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Title: |
Share Exchange Agreement |
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Date: |
2006 |
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Preview shows 21KB of 124KB total |
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$44 |
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#2559510 |
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SHARE EXCHANGE AGREEMENT
This SHARE EXCHANGE AGREEMENT, dated as of October 17, 2006, is made by and
among PARQUE LA QUINTA ESTATES, a Nevada corporation (the "Acquiror Company"),
each of the Persons listed on Exhibit A as an Acquiror Company Shareholder
(collectively, the "ACQUIROR COMPANY SHAREHOLDERS", and individually an
"ACQUIROR COMPANY SHAREHOLDER"), WEALTHCRAFT SYSTEMS LIMITED, a private limited
company organized under the laws of the Hong Kong Special Administrative Region
of the People's Republic of China ("WEALTHCRAFT"), and each of the persons
listed on Exhibit B as a WealthCraft Shareholder (collectively, the "WEALTHCRAFT
SHAREHOLDERS", and individually a "WEALTHCRAFT SHAREHOLDER").
BACKGROUND
The WealthCraft Shareholders have agreed to transfer to the Acquiror
Company, and the Acquiror Company has agreed to acquire from the WealthCraft
Shareholders, all of the issued and outstanding shares of WealthCraft (the
"WEALTHCRAFT SHARES"), in exchange for 7,000,000 shares of the Acquiror
Company's Common Stock (the "Exchange Shares"), which Exchange Shares shall
constitute 70% of the issued and outstanding shares of Acquiror Company's Common
Stock immediately after the closing of the transactions contemplated herein, in
each case, on the terms and conditions as set forth herein.
ARTICLE I.
DEFINITIONS
Section 1.1 Unless the context otherwise requires, the terms defined in
this Section 1 will have the meanings herein specified for all purposes of this
Agreement, applicable to both the singular and plural forms of any of the terms
herein defined.
"ACQUIROR COMPANY BALANCE SHEET" means the Acquiror Company's balance sheet
at September 30, 2006.
"ACQUIROR COMPANY BOARD" means the Board of Directors of the Acquiror
Company.
"ACQUIROR COMPANY COMMON STOCK" means the Acquiror Company's common stock,
par value US $0.001 per share.
"AFFILIATE" means any Person that directly or indirectly controls, is
controlled by or is under common control with the indicated Person.
"AGREEMENT" means this Share Exchange Agreement, including all Schedules
and Exhibits hereto, as this Share Exchange Agreement may be from time to time
amended, modified or supplemented.
"CLOSING DATE" has the meaning set forth in Section 3.
"CODE" means the United States Internal Revenue Code of 1986, as amended.
{PAGE}
"COMMISSION" means the United States Securities and Exchange Commission or
any other federal agency then administering the Securities Act or any successor
statute.
"COMPANY INDEMNIFIED PARTY" has the meaning set forth in Section 10.2.
"COVERED PERSONS" means all Persons, other than the Acquiror Company, who
are parties to indemnification and employment agreements with the Acquiror
Company existing on or before the Closing Date.
"DAMAGES" the actual losses, damages, liabilities, penalties, Taxes,
interest and expenses (including reasonable attorneys' fees and disbursements
and other out-of-pocket expenses and costs incurred in connection with
mitigating the Loss and investigating, preparing, settling or defending any
pending or threatened action, claim or proceeding (including those brought by
third Persons)).
"DISTRIBUTOR" means any underwriter, dealer or other Person who
participates, pursuant to a contractual arrangement, in the distribution of the
securities offered or sold in reliance on Regulation S.
"ENVIRONMENTAL LAWS" means any Law or other requirement relating to the
environment, natural resources, or public or employee health and safety.
"ENVIRONMENTAL PERMIT" means all licenses, permits, authorizations,
approvals, franchises and rights required under any applicable Environmental Law
or Order.
"EQUITY SECURITY" means any stock or similar security, including, without
limitation, securities containing equity features and securities containing
profit participation features, or any security convertible into or exchangeable
for, with or without consideration, any stock or similar security, or any
security carrying any warrant, right or option to subscribe to or purchase any
shares of capital stock, or any such warrant or right.
