STOCKPURCHASE AGREEMENT Dated asof February 22, 2009 between Mario OctavioNavarro Alvarez and Rafael Isaas Samanez Zacaras (Sellers) and GulfstreamCapital Partners, Ltd. (Buyer) relatingto the purchase and sale of 95% ofthe Outstanding Common Stock of PerusatS.A. DatedFebruary 22, 2009

 

 

 

Dated as of February 22, 2009

between

 Mario Octavio Navarro Alvarez and Rafael Isaías Samanez Zacarías

and

 

relating to the purchase and sale

 

of

 

95% of the Outstanding Common Stock

 

of

 

 

 

 

 

		Page
ARTICLE I	DEFINITIONS	2-6
1.1	Definitions	2-6
1.2	OTHER DEFINITIONS	6
1.3	Langauge	6
ARTICLE II	PURCHASE AND SALE	6-7
2.1	Purchase and Sale of the Shares	6
2.2	Purchase Price	7
2.3	Closing Date	7
2.4	Transactions to be Effected at the Closing	7
ARTICLE III	REPRESENTATIONS AND WARRANTIES OF SELLERS	8-23
3.1	Organization and Good Standing	8
3.2	Capitalization	8-9
3.3	Subsidiaries and Affiliates of the Company.	9
3.4	Authority and Enforceability	9
3.5	No Conflicts; Authorizations	9
3.6	Financial Statements	9
3.7	No Undisclosed Liabilities	10
3.8	Accounts Receivable	10
3.9	Taxes	10
3.10	Compliance with Law	11
3.11	Authorizations	11
3.12	Title to Personal Properties; Leases	12
3.13	Condition of Tangible Assets	12
3.14	Real Property	12-13
3.15	Intellectual Property.	13-16
3.16	Absence of Certain Changes or Events	16-17
3.17	Contracts	17-19
3.18	Litigation.	19

 

 

		Page
3.19	Employee Benefits	20
3.20	Labor and Employment Matters	20
3.21	Environmental	21
3.22	Insurance	21-22
3.23	Books and Records	22
3.24	Suppliers and Customers	22
3.25	Brokers or Finders	22
3.26	Bank Accounts	23
3.27	Powers of Attorney	23
3.28	Support Services	23
3.29	Completeness of Disclosure	23
ARTICLE IV	REPRESENTATIONS AND WARRANTIES OF BUYER	23-24
4.1	Organization and Good Standing	23
4.2	Authority and Enforceability	23
4.3	Brokers or Finders	24
ARTICLE V	COVENANTS OF SELLERS	24-29
5.1	Conduct of Business	24
5.2	Negative Covenants	24-26
5.3	Access to Information	26
5.4	Resignations	26
5.5	Indebtedness; Release of Liens	26
5.6	Confidentiality	26
5.7	Records Retention	27
5.8	Consents	27
5.9	Notification of Certain Matters	27
5.10	Restrictive Covenants	28
5.11	Insurance	29
5.12	Security Interest	29

 

 

		Page
ARTICLE VI	COVENANTS OF BUYER AND SELLERS	30-32
6.1	Regulatory Approvals.	30
6.2	Public Announcements	30
6.3	Tax Matters.	30-31
6.4	Employee Matters.	31-32
6.5	Further Assurances	32
6.6	Payment of Debt to Telefónica del Perú S.A.A	32
ARTICLE VII	CONDITIONS TO CLOSING	32-34
7.1	Conditions to Obligations of Buyer and Sellers	32
7.2	Conditions to Obligation of Buyer	32-34
7.3	Conditions to Obligation of Sellers	34
ARTICLE VIII	TERMINATION	34-35
8.1	Termination	34-35
8.2	Effect of Termination	35
8.3	Remedies.	35
ARTICLE IX	INDEMNIFICATION	36-42
9.1	Survival.	36
9.2	Indemnification by Sellers	36-37
9.3	Indemnification by Buyer	37
9.4	Indemnification Procedure for Third Party Claims	38-40
9.5	Indemnification Procedures for Non-Third Party Claims.	40
9.6	Contingent Claims	40
9.7	Effect of Investigation; Waiver.	40
9.8	Tax Indemnification	40-41
9.9	Procedures Relating to Indemnification of Tax Claims	41
9.10	Tax Treatment of Indemnification Payments	41
9.11	Other Rights and Remedies Not Affected	41

 

 

		Page
ARTICLE X	MISCELLANEOUS	42-45
10.1	Notices	42
10.2	Amendments and Waivers	42
10.3	Expenses	43
10.4	Successors and Assigns	43
10.5	Governing Law	43
10.6	Consent to Jurisdiction	43
10.7	Counterparts	43
10.8	Third Party Beneficiaries	44
10.9	Entire Agreement	44
10.10	Captions	44
10.11	Severability	44
10.12	Specific Performance	44
10.13	Interpretation	44-45

 

 

STOCK PURCHASE AGREEMENT, dated as of February 22, 2009 (the "Agreement"), between:

·             Mario Octavio Navarro Alvarez, identified with Foreign Identity Card No. 000280774 (together with his spouse Gisella Tsuchikame Nakamoto, identified with Peruvian Identity Card No. 09387084) (jointly “Navarro”), and Rafael Isaías Samanez Zacarías, identified with Peruvian Identity Card No. 07967650, (together with his spouse Jesus Margot Magan Guiterrez, identified with Peruvian Identity Card No. 07554742) (jointly “Samanez”), all of them domiciled for these purposes at Av. Camino Real 493, Piso 11,San Isidro, Lima, Peru, (each, individually, is a “Seller” and they are collectively the “Sellers”).

WHEREAS, Perusat S.A. is a corporation (‘sociedad anónima’) organized and existing under the laws of the Republic Peru, registered in the Electronic File No. 00380911 of the Companies’ Registry of Lima, with head office at Av. Camino Real 493, Piso 11,San Isidro, Lima, Peru ( “Perusat” or the “Company”), which has issued 13,190,800 (thirteen million one hundred ninety thousand eight hundred) shares of common stock S/.1.00 (one and 00/100 Peruvian Nuevos Soles) each; and

 

WHEREAS, Perusat is engaged in the business of providing all type of telecommunication services. It can also carry out activities of local or long distance telephones services, land line telephony, mobile phones, IP telephony, internet, cable television, rental of networks and equipments, data transmission, commercialization of telecommunication equipments, among others;

 

WHEREAS, Navarro is the holder of record of 12,941,839 shares issued by Perusat, and Samanez is the holder of record of 248,961 shares issued by Perusat, who together are the sole beneficial and registered owners of all the outstanding shares of the common stock of Perusat; and

 

WHEREAS, Navarro desires to sell 12,414,207 of his shares to Buyer, and Samanez desires to sell 117,053 of his shares to Buyer; and Buyer desires to buy 12,531,260 outstanding shares of common stock of Perusat from Sellers (the “Shares”), such that the respective ownership of the outstanding shares of Perusat following the transaction will be Buyer 95%, Navarro 4% and Samanez 1%, upon the terms and subject to the conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing premises and the respective representations and warranties, covenants and agreements contained herein and the sufficiency of which is hereby acknowledged by the parties, the parties hereto agree as follows:

 

 

 

 

 

 

 

 

“Buyer” has the meaning set forth in the preamble to this Agreement.

 

 

 

 

 

 

"ERISA" means the Employee Retirement Income Security Act of 1974 as enacted in the United States of America.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.3 Language. This Agreement has been entered into in English language and, notwithstanding any translation thereof, the English language version shall control the construction and interpretation of this Agreement. All material communications between the Parties with respect to this Agreement shall be in English language.

 

 

 

 

 

2.2 Purchase Price.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(e) Neither Sellers nor the Company is a party or subject to any stockholder agreement, voting agreement, voting trust or any other similar arrangement which has the effect of restricting or limiting the transfer, voting or other rights associated with the Shares.

 

 

 

 

 

 

 

 

 

 

3.6 Financial Statements. Sellers have delivered to Buyer during due diligence true and complete copies of the Company's audited financial statements and tax returns for each of the year 2007, along with other financial records of the Company. The financial statements and other financial records are true, complete and correct, are based on the books and records of the Company, fairly present the financial condition and operations of the Company as of the respective dates they were prepared for the periods indicated and have been prepared in accordance with PGAAP.  At the Closing Date, a copy of the 2007 audited financial statement and the 2007 tax return of the Company shall be attached as Schedule A to this Agreement.

 

 

 

 

3.9 Taxes.

 

 

 

 

(e) There is no dispute or claim concerning any liability for Taxes with respect to the Company for which notice has been provided, or which is asserted or threatened, or which is otherwise known to the Company or any of the Sellers. No issues have been raised in any Taxes examination with respect to the Company which, by application of similar principles, could be expected to result in liability for Taxes for any other period not so examined. The Company has delivered to Buyer correct and complete copies of all federal income Tax Returns, examination reports, and statements of deficiencies assessed against or agreed to by the Company. The Company has not waived (or is subject to a waiver of) any statute of limitations in respect of Taxes or has agreed to (or is subject to) any extension of time with respect to a Tax assessment or deficiency.

