SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
May 12, 2000
(Date of Report)
Forestry International, Inc.
(Exact name of registrant as specified in its charter)
Colorado
(State or other jurisdiction of incorporation)
0-023310 84-1116284
(Commission File Number) (IRS Employer Identification Number)
1205 Ampere, Street, Suite 206, Boucherville, Quebec Canada J4B 7M6
(Address of principal executive offices including zip code)
(514) 495.7747
(Registrant's telephone number including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 1. Change in Control of Registrant.
Acquisition of 2524-7883 Quebec, Inc. as a Wholly Owned Subsidiary
of
Registrant:
On May 2, 2000, Forestry International, Inc., a Colorado
corporation, doing
business as Infynia.com, Inc. (the
?Company) entered into a Purchase and Sale Agreement to acquire all
of the
outstanding stock of 2524-7883 Quebec,
Inc., a corporation incorporated under the laws of the Province of
Quebec,
Canada, that is a holding company of the
ownership interests that have operated as Reid, Marcotte, Michielli
& Associates
(RMM & Associates). The Sellers
of the stock of 2524-7883 Quebec, Inc. were Marc Michielli and Jean-
Pierre Reid.
(the ?Sellers?). Pursuant to the
Purchase and Sale Agreement, the Company agreed to acquire all of
the
outstanding capital stock of 2524-7883
Quebec, Inc. in exchange for Twenty Million Four Hundred Thousand
(20,400,000)
shares of the Company's
Common Stock. The shares issued by the Company for the purchase
price will
represent approximately 49.95% of
the Company?s then issued and outstanding shares. The shares of the
Company?s
common stock are to be issued into
a Custodial Arrangement with Rocheleau Labranche & Associates,
pending
satisfaction of certain conditions under
the Purchase and Sale Agreement, specifically including, but not
limited to,
receipt of the required financial statements
and conformance of those financial statements to representations and
warranties
made by the Sellers and deliver of
Subscription Agreements confirming the status of the shares as
Restricted
Securities to be held for investment purposes
by the Sellers. The Purchase and Sale Agreement provides for
adjustment of the
purchase price in the event the shareholders? equity of 2524-7883
Quebec, Inc. is greater or less that Four Hundred Fifty Thousand
Dollars, ($450,000), Canadian. The Purchase and Sale Agreement also
provides for the reimbursement of the Company for Net Uncollected
Receivables by the Sellers.
Consistent with the terms and conditions of the Purchase and Sale
Agreement, RMM
& Associates and the business and assets held by 2524-7883 Quebec,
Inc. will become a wholly owned Canadian subsidiary of the Company
and will operate under the name Infynia.com Incorporated.
RMM & Associates is engaged in the business of providing business to
business
solutions and services for electronics
commerce, specifically in the installation, configuration and
maintenance of
internal network and internet based
network systems for commercial use. RMM & Associates has operated
in this
market for seventeen (17) years,
primarily in the Quebec and Canadian national market. In addition
to the
operating assets of RMM & Associates,
the Company?s subsidiary will also own the building were the
principal offices
of RMM & Associates are located at
127 Cremazie Ouest, Montreal, Quebec, Canada, H2N 1L5. In
connection with the
Purchase and Sale Agreement,
the subsidiary corporation will be named Infynia.com Incorporated to
reflect its
market orientation to providing e-
commerce network services. The Company anticipates that the
electronic commerce
business operated through its subsidiary will become the principal
business of the Company.
The Board of Directors of Infynia.com Incorporated, will consist of
Marc Michielli, Jean-Pierre Reid and Louis R.
Turp. Mr. Reid has been appointed President and CEO of Infynia.com
Incorporated
and Mr. Michielli has been
appointed Chief Financial Officer and Louis R. Turp has been
appointed as vice-
president of Corporate Finance,
Mergers & Acquisitions. The Board of Directors and officers of the
parent
Company has not changed and there is
no commitment at this time to change the Board of Directors or
Officers of the
Company.
Item 2. Acquisition or Disposition of Assets: See Item 1, above.
Item 3. Bankruptcy or Receivership: Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant: Not
Applicable.
Item. 5. Other Events. The Company has filed a Certificate of
Assumed or Tradename with the Colorado Secretary of State to
authorize its used of the name Infynia.com, Inc. as a trade name.
Item 6. Resignation of Registrant's Directors: Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits:
Pursuant to the terms and conditions of the Purchase and Sale
Agreement, the financial statements required will be filed within
the time limitations set forth in applicable regulations.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended,
Registrant has duly caused this
report to be signed on its behalf by the undersigned hereunto duly
authorized.
FORESTRY INTERNATIONAL, INC.
(Registrant)
By: /s/ Louis R. Turp
Louis R. Turp, Chief Executive Officer
Date: May 12, 2000
EXHIBITS
Exhibit 1. Purchase and Sale Agreement
Exhibit 2. Custodial Agreement
PURCHASE AND SALE AGREEMENT
MEMORANDUM OF AGREEMENT made at Montreal on the 2nd day of May, 2000
BY AND BETWEEN:
2524-7883 QUEBEC, INC., a corporation incorporated under the
laws of the Province of Quebec, with its office at 127, Cremazie W.,
Montreal,Quebec,
Canada H2N 1L5 (the "Vendor"),
MARC MICHIELLI, a Canadian citizen,
having its domicile at
330, Chemin St-Emmanuel, Coteau du Lac, Quebec, Canada J0P 1B0
(The ?Vendor?),
JEAN-PIERRE REID, a Canadian citizen,
having its domicile at
21, Terrasse Venise, Coteau du Lac, Quebec, Canada J0P 1B0 (the
?Vendor?)
AND:
FORESTRY INTERNATIONAL, INC,
Doing business as INFYNIA.COM CORPORATION, a corporation
incorporated under the laws of Colorado with its US registered
office at 3705 Kipling Street, Suite 206, Wheat Ridge, Colorado
80033 (the ?Purchaser?)
INFYNIA.COM Inc., a corporation incorporated under the laws of
Canada, with its office at 1205, Ampere Street, Boucherville,
Quebec, Canada J4B 7M6 (the "Purchaser")
THIS AGREEMENT WITHNESSETH THAT, in consideration of the mutual
covenants herein
contained, it is agreed by and between the Parties as follows:
ARTICLE I
INTERPRETATION
1.1 Definitions. Where used herein or in any amendments hereto or
in any communication required or permitted to be given hereunder,
the following terms shall have the following meanings, respectively,
unless the context otherwise requires:
(a) "Accounts Receivable" shall have the meaning ascribed
thereto at Section 2.5.
(b) "Agreement" shall mean this Purchase and Sale Agreement and
all
instruments supplemental hereto or in
amendment of confirmation hereof; "herein", "hereof", "hereto",
"hereunder" and
similar expressions mean and
refer to this Agreement and not to any particular Article, Section,
Subsection
or other subdivision; "Article",
"Section", "Subsection" or other subdivision of this Agreement means
and refers
to the specified Article, Section,
Subsection or other subdivision of this Agreement.
"Auditors" shall have the meaning ascribed thereto at Section
2.4.
(d) "Benefit Plans" shall have the meaning ascribed thereto at
Section
3.1(cc).
(e) "Closing" shall mean the delivery to the Purchaser of the
certificate
(s) for the Purchased Shares, duly endorsed for transfer, and the
payment to the Vendor of the Purchase Price on the Closing Date
pursuant to Sections 2.1 and 2.3.
(f) "Closing Date" shall have the meaning ascribed thereto at
Section 9.1.
(g) "Closing Date Balance Sheet" shall have the meaning
ascribed thereto at
Section 2.4.
(h) "Corporation" shall mean 2524-7883 Quebec, Inc.
(i) "Financial Statements" shall mean the audited consolidated
financial
statements for the Corporations as of
November 30,1999 and December 31, 1999 respectively, consisting in
each case of
a balance sheet and the accompanying statements of income, retained
earnings and changes in financial position for the period then ended
and notes to the financial statements together with the report of
the auditors thereon, a copy of which financial statements is
annexed hereto as Schedule 1.1(i).
(j) "Indemnified Party" shall have the meaning ascribed
thereto at Section
8.3.
(k) "Indemnifying Party" shall have the meaning ascribed thereto
at Section
8.3.
(l) "Intellectual Property Rights" shall mean (i) all domestic and
foreign
patents, trade marks, trade names, service marks, copyrights, trade
secrets, inventions, know-how, technology, software, licenses, and
other intellectual property, and (ii) all registrations and
applications for registration of intellectual property; and
"Intellectual Property Right" shall mean any one of them.
(m) "Laws" shall mean:
(i) all constitutions, treaties, laws, statutes, codes,
ordinances, orders, decrees, rules,
regulations, and municipal by-laws, whether domestic,
foreign or international;
(ii) all judgments, orders, writs, injunctions, decisions, rulings,
decrees, and awards of any governmental authority or body; and
(iii) all policies, practices and guidelines of any governmental
authority
or body which, although not
actually having the force of law, are considered by such
governmental
authority or body as requiring
compliance as if having the force of law,
in each case binding on or affecting the Party or Person
referred to in the context in which such
word is used; and "Law" shall mean any one of them.
(n) "License" and "Licenses" shall have the respective meanings
ascribed
thereto at Section 3.1(aa).
(o) "Lien" and "Liens" shall have the respective meanings ascribed
thereto at Section 3.1(d)(iii).
(oo) ?Limited Partnership? shall have the meaning of Gestion
RMM, Limited
Partnership.
(p) "Losses" shall have the meaning ascribed thereto at Section
8.1.
(q) "Net Uncollected Receivables" shall have the meaning ascribed
thereto
at Section 2.5.
(r) "Notice of Dispute" shall have the meaning ascribed thereto at
Section 2.4.
(s) "Parties" shall mean the Vendor and the Purchaser; and "Party"
shall
mean either one of them.
