STOCK PURCHASE AGREEMENT

Between

GALAXY MINERALS, INC
and
LANGLEY PARK INVESTMENTS PLC

 
 
 

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July 15th, 2004 

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TABLE OF CONTENTS

ARTICLE
I
CERTAIN DEFINITIONS
1
1.1
 
Certain Definitions
1
 
 
 
 
ARTICLE
II
PURCHASE AND SALE OF SHARES
4
2.1
 
Purchase and Sale; Purchase Price
4
2.2
 
Execution and Delivery of Documents; The Closing
5
 
 
 
 
ARTICLE
III
REPRESENTATIONS AND WARRANTIES
5
3.1
 
Representations, Warranties and Agreements of the Target Company
5
3.2
 
Representations and Warranties of Langley
8
 
 
 
 
ARTICLE
IV
OTHER AGREEMENTS OF THE PARTIES
11
4.1
 
Manner of Offering
11
4.2
 
Notice of Certain Events
12
4.3
 
Blue Sky Laws
12
4.4
 
Integration
12
4.5
 
Furnishing of Rule 144(c) Materials
12
4.6
 
Solicitation Materials
12
4.7
 
Listing of Common Stock
13
4.8
 
Indemnification
13
4.9
 
Sale of Langley Shares
15
4.10
 
Lock Up by Langley
15
4.11
 
London Stock Exchange
15
 
 
 
 
ARTICLE
V
MISCELLANEOUS
15
5.1
 
Fee and Expenses
15
5.2
 
Entire Agreement
15
5.3
 
Notices
15
5.4
 
Amendments; Waivers
16
5.5
 
Headings
16
5.6
 
Successors and Assigns
16
5.7
 
No Third Party Beneficiaries
17
5.8
 
Governing Law; Venue; Service of Process
17
5.9
 
Survival
17
5.10
 
Counterpart Signatures
17
5.11
 
Publicity
17
5.12
 
Severability
17
5.13
 
Limitation of Remedies
17
 
 
 
 

 

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LIST OF SCHEDULES:
 
 
 
Schedule 3.1(a)
Subsidiaries
Schedule 3.1(c)
Capitalization and Registration Rights
Schedule 3.1(d)
Equity and Equity Equivalent Securities
Schedule 3.1(e)
Conflicts
Schedule 3.1(f)
Consents and Approvals
Schedule 3.1(g)
Litigation
Schedule 3.1(h)
Defaults and Violations

 

LIST OF EXHIBITS:
 
 
 
Exhibit A
Escrow Agreement
Exhibit B
Officer’s Certificate

 

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    THIS STOCK PURCHASE AGREEMENT (this “Agreement”) is made and entered into as
of July 15th, 2004, between Galaxy Minerals, Inc., a corporation organized and
existing under the laws of the State of Florida (the “Target Company”), and
Langley Park Investments PLC, a corporation organized under the laws of England
and Wales with its offices at 30 Farringdon Street, London EC4A 4HJ (
“Langley”).

WHEREAS, subject to the terms and conditions set forth in this Agreement, the
Target Company desires to issue and sell to Langley and Langley desires to
acquire from the Target Company the shares of the Target Company’s common stock,
par value $0.001 (“Common Stock”) for the Total Purchase Price. The
consideration to be paid by Langley for the Common Stock shall be subject to
certain downside price protection (the “Downside Price Protection”) provided in
Section 2 of the Escrow Agreement.
 
IN CONSIDERATION of the mutual covenants contained in this Agreement, the Target
Company and Langley agree as follows:
 
 
ARTICLE I
CERTAIN DEFINITIONS

1.1   Certain Definitions. As used in this Agreement, and unless the context
requires a different meaning, the following terms have the meanings indicated:
“Affiliate” means, with respect to any Person, any Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person. For the purposes of this definition, “control” (including, with
correlative meanings, the terms “controlled by” and “under common control with”)
shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities or by contract or otherwise.

“Agreement” shall have the meaning set forth in the introductory paragraph of
this Agreement.

“Attorney-in-Fact” means Gottbetter & Partners, LLP, 488 Madison Avenue, 12
Floor, New York, NY 10022; Tel: 212-400-6900; Fax: 212-400-6901.

“Business Day” means any day except Saturday, Sunday, any day which shall be a
legal holiday or a day on which banking institutions in the State of New York
are authorized or required by law or other government actions to close.
   
“Change of Control” means the acquisition, directly or indirectly, by any Person
of ownership of, or the power to direct the exercise of voting power with
respect to, a majority of the issued and outstanding voting shares of the Target
Company.
 

“Closing” shall have the meaning set forth in Section 2.2(a) hereof.
 

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“Closing Bid Price” shall mean the closing bid price for a share of Common Stock
on such date on the OTCBB (or such other exchange, market, or other system that
the Common Stock is then traded on), as reported on Bloomberg, L.P. (or similar
organization or agency succeeding to its functions of reporting prices).

“Closing Date” shall have the meaning set forth in Section 2.2(a) hereof.

“Closing Price” shall be the closing bid price of the Common Stock on the day of
Closing.