 

 

 

 

 

 

 

 

 

3.12 Title to Personal Properties; Leases.

 

 

 

3.14 Real Property.

 

 

 

 

 

(e) No Governmental Entity having the power of expropriation or eminent domain over the Leased Real Property has commenced or, to the Sellers’ Knowledge, intends to exercise the power of expropriation, eminent domain or a similar power with respect to all or any part of the Leased Real Property. There are no pending or, to the Sellers’ Knowledge, threatened condemnation, fire, health, safety, building, zoning or other land use regulatory proceedings, lawsuits or administrative actions relating to any portion of the Leased Real Property or any other matters which do or may adversely affect the current use, occupancy or value thereof. The Company has not received notice of any pending or threatened proceedings affecting any portion of the Leased Real Property.

 

 

 

 

 

3.15 Intellectual Property.

 

 

 

 

 

(e) The Company exclusively owns the entire right, interest and title to all Intellectual Property that is used in or necessary for the businesses of the Company as they are currently conducted or proposed to be conducted free and clear of Liens (including the design, manufacture, license and sale of all products currently under development or in production) ( the " Company Intellectual Property"), Company Intellectual Property constitutes all the Intellectual Property used in or necessary for the operation of the Company's businesses as they are currently conducted and as proposed to be conducted.

 

 

(g) There are no challenges (or any basis therefore) with respect to the validity or enforceability of any Company Intellectual Property The Company has not taken any action or failed to take any action that could reasonably be expected to result in the abandonment, cancellation, forfeiture, relinquishment, invalidation, waiver or unenforceability of any Company Intellectual Property. There are no Registered Items that the Company has abandoned, cancelled, forfeited or relinquished during the 12 months prior to the date of this Agreement.

 

(h) None of the products or services currently or formerly developed manufactured, sold, distributed, provided, shipped or licensed, by the Company, or which are currently under development, has infringed or infringes upon, or otherwise unlawfully used or uses, the Intellectual Property Rights of any third party.  The Company, by conducting its business as currently conducted or as proposed to be conducted, has not infringed or infringes upon, or otherwise unlawfully used or uses, any Intellectual Property Rights of a third party. The Company has not received any communication alleging that the Company or any of its respective products, services, activities or operations infringe upon or otherwise unlawfully use any Intellectual Property Rights of a third party nor, to the Sellers’ Knowledge, is there any basis therefore. No opposition or Action has been instituted, or, to the Sellers’ Knowledge, threatened, relating to any Intellectual Property formerly or currently used by the Company and none of the Company Intellectual Property is subject to any outstanding Order. To the Company’s Knowledge, no Person has infringed or is infringing any Intellectual Property Rights of the Company or has otherwise misappropriated or is otherwise misappropriating any Company Intellectual Property.

 

(i) With respect to the Company's Proprietary Information, the documentation relating thereto is current, accurate and sufficient in detail and content to identify and explain it and to allow its full and proper use without reliance on the special knowledge or memory of others. The Company has taken commercially reasonable steps to protect and preserve the confidentiality of all Proprietary Information owned by the Company that is not covered by an issued Patent. Without limiting the generality of the foregoing, the Proprietary Information of the Company (other than Proprietary Information that is covered by an issued Patent) is not part of the public knowledge and has not been used or divulged for the benefit of any Person other than the Company. Any receipt or use by, or disclosure to, a third party of Proprietary Information owned by the Company has been pursuant to the terms of binding written confidentiality agreement between the Company and such third party ("Nondisclosure Agreements"). True and complete copies of the Nondisclosure Agreements and any amendments thereto, have been provided to Buyer. The Company is, and to the Sellers’ Knowledge, all other parties thereto are, in compliance with the provisions of the Nondisclosure Agreements. The Company is in compliance with the terms of all Contracts pursuant to which a third party has disclosed to, or authorized the Company to use, Proprietary Information owned by such third party.

 

(j) All current and former employees, consultants, advisors and contractors of the Company have executed and delivered, and are in compliance with, enforceable agreements regarding the protection of Proprietary Information and providing valid written assignments of all Intellectual Property conceived or developed by such employees, consultants, advisors or contractors in connection with their services for the Company ("Work Product Agreements"). No current or former employee, consultant, advisor or contractor or any other Person has any right, claim or interest to any of the Company Intellectual Property.

 

(k) No employee, consultant, advisor or contractor of the Company has been, is or will be, by performing services for the Company, in violation of any term of any employment, invention disclosure or assignment, confidentiality, non-competition agreement or other restrictive covenant or any Order as a result of such employee's, consultant's, advisor’s or independent contractor's employment by the Company or any services rendered by such employee, consultant, advisor or independent contractor.

 

 

 

 

 

 

 

(d) the Company has not split, combined or reclassified any Equity Security or other security, or issued, or authorized for issuance, any Equity Security or other security;

 

(e) the Company has not altered any term of any outstanding Equity Security or other security;

(f) the Company has not (i) increased or modified the compensation or benefits payable or to become payable by the Company to any of its current or former directors, employees, contractors, advisors or consultants, (ii) increased or modified any bonus, severance, termination, pension, insurance or other employee benefit plan, payment or arrangement made to, for or with any current or former directors, employees, contractors, advisors or consultants of the Company, or (iii) entered into any employment, severance or termination agreement;

 

(g) the Company has not sold, leased, transferred or assigned any property or assets of the Company;

 

(h) the Company has not incurred, assumed or guaranteed any Indebtedness;

 

(i) the Company has not created or assumed any Lien on any asset;

 

 

(k) the Company has not entered into any Material Contract;

(l) no Material Contract has been modified, (ii) no rights under any Contract have been waived or accelerated and (iii) no Contract that would be required to be listed as a Material Contract pursuant to Section 3.17 hereof if such Contract were in effect on the date hereof has been terminated or cancelled;

 

 

 

 

(q) there has not been any Material damage, destruction or loss with respect to the property and assets of the Company, whether or not covered by insurance;

 

 (r) the Company has not made any change in accounting practices;

 

(s) the Company has made not any Tax election, changed its method of Tax accounting or settled any claim for Taxes; or

 

(t) the Company has not agreed, whether in writing or otherwise, to do any of the foregoing.

 

3.17 Contracts.

 

(a) At the Closing Date, there shall be attached to this Agreement as Schedule E a complete and accurate list of each Contract or series of related Contracts to which the Company is a party or is subject, or by which any of their respective assets are bound:

 

(i) for the purchase of materials, supplies, goods, services, equipment or other assets and that involves or would reasonably be expected to involve payments by the Company of ten thousand and 00/100 dollars ($10,000) or more;

 

 

 

 

 

 

 

 

 

 

 

(xii) for a charitable or political contribution in any one case;

 

(xiii) for any capital expenditure or leasehold improvement in any one case in excess of ten thousand and 00/100 dollars ($10,000);

 

(xiv) that restricts or purports to restrict the right of the Company to engage in any line of business, acquire any property, develop or distribute any product or provide any service (including geographic restrictions) or to compete with any Person or granting any exclusive distribution rights, in any market, field or territory;

 

(xv) that is an Out-Bound License or an In-Bound License;

 

(xvi) that relates to the acquisition or disposition of any Material business (whether by merger, sale of stock, sale of assets or otherwise);

 

(xvii) that is a collective bargaining Contract or other Contract with any labor organization, union or association;

 

(xviii) that is related to telecommunications services, interconnection or similar.

 

(xix) that is otherwise Material to the Company as a whole and not previously disclosed pursuant to this Section 3.17.

 

(b) Each Contract required to be listed in Schedule E (collectively, the "Material Contracts") is in full force and effect and valid and enforceable in accordance with its terms.

 

(c) The Company is, and no other party thereto is, in default in the performance, observance or fulfillment of any obligation, covenant, condition or other term contained in any Material Contract, and neither the Company has given or received notice to or from any Person relating to any such alleged or potential default that has not been cured. No event has occurred which, with or without the giving of notice or lapse of time, or both, may conflict with or result in a violation or breach of, or give any Person the right to exercise any remedy under or accelerate the maturity or performance of, or cancel, terminate or modify, any Material Contract.

 

(d) The Company has delivered accurate and complete copies of each Material Contract to Buyer.

 

(e) All Contracts other than Material Contracts to which the Company is a party or is subject, or by which any of their respective assets are bound (collectively, the "Minor Contracts"), are in all Material respects valid and enforceable in accordance with their terms. The Company is not, and no other party thereto is not, in default in the performance, observance or fulfillment of any obligation, covenant or condition contained therein, and no event has occurred which with or without the giving of notice or lapse of time, or both, would constitute a default thereunder by the Company or any other Person.

 

3.18 Litigation.

 

(a) There is no action, suit or proceeding, claim, arbitration, litigation or investigation (each, an "Action") (i) pending or, to the Sellers’ Knowledge, threatened against or which may affect the Company, or (ii) that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement or affect the validity, effectiveness or enforceability of this Agreement or the consummation of the transactions contemplated hereby. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action. There is no Action against any current or former director, employee, consultant, advisor or independent contractor of the Company with respect to which the Company has or is reasonably likely to have an indemnification obligation.

 

(b) There is no unsatisfied judgment, penalty or award against or which may affect the Company or any of its respective properties or assets. There is no Order to which the Company or any of their respective properties or assets is subject.

 

3.19 Employee Benefits. The Company does not have any Benefit Plans sponsored, maintained or contributed to or required to be contributed to by the Company for the benefit of any present or former directors, employees, contractors, advisors or consultants of the Company.

 

3.20 Labor and Employment Matters.

 

(a) The Company is not a party or subject to any labor union or collective bargaining agreement.