(t) "Person" shall mean an individual, corporation, company,
cooperative, partnership, trust, unincorporated association, entity
with juridical personality or governmental authority or body, and
pronouns which refer to a Person shall have a similarly extended
meaning.
(u) "Purchase Price" shall have the meaning ascribed thereto at
Section
2.1.
(v) "Purchase Price Increase" shall have the meaning ascribed
thereto at
Section 2.2.
(w) "Purchase Price Reduction" shall have the meaning ascribed
thereto at
Section 2.2.
(x) "Purchased Shares" shall mean ( shares in the capital of
the
Corporation held by theVendor, to be
delivered at Closing to the Purchaser, duly endorsed for
transfer.
(y) "Subsidiary" shall mean any subsidiaries of the vendor if
applicable.
(a?) "Tax" and "Taxes" shall have the respective meanings
ascribed thereto
at Section 3.1(y).
(aa) "Third Party Auditors" shall have the meaning ascribed
thereto at Section 2.4.
(ab) "Third Party Claim" shall have the meaning ascribed
thereto at Section
8.5.
(ac) "Uncollected Receivables" shall have the meaning ascribed
thereto at
Section 2.5.
1.2 Schedules. The following is a list of the Schedules attached
hereto and incorporated herein by reference:
Schedule 1.1(j) - Financial
Statements
Schedule 3.1(n) - Immoveable
Schedule 3.1(o) - Condition and
Sufficiency
of Assets; Inventory
Schedule 3.1(p) - Place of
Business
Schedule 3.1(q) - Intellectual
Property
Rights (if necessary)
Schedule 3.1 - Leases (if 396: applicable)
Schedule 3.1(s) - Contracts (if
applicable)
Schedule 3.1(u) - Insurance
Schedule 3.1(v) - Bank Accounts;
Powers of
Attorney
Schedule 3.1(w) - Outstanding Litigation (if
applicable)
Schedule 3.1(aa) - Licenses
Schedule 3.1(bb) - Employment
Agreements
Schedule 3.1(cc) - Benefit Plans
Schedule 3.1(dd) - Environmental
Matters
Schedule 4.5- - Form of Resignation
and
Release
ARTICLE II
Purchase and Sale
2.1 Purchase and Sale. Upon and subject to the terms and
conditions hereof,
the Vendor shall sell to the Purchaser,
and the Purchaser shall purchase from the Vendor, the Purchased
Shares and One
Hundred percent (100%) of Gestion
RMM, Limited Partnership on the Closing Date for an amount equal to
Twenty Million Four Hundred Thousand (20,400,000) common shares of
Forestry International, Inc. (the "Purchase Price").
2.2 Purchase Price Adjustment. The Purchase Price shall be
reduced (the
"Purchase Price Reduction") by the
amount, if any, by which the shareholders, equity of the
Corporation, as shown
on the Closing Date Balance Sheet, is less than Four Hundred Fifty
Thousand Canadian dollars ($450,000.00 Can).
The Purchase Price shall be increased
(the "Purchase Price Increase") by the amount, if any, by which the
shareholders' equity of the Corporation, as
shown on the Closing Date Balance Sheet, is more than Four Hundred
Fifty
Thousand Canadian dollars ($450,000.00
Can). Any Purchase Price Reduction shall be payable by the Vendor to
the
Purchaser, and any Purchase Price
Increase shall be payable by the Purchaser to the Vendor, in either
case, within
ten (10) calendar days of the date on
which the Closing Date Balance Sheet becomes final and binding on
the Parties.
2.3 Payment of the Purchase Price. On the Closing Date, the
Purchaser shall
pay to the Vendor the Purchase
Price by way of common shares of Forestry International, Inc. The
aforesaid
common shares will be held in trust
by the firm Rocheleau, Labranche & Associates.
2.4 Post-Closing Adjustment. Forthwith after the Closing, the
Purchaser and
the Vendor shall jointly instruct
Rocheleau, Labranche & Associes and Mr. Robert Kliaman, C.P.A. (The
?Auditors?)
to prepare a consolidated
balance sheet showing the assets and liabilities of the Corporation
as at the
Closing Date (the "Closing Date Balance
Sheet"). The Closing Date Balance Sheet shall be prepared in
accordance with
generally accepted accounting
principles in Canada and the United States, applied on a basis
consistent with
prior periods and consistent throughout the periods involved. The
Parties shall jointly instruct the Auditors to produce the Closing
Date Balance Sheet within 90 calendar days after the Closing Date.
If the Purchaser or the Vendor wishes to dispute any matter in the
Closing Date Balance Sheet, it may do so
by notice ("Notice of Dispute") to the other given within ten (10)
calendar days
of the delivery of the Closing Date
Balance Sheet to the Purchaser. A Notice of Dispute shall specify
the basis for
each objection and the dollar amount
involved. The Parties shall use their best efforts to amicably
resolve any
matters identified in a Notice of Dispute as
promptly as practicable. If any such dispute shall not have been
resolved
within ten (10) calendar days following the
date on which the Notice of Dispute is given, then either Party may
refer such
unresolved matters to an independent
auditor. (the "Third Party Auditors") for resolution. The
determination of the
Third Party Auditors shall be made
within thirty (30) calendar days after the matter has been referred
to them. If
no Notice of Dispute is given within
the delay prescribed above, then the Auditors shall forthwith, upon
the expiry
of said delay, deliver the Closing Date
Balance Sheet to the Parties, and such Closing Date Balance Sheet
shall be final
and binding on the Parties as of and
from the date of such delivery. If a Notice of Dispute is given in
accordance
with this Section 2.4, then the Auditors
shall, forthwith following the decision of the Third Party Auditor,
amend the
Closing Date Balance Sheet to reflect
the decision of the Third Party Auditor and deliver the Closing Date
Balance
Sheet to the Parties, and such Closing
Date Balance Sheet shall be final and binding on the Parties as of
and from the
date of such delivery.
The fees and disbursements of the Auditors and the Third Party
Auditors shall be
shared equally by the Purchaser and
the Vendor.
2.5 Accounts Receivable. The Purchaser shall use its reasonable
efforts to
collect all accounts receivable and trade
accounts due as at the Closing Date to the Corporation and the
Subsidiaries (the
"Accounts Receivable"). Any
amounts collected by the Purchaser, the Corporation or the
Subsidiaries from any
debtor of Accounts Receivable, shall
be imputed firstly to the oldest Accounts Receivable from such
debtor; provided
that if a payment of any of the
Accounts Receivable is contested, in whole or in part, by the debtor
thereof,
then any amounts collected by the
Purchaser, the Corporation or the Subsidiaries from such debtor
shall be imputed
to the next oldest uncontested
Accounts Receivable from such debtor. The Purchaser, the
Corporation and the
Subsidiaries shall have no obligation
to institute suit to collect any Accounts Receivable. The
Purchaser, the
Corporation and the Subsidiaries shall not
compromise any Accounts Receivable without the Vendor's consent. If
on the 90th
day after the Closing Date any
Accounts Receivable remain uncollected (the "Uncollected
Receivables"), the
amount of such Uncollected
Receivables less the amount of any reserves provided for Accounts
Receivable on
the Closing Date Balance Sheet (the
net amount of such Uncollected Receivables being the "Net
Uncollected
Receivables") shall be immediately payable
by the Vendor to the Purchaser. Upon payment by the Vendor to the
Purchaser of
the full amount of the Net
Uncollected Receivables, the Purchaser hereby agrees to cause the
Corporation
and the Subsidiaries to assign to the
Vendor, out of the Uncollected Receivables, such Accounts Receivable
equal to
the amount of the Net Uncollected
Receivables. If, after assignment of such Accounts Receivable, the
Purchaser,
the Corporation or the Subsidiaries
receives any payment on account of any such Accounts Receivable, the
Purchaser,
the Corporation or the Subsidiaries shall forthwith pay over the
amount of such payment to the Vendor.
ARTICLE III
Representation and
Warranties
3.1 Representations and Warranties of the Vendor. The Vendor
represents and
warrants to the Purchaser as
follows and acknowledges that the Purchaser is relying upon such
representations
and warranties in connection with the purchase by the Purchaser of
the Purchased Shares and that the Purchaser would not have entered
into this Agreement without such representations and warranties:
(a) Due Incorporation. The Corporation and (all subsidiaries
if applicable):
(i) is duly incorporated, validly existing and in good standing
under the Laws of its
jurisdiction of incorporation; and
(ii) has all necessary corporate power and authority to own, lease
and operate its properties and to conduct
its business as and in the places where such properties are
now owned, leased or operated or such
business is now conducted.
(b) Due Authorization. The Vendor has the necessary corporate
power and authority to execute this Agreement and to perform its
obligations hereunder. The execution of this Agreement by the
Vendor and the performance by the Vendor of its obligations
hereunder has been duly authorized by all necessary action on its
part. Such execution and performance by the Vendor does not require
any action or consent of, any registration with, or notification to,
any Person, or any action or consent under any Laws to which the
Vendor, the Corporation or any Subsidiary is subject.
Enforceability. This Agreement constitutes a legal, valid and
binding
obligation of the Vendor enforceable
against it in accordance with its terms.
(d) No Conflict. The execution of this Agreement, the
consummation of the
transactions contemplated herein, the
performance by the Vendor of its obligations hereunder and the
compliance by the
Vendor with this Agreement do
not:
(i) violate, contravene or breach, or constitute a default
under,
the constating instruments or by-laws of the
Corporation or any Subsidiary;
(ii) violate, contravene or breach, or constitute a default under
any contract, agreement, indenture,
instrument, or commitment to which the Vendor or the
Corporation or any Subsidiary may be a party,
or their properties may be subject, or by which either of them
is bound or affected;
(iii) result in, or give any Person the right to seek, or to cause
(a) the termination, cancellation, modification,
amendment, variation or renegotiation of any contract,
agreement, indenture, instrument or commitment
to which the Corporation or any of their properties may be a
party or subject or by which it is bound or
affected, or (b) the acceleration or forfeiture of any term of
payment, or the loss in whole or in part
of any benefit which would otherwise accrue to the Corporation;
(iv) result in, or require the creation of any lien, hypothec,
pledge, charge, prior claim, security interest,
adverse claim or other encumbrance or right of others of any
nature, whatsoever or howsoever arising
(individually, a "Lien" and collectively, "Liens"), upon any of
the Purchased Shares or any property of
the Corporation; or
(v) violate, contravene or breach any Laws.
