preferred stock, rights, warrants,
convertible securities or other agreements or commitments to
issue, or contracts or any other agreements obligating
Purchaser to issue, or to transfer from treasury, any shares
of its capital stock or membership interests, as applicable,
of any class or kind, or securities convertible into such
stock or interests. No persons who are now holders of
Purchaser's common stock, and no persons who previously were
holders of Purchaser's common stock, are or ever were
entitled to preemptive rights other than persons who
exercised or waived those rights.
3.2.2.3. There is no outstanding vote, plan, pending
proposal or right of any person to cause any redemption of
Purchaser's common stock. Neither Purchaser nor any of its
Affiliates, is under any obligation, contract or other
arrangement to register (or maintain the registration of) any
of its or their securities under federal or state securities
laws.
3.2.2.4. The Purchase Price Shares shall be validly
issued from the Purchasers authorized common stock.
3.2.3. Subsidiaries. Purchaser does not have any subsidiaries
(whether held directly or indirectly) or any equity investment in any
corporation, partnership, joint venture or other business, except as
disclosed in the SEC Documents.
3.2.4. Real Estate. Purchaser does not own any real estate or
any interest in any real estate, except as disclosed in the SEC
Documents.
3.2.5. Authority Relative to the Closing Documents;
Enforceability. Purchaser is not suffering from any legal disability
which would: (a) prevent it from executing, delivering or performing
its obligations under the Closing Documents or consummating the
Transaction, (b) make such execution, delivery, performance or
consummation voidable or subject to necessary ratification, and (c)
require the signature or consent of any third party in connection
therewith for the Transaction to be binding and enforceable against
Purchaser and its property. The Closing Documents have been duly and
validly executed and delivered and each constitutes the legal, valid
and binding obligation, enforceable against Purchaser in accordance
with their respective terms, except insofar as the enforcement thereof
may be limited by the Insolvency/Equity Exceptions.
3.2.6. Material Contracts. Except as disclosed in the SEC
Documents, Purchaser is not a party to or bound by any agreement or
contract. Purchaser represents and warrants that all of its Material
Contracts are terminable unilaterally by Purchaser without penalty or
restriction or have already been properly terminated.
3.2.7. Labor Matters. There are presently no employment or
consulting contracts with, or covenants against competition by, any
present or former employees of Purchaser. Purchaser has no employees
other than its sole officer.
3.2.8. Compliance with Other Instruments; Consents. Neither
the execution of any Closing Document nor the consummation of the
Transaction will conflict with, violate or result in a breach or
constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default), or result in a termination of, or
accelerate the performance required by, or result in the creation of
any Encumbrance upon any assets of Purchaser under any provision of the
Articles of Incorporation, Bylaws, indenture, mortgage, lien, lease,
agreement, contract, instrument, order, judgment, decree, statute,
ordinance, regulation or any other restriction of any kind or character
to which Purchaser is bound.
3.2.9. Financial Statements. Purchaser's audited financial
statements (the "Purchaser Financial Statements") for the year ended
December 31, 2004 and unaudited quarterly financial statements for the
nine month period ended September 30, 2005, copies of which have been
delivered to Seller, are true and complete in all material respects,
and have been prepared in accordance with GAAP for the period covered
by such statements, and fairly present, in accordance with GAAP, the
properties, assets and financial condition of Purchaser, and results of
its operations as of the dates and for the periods covered thereby.
Except as may be disclosed in the SEC Documents, there has been no
material adverse change in the business operations, assets, properties,
prospects or condition (financial or otherwise) of Purchaser, taken as
a whole, from that reflected in the Purchaser Financial Statements. As
of the Closing date, Purchaser does not have any debts, liabilities or
obligations of any nature, whether accrued, absolute, un-matured,
contingent, or otherwise, whether due or to become due. There are and
will be at closing no accounts payable and no liabilities owed by
Purchaser.
3.2.10. Litigation. There are no legal, administrative,
arbitration or other proceedings or claims pending against Purchaser,
nor is Purchaser subject to any existing judgment which might affect
the financial condition, business, property or prospects of Purchaser;
nor has Purchaser received any inquiry from an agency of the federal or
of any state or local government about the Transaction, or about any
violation or possible violation of any law, regulation or ordinance
affecting its business or assets.