 

 

 

 

 

3.21 Environmental.

 

 

(e) the Company is conducting and has always conducted its business and any past business in compliance with all applicable Laws (including Environmental Laws) and, in particular, the Company has not discharged any substances in a manner that is not in compliance with any applicable laws (including Environmental Laws);

 

(f) the Company holds or possesses all governmental permits and Authorizations that are necessary under Environmental Laws to carry on and conduct the business and operations of the Company as currently conducted;

 

(g) the buildings and fixtures that the Company operate, use or has operated or used have received proper maintenance and are currently in good operation conditions, in fulfillment of the Environmental Laws;

 

(h) the Company is not currently in breach of, in default under, or in violation of any Environmental Law, and is not aware of any circumstances which, with the passage of time, will cause the Company to be in breach of, in default under, or in violation of any Environmental Law; and

 

(i) no suit, claim, action, arbitration, legal, administrative or other proceeding is pending or threatened against the Company with respect to any environmental matter and no Governmental Entity has imposed fines and/or sanctions to, and/or has initiated any inspection process on the Company for any default under, or violation of, any applicable Environmental Law.

 

3.22 Insurance.

 

(a) At the Closing Date, there shall be attached to this Agreement as Schedule F an accurate and complete list of each insurance policy and fidelity bond which covers the Company or its respective businesses, properties, assets, directors or employees (the "Policies"). There are no pending claims under any of such Policies as to which coverage has been questioned, denied or disputed by the insurer or in respect of which the insurer has reserved its rights.

 

 

(b) There is no self-insurance arrangement by or affecting the Company.

 

(c) All Policies are issued by an insurer that is financially sound and reputable, are in full force and effect and are enforceable in accordance with their terms and will continue in full force and effect with respect to the Company following the Acquisition. Such Policies provide adequate insurance coverage for the Company and its respective businesses, properties, assets and employees, and are sufficient for compliance with all Laws and Contracts to which the Company is a party or by which it is bound.

 

(d) All premiums due under the Policies have been paid in full or, with respect to premiums not yet due, accrued. The Company has not received a notice of cancellation of any Policy or of any Material changes that are required in the conduct of the businesses of the Company as a condition to the continuation of coverage under, or renewal of, any such Policy. There is no existing default or event which, with the giving of notice or lapse of time or both, would constitute a default under any Policy or entitle any insurer to terminate or cancel any Policy. The Sellers have no Knowledge of any threatened termination of, or Material premium increase with respect to, any Policy and none of such Policies provides for retroactive premium adjustments.

 

3.23 Books and Records. The minute books (containing the records of the meetings, or written consents in lieu of such meetings, of the stockholders and the board of directors), the stock certificate books, and the stock record books of the Company are correct and complete, and have been maintained in accordance with sound business practices. The minute books of the Company contain accurate and complete records of all meetings, or actions taken by written consent, of the stockholders and the board of directors of the Company, and no meeting, or action by written consent in lieu of such meeting, of any such stockholders or board of directors, has been held for which minutes have not been prepared and not contained in the minute books. At the Closing, all of the books and records of the Company will be in the possession of the Company. At the Closing, Sellers will deliver, or cause to be delivered, to Buyer or its designee all of the minute books of the Company.

 

3.24 Suppliers and Customers. The relationships of each of the Company with each such supplier and customer are good commercial working relationships: (a) each supplier from whom purchases exceeded ten thousand and 00/100 dollars ($10,000) in the year ended December 31, 2008, (b) each supplier who constitutes a sole source of supply to the Company, and (c) with respect to the three-year period ended on the date of this Agreement, each customer that has contributed in excess of 10% percent of the Company’s revenues on a consolidated basis for such period. No such supplier or customer has canceled or otherwise terminated, or threatened to cancel or otherwise terminate, its relationship with the Company. The Company has not received notice that any such supplier or customer may cancel or otherwise Materially and Adversely modify its relationship with the Company or limit its services, supplies or materials to the Company, either as a result of the Acquisition or otherwise.

 

3.25 Brokers or Finders. No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Sellers or the Company.

 

 

3.26 Bank Accounts. At the Closing Date, there shall be attached to this Agreement as Schedule G a list containing the name of each bank, safe deposit company or other financial institution in which the Company has an account, lock box or safe deposit box and the names of all persons authorized to draw thereon or have access thereto.

 

3.27 Powers of Attorney. At the Closing Date, there shall be attached to this Agreement as Schedule H a list of all outstanding powers of attorney executed by or on behalf of the Company in favor of any Person. 

 

3.28 Support Services. Sellers provide no support or other services to the Company.

 

3.29 Completeness of Disclosure. No representation or warranty by Sellers in this Agreement, and no statement made in the Schedules, or any certificate or other document furnished or to be furnished to Buyer pursuant hereto, or in connection with the negotiation, execution or performance of this Agreement, contains or will at the Closing contain any untrue statement of a Material fact or omits or will omit to state a Material fact required to be stated herein or therein or necessary to make any statement herein or therein not misleading. There are no facts or circumstances that could be expected to have, individually or in the aggregate, a Material Adverse Effect on the condition (financial or otherwise), operations, prospects or results of operations of the Company taken as a whole.

 

 

Buyer represents and warrants to Sellers that each statement contained in this Article IV is true and correct as of the date hereof.

 

4.1 Organization and Good Standing. Buyer is a corporation duly organized, validly existing and in good standing under the Laws of the Republic of Seychelles, and has all requisite corporate power to own, lease and operate its properties and to carry on its business as now being conducted.

 

4.2 Authority and Enforceability. Buyer has the requisite power and authority to enter into this Agreement and to consummate the Acquisition. The execution and delivery of this Agreement and the consummation of the Acquisition have been duly authorized by all necessary corporate action on the part of Buyer. This Agreement has been duly executed and delivered by Buyer and, assuming due authorization, execution and delivery by Sellers, constitutes the valid and binding obligation of Buyer, enforceable against it in accordance with its terms, except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting or relating to creditors' rights generally, and (b) the availability of injunctive relief and other equitable remedies.  

 

4.3 Brokers or Finders.  No broker, finder or investment banker is entitled to any brokerage, finder's or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Buyer or any Affiliate of Buyer.

 

 

 

 

 

 

 

 

 

 

 

(p) change its method of Tax accounting or settle any claim relating to Taxes;

 

(q) take any action or omit to do any act which action or omission will cause it to breach any obligation contained in this Agreement or cause any representation or warranty of Sellers not to be true and correct as of the Closing Date; or

 

(r) agree or otherwise commit, whether in writing or otherwise, to do any of the foregoing.

 

5.3 Access to Information. Sellers shall, and shall cause the Company to, afford to Buyer's officers, directors, employees, accountants, counsel, consultants, advisors and agents ("Representatives") free and full access to and the right to inspect, during normal business hours, all of the Leased Real Property, properties, assets, records, Contracts and other documents related to the Company, and shall permit them to consult with the officers, employees, accountants, advisors, counsels and agents of the Sellers for the purpose of making such investigation of the Company as Buyer shall desire to make. Sellers shall furnish to Buyer all such documents and copies of documents and records and information with respect to the Company and copies of any working papers relating thereto as Buyer may request. Without limiting the foregoing, Sellers shall permit Buyer and its Representatives to conduct environmental due diligence of the Company and the Leased Real Property, including the collecting and analysis of samples of indoor or outdoor air, surface water, groundwater or surface or subsurface land on, at, in, under or from the Company and the Leased Real Property.

 

5.4 Resignations. On the Closing Date, Sellers shall cause to be delivered to Buyer duly signed resignations of all members of the Board of Directors of their positions as directors of the Company and of all officers of their positions as officers of the Company. For this purpose, on the Closing Date the Company must hold a Shareholders’ Meeting in which all the resignations presented by all of the members of the Board of Directors and officers of the Company will be accepted.

 

5.5 Indebtedness; Release of Liens.

 

(a) Prior to the Closing Date, all Indebtedness of the Company and any guarantees of such Indebtedness shall be extinguished.

 

(b) Prior to the Closing Date, the Company shall have caused to be released all Liens in and upon any of the properties and assets of the Company.

 

5.6 Confidentiality.  

 

(a) From and after the Closing, Sellers will hold, and will use its reasonable best efforts to cause its respective Representatives to hold, in confidence any and all information, whether written or oral, concerning the Company, except to the extent that Sellers can show that such information (a) is in the public domain through no fault of Sellers or (b) is lawfully acquired by Sellers after the Closing from sources which are not prohibited from disclosing such information by a legal, contractual or fiduciary obligation. If Sellers or any of its Representatives are compelled to disclose any such information by judicial or administrative process or by other requirements of Law, Sellers shall promptly notify Buyer in writing and shall disclose only that portion of such information which Sellers is advised by its counsel in writing is legally required to be disclosed, provided that Sellers shall exercise its reasonable best efforts to obtain an appropriate protective order or other reasonable assurance that confidential treatment will be accorded such information.

 

5.7 Record Retention Sellers will retain any of its books and records that relate to the Company in accordance with the Company record retention policies as presently in effect. During the period commencing on the Closing Date and ending on the seventh anniversary of the Closing Date, Sellers shall not dispose of or permit the disposal of any such books and records not required to be retained under such policies without first giving 60 days' prior written notice to Buyer offering to surrender the same to Buyer at Buyer's expense.

 

5.8 Consents. Sellers shall cause the Company to obtain all Consents; provided that no Indebtedness shall be repaid, and no Contract shall be amended nor any right thereunder be waived, and no money or other consideration shall be expended, to obtain any such Consent.