"ERISA" means the United States Employee Retirement Income Security Act of
1974, as amended.
"EXCHANGE" has the meaning set forth in Section 2.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 or any similar
federal statute, and the rules and regulations of the Commission thereunder, all
as the same are in effect from time to time.
"EXCHANGE SHARES" means the Acquiror Company Common Stock being issued to
the WealthCraft Shareholders pursuant hereto.
"EXHIBITS" means the several exhibits referred to and identified in this
Agreement.
"GAAP" means, with respect to any Person, United States generally accepted
accounting principles applied on a consistent basis with such Person's past
practices.
2
{PAGE}
"GOVERNMENTAL AUTHORITY" means any federal or national, state or
provincial, municipal or local government (including, without limitation, that
of the PRC or the HKSAR), governmental authority, regulatory or administrative
agency, governmental commission, department, board, bureau, agency or
instrumentality, political subdivision, commission, court, tribunal, official,
arbitrator or arbitral body, in each case whether United States or non-United
States with jurisdiction over any party hereto.
"HK$" - Hong Kong Dollars, the lawful currency of the HKSAR.
"HKSAR" means the Hong Kong Special Administrative Region of the PRC.
"INDEBTEDNESS" means any obligation, contingent or otherwise. Any
obligation secured by a Lien on, or payable out of the proceeds of, or
production from, property of the relevant party will be deemed to be
Indebtedness.
"INTELLECTUAL PROPERTY" means all industrial and intellectual property,
including, without limitation, all United States and non-United States patents,
patent applications, patent rights, trademarks, trademark applications, common
law trademarks, Internet domain names, trade names, service marks, service mark
applications, common law service marks, and the goodwill associated therewith,
copyrights, in both published and unpublished works, whether registered or
unregistered, copyright applications, franchises, licenses, know-how, trade
secrets, technical data, designs, customer lists, confidential and proprietary
information, processes and formulae, all computer software programs or
applications, layouts, inventions, development tools and all documentation and
media constituting, describing or relating to the above, including manuals,
memoranda, and records, whether such intellectual property has been created,
applied for or obtained anywhere throughout the world.
"LAWS" means, with respect to any Person, any United States or non-United
States federal, national, state, provincial, local, municipal, international,
multilateral or other law (including common law), constitution, statute, code,
ordinance, rule, regulation or treaty applicable to such Person.
"LIEN" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind, including, without limitation, any conditional sale or other
title retention agreement, any lease in the nature thereof and the filing of or
agreement to give any financing statement under the Uniform Commercial Code of
any jurisdiction and including any lien or charge arising by Law.
"MATERIAL ACQUIROR COMPANY CONTRACT" means any and all agreements,
contracts, arrangements, leases, commitments or otherwise, of the Acquiror
Company, of the type and nature that the Acquiror Company is required to file
with the Commission.
"MATERIAL ADVERSE EFFECT" means, when used with respect to the Acquiror
Company or WealthCraft, as the case may be, any change, effect or circumstance
which, individually or in the aggregate, would reasonably be expected to (a)
have a material adverse effect on the business, assets, financial condition or
results of operations of the Acquiror Company or WealthCraft, as the case may
be, in each case taken as a whole or (b) materially impair the ability of the
Acquiror Company (or the Acquiror Company Shareholders) or WealthCraft (or the
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{PAGE}
WealthCraft Shareholders), as the case may be, to perform its obligations under
this Agreement, excluding any change, effect or circumstance resulting from (i)
the announcement, pendency or consummation of the transactions contemplated by
this Agreement, (ii) changes in the United States securities markets generally,
or (iii) changes in general economic, currency exchange rate, political or
regulatory conditions in industries in which the Acquiror Company or
WealthCraft, as the case may be, operate.
"ORDER" means any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any Governmental
Authority.