3.2.11. SEC Documents. Purchaser has furnished or made
available to Sellers a true and complete copy of each report, schedule,
registration statement and proxy statement filed by Purchaser with the
SEC since the inception of Purchaser (as such documents have since the
time of their filing been amended, the "SEC Documents"), a list of
which is attached as Schedule 3.1.12. Purchaser has timely filed with
the SEC all documents required to have been filed pursuant to the
Securities Act and the Exchange Act. As of their respective dates, the
SEC Documents complied in all material respects with the requirements
of the Securities Act, or the Exchange Act, as the case may be, and the
rules and regulations of the SEC thereunder applicable to such SEC
Documents, and none of the SEC Documents contained any untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
3.2.12. Taxes. Purchaser either: (a) has timely filed with the
appropriate taxing authority all Tax and information returns required
to have been filed by Purchaser or (b) has timely filed for any
required extensions with regard to such returns. All Taxes of
Purchaser have been paid (or estimated Taxes have been deposited) to
the extent such payments are required prior to the date hereof or
accrued on the books of Purchaser. The returns were correct when filed.
There are no pending investigations of Purchaser concerning any Tax
returns by any federal, state or local Taxing authority, and there are
no federal, state, local or foreign Tax liens upon any of Purchaser's
assets.
3.2.13. Compliance with Law and Government Regulations.
Purchaser is in compliance with, and is not in violation of, applicable
federal, state, local or foreign statutes, laws and regulations
(including without limitation, any applicable environmental, building,
zoning or other law, ordinance or regulation) affecting Purchaser or
its properties or the operation of its business. Purchaser is not
subject to any order, decree, judgment or other sanction of any court,
administrative agency or other tribunal.
3.2.14. Trade Names and Rights. Purchaser does not use any
trademark, service ▇▇▇▇, trade name, or copyright in its business, nor
does it own any trademarks, trademark registrations or applications,
trade names, service marks, copyrights, copyright registrations or
applications. No person owns any trademark, trademark registration or
application, service ▇▇▇▇, trade name, copyright or copyright
registration or application, the use of which is necessary or
contemplated in connection with the operation of Purchaser's business.
3.2.15. OTCBB Status. Purchaser is currently eligible for
trading on the "Pink Sheets", and Purchaser does not have any reason to
believe that its current market makers will cease to make a market
following the Closing. Purchaser shall take all necessary action to
apply for eligibility for quotation on the OTCBB.
3.2.16. Investment Company Act. Purchaser is not, and upon
completion of the Transaction will not be, subject to registration as
an investment company under the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder.
3.2.17. Full Disclosure. None of the representations and
warranties made by Purchaser herein, or in any Closing Document
furnished or to be furnished by them hereunder contain or will contain
any untrue statement of material fact, or omits any material fact, the
omission of which would be misleading.
ARTICLE IV.
ADDITIONAL COVENANTS AND AGREEMENTS OF THE PARTIES
4.1. Filing with Securities and Exchange Commission. Upon the
consummation of this Agreement, if required to do so by law, Purchaser
shall file with the SEC an Information Statement on Schedule 14F (the
"Schedule 14F") or such other documents as may be required, disclosing
the anticipated resignation of the current directors and appointment of
the anticipated new directors as provided herein, in a form that will
satisfy the requirements of law. The parties agree to cooperate in the
preparation and filing of such report or any other filings to be filed
with the SEC.
4.2. Brokers or Finders. Each party agrees to hold the others harmless
and to indemnify them against the claims of any persons or entities
claiming to be entitled to any brokerage commission, finder's fee,
advisory fee or like payment from such other party based upon actions
of the indemnifying party in connection with the Transaction.
ARTICLE V.
CLOSING DELIVERIES
5.1. The Closing. The Closing shall take place on or before the
Closing Date (unless such date is extended by the mutual agreement of
the parties) at such location as agreed to by the parties.
Notwithstanding the location of the Closing, each party agrees that the
Closing may be completed by the exchange of undertakings between the
respective legal counsel for the Sellers and Purchaser, provided such
undertakings are satisfactory to each party's respective legal counsel.
5.2. Deliveries by the Purchaser. Purchaser hereby agrees to deliver,
or cause to be delivered, to Sellers the following items on Closing:
5.2.1. Certified Resolutions. Copies of the resolutions,
certified by an officer of the Company, of the Board of Directors of
the Company approving the terms of this Agreement, and a copy of the
resolution of the shareholders of the Company approving the sale of the
Transferred Shares.
5.2.2. Resignations. A copy of the resignations of the
existing directors and officers of Purchaser, to be effective as of the
Resignation Date.