 

5.9 Notification of Certain Matters.  

 

(a) Sellers shall give prompt notice to Buyer of (i) any fact, event or circumstance known to any of them that individually or taken together with all other facts, events and circumstances known to any of them, has had or is reasonably likely to have, individually or in the aggregate, a Material Adverse Effect on the condition (financial or otherwise), operations, prospects or results of operations of the Company taken as a whole, or that would cause or constitute a breach of any of its representations, warranties, covenants or agreements contained herein, (ii) any fact, event or circumstance known to any of them that individually or taken together with all other facts, events and circumstances known to any of them, has had or is reasonably likely to result in the failure of any condition precedent to Buyer's obligations, (iii) any notice or other communication from any third party alleging that the consent of such third party is or may be required in connection with the Acquisition, (iv) any notice or other communication from any Governmental Entity in connection with the Acquisition, or (v) any Actions commenced relating to Sellers, the Company that, if pending on the date of this Agreement, would have been required to have been disclosed pursuant to Section 3.18;  provided however, that (A) the delivery of any notice pursuant to this Section 5.9 shall not limit or otherwise affect any remedies available to Buyer or prevent or cure any misrepresentations, breach of warranty or breach of covenant, and (B) disclosure by Sellers shall not be deemed to amend or supplement the Schedules or constitute an exception to any representation or warranty.

 

(b) From the date hereof to and including the Closing Date, the Company shall provide Buyer with regular management reports on its operations.

 

 

5.10 Restrictive Covenants.

 

(a) Sellers covenant that, commencing on the Closing Date and ending on the fifth anniversary of the Closing Date (the "Noncompetition Period"), they shall not engage in, directly or indirectly, in any capacity, or have any direct or indirect ownership interest in, or permit the Company's name to be used in connection with, any business anywhere in any South American country, which is engaged, either directly or indirectly, in the business of providing all type of telecommunication services or carrying out activities of local or long distance telephones services, fixed telephony, mobile phones, IP telephony, internet, cable television, rental of networks and equipments, data transmission, commercialization of telecommunication equipments, among others; or providing services which are competitive with products or equipment leased, marketed, sold or under development by, or services provided by, the Company (the "Restricted Business"). It is recognized that the Restricted Business is expected to be conducted throughout at least the Republic of Peru and that more narrow geographical limitations of any nature on this non-competition covenant (and the non-solicitation covenants set forth in Sections 5.10(b) and (c)) are therefore not appropriate.

 

(b) Sellers covenant that, during the Noncompetition Period, they shall not directly or indirectly, solicit or entice, or attempt to solicit or entice, any clients or customers of the Company or potential clients or customers of the Company for purposes of diverting their business or services from the Company.

 

(c) Sellers covenant that, during the Noncompetition Period, Sellers shall not solicit the employment or engagement of services of any person who is or was employed as an employee, contractor, advisor or consultant by the Company during such period on a full or part-time basis.

 

(d) Sellers acknowledge that the restrictions contained in this Section 5.10 are reasonable and necessary to protect the legitimate interests of Buyer and constitute a Material inducement to Buyer to enter into this Agreement and consummate the Acquisition. Sellers acknowledges that any violation of this Section 5.10 will result in irreparable injury to Buyer and agrees that Buyer shall be entitled to preliminary and permanent injunctive relief, without the necessity of proving actual damages, as well as an equitable accounting of all earnings, profits and other benefits arising from any violation of this Section 5.10, which rights shall be cumulative and in addition to any other rights or remedies to which Buyer may be entitled. Without limiting the generality of the foregoing, the Noncompetition Period shall be extended for an additional period equal to any period during which either of the Sellers are in breach of their obligations under this Section 5.10.

 

(e) In the event that any covenant contained in this Section 5.10 should ever be adjudicated to exceed the time, geographic, product or service, or other limitations permitted by applicable Law in any jurisdiction, then any court is expressly empowered to reform such covenant, and such covenant shall be deemed reformed, in such jurisdiction to the maximum time, geographic, product or service, or other limitations permitted by applicable Law. The covenants contained in this Section 5.10 and each provision thereof is severable and distinct covenants and provisions. The invalidity or unenforceability of any such covenant or provision as written shall not invalidate or render unenforceable the remaining covenants or provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such covenant or provision in any other jurisdiction.

 

 

5.11 Insurance.

 

(a) To the extent that Sellers shall be entitled under the terms and conditions of "occurrence" based Policies in effect on the date hereof to coverage for losses suffered by the Company after the Closing arising out of any occurrences covered by such Policies occurring prior to the Closing, Sellers shall use such efforts and take such actions to recover such losses on behalf of the Company pursuant to such Policies as it would use or take in conducting its own business in the Ordinary Course if such losses were suffered by Sellers, and shall deliver the proceeds thereby recovered to the Company. In the event of any dispute regarding the date of any loss or occurrence, the terms of the applicable Policy shall govern. Sellers shall continue to maintain such Policies, to the extent they apply on the date hereof to the Company, in full force and effect (and without any amendment that would be adverse, in any Material respect, to the Company) with respect to occurrences prior to and including the Closing. Sellers shall continue to have the Company as a named insured party under each such Policy with respect to occurrences prior to and including the Closing.

 

(b) Following the Closing, Buyer shall provide, and shall cause the Company to provide, Sellers with all records and other information necessary for the reporting, investigation, negotiation and, if applicable, prosecution of any claim made by Sellers pursuant to this Section 5.11.

 

5.12 Security Interest.

 

(a) Sellers hereby grant Buyer a security interest on fifty percent (50%) of the 1,000,000 (one million) shares of China Tel Group Inc. (the “Pledged Shares”) they will receive as consideration for the sale of the Shares in accordance with Section 2.2 of this Agreement.

 

(b) The pledge on the Pledged Shares will secure each and all of the representations, warranties, statements, agreements, covenants and obligations of the Sellers under this Agreement, for which each Seller will be jointly and severally liable.

 

(c) The Pledged Shares are pledged to the Buyer up to the amount of One Million One Hundred Twenty-Five Thousand and 00/100 Dollars (US$1,125,000) for a term of thirty-six (36) months following the Closing Date.

 

(d) Buyer may enforce the security interest and sell all of the Pledged Shares, or any part thereof, upon breach by any of the Sellers of any of the representations, warranties, statements, agreements, covenants or obligations of the Sellers under this Agreement.

 

(e) The Pledged Shares will be released from their security interest immediately upon expiration of the term set forth in subparagraph (c) hereinabove, provided that all of the Pledged Shares or any part thereof have not been sold by Buyer as set out in subparagraph (d) hereinabove.

 

 

 

6.1 Regulatory Approvals. Each of Buyer and Sellers shall promptly apply for, and take all reasonably necessary actions to obtain or make, as applicable, all Authorizations, Orders, declarations and filings with, and notices to, any Governmental Entity or other Person required to be obtained or made by it for the consummation of the Acquisition and the transactions contemplated by this Agreement.  Each Party shall cooperate with and promptly furnish information to the other Party necessary in connection with any requirements imposed upon such other Party in connection with the consummation of the Acquisition. Parties shall be equally responsible for all filings and other similar fees payable in connection with such filings, and for any local counsel fees.

 

6.2 Public Announcements. Neither Buyer nor Sellers shall, and Sellers shall cause the Company not to, issue any press releases or otherwise make any public statements with respect to the transactions contemplated by this Agreement; provided that Buyer or Sellers may, without such approval, make such press releases or other public announcement as it believes are required pursuant to any listing agreement with any national securities exchange or stock market or applicable securities Laws, in which case the Party required to make the release or announcement shall allow the other Party reasonable time to comment on such release or announcement in advance of such issuance; provided, further, that each of the parties may make internal announcements to their respective employees that are consistent with the parties' prior public disclosures regarding the Acquisition.

 

6.3 Tax Matters.

 

(a) Preparation and Filing of Pre-Closing and Post-Closing Period Tax Returns.

 

(i) Tax Periods Ending on or Before the Closing Date. Buyer shall prepare, or cause to be prepared, and file, or cause to be filed, all Tax Returns of the Company for all periods ending on or prior to the Closing Date which are filed after the Closing Date. Buyer shall permit Sellers to review and comment on each such Tax Return described in the preceding sentence prior to filing. Sellers shall pay to Buyer the amount of the Taxes with respect to such Tax Returns within five days following any demand by Buyer for such payment.

 

(ii) Tax Periods Beginning Before and Ending After the Closing Date. Buyer shall prepare, or cause to be prepared, and file, or cause to be filed, all Tax Returns of the Company for Tax periods which begin before the Closing Date and end after the Closing Date. Sellers shall pay to Buyer, within five days following any demand by Buyer, with respect to such Tax Returns, an amount equal to the portion of such Taxes which relates to the portion of such taxable period ending on the Closing Date (as determined pursuant to Section 6.3(c) hereof). Buyer shall permit Sellers to review and comment upon such Tax Returns.