(e) Authorized and Issued Capital. The authorized capital of
the
Corporation consists of Three Hundred (300)
Class A shares, Two Hundred Twenty Five (225) Preferred shares,
Class C and Two
Hundred Twenty Five
(225) Preferred shares Class D of which shares have been validly
subscribed and
issued and are outstanding as fully paid and non-assessable. The
Purchased Shares represent all of the issued and outstanding shares
in the capital of the Corporation and also include One Hundred
percent (100%) of Gestion RMM, Limited Partnership that own the
building where the principal offices of RMM & Associates are
located at 127 Cremazie Ouest, Montreal, (Quebec) Canada H2N 1L5.
(f) No Subsidiaries. (if applicable) The Corporation does not
own, and has
never owned, directly or indirectly,
any shares in the capital of any Person (other than the
Subsidiaries) and has
never made any investment in, and does
not have, and has never had, any property interest in, any Person
(other than
the Subsidiaries).
(g) Title to Purchased Shares. The Vendor is the beneficial
owner and holder of record of the Purchased Shares and at Closing
shall transfer to the Purchaser a good and valid title to the
Purchased Shares, free and clear of all Liens.
The Corporation is the beneficial owner and holder of record of all
of the
issued and outstanding shares in the capital
of each Subsidiary, with good and valid title to such shares, free
and clear of
all Liens.
(h) No Options. There is no:
(i) outstanding security of the Corporation or any
Subsidiary
convertible or exchangeable into any
share or shares in the capital of the Corporation or any Subsidiary;
(ii) outstanding subscription, option, warrant, call,
commitment
or agreement obligating the
Corporation or any Subsidiary to issue any share or shares
of its capital or any security or
securities of any class or kind which in any way relate to
the authorized or issued capital of the
Corporation or any Subsidiary;
(iii) agreement (other than this Agreement) which grants to any
Person the right to purchase or
otherwise acquire any share or shares issued and
outstanding in the capital of the Corporation or
any Subsidiary; or
(iv) voting trust or voting agreement or pooling agreement or
proxy with respect to any Purchased
Shares or any issued and outstanding shares in the capital
of any Subsidiary.
(i) Books and Records. The minute books of the Corporation
and the
Subsidiaries are complete and accurate,
and contain copies of all by-laws and resolutions passed by the
shareholders and
directors since the date of their incorporation; all of which by-
laws and resolutions have been duly passed.
The share certificate books, registers of shareholders, registers of
transfers and registers of directors of the
Corporation and the Subsidiaries are complete and accurate.
The financial books and records of the Corporation and the
Subsidiaries have been maintained in accordance
with sound business practices and fairly, accurately and completely
present and
disclose in accordance with generally
accepted accounting principles consistently applied (i) the
financial position
of the Corporation and the Subsidiaries, and (ii) all transactions
of the Corporation and the Subsidiaries.
(j) Financial Statements. The Financial Statements fairly,
accurately and completely present and disclose in all material
respects (i) the assets, liabilities and obligations (whether
accrued, contingent, absolute or otherwise), income, losses,
retained earnings, reserves and financial position of the
Corporation and the Subsidiaries, (ii) the results of operations of
the Corporation and the Subsidiaries, and (iii) the changes in the
financial position of the Corporation and the Subsidiaries, all as
at the dates and for the periods therein specified.
(k) Liabilities. The Corporation and the Subsidiaries have
no
liabilities or obligations of any nature whatsoever,
whether direct, indirect, absolute, contingent or otherwise, except
for those
liabilities or obligations (i) reflected in
or reserved against in the Financial Statements for the year ended
November 30,
1999, (ii) incurred after November
30, 1999 in the usual and ordinary course of its business, or (iii)
disclosed in
any of the Schedules attached to this
Agreement.
(l) Accounts Receivable. All accounts receivable of the
Corporation and
the Subsidiaries are bona fide, result
from the ordinary course of business, have been properly recorded in
the
ordinary course of business, and, subject
to reserves in accordance with past practice, are good and
collectible in full
when due without any discount, setoff or counterclaim, in amounts
equal to not less than the aggregate face amounts thereof.
(m) Title to Property. The Corporation and each Subsidiary is
the sole
and unconditional owner of, and has
a good and valid title to (or, in the case of immoveable and real
property, has
a good and marketable title to), all
of its assets reflected on the Financial Statements for the year
ended November
30, 1999, or which have been
acquired on or after November 30, 1999 (other than such assets
consumed or
disposed of on or after November
30, 1999 in the ordinary course of business and in a manner
consistent with past
practice), in each case free and
clear of all Liens.
(n) Immoveables. Schedule 3.1(n) annexed hereto is a true
and complete
description of all immoveables and real property owned by or leased
to the Corporation or any Subsidiary, including, without limitation,
all buildings, structures, erections and appurtenances located
thereon.
Every immoveable and real property owned or used by or leased to or
from the Corporation or any
Subsidiary does not violate, contravene or breach, and is used in
compliance
with, any and all Laws. The Corporation
and the Subsidiaries have not received any notice that any of the
aforesaid
immoveable or real property (i) is not in
compliance with any Laws, (ii) is not used in compliance with any
Laws, and/or
(iii) requires work to be done in
connection therewith.
(o) Condition and Sufficiency of Assets; Inventory. Except
as disclosed
in Schedule3.1(o) annexed hereto,
all of the tangible assets of the Corporation and the Subsidiaries
are (i) in
good operating condition and repair,
ordinary wear and tear excepted, (ii) not in need of maintenance or
repairs
(except ordinary or routine maintenance
or repairs that are not material in nature or costs, individually or
collectively), and (iii) adequate and sufficient for
the continuing conduct of the business of the Corporation and the
Subsidiaries
as now conducted.
All Inventory of the Corporation and the Subsidiaries is of a
quality and quantity usable and saleable in the ordinary course of
business.
(p) Location; Place of Business. Other than inventory in
transit and
vehicles used in the transportation of such
inventory, the Corporation and the Subsidiaries do not hold,
directly or
indirectly, any of their immoveable or real
property or moveable or personal property anywhere other than in the
locations
set forth in Schedule 3.1(p) annexed
hereto.
(q) Intellectual Property Rights. (If necessary) Schedule
3.1(q) annexed
hereto is a true and complete list of
(i) all registered Intellectual Property Rights used by the
Corporation and the
Subsidiaries, and (ii) all pending
applications for Intellectual Property Rights used by the
Corporation and the
Subsidiaries in connection with their
business, none of which has been opposed or held unenforceable.
Each of the
aforesaid Intellectual Property Rights
is valid, subsisting and enforceable and each such Intellectual
Property Right
is duly recorded in the name of the
Corporation or a Subsidiary, and the corporation or a Subsidiary is
the absolute
owner and has the sole and exclusive right to hold and use the said
Intellectual Property Right without making any payment to others or
granting rights to others in exchange.
Leases. (If applicable) Schedule 3.1 annexed hereto is a
true
and complete list of all leases to which any
of the Corporation or the Subsidiaries are party or their properties
are
subject. All such leases are in good standing
and in full force and effect without amendment thereto, and the
Corporation and
the Subsidiaries are entitled to all
benefits under such leases.
(s) Contracts. Schedule 3.1(s) annexed hereto contains a
description of all written contracts, agreements, indentures,
instruments and commitments to which the Corporation or any
Subsidiary is a party or by which it is bound.
(t) Guarantees. The Corporation and the Subsidiaries are
not party to
or bound either absolutely or on a
contingent basis by any comfort letter, understanding or agreement
of guarantee,
indemnification, assumption or endorsement or any like commitment
with respect to the liabilities or obligations of any Person
(whether accrued, absolute or otherwise contingent), except in the
ordinary course of business. (u) Insurance. The Corporation
and the Subsidiaries maintain insurance with responsible and
reputable insurers in such amounts and covering such risks and with
such deductibles as are generally maintained by like businesses.
Schedule 3.1(u) is a true and complete list of all insurance
policies currently
maintained by or for the Corporation and the Subsidiaries. The
coverage under each such policy is in full force and effect and the
Corporation and the Subsidiaries are in good standing under such
policies.
The Corporation and the Subsidiaries have not received notice of,
and the Vendor has no knowledge of,
any fact, condition or circumstance which might reasonably form the
basis of any
claim against the Corporation or
any Subsidiary which (i) is not fully covered by insurance (subject
to
deductibles) maintained by or for the Corporation
or any Subsidiary, or (ii) would result in any increase in
insurance premiums
payable by the Corporation or any
Subsidiary.
(v) Bank Accounts: Powers of Attorney. Schedule 3.1(u)
annexed hereto
sets forth: (i) the name of each
Person with whom the Corporation and the Subsidiaries maintain an
account or
safety deposit box and the names of
all Persons authorized to draw thereon or to have access thereto;
and (ii) the
name of each Person holding a general
or special power of attorney from the Corporation or any
Subsidiary and a
summary of the terms thereof.
(w) Litigation. Except as disclosed in Schedule 3.1(w) (if
applicable)
annexed hereto, there are (i) no actions,
claims, investigations, arbitrations, and other proceedings pending,
or to the
knowledge of the Vendor, threatened against, with respect to, or
affecting in any manner, the Corporation, the Subsidiaries, their
properties or the Purchased Shares, or any issued and outstanding
shares in the capital of any Subsidiary; and (ii) no outstanding
judgments, orders, decrees, writs, injunctions, decisions, rulings
or awards against, with respect to, or in any manner affecting any
of the Corporation, the Subsidiaries, their properties or the
Purchased Shares, or any issued and outstanding shares in the
capital of any Subsidiary.