5.2.3. Termination of Contracts. Evidence satisfactory to the
Sellers that all material contracts and all payables and liabilities
have been terminated, effective as of the Resignation Date without any
payment by, or continuing liability to, the Company.
5.2.4. Stock Certificates. A stock certificate or certificates
representing the Purchase Price Shares issued in the name of Sellers.
5.2.5. SEC Filings. Evidence that all SEC filings have been
properly certified and filed with the SEC.
5.2.6. Transfer Agent Direction. A direction of Purchaser to
its transfer agent to register the Purchase Price Shares in the name of
the Sellers with the legend set forth in paragraph 2.2.1 of this
Agreement or such legend as is otherwise required by law.
5.3. Deliveries by Sellers. Sellers hereby agree to deliver to the
Purchaser the following items on Closing:
5.3.1. Certified Resolutions. Copies of the resolutions,
certified by an officer of the Company, of the Board of Directors of
the Company approving the terms of this Agreement, and a copy of the
resolution of the shareholders of the Company approving the sale of the
Transferred Shares.
5.3.2. Stock Certificates. A stock certificate or certificates
representing the Transferred Shares, together with such stock powers,
legal opinions and all other documentation required by the Company's
transfer agent to reissue such shares in the name of Purchaser.
5.3.3. Investment Letter. The Investment Letter, executed by
the Sellers.
5.3.4. Transfer Agent Direction. A direction of the Company to
the Company's transfer agent to register the Transferred Shares in the
name of the Purchaser with the legend set forth in paragraph 2.2.1 of
this Agreement or such legend as is otherwise required by law.
ARTICLE VI.
CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATION TO CLOSE
Purchaser's obligation to purchase the Transferred Shares and to take
the other actions required to be taken by Purchaser at the Closing is
subject to the satisfaction, at or prior to Closing, of each of the
following conditions (any of which may be waived by Purchaser, in whole
or in part):
6.1. Performance of Covenants. The Sellers shall have performed all
covenants and agreements required to be completed prior to or on
closing, including completion of the deliveries required by Section 5.3
of this Agreement.
6.2. Accuracy of Representations. All of Sellers' representations and
warranties in this Agreement (considered collectively), and each of
Sellers' representations and warranties (considered individually), must
have been accurate in all material respects as of the date of this
Agreement, and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date.
ARTICLE VII.
CONDITIONS PRECEDENT TO SELLERS'S OBLIGATION TO CLOSE
The Sellers' obligation to sell the Transferred Shares and to take the
other actions required to be taken by Sellers at the Closing is subject
to the satisfaction, at or prior to Closing, of each of the following
conditions (any of which may be waived by the Sellers, in whole or in
part):
7.1. Performance of Covenants. Purchaser shall have performed all
covenants and agreements required to be completed prior to or on
closing, including completion of the deliveries required by Section 5.2
of this Agreement.
7.2. Accuracy of Representations. All of Purchaser's representations
and warranties in this Agreement (considered collectively), and each of
Purchaser's representations and warranties (considered individually),
must have been accurate in all material respects as of the date of this
Agreement, and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date.
ARTICLE VIII.
SURVIVAL OF REPRESENTATIONS
8.1. Representations to Survive Closing. The representations and
warranties of the Sellers and Purchaser contained herein or in any
document furnished pursuant hereto shall survive the Closing of the
Transaction for a period of one year following the Closing. Each party
acknowledges and agrees that, except as expressly set forth in this
Agreement or any Closing Document, no party has made (and no party is
relying on) any representation or warranties of any nature, express or
implied, regarding any or relating to any of the transactions
contemplated by this Agreement.
8.2. This agreement shall be entirely dependant on the Sellers
obtaining consent (Should such consent be necessary) from the South
African Reserve Bank.
ARTICLE IX.
MISCELLANEOUS
9.1. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed delivered if
delivered by hand, by telecopier, by courier or mailed by certified or
registered mail, postage prepaid, addressed to the following persons at
their last know or provided address:
If to the Sellers:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Guapo Garcao
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇
1724 Marble Towers
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
If to Purchaser:
▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
9.2. Assignability and Parties in Interest. This Agreement shall not
be assignable by any of the parties hereto without the consent of all
other parties hereto. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective successors.
Nothing in this Agreement is intended to confer, expressly or by
implication, upon any other person any rights or remedies under or by
reason of this Agreement.