 

(b) Cooperation in Filing Tax Returns. Buyer and Sellers shall provide to the other such cooperation and information, as and to the extent reasonably requested, in connection with the filing of any Tax Return, amended Tax Return or claim for refund, determining liability for Taxes or a right to refund of Taxes, or in conducting any audit, litigation or other proceeding with respect to Taxes. Such cooperation and information shall include providing copies of all relevant portions of relevant Tax Returns, together with relevant accompanying schedules and relevant work papers, relevant documents relating to rulings and other determinations by Taxing Authorities, and relevant records concerning the ownership and Tax basis of property, which any such party may possess.  Each party will retain all Tax Returns, schedules, work papers, and all Material records and other documents relating to Tax matters, of the Company for the Tax period first ending after the Closing Date and for all prior Tax periods until the expiration of the applicable statute of limitations for the Tax periods to which the Tax Returns and other documents relate. Thereafter, the Party holding such Tax Returns or other documents may dispose of them. Each Party shall make its employees, contractors, consultants and advisors reasonably available on a mutually convenient basis at its cost to provide explanation of any documents or information so provided.

 

(c) Carryovers, Refunds, and Related Matters.

 

(i) Any refund of Taxes (including any interest thereon) that relates to the Company and that is attributable to a post-Closing period shall be the property of the Company, as applicable, and shall be retained by the Company (or promptly paid by Sellers to the Company if any such refund (or interest thereon) is received by any of the Sellers). Without limiting the generality of the preceding sentence, any such refund or other benefit realized by the Company in a post-Closing period that results from the carry forward of any Tax attribute from a pre-Closing period shall be the property of the Company and shall be retained by the Company.

 

(ii) In the event that the Company (or successor thereto) realizes any item of loss or credit for Tax purposes for any post-Closing period, the Company may, in its sole discretion, carry forward such loss or credit.

 

(d) Payment of Taxes and Fees. Sellers shall pay all Transfer Taxes and any other Taxes arising out of or in connection with the transactions effected pursuant to this Agreement, and shall indemnify, defend, and hold harmless Buyer with respect to such Taxes. Sellers shall file all necessary documentation and Tax Returns with respect to such Taxes.

 

6.4 Employee Matters.

 

(a) Severance. Sellers shall be jointly liable for any severance, separation, deferred compensation or similar benefits that are payable to any employee of the Company as a result of the Acquisition. Sellers shall indemnify Buyer for any claim by any such employees that they are entitled to any such benefits as a result of the Acquisition.

 

(b) Certain Welfare Benefits Matters. Sellers shall retain joint responsibility for and continue to pay all medical, life insurance, disability and other welfare plan expenses and benefits with respect to claims incurred by such employees or their covered dependents on or prior to the Closing Date. Expenses and benefits with respect to claims incurred by such employees or their covered dependents after the Closing Date shall be the responsibility of Buyer, except if they are the result of, or arise out of, the Company’s breach of the applicable Laws. For purposes of this paragraph, a claim is deemed incurred when the services that are the subject of the claim are performed; in the case of life insurance, when the death occurs; in the case of long-term disability benefits, when the disability occurs; and, in the case of a hospital stay, when the employee first enters the hospital.

 

 

(c) Workers' Compensation. Sellers shall be jointly responsible for all claims for workers' compensation benefits which are incurred on or prior to the Closing Date by such employees that are payable under the terms and conditions of the Company  workers' compensation programs. Buyer's workers compensation programs shall be responsible for all claims for benefits which are incurred after the Closing Date by such employees that are payable under the terms and conditions of Buyer's workers' compensation programs. For purposes of this Section 6.4(c), a claim for workers' compensation benefits shall be deemed to be incurred when the event giving rise to the claim occurs (each, a "Workers' Compensation Event"). If a Workers' Compensation Event occurs over a period both preceding and following the Closing, the claim shall be the joint responsibility and liability of Sellers and Buyer and shall be equitably apportioned between Sellers, on the one hand, and Buyer, on the other hand, based upon the relevant periods of time that such Workers' Compensation Event transpired preceding and following the Closing.

 

6.5 Further Assurances. Subject to the terms of this Agreement, each of Buyer and Sellers shall execute such documents and other instruments and take such further actions as may be reasonably required to carry out the provisions hereof and consummate the Acquisition.

 

6.6 Payment of Debt to Telefónica del Perú S.A.A. Within 10 (ten) Business Days as of the Closing Date, Buyer will pay to Telefónica del Perú S.A.A. US$100,000.00 (one hundred thousand and 00/100 U.S. dollars) of the current debt that Perusat has with Telefónica del Perú S.A.A.  Sellers shall use best efforts to negotiate with Telefónica del Perú S.A.A to defer payment of the remaining balance due by the Company to Telefónica del Perú S.A.A. a minimum of 90 (ninety) days following the Closing Date without penalty or interests.

 

 

 

 

 

(a) The representations and warranties of Sellers set forth in this Agreement shall have been true and correct at and as of the date hereof and shall be true and correct at and as of the Closing Date as if made at and as of the Closing Date, and the Sellers shall have executed and delivered or cause to be delivered a certificate to Buyer to that effect. The receipt of such certificate at the Closing Date shall not constitute a waiver by Buyer of any of the representation and warranties of the Sellers which are contained in this Agreement.

 

(b) Sellers shall have performed or complied with all obligations and covenants required by this Agreement to be performed or complied by Sellers with at or prior to the Closing Date, and the Sellers shall have executed and delivered or cause to be delivered a certificate to Buyer to that effect. The receipt of such certificate at the Closing Date shall not constitute a waiver by Buyer of any of the covenants of the Sellers which are contained in this Agreement.

 

(c) There shall have been no Material Adverse Change in the condition (financial or otherwise), operations, prospects or results of operations of the Company taken as a whole.

 

(d) No Action shall be pending or threatened before any court, judge, arbitrator, arbitration panel or other Governmental Entity or other Person (i) seeking to prevent consummation of any of the transactions contemplated by this Agreement, (ii) seeking to impose any Material limitation on the right of Buyer to own the Shares and to control the Company or (iii) seeking to restrain or prohibit Buyer's ownership or operation of all or any Material portion of the business or assets of the Company, taken as a whole, or compel Buyer to dispose of or hold separate all or any Material portion of the business or assets of the Company, taken as a whole. No such Order shall be in effect.

 

(e) No Law shall have been enacted or shall be deemed applicable to the Acquisition which has any of the effects set forth in clauses (i) through (iii) in Section 7.2(d).

 

(f) Sellers shall have obtained the Consent of each Person whose Consent is required under the Contracts set forth in Section 7.2(g) and shall have provided evidence of each such Consent in form and substance satisfactory to Buyer.

 

(g) Sellers shall have delivered to Buyer evidence of (i) the release of all Liens with respect to the property and assets of the Company, (ii) the repayment of all outstanding Indebtedness of the Company, (iii) the repayment or other cancellation of all intercompany accounts between Sellers (other than the Company), on the one hand, and the Company, on the other hand, and (iv) the release of all guarantees by the Company of any Indebtedness or other obligation of any third party, including Sellers, in each case in form and substance satisfactory to Buyer.

 

(h) Sellers shall have delivered to Buyer true and complete copies of all resolutions adopted by the Board of Directors and/or the Shareholders’ Meeting of the Company in connection with the Acquisition.

 

(i) Sellers shall have delivered to Buyer (i) copies of the Charter Documents of the Company currently in force, (ii) original stock certificates representing the ownership of the Shares, duly endorsed, as set forth in Section 2.4(b) of this Agreement, (iii) all other documents and instruments necessary to vest in Buyer all of Sellers' rights, title and interest in and to the Shares, free and clear of all Liens, as set forth in Section 2.4(b) of this Agreement, (iv) duly signed resignations of all members of the Board of Directors to their positions as directors of the Company and of all officers to their positions as officers of the Company, as set fort in Section 5.4 of this Agreement, and (v) all other documents, instruments or certificates required to be delivered by Sellers at or prior to the Closing pursuant to this Agreement.

 

(j) Each Seller shall have delivered to Buyer, or cause to be delivered to Buyer, an original signed receipt evidencing payment of the Purchase Price.

 

7.3 Conditions to Obligation of Sellers. The obligation of Sellers to consummate the Acquisition is subject to the satisfaction (or waiver by Sellers in its sole discretion), of the following further conditions, which are for their exclusive benefit:

 

(a) The representations and warranties of Buyer set forth in this Agreement shall have been true and correct at and as of the date hereof and shall be true and correct at and as of the Closing Date as if made at and as of the Closing Date, and Buyer shall have executed and delivered or cause to be delivered a certificate to Sellers to that effect. The receipt of such certificate at the Closing Date shall not constitute a waiver by the Sellers of any of the representation and warranties of the Buyer which are contained in this Agreement.

 

(b) Buyer shall have performed or complied in all Material respects with all obligations and covenants required by this Agreement to be performed or complied with by Buyer at or prior to the Closing Date, and Buyer shall have executed and delivered or cause to be delivered a certificate to Sellers to that effect. The receipt of such certificate at the Closing Date shall not constitute a waiver by the Sellers of any of the covenants of the Buyer which are contained in this Agreement.

 

(c) No Action shall be pending or threatened before any court, judge, arbitrator or arbitration panel or other Governmental Entity or other Person wherein an unfavorable Order would (i) prevent consummation of any of the transactions contemplated by this Agreement or (ii) cause any of the transactions contemplated by this Agreement to be rescinded following consummation. No such Order shall be in effect.