(x) Default Under Agreements. The Corporation and the
Subsidiaries (i)
are in good standing and entitled to
all benefits under, (ii) have performed all obligations required to
be performed
under, and (iii) are not in default
under, or in breach of, any written or oral contracts, agreements,
indentures,
instruments, commitments, licenses or
permits applicable to any of them.
(y) Tax Matters. The Corporation and the Subsidiaries have
correctly prepared and duly and timely filed all tax returns
required to be filed by them, have paid all taxes, (including,
without limitation, income, withholding, real property, social
service and corporation, capital, value added, sales, franchise,
excise, profits, gross receipts, customs duties, stamp, transfer,
water, business and goods and services taxes)
(collectively, the "Taxes", and individually,
a "Tax") which are due and payable and adequate provision will be
made in the
Closing Date Balance Sheet for the
payment of all Taxes not yet due and payable for any taxation year
ending on or
prior to the Closing Date. The
Corporation and the Subsidiaries have made adequate and timely
installments of
Tax. All Tax returns filed by the
Corporation and the Subsidiaries have been duly and accurately
completed as required by Law.
With respect to any period for which Tax returns have not yet been
filed or for which Taxes are not yet due and payable, the
Corporation and the Subsidiaries have only incurred liabilities for
Taxes in the ordinary course of their business.
All Tax returns of the Corporation and the Subsidiaries have been
assessed through and including (and there
are no outstanding waivers of any limitation periods or agreements
providing for
an extension of time for the filing of any Tax return or the payment
of any Tax by the Corporation or any Subsidiary. All deficiencies
proposed as a result of such assessments or reassessments of the Tax
returns through and including November 30, 1999 have been paid and
settled.
The Corporation and each Subsidiary have withheld from each
payment made to any of their past and
present shareholders, directors, officers, employees and agents the
amount of
all Taxes and other deductions required
to be withheld and has paid such amounts when due or made adequate
provision for
the payment of such amounts to
the proper receiving authorities.
The Corporation and the Subsidiaries are not subject to any
assessments, levies, penalties or interest with
respect to Taxes which will result in any liability on their part in
respect of
any period ending on or prior to the
Closing Date, in excess of the amount provided for and reserved
against in the
Closing Date Balance Sheet.
(a?) Paid-up Capital. The paid-up capital for tax purposes
of each of the Purchased Shares is no less than its stated capital
for corporate purposes.
(aa) Licenses, Permits. The Corporation and each Subsidiary
has, and is
in full compliance with and entitled
to all of the benefits under, all permits, licenses, certificates of
compliance,
consents, approvals and authorizations
of, or registrations with, any governmental, judicial or public
authority or
regulatory body (collectively, the
"Licenses", and individually a "License") necessary or required to
conduct its
business as presently conducted, and
each License has been validly issued and is in full force and
effect. Other
than as set forth in Schedule 3.1(aa)
annexed hereto, there are no Licenses required to conduct the
business of the
Corporation or any Subsidiary as
presently conducted. No fact, condition or circumstance has occurred
to create,
and the execution of this Agreement and its performance shall not
create, any right to terminate, cancel, modify, amend, revoke or
expire any License.
(ab) Employee Matters. The Corporation and the Subsidiaries
have complied
with all applicable Laws relating to employment matters, including,
without limitation, any provisions thereof relating to wages, hours
and collective bargaining.
Schedule 3.1(bb) annexed hereto is a true and complete list of all
written employment, service, union,
agency, consulting, termination and severance contracts and
agreements entered
into by the Corporation or any
Subsidiary with or for any or all of its present or past
shareholders, directors, officers, employees and agents. Except as
set out in the contracts and agreements therein referred to, there
are no shareholders, directors, officers, employees or agents of the
Corporation who are entitled to a specified notice of termination or
fixed term of employment or who cannot be dismissed upon such notice
as is required by Law.
(ac) Benefit Plans. Except as set forth in Schedule 3.1(cc)
annexed hereto,
neither the Corporation nor any
Subsidiary is a party to any pension, retirement, bonus, profit
sharing,
compensation, incentive, stock purchase, stock
option, stock appreciation, severance, change-of-control, savings,
thrift,
insurance, medical, hospitalization,
disability, death or other similar program, or practice providing
directors,
officers, shareholders or employee benefits
(the "Benefit Plans").
There are no outstanding defaults or violations by the Corporation
or any Subsidiary of any payment
obligation required to be performed by it in connection with any
Benefit Plan.
There are no actions, claims,
investigations, arbitrations or other proceedings which, to the
knowledge of the
Vendor, are pending or threatened with respect to the Benefit Plans
(other than routine claims for benefits) against the Corporation,
any Subsidiary, the funding agent or the fund of such Benefit Plan.
No proceeding has been initiated to terminate any Benefit Plan.
All Benefit Plans which are funded plans are funded in accordance
with their rules and all Laws and are fully funded on both a going-
concern and a termination basis.
(ad) Environmental Matters. Except as set forth at Schedule
3.1(dd)
annexed hereto, the Corporation and the
Subsidiaries have at all times conducted, held and used, and are
continuing to
conduct, hold and use, their affairs,
business and properties in accordance with all applicable Laws
relating in whole
or in part to the environment or its
protection.
Except as disclosed at Schedule 3.1(dd) annexed hereto, at no time
have any contaminants been released,
emitted, discharged, deposited, issued, sprayed, injected,
abandoned, buried,
spilled, incinerated, disposed, leaked,
poured, emptied, dumped, or placed on, in, under or adjacent to any
immoveable
or real property owned or used by
the Corporation or any Subsidiary.
(ae) Compliance with Laws. The Corporation and each
Subsidiary have complied and continue to comply with all Laws.
(af) No Changes. Since November 30, 1999 there has not been
any material
adverse change in the business, operations, properties, prospects or
condition of the Corporation or the Subsidiaries, or any event,
condition or contingency that is likely to result in such a material
adverse change. (ag) No Unusual Transactions. Since
Novemver 30, 1999 each of the Corporation and the Subsidiaries has
conducted its business in the ordinary course, and, without limiting
the generality of the foregoing, has not:
(i) made or assumed any commitment, obligation or
liability which is outside the
usual and ordinary course of its business;
(ii) ceased to operate its properties and to carry on its
business as heretofore carried on nor has the
Corporation or any Subsidiary failed to maintain all of
its properties, rights and assets consistently
with past practices, nor has the Corporation or any
Subsidiary failed to do any and all things
reasonably necessary and within its power to retain and
preserve the goodwill of its business;
(iii) sold or otherwise in any way alienated or disposed of
or lost any of its assets other than in the
ordinary course of business and in a manner consistent
with past practices;
(iv) split, combined or reclassified any of its shares, or
redeemed, retired, repurchased or otherwise
acquired shares in its capital stock or other corporate
security, or reserved, declared, made or
paid any dividend, or made any other distributions or
appropriations of profits or capital;
(v) discharged any secured or unsecured obligation or
liability (whether accrued, absolute,
contingent or otherwise), other than obligations and
liabilities discharged in the ordinary course
of business and in a manner consistent with past practices;
(vi) waived or canceled any material claim, account
receivable, trade account, or right outside the
ordinary course of business or made any gift;
(vii) made any change in the rate or form of compensation or
remuneration payable or to become
payable to any of its shareholders, directors, officers, employees
or agents;
(viii) made any change in its accounting principles and
practices as utilized in the preparation of the
Financial Statements, or granted to any customer any
special allowance or discount, or changed
its pricing, credit or payment policies, other than in
the ordinary course of business;
(ix) made any capital expenditure;
(x) made any loan or advance, or assumed,
guaranteed or
otherwise became liable with respect to
the liabilities or obligations of any Person;
(xi) suffered any extraordinary losses whether or not covered
by insurance; modified its constating
instruments, by-laws or capital structure;
(xii) suffered any material shortage or any cessation or
interruption of inventory shipments, supplies
or ordinary services;
(xiv) removed any director or auditor or terminated any officer;
(xv) purchased or otherwise acquired any corporate security or
proprietary, participatory or profit
interest in any Person;
(xvi) incurred any indebtedness other than to trade creditors
in the ordinary course of business and in
a manner consistent with past practices;
(xvii) issued, sold or otherwise disposed of any shares of its
capital stock or any warrants, rights,
bonds, debentures, notes or other corporate security;
(xviii) modified or changed its business organization or its
relationship with its suppliers, customers
and others having business relations with it; or
(xix) authorized, agreed or otherwise committed to any of the
foregoing;
(ah) No Broker. None of the Vendor, the Corporation, the
Subsidiaries or
any of their respective shareholders,
directors, officers, employees or agents has employed or incurred
any liability
to any broker, finder or agent for any brokerage fees, finder's
fees, commissions or other amounts with respect to this Agreement
or any of the transactions contemplated hereby.
(ai) Stand Alone. No part of the business of the Corporation
or any
Subsidiary is conducted through any Person
other than the Corporation or any Subsidiary. The Vendor does not
have, and
none of the Corporation's or any
Subsidiary's directors or officers has, any interest in any
property, immovable
or real, movable or personal, tangible
or intangible, used in or pertaining to the business of the
Corporation or any
Subsidiary.
(aj) Full Disclosure. The Vendor has made or caused to be
made due
inquiry with respect to (i) each covenant,
agreement, obligation, representation and warranty contained in this
Agreement,
(ii) the Schedules annexed hereto,
and (iii) any certificates or other documents referred to herein or
furnished to
the Purchaser pursuant hereto, and none
of the aforesaid covenants, agreements, obligations,
representations,
warranties, Schedules, certificates or documents
contains any untrue statement of a material fact or omits to state
a material
fact necessary to make such representation, warranty, Schedule,
certificate or other document not misleading.
