THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "1933 ACT"), NOR REGISTERED
UNDER ANY STATE SECURITIES LAW, AND ARE "RESTRICTED SECURITIES" AS THAT TERM IS
DEFINED IN RULE 144 UNDER THE 1933 ACT. THE SECURITIES MAY NOT BE OFFERED FOR
SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE 1933 ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE
SATISFACTION OF THE COMPANY.
AGREEMENT FOR THE EXCHANGE OF COMMON STOCK
AGREEMENT made this 31st day of December 1999, by and among August
Project III Corp., a Florida corporation (the "ISSUER"), the selling
shareholders listed on Schedule A attached hereto (the "Selling Shareholders")
and the shareholders listed in Schedule B attached hereto (the "SHAREHOLDERS"),
which SHAREHOLDERS own all of the issued and outstanding shares of Trinity
Medical Group USA, Inc., a Nevada corporation ("Trinity").
In consideration of the mutual promises, covenants, and representations
contained herein, and other good and valuable consideration,
THE PARTIES HERETO AGREE AS FOLLOWS:
EXCHANGE OF SECURITIES. Subject to the terms and conditions of this
Agreement, the ISSUER agrees to issue to SHAREHOLDERS, 5,226,000 shares of the
common stock of ISSUER, $0.001 par value (the "Shares"), in exchange for 100% of
the issued and outstanding shares of Trinity such that Trinity shall become a
wholly owned subsidiary of the ISSUER. In addition, the Selling Shareholders
shall transfer 4,867,000 shares the SHAREHOLDERS in exchange for $175,000. The
total number of shares, 10,093,000 shall be issued in accordance with the
Schedule B attached hereto.
REPRESENTATIONS AND WARRANTIES. ISSUER represents and warrants to
SHAREHOLDERS and Trinity the following:
Organization. ISSUER is a corporation duly organized, validly
existing, and in good standing under the laws of Florida, has all necessary
corporate powers to own properties and carry on a business, and is duly
qualified to do business and is in good standing in Florida. All actions taken
by the incorporators, directors and shareholders of ISSUER have been validly
taken in accordance with the laws of the State of Florida.
<PAGE>
Capital. The authorized capital stock of ISSUER consists of
50,000,000 shares of common stock, $0.001 par value, of which 5,000,000 are
issued and outstanding. All of the outstanding shares were fully paid and non
assessable, free of liens, encumbrances, options, restrictions and legal or
equitable rights of others not a party to this Agreement. At closing, there will
be no outstanding subscriptions, options, rights, warrants, convertible
securities, or other agreements or commitments obligating ISSUER to issue or to
transfer from treasury any additional shares of its capital stock. All of the
shareholders of ISSUER have valid title to such shares and acquired their shares
in a lawful transaction and in accordance with the laws of Florida.
Financial Statements. Annexed hereto as Exhibit A to this
Agreement are the audited financial statements of ISSUER as of July 9, 1999. The
financial statements have been prepared in accordance with generally accepted
accounting principles consistently followed by ISSUER throughout the periods
indicated, and fairly present the financial position of ISSUER as of the date of
the balance sheet in the financial statements, and the results of its operations
for the periods indicated.
Absence of Changes. Since the date of the financial
statements, there has not been any change in the financial condition or
operations of ISSUER, except changes in the ordinary course of business, which
changes have not in the aggregate been materially adverse.
Assets and Liabilities. ISSUER does not have any debt,
liability, or obligation of any nature, whether accrued, absolute, contingent,
or otherwise, and whether due or to become due, that is not reflected on the
ISSUERS' financial statement. ISSUER is not aware of any pending, threatened or
asserted claims, lawsuits or contingencies involving ISSUER or its common stock.
There is no dispute of any kind between ISSUER and any third party, and no such
dispute will exist at the closing of this Agreement. ISSUER has no assets. At
closing, ISSUER will be free from any and all liabilities, liens, claims and/or
commitments and will continue to have no assets.
Ability to Carry Out Obligations. ISSUER has the right, power,
and authority to enter into and perform its obligations under this Agreement.
The execution and delivery of this Agreement by ISSUER and the performance by
ISSUER of its obligations hereunder will not cause, constitute, or conflict with
or result in (a) any breach or violation or any of the provisions of or
constitute a default under any license, indenture, mortgage, charter,
instrument, articles of incorporation, bylaw, or other agreement or instrument
to which ISSUER or its shareholders are a party, or by which they may be bound,
nor will any consents or authorizations of any party other than those hereto be
required, (b) an event that would cause ISSUER to be liable to any party, or (c)
an event that would result in the creation or imposition or any lien, charge or
encumbrance on any asset of ISSUER or upon the securities of ISSUER to be
acquired by SHAREHOLDERS.
2
<PAGE>
Full Disclosure. None of representations and warranties made
by the ISSUER, or in any certificate or memorandum furnished or to be furnished
by the ISSUER, contains or will contain any untrue statement of a material fact,
or omit any material fact the omission of which would be misleading.