 

 

8.1 Termination.

 

(a) This Agreement may be terminated and the Acquisition abandoned at any time prior to the Closing:

 

(i) by mutual written consent of Buyer and Sellers;

 

(ii) by Buyer or Sellers if:

 

 

 

(iii) by Buyer if:

 

(A) any condition to the obligations of Buyer hereunder becomes incapable of fulfillment other than as a result of a breach by Buyer of any covenant or agreement contained in this Agreement, and such condition is not waived by Buyer; or

 

(B) there has been a breach by Sellers of any representation, warranty, covenant or agreement contained in this Agreement or Schedules, or if any representation or warranty of Sellers shall have become untrue, in either case such that the conditions set forth in Section 7.2(a) or Section 7.2(b) would not be satisfied; or

 

(iv) by Sellers if:

 

(A) any condition to the obligations of Sellers hereunder becomes incapable of fulfillment other than as a result of a breach by Sellers of any covenant or agreement contained in this Agreement, and such condition is not waived by Sellers; or

 

(B) there has been a breach by Buyer of any representation, warranty, covenant or agreement contained in this Agreement, or if any representation or warranty of Buyer shall have become untrue, in either case such that the conditions set forth in Section 7.3(a) or Section 7.3(b) would not be satisfied.

 

(b) The Party desiring to terminate this Agreement pursuant to Section 8.1(a) (ii), (iii) or (iv)  shall give written notice of such termination to the other Party hereto.

 

8.2 Effect of Termination. In the event of termination of this Agreement as provided in Section 8.1, this Agreement shall immediately become null and void and there shall be no liability or obligation on the part of Buyer or Sellers, except as set forth in Section 8.3; provided that the provisions of Section 6.2 (Public Announcements) and Section 8.3 (Remedies) and Article X of this Agreement shall remain in full force and effect and survive any termination of this Agreement.

 

8.3 Remedies. Any Party terminating this Agreement pursuant to Section 8.1 shall have the right to recover damages sustained by such Party as a result of any breach by the other Party of any representation, warranty, covenant or agreement contained in this Agreement or fraud or willful misrepresentation; provided, however, that the Party seeking relief is not in breach of any representation, warranty, covenant or agreement contained in this Agreement under circumstances which would have permitted the other Party to terminate the Agreement under Section 8.1.

 

 

9.1 Survival.

 

(a) Except as set forth in Section 9.1(b), all representations and warranties contained in this Agreement, or in any Schedule, certificate or other document delivered pursuant to this Agreement, shall survive the Closing for a period of two years.

 

(b) The representations and warranties of Sellers contained in Sections 3.1 (Organization and Good Standing), 3.2 (Capitalization), 3.4 (Authority and Enforceability), 3.25 (Brokers or Finders), and the representation and warranties of Buyer contained in Sections 4.1 (Organization and Good Standing), 4.2 (Authority and Enforceability) and 4.3 (Brokers or Finders) shall survive the Closing indefinitely. The representations and warranties of Sellers contained in Sections 3.9 (Taxes), 3.19 (Employee Benefits), 3.20 (Labor and Employment Matters) and 3.21 (Environmental) shall survive the Closing until 90 Business Days after the expira­tion of the applicable statute of limitations period (after giving effect to any waivers and extensions thereof).

 

(c) The period for which a representation or warranty, covenant or agreement survives the Closing is referred to herein as the "Applicable Survival Period". In the event a Notice of Claim for indemnification under Section 9.2 or 9.3 is given within the Applicable Survival Period, the representation or warranty, covenant or agreement that is the subject of such indemnification claim (whether or not formal legal action shall have been commenced based upon such claim) shall survive with respect to such claim until such claim is finally resolved. The Indemnitor shall indemnify the Indemnitee for all Losses (subject to the limitations set forth herein, if applicable) that the Indemnitee may incur in respect of such claim, regardless of when incurred.

 

9.2 Indemnification by Sellers.

 

(a) Sellers shall jointly and severally indemnify and defend Buyer and its Affiliates (including, following the Closing, the Company) and their respective stockholders, members, managers, officers, directors, employees, agents, successors and assigns (the "Buyer Indemnitees") against, and shall hold them harmless from, any and all losses, damages, claims (including third party claims), charges, interest, penalties, Taxes, diminution in value, costs and expenses (including legal, consultant, accounting and other professional fees, costs of sampling, testing, investigation, removal, treatment and remediation of contamination and fees and costs incurred in enforcing rights under this Section 9.2) (collectively, "Losses") resulting from, arising out of, or incurred by any Buyer Indemnitee in connection with, or otherwise with respect to:

 

(i) the failure of any representation and warranty or other statement by Sellers contained in this Agreement, the Schedules, or any other document furnished or to be furnished to Buyer in connection with the transactions contemplated by this Agreement, to be true and correct in all respects as of the date of this Agreement or as of the Closing Date;

 

(ii) any breach of any covenant or agreement of Sellers contained in this Agreement, the Schedules, or any other document furnished or to be furnished to Buyer in connection with the transactions contemplated by this Agreement;

 

(iii) any fees, expenses or other payments incurred or owed by Sellers or the Company to any agent, broker, investment banker or other firm or person retained or employed by it in connection with the transactions contemplated by this Agreement;

 

(iv) any Pre-Closing Environmental Liabilities and any Action arising out of or in connection therewith; provided that (A) this Section 9.2 shall not apply with respect to any Loss relating to Taxes to the extent that indemnification payments for such Loss have been made pursuant to Section 9.8, and (B) for purposes of this Section 9.2, the representations and warranties herein shall be deemed to have been made without any qualifications as to Knowledge or materiality and, accordingly, all references herein and therein to "Knowledge," "material," "in all material respects" and similar qualifications as to Knowledge and materiality shall be deemed to be deleted therefrom (except where any such provision requires disclosure of lists of items of a material nature or above a specified threshold). Any and all Losses hereunder shall bear interest from the date incurred until paid at the rate of 8% per annum.

 

(b) Sellers shall not be liable for any Loss or Losses pursuant to Section 9.2(a)(i) ("Buyer Warranty Losses") (i) unless and until the aggregate amount of all Buyer Warranty Losses incurred by the Buyer Indemnitees exceeds Fifty Thousand and 00/100 dollars ($50,000), in which event Sellers shall be jointly liable for all Buyer Warranty Losses from the first dollar; provided that nothing contained in this Section 9.2(b) shall be deemed to limit or restrict in any manner any rights or remedies which Buyer has, or might have, at Law, in equity or otherwise, based on fraud or a willful misrepresentation or willful breach of warranty hereunder.

 

9.3 Indemnification by Buyer.

 

(a) Buyer shall indemnify and defend Sellers (the "Sellers Indemnitees") against, and shall hold them harmless from, any and all Losses resulting from, arising out of, or incurred by any Sellers Indemnitee in connection with, or otherwise with respect to:

 

(i) the failure of any representation and warranty or other statement by Buyer contained in this Agreement or any other document furnished or to be furnished by Buyer to Sellers in connection with the transactions contemplated by this Agreement, to be true and correct in all respects as of the date of this Agreement or as of the Closing Date; and

 

(ii) any breach of any covenant or agreement of Buyer contained in this Agreement or any other document furnished or to be furnished by Buyer to Sellers in connection with the transactions contemplated by this Agreement.

 

(b) Buyer shall not be liable for any Loss or Losses pursuant to 9.3(a)(i) ("Sellers Warranty Losses") (i) unless and until the aggregate amount of all Sellers Warranty Losses incurred by the Sellers Indemnitees exceeds Fifty Thousand and 00/100 dollars ($50,000), in which event Buyer shall be liable for all Sellers Warranty Losses from the first dollar.

 

9.4 Indemnification Procedures for Third Party Claims.

 

(a) In the event that an Indemnitee receives notice of the assertion of any claim or the commencement of any Action by a third party in respect of which indemnity may be sought under the provisions of this Article IX ("Third Party Claim"), the Indemnitee shall promptly notify the Indemnitor in writing ("Notice of Claim") of such Third Party Claim. Failure or delay in notifying the Indemnitor will not relieve the Indemnitor of any liability it may have to the Indemnitee, except and only to the extent that such failure or delay causes actual harm to the Indemnitor with respect to such Third Party Claim. The Notice of Claim shall set forth the amount, if known, or, if not known, an estimate of the foreseeable maximum amount of claimed Losses (which estimate shall not be conclusive of the final amount of such Losses) and a description of the basis for such Third Party Claim.

 

(b) Subject to the further provisions of this Section 9.4, the Indemnitor will have 10 (ten) days (or less if the nature of the Third Party Claim requires) from the date on which the Indemnitor received the Notice of Claim to notify the Indemnitee that the Indemnitor will assume the defense or prosecution of such Third Party Claim and any litigation resulting therefrom with counsel of its choice (reasonably satisfactory to the Indemnitee) and at its sole cost and expense (a "Third Party Defense"). If the Indemnitor assumes the Third Party Defense in accordance with the preceding sentence, the Indemnitor shall be conclusively deemed to have acknowledged that the Third Party Claim is within the scope of its indemnity obligation hereunder and shall hold the Indemnitee harmless from and against the full amount of any Losses resulting therefrom (subject to the terms and conditions of this Agreement). Any Indemnitee shall have the right to employ separate counsel in any such Third Party Defense and to participate therein, but the fees and expenses of such counsel shall not be at the expense of the Indemnitor unless (A) the Indemnitor shall have failed, within the time after having been notified by the Indemnitee of the exist­ence of the Third Party Claim as provided in the first sentence of this paragraph (b), to assume the defense of such Third Party Claim, or (B) the employment of such counsel has been specifically authorized in writing by the Indemnitor, which authorization shall not be unreasonably withheld.