Except as disclosed in this Section 3.1 or as set forth in the
Schedules annexed hereto, there is no fact,
condition or circumstance which (i) adversely or in the future may
adversely
affect the business, operations,
properties, prospects, or condition of the Corporation or any
Subsidiary or the
ability of the Vendor to perform its obligations under this
Agreement, or (ii) relates to the business of the Corporation or any
Subsidiary and might reasonably be expected to deter a Person
carrying on a like business from consummating the transactions
hereby contemplated.
3.2 Representations and Warranties of the Purchaser. The
Purchaser represents
and warrants to the Vendor as follows and acknowledges that the
Vendor is relying upon such representations and warranties in
connection with the sale by the Vendor of the Purchased Shares and
that the Vendor would not have entered into this Agreement without
such representations and warranties:
(a) Due Incorporation. The Purchaser is duly incorporated,
validly existing and in good standing under the laws
of its jurisdiction of incorporation and has the necessary
corporate power to
own or lease its properties and to carry on its business as such
business is presently conducted.
(b) Due Authorization. The Purchaser has the necessary corporate
power and authority to execute this Agreement and to perform its
obligations hereunder. The execution of this
Agreement by the Purchaser and the
performance by the Purchaser of its obligations hereunder have been
duly
authorized by all necessary corporate action
on its part. Such execution and performance by the Purchaser does
not require
any action or consent of, any registration with, or notification to,
any Person, or any action or consent under any Laws to which the
Purchaser is subject.
(c) Enforceability. This Agreement constitutes a legal, valid and
binding
obligation of the Purchaser, enforceable
against it in accordance with its terms.
(d) No Conflict. The execution of this Agreement, the
consummation of the
transactions contemplated herein,
the performance by the Purchaser of its obligations hereunder and
the compliance
by the Purchaser with this
Agreement do not violate, contravene or breach, or constitute a
default under,
the constating instruments or by-laws
of the Purchaser.
(e) No Broker. Neither the Purchaser nor any of its shareholders,
directors, officers, employees or agents has employed or incurred
any liability to any broker, finder or agent for any brokerage fees,
finder's fees, commissions or other amounts with respect to this
Agreement or any of the transactions contemplated hereby.
ARTICLE IV
Covenants of the Vendor
4.1 Conduct of Business. The Vendor shall cause each of the
Corporation and
the Subsidiaries from the date hereof
up to the Closing Date to conduct its business in the ordinary
course and in a
manner consistent with past practices and, without limiting the
generality of the foregoing, the Vendor shall cause each of the
Corporation and the Subsidiaries not to:
(a) make or assume any commitment, obligation or liability
which is
outside the usual and ordinary course of
its business;
(b) cease to operate its properties and to carry on its
business as
heretofore carried on or fail to maintain all of
its properties, rights and assets consistently with past practices,
or fail to do any and all things reasonably
necessary and within its power to retain and preserve the goodwill
of its business;
sell or otherwise in any way alienate or dispose of any of
its
assets, other than in the ordinary course of
business and in a manner consistent with past practices;
(d) split, combine or reclassify any of its shares, or
redeem, retire,
repurchase or otherwise acquire shares in
its capital stock or other corporate security, or reserve, declare,
make or pay any dividend, or make any other
distributions or appropriations of profits or capital;
(e) discharge any secured or unsecured obligation or
liability (whether
accrued, absolute, contingent or
otherwise), other than obligations and liabilities discharged in the
ordinary course of business and in a
manner consistent with past practices;
(f) waive or cancel any material claim, account receivable,
trade
account or right outside the ordinary course
of business or make any gift;
(g) make any change in the rate or form of compensation or
remuneration
payable to or to become payable to,
any of its shareholders, directors, officers, employees or agents;
(h) make any change in its accounting principles and
practices as
utilized in the preparation of the Financial
Statements, or grant to any customer any special allowance or
discount, or change its pricing, credit or
payment policies, other than in the ordinary course of business;
(i) make any capital expenditure;
(j) make any loan or advance, or assume, guarantee, endorse
or otherwise
become liable with respect to the
liabilities or obligations of any Person;
(k) modify its constating instruments, by-laws or capital
structure;
(l) remove any director or auditor or terminate any officer
[without
cause], except those directors, auditors and
officers who will resign in accordance with Subsection 4.5(d);
(m) purchase or otherwise acquire any corporate security or
proprietary,
participatory or profit interest in any
Person;
(n) incur any indebtedness other than to trade creditors in
the ordinary
course of business and in a manner
consistent with past practices;
(o) issue, sell or otherwise dispose of any shares of its
capital stock
or any warrants, rights, bonds,
debentures, notes or other corporate security;
(p) modify or change its business organization or its
relationship with
its suppliers, customers and others having
business relations with it; and
(q) authorize, agree or otherwise commit to any of the
foregoing.
In addition, and without limiting the generality of the foregoing,
from the date
hereof up to the Closing Date, the
Vendor shall cause each of the Corporation and the Subsidiaries to:
(i) comply with all Laws, (ii) duly and punctually file all
reports
and returns required to be filed by any
Laws or Benefit Plans, and (iii) pay or provide for the payment of
all Taxes;
(s) maintain its books in a manner that fairly and accurately
reflects its
income, expenses and liabilities in
accordance with generally accepted accounting principles
consistently
applied and using accounting policies,
practices and calculations applied on a basis consistent with past
periods and throughout the periods
involved;
(t) maintain in full force and effect insurance policies on
all of its
properties providing coverage and amounts
of coverage comparable to the coverage and amounts of coverage
provided under its insurance policies in
effect on the date hereof;
(u) perform duly and punctually all of its contractual
obligations in
accordance with the terms thereof; and
(v) maintain and keep its properties in good condition and
working order,
except for ordinary wear and tear.
4.2 Notification. From the date hereof up to the Closing Date,
the Vendor will promptly notify the Purchaser in writing if the
Vendor becomes aware of any fact or condition that causes or
constitutes a breach of any of the
Vendor's representations and warranties as of the date of this
Agreement, or if
the Vendor becomes aware of the
occurrence after the date of this Agreement of any fact or condition
that would
cause or constitute a breach of any
such representation or warranty had such representation or warranty
been made as
of the time of occurrence or
discovery of such fact or condition. During the same period, the
Vendor will
promptly notify the Purchaser in writing
of the occurrence of any breach of any covenant of the Vendor in
this Article IV
or of the occurrence of any event that may make the satisfaction of
the conditions in Article V impossible.
4.3 Examination. From the date hereof up to the Closing Date, the
Vendor shall
afford, and shall cause the
Corporation and each Subsidiary to afford, to the Purchaser and its
legal,
accounting and other representatives
full access during normal business hours (without undue interference
to the
ordinary conduct of the business of
the Corporation and each Subsidiary) to (a) the Corporation, the
Subsidiaries,
and their affairs, business and
properties, and (b) all executive personnel and auditors of the
Corporation and
the Subsidiaries to consult with
them in respect of (i) the affairs, business and properties of the
Corporation
and each Subsidiary and the manner
in which they are conducted, held or used, and (ii) any questions
raised by the
examination made by the
Purchaser and its representatives pursuant to this Section 4.3.
4.4 Restrictions. The Vendor shall not and shall cause the
Corporation and the
Subsidiaries not to, directly or
indirectly, through any representative or otherwise, solicit or
entertain offers
from, provide information to, negotiate
with or in any manner encourage, discuss, accept or consider any
proposal of any
other Person relating to the
acquisition of the Purchased Shares or the assets of the Corporation
and/or the
assets or shares of the Subsidiaries,
in whole or in part, whether through direct or indirect purchase,
amalgamation,
consolidation or other business combination (other than sales of
assets in the ordinary course of business).
4.5 Closing. On the Closing Date, the Vendor shall:
(a) take, and shall cause the Corporation to take, all actions as
may be
reasonably required by legal counsel for
the Purchaser to duly and validly transfer the Purchased Shares to
the Purchaser
and/or its nominee, including, without
limitation, to cause the Corporation (i) to make the necessary
inscriptions in
the register of the Corporation in order
to record the transfer of the Purchased Shares in favour of the
Purchaser and/or
its nominee, and (ii) to deliver to the
Purchaser and/or its nominee, upon the cancellation of the old share
certificate
representing the Purchased Shares, a new certificate in its name
representing the Purchased Shares;
(b) deliver to the Purchaser at the place of Closing (i)
certificates for
the Purchased Shares, duly endorsed for
transfer to the Purchaser, and (ii) a certificate executed by the
Vendor to the
effect that each of the Vendor's
representations and warranties in this Agreement (except as
qualified in the
certificate) is true and correct in all
respects as of the Closing Date as if made on the Closing Date and
that the
Vendor has complied with each of its
covenants in this Agreement. The only representations and
warranties permitted
to be qualified in such certificate are
( ) and, in such case, only to the extent such
representations
and warranties are affected by events
occurring between the date of this Agreement and the Closing Date
that are
beyond the control of the Vendor and
subject at all times to the indemnification provisions contained in
Article
VIII hereof. The representations and
warranties of the Vendor made as of the Closing Date in the Vendor's
certificate shall be deemed made as of the
Closing Date with the same effect as the representations and
warranties made by
the Vendor herein;
(c) if required by the Purchaser, cause all or any of the
directors, officers and auditors of the Corporation (i) to resign
from the Corporation or a Subsidiary, as the case may be, effective
on the Closing Date, and (ii) to deliver to
the Corporation or such Subsidiary, as the case may be, at the place
of Closing
resignations and releases substantially
in the form of Schedule 4.5 annexed hereto;
(d) deliver to the Purchaser at the place of Closing certified
copies of resolutions of the shareholders and directors of the
Corporation and the Subsidiaries (in form and substance reasonably
satisfactory to the Purchaser's legal counsel)
(i) authorizing and approving the sale, assignment and transfer of
the Purchased
Shares from the Vendor to the
Purchaser and/or its nominees and their registration in the name of
the
Purchaser and/or its nominees, (ii) accepting
the resignations effective on the Closing Date of the directors,
officers and
auditors referred to in Subsection 4.5(d),
and (iii) appointing such new directors, officers and auditors of
the
Corporation and the Subsidiaries as may be
nominated by the Purchaser;
ARTICLE V
Covenants of the
Purchaser
5.1 Closing. If each condition set forth at Section 7 .1 is (i)
performed or
complied with, or (ii) waived by the
Purchaser, and if this Agreement is not terminated in accordance
with Section
7.2, then the Purchaser shall, on the
Closing Date, deliver to the Vendor at the place of Closing:
(a) a certificate executed by the Purchaser to the effect
that each of
the Purchaser's representations and warranties
in this Agreement (except as qualified in the certificate) is true
and correct
in all respects as of the Closing Date as
if made on the Closing Date and that the Purchaser has complied with
each of its
covenants in this Agreement. The only representations and
warranties permitted to be qualified in such certificate are (
) and, in such case, only to the extent such representations and
warranties are affected by events occurring between the date of this
Agreement and the Closing Date that are beyond the control of the
Purchaser.