"ORGANIZATIONAL DOCUMENTS" means (a) the articles or certificate of
incorporation, memorandum and articles of association and/or the by-laws or code
of regulations of a corporation; (b) the partnership agreement and any statement
of partnership of a general partnership; (c) the limited partnership agreement
and the certificate of limited partnership of a limited partnership; (d) the
articles or certificate of formation and operating agreement of a limited
liability company; (e) any other document performing a similar function to the
documents specified in clauses (a), (b), (c) and (d) adopted or filed in
connection with the creation, formation or organization of a Person; and (f) any
and all amendments to any of the foregoing.
"PRC" means the People's Republic of China.
"WEALTHCRAFT" means, collectively, WealthCraft individually and, as the
context requires, the WealthCraft Subsidiaries.
"WEALTHCRAFT BOARD" means the Board of Directors of WealthCraft.
"WEALTHCRAFT SHARES" means the 10,148,500 issued and outstanding ordinary
shares of WealthCraft.
"WEALTHCRAFT SUBSIDIARIES" means all of the direct and indirect
Subsidiaries of WealthCraft, including, without limitation, WealthCraft Systems
(Shenzhen) Limited, a private limited company organized under the laws of the
PRC.
"PERMITTED LIENS" means (a) Liens for Taxes not yet payable or in respect
of which the validity thereof is being contested in good faith by appropriate
proceedings and for the payment of which the relevant Person has made adequate
reserves; (b) Liens in respect of pledges or deposits under workmen's
compensation laws or similar Laws, carriers, warehousemen, mechanics, laborers
and materialmen and similar Liens, if the obligations secured by such Liens are
not then delinquent or are being contested in good faith by appropriate
proceedings conducted and for the payment of which the relevant Person has made
adequate reserves; (c) statutory Liens incidental to the conduct of the business
of the relevant Person which were not incurred in connection with the borrowing
of money or the obtaining of advances or credits and that do not in the
aggregate materially detract from the value of its property or materially impair
the use thereof in the operation of its business; and (d) Liens that would not
have a Material Adverse Effect.
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{PAGE}
"PERSON" means all natural persons, corporations, business trusts,
associations, companies, general partnerships, limited partnerships, limited
liability companies, joint ventures and other entities, governments, agencies
and political subdivisions.
"PROCEEDING" means any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative or investigative)
commenced, brought, conducted, or heard by or before, or otherwise involving,
any Governmental Authority.
"REGULATION S" means Regulation S under the Securities Act, as the same may
be amended from time to time, or any similar or successor rule or regulation
hereafter adopted by the Commission.
"RULE 144" means Rule 144 under the Securities Act, as the same may be
amended from time to time, or any similar or successor rule or regulation
hereafter adopted by the Commission.
"SCHEDULE 14(F) FILING" means an information statement filed by the
Acquiror Company on Schedule 14f-1 under the Exchange Act.
"SCHEDULES" means the several schedules referred to and identified herein,
setting forth certain disclosures, exceptions and other information, data and
documents referred to at various places throughout this Agreement.
"SEC DOCUMENTS" has the meaning set forth in Section 6.26.
"SECTION 4(2)" means Section 4(2) of the Securities Act, as the same may be
amended from time to time, or any successor statute.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar or successor federal statute, and the rules and regulations of the
Commission thereunder, all as the same will be in effect at the time.
"SUBSIDIARY" means, with respect to any Person, any other Person of which
such Person (a) beneficially owns, either directly or indirectly, more than 50%
of (i) the total combined voting power of all classes of voting securities of
such Person, (ii) the total combined equity interests, or (iii) the capital or
profit interests of such Person; or (b) otherwise has the power to Control such
Person.
"SURVIVAL PERIOD" has the meaning set forth in Section 10.1.