9.3. Expenses. Each party shall bear its own expenses and costs,
including the fees of any attorney retained by it, incurred in
connection with the preparation of the Closing Documents and
consummation of the Transaction.
9.4. Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the Republic of South
Africa. Each of the parties hereto consents to the jurisdiction of the
High Court of South Africa, Witwatersrand Local Division in connection
with any action arising under or brought with respect to this
Agreement.
9.5. Counterparts. This Agreement may be executed as of the same
effective date in one or more counterparts, each of which shall be
deemed an original.
9.6. Headings. The headings and subheadings contained in this
Agreement are included solely for ease of reference, and are not
intended to give a full description of the contents of any particular
Section and shall not be given any weight whatever in interpreting any
provision of this Agreement.
9.7. Pronouns, Etc. Use of male, female and neuter pronouns in the
singular or plural shall be understood to include each of the other
pronouns as the context requires. The word "and" includes the word
"or". The word "or" is disjunctive but not necessarily exclusive.
9.8. Complete Agreement. This Agreement, the Appendices hereto, and
the documents delivered pursuant hereto or referred to herein or
therein contain the entire agreement between the parties with respect
to the Transaction and, except as provided herein, supersede all
previous negotiations, commitments and writings.
9.9. Modifications, Amendments and Waivers. This Agreement shall not
be modified or amended except by a writing signed by each of the
parties hereto. Prior to the Closing, the Sellers may amend any of the
disclosure schedules referenced herein by giving the other party notice
of such amendments. If such amended disclosures reveal material
adverse information about the Company, Purchaser may terminate this
Agreement without liability to the Sellers.
9.10. 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 terms and provisions of this Agreement will
nevertheless remain in full force and effect so long as the economic or
legal substance of the Transaction is not affected in any manner
adverse to any party hereto. Upon any such determination that any term
or other provision is invalid, illegal, or incapable of being enforced,
the parties hereto will negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely
as possible in any acceptable manner to the end that the Transaction
are consummated to the extent possible.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
PURCHASER:
▇▇▇▇ ▇▇▇▇▇: President: The African Diamond Company, Inc.
SELLERS:
▇▇▇▇▇▇▇▇ Garcao: Chief Executive
Officer: Meepo Investment Consortium
(Pty) Ltd
APPENDIX A
INVESTMENT LETTER
October 19th, 2006
The African Diamond Company, Inc.
Dear Sir:
In connection with the purchase of 16,000,000 shares of the common stock
(the "Shares") of The African Diamond Company, Inc. (the "Corporation") by
the undersigned (the "Purchasers") pursuant to a share purchase agreement
dated the 19th day of October 2006 (the "Share Purchase Agreement"), the
undersigned (the "Purchaser"), hereby makes the following acknowledgments,
representations and warranties:
1. Investment Intent. The Purchaser is acquiring the Shares for
investment solely for its clients account and not with a present view to
any distribution, transfer or resale to others, including any
"distribution" within the meaning of Securities Act of 1933, as amended,
(the "Securities Act"). The Purchaser understands that the Shares have
not and will not be registered under the Securities Act by reason of a
specific exemption from the registration provisions of the Securities
Act, the availability of which depends on, among other things, the bona
fide nature of the investment intent and the accuracy of my
representations made herein.
2. Financial Ability. The Purchaser is financially able to bear
the economic risks of an investment in the Corporation and has no need for
liquidity in this investment. Furthermore, the financial capacity of the
Purchaser is of such a proportion that the total cost of the Purchaser's
commitment is not material when compared with his total committed capital.
The Purchaser is financially able to suffer a complete loss of this
investment.
3. Experience. The Purchaser has such knowledge and experience in
financial and business matters in general and with respect to investments
of a nature similar to that evidenced by the Shares so as to be capable,
by reason of such knowledge and experience, of evaluating the merits and
risks of, and making an informed business decision with regard to, and
protecting his own interests in connection with, the acquisition of the
Shares.
4. Review of Prospectus and Financial Statements. The Purchaser
has been provided with and had the opportunity to review all filings made
by the Corporation with the United States Securities and Exchange
Commission, as disclosed in the Share Purchase Agreement and available at
the SEC's web site at ▇▇▇.▇▇▇.▇▇▇.
5. Limited Public Market. The Purchaser understands that a
limited public market now exists for any of the securities of the
Corporation and that the Corporation has made no assurances that a more
active public market will ever exist for the Corporation's securities.