The representations and warranties
of the Purchaser made as of the Closing Date in the Purchaser's
certificate
shall be deemed made as of the Closing
Date with the same effect as the representations and warranties made
by the
Purchaser herein; and
(b) two (2) stock certificates of common shares of Forestry
International, Inc. registered under the name of Mr.
Marc Michielli and Mr. Jean-Pierre Reid in the amount of the
Purchase Price.
ARTICLE VI
Survival of Representations and
Warranties
6.1 Survival of Representations and Warranties of the Vendor. The
representations and warranties of the Vendor contained in this
Agreement, in the Schedules annexed hereto or in any certificate or
other document delivered or given pursuant to this Agreement shall
survive the completion of the transactions contemplated by this
Agreement, and notwithstanding such completion or any investigation
made by or
on behalf of the Purchaser
or any knowledge by the Purchaser of any incorrectness in, or breach
of, such
representations or warranties,
shall continue in full force and effect for the benefit of the
Purchaser for a
period of three (3) years from the
date hereof; (i) except for any representation and warranty relating
to Tax
matters which shall survive until
ninety (90) days after the last date on which the relevant tax
authority is
entitled to assess or reassess the
Corporation, the Subsidiaries or the Purchaser with respect to such
Tax matters,
(ii) except for any
representation and warranty in respect of which a claim based on
fraud is made,
and (iii) except for the
representations and warranties contained in sections as mentionned
herein, which
in each such case shall be
unlimited as to duration.
6.2 Survival of Representations and Warranties of Purchaser. The
representations and warranties of the Purchaser contained in this
Agreement or in any certificate or other document delivered or given
pursuant to this
Agreement shall survive the completion of the transactions
contemplated by this
Agreement, and notwithstanding such
completion or any investigation made by or on behalf of the Vendor
or any
knowledge by the Vendor of any
incorrectness in, or breach of, such representations or warranties,
shall
continue in full force and effect for the benefit
of the Vendor for a period of three (3) years from the date hereof;
except for
any representation and warranty in
respect of which a claim based on fraud is made and except for the
representations and warranties contained in
sections as mentionned herein, which in each such case shall be
unlimited as to
duration.
ARTICLE VII
Conditions of Closing
7.1 Conditions for the Benefit of the Purchaser. The purchase and
sale of the
Purchased Shares in accordance with the terms of this Agreement are
subject to the following conditions, each of which is hereby
declared to be for the exclusive benefit of the Purchaser. Each
condition is to be performed or complied with in all respects at or
prior to the Closing Date:
(a) Truth of Representations and Warranties of the Vendor.
The
representations and warranties of the
Vendor contained in this Agreement or in any Schedule annexed hereto
or in any
certificate or other document
delivered or given pursuant to this Agreement (considered
individually and
collectively), shall have been accurate in
all material respects as of the date of this Agreement, and shall be
true and
correct in all material respects as of the
Closing Date as though made on such date, without giving effect to
any exception
contained in the certificate delivered
pursuant to Section 4.5(b)(ii). [Each of the Vendor's
representations and
warranties contained in Section ( shall have
been accurate in all respects as of the date of this Agreement, and
shall be
true and correct in all respects as of the
Closing Date as though made on such date, without giving effect to
any exception
contained in the certificate delivered
pursuant to Section 4.5(b)(ii).]
(b) Performance of Covenants by the Vendor. All of the
covenants,
obligations and agreements that the
Vendor is required to perform or to comply with pursuant to this
Agreement at or
prior to the Closing Date
(considered individually and collectively), shall have been
performed or
complied with in all material respects at or
prior to the Closing Date.
(c ) Governmental Approvals. There shall have been obtained
from all
appropriate governmental agencies and
authorities all approvals, consents and assurances, in form and
substance
reasonably satisfactory to the Purchaser's
legal counsel, necessary in order to permit the transactions
contemplated herein
to be completed on the Closing Date
without affecting or resulting in the termination, cancellation,
modification,
amendment, variation or renegotiation of this Agreement or any
contract to which the Corporation or any of the Subsidiaries is a
party. To the extent that a notification is required under the
Competition Act (Canada), all applicable waiting periods shall have
expired.
(d) Third Party Approvals. There shall have been obtained
from all
appropriate Persons all approvals,
consents and assurances, in form and substance reasonably
satisfactory to the
Purchaser's legal counsel, necessary
in order to permit the transactions contemplated herein to be
completed without
affecting or resulting in the
termination, cancellation, modification, amendment, variation or
renegotiation
of this Agreement.
(e) No Material Change. From the date hereof up to and
including the
Closing Date, there shall have been
no material adverse change in the business, operations, properties,
prospects or
condition of the Corporation and the
Subsidiaries, nor shall any change of Law have occurred which, in
the reasonable
opinion of the Purchaser, materially
and adversely affects or may materially and adversely affect the
Corporation or
any Subsidiary. For the purposes of
this Subsection 7.1(e), the phrase "change of Law" shall mean (i)
any change to
any Law, or (ii) any future Law.
(f) Litigation. There shall be no actions, claims,
investigations, arbitrations or other proceedings (whether or not on
behalf of the Vendor, the Corporation or any Subsidiary) pending or
threatened to restrain, enjoin or invalidate any transaction
contemplated by this Agreement.
If any of the conditions of this Section 7.1 has not been satisfied
as of the
Closing Date, or if the Purchaser is not
satisfied for any reason whatsoever with the results of its due
diligence
investigation made pursuant to Section 4.3 or
if Closing has not occurred by May 2, 2000 for reasons other than
the
Purchaser's failure to comply with its
obligations under this Agreement, the Purchaser may, at its option,
either (i)
terminate this Agreement by notice to
the Vendor at any time prior to the Closing without further
formality, or (ii) proceed with the Closing, without prejudice, in
either case, to the Purchaser's other rights, recourses and
remedies.
7.2 Conditions for the Benefit of the Vendor. The purchase and
sale of the
Purchased Shares in accordance with
the terms of this Agreement are subject to the following conditions,
each of
which is hereby declared to be for the
exclusive benefit of the Vendor. Each condition is to be performed
or complied
with in all respects at or prior to the Closing Date:
(a) Truth of representations and Warranties of the Purchaser. The
representations and warranties of the Purchaser contained in this
Agreement or in any certificate or other document delivered or given
pursuant to this
Agreement (considered individually and collectively), shall have
been accurate
in all material aspects as of the date
of this Agreement, and shall be true and correct in all material
respects as of
the Closing Date as though made on such
date, without giving effect to any exception contained in the
certificate
delivered pursuant to Section 5.1(a). Each
of the Purchaser's representations and warranties contained in
sections as
mentionned herein shall have been accurate
in all respects as of the date of this Agreement, and shall be true
and correct
in all respects as of the Closing Date
as though made on such date, without giving effect to any exception
contained in
the certificate delivered pursuant
to Section 5.1(a).
(b) Litigation. There shall be no actions, claims,
investigations, arbitrations or other proceedings (whether or not on
behalf of the Purchaser) pending or threatened to restrain, enjoin
or invalidate any transaction contemplated by this Agreement.
If any of the conditions of this Section 7.2 has not been satisfied
as of the Closing Date for reasons other than the Vendor's failure
to comply with its obligations under this Agreement, the Vendor may,
at its option, either (i)
terminate this Agreement by notice to the Purchaser at any time
prior to Closing
without further formality, or (ii) proceed with the Closing, without
prejudice, in either case, to the Vendor's other rights, recourses
and remedies.
ARTICLE
VIII
Indemnification
8.1 Indemnification by the Vendor. The Vendor shall indemnify and
hold the
Purchaser harmless from and against
any claims, demands, actions, causes of action, judgments, damages,
losses
(which shall include any diminution in
value), liabilities, costs or expenses (including, without
limitation, interest,
penalties and reasonable attorneys' and
experts' fees and disbursements), including Tax liabilities
(collectively, the
"Losses") which may be made against the
Purchaser, the Corporation or the Subsidiaries or which any of them
may suffer
or incur as a result of, arising out
of or relating to:
(a) any violation, contravention or breach of any
covenant, agreement
or obligation of the Vendor under or
pursuant to this Agreement; or
(b) any incorrectness in, or breach of, any representation
or warranty
made by the Vendor in Section 3.1, the
Schedules annexed hereto or in any certificate or other document
delivered or given pursuant to this
Agreement, whether or not the Purchaser relied thereon or had
knowledge thereof; or
any liabilities or obligations of the Corporation or
any
Subsidiary of any nature whatsoever arising after
the Closing Date in respect of any fact, condition or
circumstance existing or occurring on or prior to the
Closing Date (including, without limitation, any liabilities or
obligations of the Corporation or any
Subsidiary for Taxes due, together with any penalties or
interest, in connection with any period ending on
or prior to the Closing Date), other than liabilities or
obligations reflected in or reserved against in the
Closing Date Balance Sheet.