 

(c) The Indemnitor will not be entitled to assume the Third Party Defense if:

 

(i) the Third Party Claim seeks, in addition to or in lieu of monetary damages, any injunctive or other equitable relief (except where non-monetary relief is merely incidental to a primary claim or claims for monetary damages);

 

(ii) the Third Party Claim relates to or arises in connection with any criminal proceed­ing, action, indictment, allegation or investigation;

 

(iii) the Third Party Claim relates to or arises in connection with any Action related to Environmental Laws;

 

(iv) under applicable standards of professional conduct, a conflict on any significant issue exists between the Indemnitee and the Indemnitor in respect of the Third Party Claim;

 

(v) the Third Party Claim involves a Material customer or supplier of the Company;

 

(vi) the Indemnitee reasonably believes an adverse determination with respect to the Third Party Claim would be detrimental to or injure the Indemnitee's reputation or future business prospects;

 

(vii) the Indemnitor has failed or is failing to vigorously prosecute or defend such Third Party Claim; or

 

(viii) the Indemnitor fails to provide reasonable assurance to the Indemnitee of its financial capacity to prosecute the Third Party Defense and provide indemnification in accordance with the provisions of this Agreement.

 

(d) If by reason of the Third Party Claim a Lien, attachment, garnishment or execution is placed upon any of the property or assets of the Indemnitee, the Indemnitor, if it desires to exercise its right to assume such Third Party Defense, must furnish a satisfactory indemnity bond to obtain the prompt release of such Lien, attachment, garnishment or execution.

 

(e) If the Indemnitor assumes a Third Party Defense, it will take all steps necessary in the defense, prosecution, or settlement of such claim or litigation and will hold all Indemnitees harmless from and against all Losses caused by or arising out of such Third Party Claim. The Indemnitor will not consent to the entry of any judgment or enter into any settlement except with the written consent of the Indemnitee; provided that the consent of the Indemnitee shall not be required if all of the following conditions are met: (i) the terms of the judgment or proposed settlement include as an unconditional term thereof the giving to the Indemnitees by the third party of a release of the Indemnitees from all liability in respect of such Third Party Claim, (ii) there is no finding or admission of (A) any violation of Law by the Indemnitees (or any Affiliate thereof), (B) any violation of the rights of any Person and (C) no effect on any other Action or claims of a similar nature that may be made against the Indemnitees (or any Affiliate thereof), and (iii) the sole form of relief is monetary damages which are paid in full by the Indemnitor. The Indemnitor shall conduct the defense of the Third Party Claim actively and diligently, and the Indemnitee will provide reasonable cooperation in the defense of the Third Party Claim. So long as the Indemnitor is reasonably conducting the Third Party Defense in good faith, the Indemnitee will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnitor (not to be unreasonably withheld or delayed). Notwithstanding the foregoing, the Indemnitee shall have the right to pay or settle any such Third Party Claim, provided that in such event it shall waive any right to indemnity therefore by the Indemnitor for such claim unless the Indemnitor shall have consented to such payment or settlement (such consent not to be unreasonably withheld or delayed). If the Indemnitor is not reasonably conducting the Third Party Defense in good faith, the Indemnitee shall have the right to consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnitor and the Indemnitor shall reimburse the Indemnitee promptly for all Losses incurred in connection with such judgment or settlement.

 

(f) In the event that (i) an Indemnitee gives Notice of Claim to the Indemnitor and the Indemnitor fails or elects not to assume a Third Party Defense which the Indemnitor had the right to assume under this Section 9.4 or (ii) the Indemnitor is not entitled to assume the Third Party Defense pursuant to this Section 9.4, the Indemnitee shall have the right, with counsel of its choice, to defend, conduct and control the Third Party Defense, at the sole cost and expense of the Indemnitor. In each case, the Indemnitee shall conduct the Third Party Defense actively and diligently, and the Indemnitor will provide reasonable cooperation in the Third Party Defense. The Indemnitee shall have the right to consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim on such terms as it may deem appropriate; provided, however, that the amount of any settlement made or entry of any judgment consented to by the Indemnitee without the consent of the Indemnitor shall not be determinative of the validity of the claim, except with the consent of the Indemnitor (not to be unreasonably withheld or delayed). Notwithstanding Section 10.6 hereof, in connection with any Third Party Claim, the Indemnitor hereby consents to the nonexclusive jurisdiction of any court in which an Action in respect of a Third-Party Claim is brought against any Indemnitee for purposes of any claim that the Indemnitee may have under this Article IX with respect to such Action or the matters alleged therein and agrees that process may be served on the Indemnitor with respect to such a claim anywhere in the world. If the Indemnitor does not elect to assume a Third Party Defense which it has the right to assume hereunder, the Indemnitee shall have no obligation to do so.

 

 

(g) Each Party to this Agreement shall use its commercially reasonable efforts to cooperate and to cause its employees, contractors, advisors and consultants to cooperate with and assist the Indemnitee or the Indemnitor, as the case may be, in connection with any Third Party Defense, including attending conferences, discovery proceedings, hearings, trials and appeals and furnishing records, information and testimony, as may reasonably be requested; provided that each Party shall use its best efforts, in respect of any Third Party Claim of which it has assumed the defense, to preserve the confidentiality of all confidential information and the attorney-client and work-product privileges.

 

9.5 Indemnification Procedures for Non-Third Party Claims. In the event of a claim that does not involve a Third Party Claim being asserted against it, the Indemnitee shall send a Notice of Claim to the Indemnitor. The Notice of Claim shall set forth the amount, if known, or, if not known, an estimate of the foreseeable maximum amount of claimed Losses (which estimate shall not be conclusive of the final amount of such Losses) and a description of the basis for such claim. The Indemnitor will have 30 days from receipt of such Notice of Claim to dispute the claim and will reasonably cooperate and assist the Indemnitee in determining the validity of the claim for indemnity. If the Indemnitor does not give notice to the Indemnitee that it disputes such claim within 30 days after its receipt of the Notice of Claim, the claim specified in such Notice of Claim will be conclusively deemed a Loss subject to indemnification hereunder.

 

9.6 Contingent Claims. Nothing herein shall be deemed to prevent an Indemnitee from making a claim hereunder for potential or contingent claims or demands; provided that the Notice of Claim sets forth the specific basis for any such contingent claim to the extent then feasible and the Indemnitee has reasonable grounds to believe that such a claim may be made.

 

9.7 Effect of Investigation; Waiver.

 

(a) An Indemnitee's right to execute the security interest on the Pledged Shares, indemnification or other remedies based upon the representations and warranties and covenants and agreements of the Indemnitor will not be affected by any investigation or knowledge of the Indemnitee or any waiver by the Indemnitee of any condition based on the accuracy of any representation or warranty, or compliance with any covenant or agreement. Such representations and warranties and covenants and agreements shall not be affected or deemed waived by reason of the fact that the Indemnitee knew or should have known that any representation or warranty might be inaccurate or that the Indemnitor failed to comply with any agreement or covenant. Any investigation by such Party shall be for its own protection only and shall not affect or impair any right or remedy hereunder.

 

(b) Sellers acknowledge and agree that, upon and following the Closing, the Company shall not have any liability or obligation to indemnify, save or hold harmless or otherwise pay, reimburse or make Sellers whole for or on account of any indemnification or other claims made by any Buyer Indemnitees hereunder. Sellers shall have no right of contribution against the Company with respect to any such indemnification or other claim.

 

9.8 Tax Indemnification.

 

(a) From and after the Closing Date, Sellers shall be jointly responsible for, shall pay or cause to be paid, and shall jointly indemnify, defend and hold harmless each Tax Indemnitee against, and reimburse such Tax Indemnitee for, on a Grossed-Up Basis, any Losses resulting from, arising out of, relating to, in the nature of, or caused by:

 

 

(i) any Tax imposed on or relating to the Company with respect to any Pre-Closing Period;

 

(ii) any Tax imposed upon or relating to the Company as a transferee or successor, by contract, or otherwise; and

 

(iii) any Tax arising directly or indirectly from a breach or inaccuracy of a representation or warranty set forth in Section 3.9.

 

(b) Except as otherwise provided in Section 9.8, payment in full of any amount due under Section 9.8(a) shall be made to the Tax Indemnitee in immediately available funds at least five Business Days before the date for payment of the Taxes to which such payment relates is due. The Tax indemnities contained in Section 9.8 shall not be subject to any threshold or other limitations contained in this Agreement.

 

9.9 Procedures Relating to Indemnification of Tax Claims.

 

(a) If any Taxing Authority or other Person asserts a Tax Claim, then the Party hereto first receiving notice of such Tax Claim promptly shall provide written notice of such Tax Claim to the other Party hereto; provided that the failure of Buyer to give such prompt notice to Sellers of any such Tax Claim shall not relieve Sellers of any of its obligations under this Section 9.9. Such notice shall specify in reasonable detail the basis for such Tax Claim and shall include a copy of any relevant correspondence received from the Taxing Authority or other Person.