6. Restricted Legend. The Purchaser acknowledges that certificates
representing the Shares will bear a legend substantially as follows:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE STATE SECURITIES LAWS, AND MAY NOT
BE TRANSFERRED UNLESS THEY ARE SO REGISTERED OR, IN THE
OPINION OF COUNSEL ACCEPTABLE TO THE CORPORATION, SUCH
TRANSFER IS EXEMPT FROM REGISTRATION.
7. Stock Transfer. The Purchaser is aware that stop-transfer
instructions will be given to the transfer agent of the common stock of
the Corporation to prevent any unauthorized or illegal transfer of the
Shares.
8. Reliance for Exemptions. The Purchaser understands that the
Shares are being transferred to him pursuant to exemptions from the
registration requirements of federal and applicable state securities laws
and acknowledges that he is relying upon the investment and other
representations made herein as the basis for such exemptions.
9. Accuracy of Purchaser Representations. The Purchaser represents
that the information and representations contained in this letter are
true, correct and complete.
Dated: October 19th , 2006
Meepo Investment Consortium (Pty) Ltd
_______________________________
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Guapo Garcao
_________________
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
_______________
▇▇▇▇▇ ▇▇▇▇ Ruiters
SCHEDULE 2.1
SELLING SHAREHOLDER'S SHARE OWNERSHIP
Adjusted African
Shareholder No. of Shares Percentage No. of Shares
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Gaupo Garcao 244 24.4 % 7,654,902
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ 26 2.6 815,687
▇▇▇▇▇ ▇▇▇▇ Ruiters 240 24.0 7,529,411
____________________________________________
Sub-Total 510 51% 16,000,000
The African Diamond
Company, Inc 490 49.0
Shares in Meepo
Total 1000 100% 16,000,000
SCHEDULE 3.1.12
COMPANY SEC DOCUMENTS
SEC Filings
Filing Date of Filing
Form 10-SB-12g (as amended) Originally: May 28, 1999
Last Pre-Effective Amendment:
September 1, 1999
Form 10-KSB April 27, 2000
Form 10-QSB May 9, 2000
Form 10-SB-12g May 16, 2000
Form 10-QSB August 16, 2000
Form 10-K/A October 25, 2000
Form 8-K January 16, 2001
Form 10-QSB March 12, 2001
Form 10-KSB April 18, 2001
Form 10-SB-12g May 2, 2001
Form 10-SB-12g June 18, 2001
Form 10-QSB June 21, 2001
Form 10-KSB July 31, 2001
Form 10-QSB August 15, 2001
Form NTN 10-Q November 20, 2001
Form 10-QSB November 27, 2001
Form 10-KSB February 13, 2002
Form 10-QSB May 10, 2002
Form 10-Q August 16, 2002
Form 10-QSB November 15, 2002
Form 10-QSB-A December 9, 2002
Form 10-KSB April 4, 2003
Form SC-14-F1 April 4, 2003
Form SC-14-F1A April 17, 2003
Form 10-KSB-A April 23, 2003
Form SC-14-F1A May 8, 2003
Form 10-QSB May 15, 2003
Form 8-K August 12, 2003
Form NT 10-Q August 14, 2003
Form 10-QSB August 21, 2003
Form SC-14-F1A September 18, 2003
Form 8-K October 3, 2003
Form 8-KA October 9, 2003
Form NT-10-Q November 14, 2003
Form 10-QSB December 16, 2003
Form 3 January 28, 2004
Form 4 January 28, 2004
Form NT-10-K March 31, 2004
Form 10-QSB-A November 9, 2004
Form 10-KSB November 24, 2004
Form 10-QSB November 24, 2004
Form 10-QSB November 24, 2004
Form 10-QSB November 24, 2004
Form 8-K December 20, 2004
Form PRE 14C December 20, 2004
Form 10-KSB-A January 7, 2005
Form DEF 14C January 13, 2005
Form 8-K April 12, 2005
Form 8-K January 25, 2006
Form 8-K February 3, 2006
Form 8-K /A March 3, 2006
Form 10-QSB/A March 20, 2006
Form 10-KSB March 20, 2006
Form 10-QSB/A March 20, 2006
Form 10-QSB/A March 20, 2006
Form 10-QSB March 20, 2006
Form 10-QSB March 20, 2006
Form 10-QSB March 20, 2006
Form 10-KSB/A March 20, 2006
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