8.2 Indemnification by Purchaser. The Purchaser shall indemnify
and hold the
Vendor harmless from and against
any Losses which may be made against the Vendor or which the Vendor
may suffer
or incur as a result of, arising
out of or relating to:
(a) any violation, contravention or breach of any covenant,
agreement, or
obligation of the Purchaser under or
pursuant to this Agreement; or
(b) any incorrectness in, or breach of, any representation or
warranty made by the Purchaser in Section 3.2, the
Schedules annexed hereto or in any certificate or other document
delivered or given pursuant to this
Agreement, whether or not the Vendor relied thereon or had knowledge
thereof.
8.3 Obligation to Reimburse. The Party providing indemnification
hereunder
(the "Indemnifying Party") shall
reimburse, on demand, to the Party being indemnified hereunder (the
"Indemnified
Party") the amount of any Losses
suffered or incurred by the Indemnified Party, the whole as of the
date that the
Indemnified Party incurs any such
Losses, together with interest thereon from the aforesaid date until
payment in
full at the annual rate equal to the
National Bank of Canada preferential rate plus one percent (1%).
8.4 Notification. Promptly upon obtaining knowledge thereof, the
Indemnified
Party shall notify the Indemnifying
Party of any cause which the Indemnified Party has determined has
given or could
give rise to indemnification under
this Article VIII. The omission so to notify the Indemnifying Party
shall not
relieve the Indemnifying Party from any
duty to indemnify and hold harmless which otherwise might exist with
respect to
such cause unless (and only to that extent) the omission to notify
materially prejudices the ability of the Indemnifying Party to
exercise its right to defend provided in this Article VIII.
8.5 Defense of Third Party Claim. If any legal proceeding shall
be instituted or any claim or demand shall be asserted by a third
party against the Indemnified Party (each a "Third Party
Claim"), then the Indemnifying Party shall
have the right, after receipt of the Indemnified Party's notice
under Section
8.4 and upon giving notice to the
Indemnified Party within five (5) calendar days of such receipt, to
defend the
Third Party Claim at its own cost and expense with counsel of its
own selection, provided that:
(a) the Indemnified Party shall at all times have the right to
fully participate in the defense at its own
expense;
(b) the Third Party Claim seeks only monetary damages and does
not seek any injunctive or other
relief against the Indemnified Party;
(c) the Indemnifying Party unconditionally acknowledges in writing
its obligation to indemnify and hold the Indemnified Party
harmless with respect to the
Third Party Claim;
(d) legal counsel chosen by the Indemnifying Party is satisfactory
to the Indemnified Party, acting reasonably; and
(e) if the amount of the Third Party Claim is greater than Ten
Thousand dollars ($10,000), inclusive
of reasonably estimated interest and costs, then the
Indemnifying Party shall deliver a letter of
credit, surety bond or similar security in form and
substance satisfactory to the Indemnified Party,
acting reasonably, in the amount by which such Third Party
Claim exceeds Ten Thousand dollars
($10,000), as security for the payment of amounts payable
by the Indemnifying Party to the
Indemnified Party pursuant hereto.
Amounts payable by the Indemnifying Party pursuant to a Third
Party Claim shall be paid in accordance with the terms of the
settlement or, the judgment, as applicable, but in any event prior
to the expiry of any delay for a judgment to become executory.
8.6 No Compromise. The Indemnifying Party shall not be permitted
to compromise and settle or to cause a compromise and settlement of
any Third Party Claim, without the prior written consent of the
Indemnified Party, unless:
(a) the terms of the compromise and settlement require only
the payment of money and do not require
the Indemnified Party, the Corporation or the Subsidiaries to admit
any
wrongdoing or take or refrain from taking
any action; and
(b) the Indemnified Party receives, as part of the
compromise and settlement, a legally binding and
enforceable unconditional satisfaction or release, which is in form
and
substance satisfactory to the Indemnified Party,
acting reasonably, from any and all obligations or liabilities it
may have with
respect to the Third Party Claim.
8.7 Failure to Defend. If the Indemnifying Party fails:
(a) within twenty (20) calendar days from receipt of the notice
of a Third Party Claim to give notice of
its intention to defend the Third Party Claim in accordance with
Section 8.5, or
(b) to comply at any time with any of Subsections 8.5(c) or
8.5(e).
then the Indemnifying Party shall be deemed to have waived its right
to defend
the Third Party Claim and the
Indemnified Party shall have the right (but not the obligation) to
undertake or
to cause the Corporation or the
Subsidiaries to undertake the defense of the Third Party Claim and
compromise
and settle the Third Party Claim on
behalf, for the account and at the risk and expense of the
Indemnifying Party.
8.8 Limitation on Indemnification. The obligation of
indemnification set out in Sections 8.1 and 8.2 shall survive the
Closing [without limit as to time] [for the period prescribed by
law], except the obligation of indemnification
arising from any material incorrectness in, or breach of, any
representation or
warranty made by the Vendor or the
Purchaser, as the case may be, which in each case shall be subject
to the
limitations regarding survival of
representations and warranties set forth in Section 6.1 or 6.2, as
the case may
be.
ARTICLE IX
Closing
9.1 Date, Time and Place of Closing. The Closing shall take place
at
Montreal, on May 2, 2000 on the (
) calendar day following the satisfaction or waiver of all the
conditions of
Closing set forth in Article VII hereof (the
"Closing Date"), at the hour of 01:30 PM, ET, or at such other
place, on such
other date and/or at such other time
as may be agreed between the Parties.
ARTICLE X
Miscellaneous
10.1 Announcements. Prior to Closing, any press release, public
announcement
or publicity with respect to the
transaction contemplated in this Agreement shall be made only with
the prior
written consent of the Parties unless such
release, announcement or publicity is required by Law, in which case
the Party
required to make such release,
announcement or publicity shall use its best efforts to obtain
approval of the
other Party to the form, nature and extent
of such disclosure, which approval shall not be unreasonably
withheld. After
the Closing, any such press release,
public announcement or publicity by the Vendor shall be made only
with the prior
written consent of the Purchaser
unless such release, announcement or publicity is required by law,
in which case
the Vendor shall use its best efforts
to obtain the Purchaser's approval to the form, nature and extent of
such
disclosure, which approval shall not be
unreasonably withheld. Unless otherwise determined by a court of
competent
jurisdiction, the Parties shall, and the
Vendor shall cause the Corporation and the Subsidiaries to, keep
this Agreement
strictly confidential and make no disclosure thereof to any person
except the Parties' counsel and advisors and except as may be
required in connection with the consummation of the transactions
contemplated hereby or as may be required by Law, without the prior
written consent of the other Party.
10.2 Further Assurances. Each Party upon the request of the other,
whether at
or after the Closing, shall do,
execute, acknowledge and deliver or cause to be done, executed,
acknowledged or
delivered all such further acts, deeds, documents, assignments,
transfers, conveyances, powers of attorney and assurances as may be
reasonably necessary or desirable to effect complete consummation of
the transactions contemplated by this Agreement.
10.3 Successors in Interest. This Agreement and the provisions
hereof shall
enure to the benefit of and be binding
upon the Parties and their respective successors and assigns. The
Vendor may
not assign this Agreement or any of
his rights and obligations hereunder without the prior written
consent of the
Purchaser. The Purchaser may assign
this Agreement and all of the Purchaser's rights and obligations
hereunder to an
affiliate; provided however, that such assignment shall not relieve
the Purchaser of its obligations hereunder.
10.4 Notices. Any notice, consent, authorization, direction or
other communication required or permitted to be given hereunder
shall be in writing and shall be delivered either by personal
delivery or by telex, telecopier or similar telecommunications
device and addressed as follows:
(a) in the case of the Vendor, to it at:
Attention: Mr. Jean-Pierre Reid, President,
R.M.M. &
Associates, and /or,
Mr. Marc Michielli, Vice-President, R.M.M. &
Associates
Telecopier: (514) 383-8272
(b) in the case of the Purchaser, to it at:
Attention: Mr. Louis R. Turp, President,
Forestry
International, Inc., and/or
Mr. Richard Jamieson, C.F.O., Forestry International, Inc.
Telecopier: (514) 270-4844 and/or (514) 624-9215
Any notice, consent, authorization, direction or other communication
delivered
as aforesaid shall be deemed to have
been effectively delivered and received, if sent by telex,
telecopier or similar
telecommunications device on the
calendar day next following receipt of such transmission or, if
delivered, to
have been delivered and received on the
date of such delivery provided, however, that if such date is not a
business day
then it shall be deemed to have been
delivered and received on the business day next following such
delivery. Either
Party may change its address for
service by notice delivered as aforesaid.
10.5 Expenses. Subject to Section 2.4, the Vendor shall bear and
pay all costs, expenses and fees (including, without limitation,
legal counsel and accounting fees and disbursements) incurred by the
Vendor, the Corporation and
the Subsidiaries in connection with the preparation, execution and
consummation
of this Agreement and the
transactions contemplated hereunder.
Subject to Section 2.4, the Purchaser shall bear and pay all
costs, expenses and fees (including, without
limitation, legal counsel and accounting fees and disbursements)
incurred by it
in connection with the preparation,
execution and consummation of this Agreement and the transactions
contemplated
hereunder.
10.6 Counterparts. This Agreement may be executed in one or more
counterparts, each of which when so executed shall be deemed an
original, and such counterparts together shall constitute one and
the same instrument.
10.7 Severability. Any Article, Section, Subsection or other
subdivision of
this Agreement or any other provision
of this Agreement which is, or becomes, illegal, invalid or
unenforceable shall
be severed herefrom and shall be
ineffective to the extent of such illegality, invalidity or
unenforceability and
shall not affect or impair the remaining
provisions hereof, which provisions shall (a) be severed from any
illegal,
invalid or unenforceable Article, Section,
Subsection or other subdivision of this Agreement or any other
provision of this
Agreement, and (b) otherwise remain
in full force and effect.
10.8 Governing Law. This Agreement shall be governed by and
interpreted and
construed in accordance with the
laws presently in force in the Province of Quebec.