"TAX" or "TAXES" means all United States, HKSAR, PRC other applicable
federal, state or local taxes, charges, fees, levies, imposts, duties and other
assessments, as applicable, including, but not limited to, any income,
alternative minimum or add-on, estimated, gross income, gross receipts, sales,
use, transfer, transactions, intangibles, ad valorem, value-added, franchise,
registration, title, license, capital, paid-up capital, profits, withholding,
payroll, employment, unemployment, excise, severance, stamp, occupation,
premium, real property, recording, personal property, federal highway use,
commercial rent, environmental (including, but not limited to, taxes under
Section 59A of the Code) or windfall profit tax, custom, duty or other tax,
governmental fee or other like assessment or charge of any kind whatsoever,
together with any interest, penalties or additions to tax with respect to any of
the foregoing.
5
{PAGE}
"TAX GROUP" means any United States, HKSAR, PRC and other applicable
federal, state, local or foreign consolidated, affiliated, combined, unitary or
other similar group of which the Acquiror Company is now or was formerly a
member.
"TAX RETURN" means any return, declaration, report, claim for refund or
credit, information return, statement or other similar document filed with any
Governmental Authority with respect to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"TRANSACTION DOCUMENTS" means, collectively, all agreements, instruments
and other documents to be executed and delivered in connection with the
transactions contemplated by this Agreement.
"UNITED STATES" means the United States of America.
"UNITED STATES DOLLARS" or "US $" or "$" means the currency of the United
States of America.
"U.S. PERSON" has the meaning set forth in Regulation S under the
Securities Act and set forth on Exhibit C hereto.
ARTICLE II.
EXCHANGE OF WEALTHCRAFT SHARES AND SHARE CONSIDERATION
Section 2.1 SHARE EXCHANGE. At the Closing, each WealthCraft Shareholder
shall transfer to the Acquiror Company the number of WealthCraft Shares set out
forth opposite each such WealthCraft Shareholder's name in Exhibit B, and, in
consideration therefor, the Acquiror Company shall issue to such WealthCraft
Shareholder the number of Exchange Shares set forth opposite each WealthCraft
Shareholder's name in Exhibit B (the "EXCHANGE").
Section 2.2 TAX WITHHOLDING. The Acquiror Company shall be entitled to
deduct and withhold from the Exchange Shares otherwise deliverable to the
WealthCraft Shareholders pursuant to this Agreement such amounts as the Acquiror
Company is required to deduct and withhold with respect to the making of such
payment under the Code or any provision of state, local, provincial or foreign
Tax Law. To the extent that amounts are so withheld, such withheld amounts shall
be treated for all purposes of this Agreement as having been paid to such
WealthCraft Shareholder in respect of which such deduction and withholding was
made.
Section 2.3 SECTION 368 REORGANIZATION. For United States federal income
tax purposes, the Exchange is intended to constitute a "reorganization" within
the meaning of Section 368(a)(1)(B) of the Code. The parties to this Agreement
hereby adopt this Agreement as a "plan of reorganization" within the meaning of
Sections 1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations.
Notwithstanding the foregoing or anything else to the contrary contained in this
Agreement, the parties acknowledge and agree that no party is making any
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{PAGE}
representation or warranty as to the qualification of the Exchange as a
reorganization under Section 368 of the Code or as to the effect, if any, that
any transaction consummated prior to the Closing Date has or may have on any
such reorganization status. The parties acknowledge and agree that each (i) has
had the opportunity to obtain independent legal and tax advice with respect to
the transaction contemplated by this Agreement, and (ii) is responsible for
paying its own Taxes, including without limitation, any adverse Tax consequences
that may result if the transaction contemplated by this Agreement is not
determined to qualify as a reorganization under Section 368 of the Code.
Section 2.4 DIRECTORS OF THE ACQUIROR COMPANY AT THE CLOSING DATE.
Effective as of the Closing Date the current directors of the Acquiror Company
shall appoint Kelly Jay Michael Tallas and Curtis Hulleman as additional members
of the Acquiror Company Board. Immediately thereafter, all current directors of
the Acquiror Company shall resign as directors of the Acquiror Company Board.
ARTICLE III.
CLOSING DATE
The closing of the Exchange will occur on October 31, 2006 or at such later
date as all of the closing conditions set forth in Articles 8 and 9 have been
satisfied or waived (the "CLOSING DATE").
ARTICLE IV.
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