Contract and Leases. ISSUER is not currently carrying on any
business and is not a party to any contract, agreement or lease. No person holds
a power of attorney from ISSUER.
Compliance with Laws. ISSUER has complied with, and is not in
violation of any federal, state, or local statute, law, and/or regulation
pertaining to ISSUER . ISSUER has complied with all federal and state securities
laws in connection with the issuance, sale and distribution of its securities.
Pink Sheet Listing. ISSUER has been approved for listing on
the National Quotation Service Pink Sheets with the following trading symbol:
AUUK.
Litigation. ISSUER is not (and has not been) a party to any
suit, action, arbitration, or legal, administrative, or other proceeding, or
pending governmental investigation. To the best knowledge of the ISSUER, there
is no basis for any such action or proceeding and no such action or proceeding
is threatened against ISSUER and ISSUER is not subject to or in default with
respect to any order, writ, injunction, or decree of any federal, state, local,
or foreign court, department, agency, or instrumentality.
Conduct of Business. Prior to the closing, ISSUER shall
conduct its business in the normal course, and shall not (1) sell, pledge, or
assign any assets, (2) amend its Articles of Incorporation or Bylaws, (3)
declare dividends, redeem or sell stock or other securities, (4) incur any
liabilities, (5) acquire or dispose of any assets, enter into any contract,
guarantee obligations of any third party, or (6) enter into any other
transaction.
Documents. All minutes, consents or other documents pertaining
to ISSUER to be delivered at closing shall be valid and in accordance with the
laws of Florida.
Title. The Shares to be issued to SHAREHOLDERS will be, at
closing, free and clear of all liens, security interests, pledges, charges,
claims, encumbrances and restrictions of any kind. None of such Shares are or
will be subject to any voting trust or agreement. No person holds or has the
right to receive any proxy or similar instrument with respect to such shares,
except as provided in this Agreement, the ISSUER is not a party to any agreement
which offers or grants to any person the right to purchase or acquire any of the
securities to be issued to SHAREHOLDERS. There is no applicable local, state or
federal law, rule, regulation, or decree which would, as a result of the
issuance of the Shares to SHAREHOLDERS, impair, restrict or delay SHAREHOLDERS'
voting rights with respect to the Shares.
SHAREHOLDERS and Trinity represent and warrant to ISSUER the following:
3
<PAGE>
Organization. Trinity is a corporation duly organized, validly
existing, and in good standing under the laws of Nevada and has all necessary
corporate powers to own properties and carry on a business, and is duly
qualified to do business and is in good standing in Nevada. All actions taken by
the incorporator, directors and shareholders of Trinity have been validly taken
in accordance with the laws of Nevada.
Shareholders and Issued Stock. Schedule B annexed hereto sets
forth the names and share holdings of 100% of Trinity's shareholders.
Counsel. SHAREHOLDERS and Trinity represent and warrant that
prior to Closing, that they are represented by independent counsel or have had
the opportunity to retain independent counsel to represent them in this
transaction and that prior to Closing, the law offices of Eric P. Littman, P.A.
has acted as exclusive counsel to the ISSUER and has not represented either the
SHAREHOLDERS or Trinity in any manner whatsoever.
INVESTMENT INTENT. SHAREHOLDERS agree that the Shares being issued
pursuant to this Agreement may be sold, pledged, assigned, hypothecate or
otherwise transferred, with or without consideration ( a "Transfer"), only
pursuant to an effective registration statement under the Act, or pursuant to an
exemption from registration under the Act, the availability of which is to be
established to the satisfaction of ISSUER. SHAREHOLDERS agrees, prior to any
Transfer, to give written notice to ISSUER expressing his desire to effect the
transfer and describing the proposed transfer.
CLOSING. The closing of this transaction shall take place at the law
offices of Eric P. Littman, 7695 S.W. 104th Street, Suite 210, Miami, Florida
33156. Unless the closing of this transaction takes place on or before December
24, 1999, then either party may terminate this Agreement.
DOCUMENTS TO BE DELIVERED AT CLOSING.
By the ISSUER
Board of Directors Minutes authorizing the issuance
of a certificate or certificates for 5,226,000 Shares, and instructions from the
Selling Shareholders to reissue 4,867,000 shares all to be registered in the
names of the SHAREHOLDERS equal to their pro-rata holdings in Trinity, pursuant
to schedule B attached hereto.
The resignation of all officers of ISSUER.
A Board of Directors resolution appointing such
person as SHAREHOLDERS designate as a director(s) of ISSUER.
4
<PAGE>
The resignation of all the directors of ISSUER,
except that of SHAREHOLDERS designee, dated subsequent to the resolution
described in clause (iii), above.
Audited financial statements of ISSUER, which shall
include a balance sheet dated as of July 9, 1999 and statements of operations,
stockholders equity and cash flows for the twelve month period then ended.
All of the business and corporate records of ISSUER,
including but not limited to correspondence files, bank statements, checkbooks,
savings account books, minutes of shareholder and directors meetings, financial
statements, shareholder listings, stock transfer records, agreements and
contracts.