 

(b) Sellers shall have the right to defend or prosecute, at its sole cost, expense and risk, only those Tax Claims with respect to Taxes set forth in Section 9.8(a). In order to defend or prosecute any such Tax Claim, Sellers shall notify Buyer that it elects to defend or prosecute such Tax Claim ("Election Notice") within 30 days after (i) the date on which Sellers receives notice of any such Tax Claim from Buyer (with respect to Tax Claims as to which Buyer first received notice from a Taxing Authority or any other Person), or (ii) the date on which Sellers delivered to Buyer notice of any such Tax Claim (with respect to Tax Claims as to which Sellers first received notice from a Taxing Authority or any other Person). With respect to any Tax Claim as to which Sellers has provided an Election Notice to Buyer, Sellers shall defend or prosecute such Tax Claim by all appropriate proceedings, which proceedings shall be defended or prosecuted diligently by Sellers to a Final Determination; provided that Sellers shall not, without the prior written consent of Buyer, enter into any compromise or settlement of such Tax Claim that would result in any Tax detriment to any Tax Indemnitee. Sellers shall inform Buyer of all developments and events relating to such Tax Claim (including providing to Buyer copies of all written materials relating to such Tax Claim), and Buyer or its authorized representatives shall be entitled, at the expense of Buyer, to attend, but not participate in or control, all conferences, meetings and proceedings relating to such Tax Claim.

 

(c) If, with respect to any Tax Claim, Sellers fails to deliver an Election Notice to Buyer within the period provided in Section 9.9(b) or fails diligently to defend or prosecute such Tax Claim to a Final Determination, then Buyer shall at any time thereafter have the right (but not the obligation) to defend or prosecute such Tax Claim, at the sole cost, expense and risk of Sellers. Buyer shall have full control of such defense or prosecution and such proceedings, including any settlement or compromise thereof. Sellers shall cooperate in good faith with Buyer and its authorized representatives in order to contest effectively such Tax Claim. Sellers may attend, but not participate in or control, any defense, prosecution, settlement, or compromise of any Tax Claim controlled by Buyer pursuant to this Section 9.9(c), and shall bear its own costs and expenses with respect thereto. In the case of any Tax Claim that is defended or prosecuted by Buyer pursuant to this Section 9.9(c), Buyer shall be entitled upon demand to prompt payment from Sellers for any and all costs and expenses incurred by Buyer in connection with such defense or prosecution (including attorneys', accountants', and experts' fees and disbursements, settlement costs, court costs, and any other costs or expenses for investigating, defending or prosecuting such Tax Claim), in each case on a Grossed-Up Basis.

 

9.10 Tax Treatment of Indemnification Payments. Except as otherwise required by applicable Law, the Parties shall treat any indemnification payment made hereunder as an adjustment to the Purchase Price.  

 

9.11 Other Rights and Remedies Not Affected. The indemnification rights of the Parties under this Article IX are independent of and in addition to such rights and remedies as the Parties may have at Law or in equity or otherwise for any misrepresentation, breach of warranty or failure to fulfill any agreement or covenant hereunder on the part of any Party hereto, including the right to seek specific performance, rescission or restitution, none of which rights or remedies shall be affected or diminished hereby.

 

 

 

If to Buyer, to:

 

Gulfstream Capital Partner Ltd.

c/o China Tel Group, Inc.

8105 Irvine Center Drive, Suite 800

Irvine, CA  92618 USA

Attn: Kenneth Waggoner

If to Sellers, to:

 

Mario Navarro

Av. Camino Real 493

Piso 11, San Isidro

Lima, Peru

 

 

10.2 Amendments and Waivers.

 

 

 

 

10.3 Expenses. Each Party shall bear its own costs and expenses in connection with this Agreement and the transactions contemplated by this Agreement, including all legal, accounting, financial advisory, consulting and all other fees and expenses of third parties, whether or not the Acquisition is consummated.

 

10.4 Successors and Assigns. This Agreement may not be assigned by either Party hereto without the prior written consent of the other Party; provided that, without such consent, Buyer may transfer or assign, in whole or in part or from time to time, to one or more of its Affiliates, the right to purchase all or a portion of the Shares, but no such transfer or assignment will relieve Buyer of its obligations hereunder.  Subject to the foregoing, all of the terms and provisions of this Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and assigns.

 

10.5 Governing Law. This Agreement and the Exhibits and Schedules hereto and thereto shall be governed by and interpreted and enforced in accordance with the Laws of the State of California, United States of America, without giving effect to any choice of Law or conflict of Laws rules or provisions (whether of the State of California or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of California, United States of America.

 

10.6  Consent to Jurisdiction. Each Party irrevocably submits to the exclusive jurisdiction of (a) the Orange County Superior Court, State of California, United States of America, and (b) the United States District Court for Southern District of California, United States of America, for the purposes of any Action arising out of this Agreement or any transaction contemplated by this Agreement. Each Party agrees to commence any such Action either in the Orange County Superior Court, State of California, United States of America or if such Action may not be brought in such court for jurisdictional reasons, in the United States District Court for the Southern District of California, United States of America. Each Party further agrees that service of any process, summons, notice or document by registered mail to such Party's respective address set forth above shall be effective service of process with respect to any matters to which it has submitted to jurisdiction in this Section 10.6. Each Party irrevocably and unconditionally waives any objection to the laying of venue of any Action arising out of this Agreement or the transactions contemplated by this Agreement in (i) the Orange County Superior Court, State of California, United States of America, or (ii) the United States District Court for the Southern District of California, United States of America, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action brought in any such court has been brought in an inconvenient forum. Each Party hereby irrevocably waives all right to trial by jury in any Action (whether based on contract, tort or otherwise) arising out of or relating to this Agreement or the actions of such Party in the negotiation, administration, performance and enforcement hereof.

 

10.7  Counterparts. This Agreement may be executed in counterparts, and either Party hereto may execute any such counterpart, each of which when executed and delivered shall be deemed to be an original and both of which counterparts taken together shall constitute but one and the same instrument. This Agreement shall become effective when each Party hereto shall have received a counterpart hereof signed by the other Party hereto. The Parties agree that the delivery of this Agreement may be effected by means of an exchange of facsimile signatures with original copies to follow by mail or courier service.

 

10.8  Third Party Beneficiaries. No provision of this Agreement is intended to confer upon any Person other than the parties hereto any rights or remedies hereunder; except that in the case of Article IX hereof, the other Indemnitees and their respective heirs, executors, administrators, legal representatives, successors and assigns, are intended third party beneficiaries of such sections and shall have the right to enforce such sections in their own names.

 

10.9  Entire Agreement. This Agreement, the Schedules and the documents, instruments and other agreements specifically referred to herein or delivered pursuant hereto set forth the entire understanding of the Parties hereto with respect to the Acquisition. All Schedules referred to herein are intended to be and hereby are specifically made a part of this Agreement. Any and all previous agreements and understandings between or among the Parties regarding the subject matter hereof, whether written or oral, are superseded by this Agreement.

 

10.10  Captions. All captions contained in this Agreement and on the Schedules are for convenience of reference only, do not form a part of this Agreement and shall not affect in any way the meaning or interpretation of this Agreement and of the Schedules.

 

10.11  Severability. Subject to Section 5.10(d), any provision of this Agreement which is invalid or unenforceable in any jurisdiction shall be ineffective to the extent of such invalidity or unenforceability without invalidating or rendering unenforceable the remaining provisions hereof, and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

10.12  Specific Performance. Buyer and Sellers each agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by them in accordance with the terms hereof and that each Party shall be entitled to specific performance of the terms hereof, in addition to any other remedy at Law or equity.

 

10.13  Interpretation.

 

(a) The meaning assigned to each term defined herein shall be equally applicable to both the singular and the plural forms of such term and vice versa, and words denoting either gender shall include both genders as the context requires. Where a word or phrase is defined herein, each of its other grammatical forms shall have a corresponding meaning.

 

(b) The terms "hereof", "herein" and "herewith" and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.

 

(c) When a reference is made in this Agreement to an Article, Section, paragraph, Exhibit or Schedule, such reference is to an Article, Section, paragraph, Exhibit or Schedule to this Agreement unless otherwise specified.

 

(d) The word "include", "includes", and "including" when used in this Agreement shall be deemed to be followed by the words "without limitation", unless otherwise specified.

 

(e) The phrase “the aggregate of”, “the total of”, “the sum of”, or a phrase of similar meaning means “the aggregate (or total or sum), without duplication, of”.

 

(f) In the computation of periods of time from a specified date to a later specified date , unless otherwise expressly stated, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”.

 

(g) A reference to any Party to this Agreement or any other agreement or document shall include such Party's predecessors, successors and permitted assigns.

 

(h) Reference to any Law means such Law as amended, modified, codified, replaced or reenacted, and all rules and regulations promulgated thereunder.

 

(i) The Parties have participated jointly in the negotiation and drafting of this Agreement. Any rule of construction or interpretation otherwise requiring this Agreement to be construed or interpreted against any Party by virtue of the authorship of this Agreement shall not apply to the construction and interpretation hereof.

 

(j) All accounting terms used and not defined herein shall have the respective meanings given to them under PGAAP.

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the date first above written.

 

 

	BUYER
	GULFSTREAM CAPITAL PARTNERS LTD.
	By:      /s/ Colin Tay
	Colin Tay, its Secretary
	SELLERS
	/s/ Mario Octavio Navarro Álvarez
	Mario Octavio Navarro Álvarez
	/s/ Rafael Isaías Samanez Zacarías
	Rafael Isaías Samanez Zacarías
	/s/ Gisella Tsuchikame Nakamoto
	Gisella Tsuchikame Nakamoto
	/s/ Jesus Margot Magan Gutierrez
	Jesus Margot Magan Gutierrez