10.9 Entire Agreement. This Agreement, including the Schedules,
constitutes
the entire Agreement between the
Parties pertaining to the subject matter hereof, and supersedes all
prior
agreements, understandings, negotiations and
discussions of the Parties.
10.10 Inconsistency. This Agreement shall override the Schedules
annexed hereto to the extent of any inconsistency.
10.11 Gender. Any reference in this Agreement to any gender shall
include both
genders and the neuter, and words herein importing the singular
number only shall include the plural and vice versa.
10.12 Currency. The common share value of Forestry International,
Inc. mentionned herein is expressed in US dollars, considering the
value of the vendor?s company which is expressed in Canadian funds.
10.13 Headings. The headings in this Agreement are inserted for
convenience
of reference only and shall not affect
the interpretation hereof.
10.14 Amendment. No amendment shall be binding unless expressly
provided in
an instrument duly executed by
the Parties.
10.15 Waiver. No waiver, whether by conduct or otherwise, of any of
the provisions of this Agreement shall be
deemed to constitute a waiver of any other provisions (whether or
not similar) nor shall such waiver constitute a continuing waiver
unless otherwise expressly provided in an instrument duly executed
by the Parties to be bound thereby.
IN WITNESS WHEREOF, the Parties have executed this Agreement on the
date and at the place first above mentioned.
2524-7883 QUEBEC, INC. (Vendor)
Signature:
Signature:
Name: /s/ Jean-Pierre Reid
Name:
/s/ Mark Michielli
Title: President
Title: Vice-President
FORESTRY INTERNATIONAL, INC. d/b/a
INFYNIA.COM CORPORATION (Purchaser)
Signature:
Signature:
Name: /s/ Louis R. Turp
Name:
/s/ Andrea Audet
Title: President
Title: Secretary-Treasurer
CUSTODIAL
AGREEMENT
THIS CUSTODIAL AGREEMENT, dated effective the 2nd day of May 2000,
is entered into by and
between Forestry International Inc., a Colorado corporation, doing
business as
INFYNIA.COM (?Infynia?) and
Rocheleau Labranche & Associates (the ?Custodial Agent?).
RECITALS
WHEREAS, pursuant to the provisions of a Purchase and Sale Agreement
dated May
2, 2000 (the
?Agreement?) two (2) stock certificates are to be issued as follows:
(1) to
Jean-Pierre Reid in the amount of Ten
Million Two Hundred Thousand (10,200,000) shares of common stock of
Infynia; and
(2) to Marc Michielli in the
amount of Ten Million Two Hundred Thousand (10,200,000) shares of
common stock
of Infynia; (the shares
represented by these certificates shall be referred to herein as the
?Shares?);
and
WHEREAS, pursuant to the provisions of the Agreement the Shares and
certificates
are not to be delivered
to Mr. Reid and Mr. Michieille until certain conditions as set forth
in the
Agreement have been satisfied; and
WHEREAS, infynia and Mr. Reid and Mr. Michielli have agreed to place
the shares
into the custody of the
Custodial Agent to hold subject to the instructions of Infynia; and
WHEREAS, Infynia and the Custodial Agent desire to enter into an
agreement with
respect to the above-
described custodial arrangement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants contained herein, the parties agree as
follows:
1. Deposit and Instructions. Infynia agrees to cause to be issued
into the name
of Mr. Reid and Mr.
Michielli two certificates representing the Shares. Infynia hereby
agrees and
instructs the Custodial Agent to hold
the Shares and to deliver the Shares as instructed by Infynia, upon
satisfaction
of the conditions of the Agreement.
The Custodial Agent agrees to hold in safekeeping and as a fiduciary
of Infynia
the certiflcaes representing the
Shares.
2. Terms. The Custodial Period shall begin as of the effective
date of this
Custodial Agreement. The
Custodial Period shall terminate on the earlier to occur of the
following;
(a) The expiration of two (2) years from the effective date;
(b) Fulfillment of the conditions as described in Parag~,h I as
evidenced
by delivery of written
instructions from Inynia; or
(c) Written notice from lnf3tnia of termination to the CustodiaI
Agreement receipt of such notice, the Custodial Agent shall act in
accordance with the directives contained herein.
3. Limitations of the Custodial Agent?s Obligations. The
Custodial Agent
in its actions pursuant to this
Custodial Agreement shall be fully protected in every reasonable
exercise of its
discretion and shall have no obligations hereunder, except as
expressly set forth herein.
4. Limitation of Liability. In performing any of its duties
hereunder, the
Custodial Agent shall not
incur any liability to anyone for any damages, losses or expenses,
except for
willful default or for negligence,
and it shall, accordingly, not incur any such liability with respect
to (i) any
action taken or omitted in good
faith upon advice of its counsel given in respect to any questions
relating to
the duties and responsibilities of
the Custodial Agent under this Custodial Agreement; or (ii) any
action taken or
omitted in reliance upon any
instrument, including the written advice provided for herein, not
only as to its
due execution and the validity
and effectiveness of its provisions, but also as to the truth and
accuracy of
any information contained therein,
which the Custodial Agent shall in good faith believeto be genuine,
to have been
signed and presented by a
proper person or persons, and to conform with the provisions of this
Custodial
Agreement.
5. Indemnification. The parties jointly and severally hereby
agree to indemnify and bold harmless the Custodial Agent against any
and all losses, claims, damages, liabilities and expenses, including
reasonable costs of investigation and counsel fees and
disbursements, that may be imposed upon the Custodial Agent or
incurred by the Custodial Agent in connection with its acceptance of
appointment
as Custodial Agent
hereunder, or the performance of its duties hereunder, including any
litigation
arising from this Agreement
or involving the subject matter hereof. The Custodial Agent shall
not be
entitled to indemnification pursuant
to this subparagraph, however, if the Custodial Agent?s conduct,
concerning
which the Custodial Agent is
seeking indenmiflcation, constitutes negligence or an action not in
good faith.
6. Notices. Except as otherwise provided in this Custodial
Agreement, any notice pursuant to this Custodial Agreement shall be
validly given or served if that notice is in writing and delivered
in person or by
hand delivery or professional messenger service to either party or
by facsimile
to facsimile numbers
designated in writing by the respective parties or may be sent by
registered or
certified mail, with postage
prepaid, return receipt requested or delivered by Federal Express or
any other
courier service guaranteeing overnight delivery, charges prepaid and
addressed as follows:
If to Infynia:
1205 Ampere Street
Suite 206
Quebec, Canada J4fl 7MG
Facsimile No, 514 270 4844
If to the Custodial Agent:
Rocheleau, Labranche & Associates
1205 Ampere Street, Suite 206
Boucherville, (Quebec) Canada J4B 7M6
Facsimile No: (450) 449-3978
Notices sent by facsimile shall be deemed to have been duly given
upon receipt
by the recipient with
confirmation of such receipt by the sender. Any such notice sent by
registered
or certified mail, return
receipt requested, shall be deemed to have been duly given and
received three
(3) business days after the same
is so addressed and mailed within the continental United States with
postage
prepaid. Notices delivered by
overnight service shall be deemed to have been given one business
day after
delivery of the same, charges
prepaid, to the courier. Any notice or other document sent by any
other manner
shall be effective only upon actual receipt thereof. Any party may
change its address for purposes of this paragraph by giving notice
to the other party as provided herein.
7. Miscellaneous.
(a) The Custodial Agent expressly agrees that he shall have no
lien or recourse in
respect of the Shares and documents deposited in the Custodial
Account for any
fees or expenses in
establishing or maintaining the Custodial Account or in effecting
the payments,
deliveries and remittances
described herein.
(b) The Custodial Agent shall have no duty to know or determine
the performance or non-performance of any provision of any agreement
between Infynia and the Mr.
Reid and Mr. Michielli and
any such agreement deposited with the Custodial Agent shall not bind
said agent
in any manner. The Custodial
Agent assumes no responsibility for the validity or sufficiency of
any such
documents or papers or payments
deposited or called for hereunder except as may be expressly and
specifically
set forth in clear and
unambiguous language, and the duties and responsibilities of the
Custodial Agent
are limited to those expressly and specifically stated herein and in
such instructions.
(c) In the event of any dispute between the parties hereto as to
the facts of
default, the
validity or meaning of these instructions or any other fact or
matter relating
to the transaction between the parties, the Custodial Agent is
instructed as follows:
(1) That it shall be under no obligation to act, except under
process or order
of
court, or until he has been adequately indemnified to its full
satisfaction, and
shall sustain no liability for its failure to act pending such
process or court order or indemnification;
(2) That it may in its sole and absolute discretion, deposit the
property
described herein or so much thereof as remains in its hands with the
then Clerk,
or acting Clerk, of
any Court that would have jurisdiction over such dispute, and to
interplead or
otherwise join the parties hereto, and
upon so depositing such property and invoking the jurisdiction of a
proper court
the Custodial Agent shall be relieved
of all liability under the terms hereof as to the property so
deposited and
shall be entitled to recover in such
interpleader or other action, its reasonable attorney fees and
related costs and
expenses incurred in commencing such action. The institution of any
such interpleader or other action shall not impair the rights of the
Custodial Agent.
(d) This Custodial Agreement may be amended at any time or times
by an instrument in writing signed by all of the parties hereto. The
validity, interpretation and construction of this Custodial
Agreement and of each part hereof shall be governed by the laws of
the Province of Quebec,
(e) This Custodial Agreement shall bind and inure to the benefit
of each signatory hereto and their respective heirs, personal
representatives, successors and assigns.
IN WITNESS WHEREOF, the parties have executed this Custodial
Agreement on the dates set forth below to be effective on the day
and year first above written.
FORESTRY INTERNATIONAL, INC. d/b/a
INFYNIA.COM CORPORATION
By: /s/ Louis R. Turp
Louis R. Turp, President
ROCHELEAU, LABRANCHE & ASSOCIATES
By: /s/ Michel
Daoust
Michel Daoust, C.A.
If to the Custodial Agent:
2-