Such other minutes of ISSUER's shareholders or
directors as may reasonably be required by SHAREHOLDERS.
BY SHAREHOLDERS and Trinity:
Delivery to the ISSUER, or to its Transfer Agent, the
certificates representing 100% of the issued and outstanding stock of Trinity.
Consents signed by all the shareholders of Trinity
consenting to the terms of this Agreement.
Payment in the amount of $175,000 which shall be
wired as follows:
CITY NATIONAL BANK
801 Brickell Avenue
Miami, FL 33131
ABA: 066004367
CREDIT THE ACCOUNT OF ERIC P. LITTMAN, P.A., TRUST ACCOUNT
ACCOUNT NUMBER: 10002924139
REMEDIES.
Any controversy or claim arising out of, or relating to, this
Agreement, or the making, performance, or interpretation thereof, shall be
settled by arbitration in Miami, Dade County, Florida in accordance with the
Rules of the American Arbitration Association then existing, and judgment on the
arbitration award may be entered in any court having jurisdiction over the
subject matter of the controversy.
5
<PAGE>
MISCELLANEOUS.
Captions and Headings. The Article and paragraph headings
throughout this Agreement are for convenience and reference only, and shall in
no way be deemed to define, limit, or add to the meaning of any provision of
this Agreement.
No oral Change. This Agreement and any provision hereof, may
not be waived, changed, modified, or discharged orally, but only by an agreement
in writing signed by the party against whom enforcement of any waiver, change,
modification, or discharge is sought.
Non Waiver. Except as otherwise expressly provided herein, no
waiver of any covenant, condition, or provision of this Agreement shall be
deemed to have been made unless expressly in writing and signed by the party
against whom such waiver is charged; and (i) the failure of any party to insist
in any one or more cases upon the performance of any of the provisions,
covenants, or conditions of this Agreement or to exercise any option herein
contained shall not be construed as a waiver or relinquishment for the future of
any such provisions, covenants, or conditions, (ii) the acceptance of
performance of anything required by this Agreement to be performed with
knowledge of the breach or failure of a covenant, condition, or provision hereof
shall not be deemed a waiver of such breach or failure, and (iii) no waiver by
any party of one breach by another party shall be construed as a waiver with
respect to any other or subsequent breach.
Time of Essence. Time is of the essence of this Agreement and
of each and every provision hereof.
Entire Agreement. This Agreement contains the entire Agreement
and understanding between the parties hereto, and supersedes all prior
agreements and understandings.
Counterparts. This Agreement may be executed simultaneously in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Notices. All notices, requests, demands, and other
communications under this Agreement shall be in writing and shall be deemed to
have been duly given on the date of service if served personally on the party to
whom notice is to be given, or on the third day after mailing if mailed to the
party to whom notice is to be given, by first class mail, registered or
certified, postage prepaid, and properly addressed, and by fax, as follows:
ISSUER: c/o Eric P. Littman, Esquire
7695 S.W. 104th Street, Suite 210
Miami, Florida 33156
TRINITY: Dr. James Namnath
6
<PAGE>
Trinity Medical Group USA, Inc.
55 Shaver Street, Suite 320
San Rafael, CA 94901
IN WITNESS WHEREOF, the undersigned has executed this Agreement this
31st day of December, 1999.
AUGUST PROJECT III CORP.
By: /s/ Eric Littman
-----------------------------
Eric Littman, President and as
Representative of the Selling
Shareholder
TRINITY MEDICAL GROUP USA, INC.
By: /s/ James Namnath
-----------------------------
James Namnath, President
7
<PAGE>
SCHEDULE A
----------
Selling Shareholders of August Project III Corp.
NAME NO. OF SHARES BEING SOLD
---- ------------------------
Eric Littman 3,867,000
Dennis Strum 1,000,000
TOTAL 4,867,000
8
<PAGE>
SCHEDULE B
----------
Shareholders of Trinity Medical Group USA, Inc.
NAME OF STOCKHOLDER CERTIFICATES ISSUED ISSUED-NOS
NO. OF SHARES OF SHARES
Churdboonchart Trinity Trust 7,200,000 1501
Trinity Partners Trust 400,000 1502
Eastern Frontier 175,000 1503
Black Hills Investment Corp. 175,000 1504
Baldwin Family Trust 50,000 1505
Coleman Abbe 22,500 1506
Bob Rubin 5,000 1507
Atlas Equity 5,500 1508
Ron Mcdonald 20,000 1509
Ron Mcdonald 20,000 1510
Stephen Devanney 20,000 1511
Dr. Buranaj Smutharako 500,000 1512
Virongrong Chaisiriroj 500,000 1513
Ubolrattana Mahidol 500,000 1514
Dr. Vina Churdboonchart 450,000 1515
Elizabeth Namnath 50,000 1516
TOTAL 10,093,000
9
<PAGE>
EXHIBIT A
---------
Financial Statements of August Project III Corp. as of July 9, 1999.
10