“Common Stock” shall have the meaning in the recital.

“Consideration Stock” shall have the meaning set forth in Secion 2.1(a) hereof.

“Control Person” shall have the meaning set forth in Section 4.8(a) hereof.

“Default” means any event or condition which constitutes an Event of Default or
which with the giving of notice or lapse of time or both would, unless cured or
waived, become an Event of Default.

“Disclosure Documents” means the Target Company’s reports filed under the
Exchange Act with the SEC.

“Downside Price Protection” shall have the meaning in the recital.

“Escrow Agent” means Gottbetter & Partners, LLP, 488 Madison Avenue, 12 Floor,
New York, NY 10022; Tel: 212-400-6900; Fax: 212-400-6901.

“Escrow Agreement” means the escrow agreement, dated the date hereof, by and
among the Target Company, Langley and the Escrow Agent annexed hereto as Exhibit
A.

“Event of Default” shall have the meaning set forth in Section 5.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Execution Date” means the date of this Agreement first written above.

“Indemnified Party” shall have the meaning set forth in Section 4.8(b) hereof.

“Indemnifying Party” shall have the meaning set forth in Section 4.8(b) hereof.
 

“G&P” means Gottbetter & Partners, LLP.
 

“Langley” shall have the meaning in the introductory paragraph.
 
 

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“Langley Consideration Shares” shall have the meaning in Section 2.1(c) hereof.

“Langley Escrow Shares” means the Langley Consideration Shares deposited into
escrow by the Target Company under the terms of the Escrow Agreement in Exhibit
A.

“Langley Protection Shares” means the Langley Escrow Shares that the Target
Company is required to sell to Langley under the terms of the Escrow Agreement
in Exhibit A.

“Langley Shares” shall mean ordinary shares of 1.0p each in Langley.

“Losses” shall have the meaning set forth in Section 4.8(a) hereof.

“Material” shall mean having a financial consequence in excess of $25,000.

“Material Adverse Effect” shall have the meaning set forth in Section 3.1(a).

“NASD” means the National Association of Securities Dealers, Inc.

“Nasdaq” shall mean the Nasdaq Stock Market, Inc.®
 

“OTCBB” shall mean the NASD over-the counter Bulletin Board®.

“Per Share Market Value” of the Common Stock means on any particular date
(a) the last sale price of shares of Common Stock on such date or, if no such
sale takes place on such date, the last sale price on the most recent prior
date, in each case as officially reported on the principal national securities
exchange on which the Common Stock is then listed or admitted to trading, or
(b) if the Common Stock is not then listed or admitted to trading on any
national securities exchange, the closing bid price per share as reported by
Nasdaq, or (c) if the Common Stock is not then listed or admitted to trading on
the Nasdaq, the closing bid price per share of the Common Stock on such date as
reported on the OTCBB or if there is no such price on such date, then the last
bid price on the date nearest preceding such date, or (d) if the Common Stock is
not quoted on the OTCBB, the closing bid price for a share of Common Stock on
such date in the over-the-counter market as reported by the Pinksheets LLC (or
similar organization or agency succeeding to its functions of reporting prices)
or if there is no such price on such date, then the last bid price on the date
nearest preceding such date, or (e) if the Common Stock is no longer publicly
traded, the fair market value of a share of the Common Stock as determined by an
appraiser selected in good faith by Langley and the Target Company.

“Person” means an individual or a corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint
stock company, government (or an agency or political subdivision thereof) or
other entity of any kind.

“Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
 
 

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“Reporting Issuer” means a company that is subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act.

“Required Approvals” shall have the meaning set forth in Section 3.1(f).

“Securities” means the Common Stock and stock of any other class into which such
shares may hereafter have been reclassified or changed.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Subsidiaries” shall have the meaning set forth in Section 3.1(a).

“Target Company” shall have the meaning set forth in the introductory paragraph.

“Total Purchase Price” shall have the meaning in the recital.

“Trading Day” means (a) a day on which the Common Stock is quoted on Nasdaq, the
OTCBB or the principal stock exchange on which the Common Stock has been listed,
or (b) if the Common Stock is not quoted on Nasdaq, the OTCBB or any stock
exchange, a day on which the Common Stock is quoted in the over-the-counter
market, as reported by the Pinksheets LLC (or any similar organization or agency
succeeding its functions of reporting prices).

“Transaction Documents” means this Agreement and all exhibits and schedules
hereto and all other documents, instruments and writings required pursuant to
this Agreement.

“U.S.” means the United States.
 
ARTICLE II
PURCHASE AND SALE OF SHARES

2.1   Purchase and Sale; Purchase Price.
(a) Subject to the terms and conditions set forth herein, the Target Company
shall issue and sell and Langley shall purchase 31,578,950 (thirty-one million
five hundred & seventy eight thousand nine hundred & fifty ) shares of the
Target Company’s Common Stock (the “Consideration Stock”).
(b) The total purchase price (the “Total Purchase Price”) shall be the number of
shares of Consideration Stock multiplied by the Closing Bid Price per share of
Common Stock on July 14th 2004 of “$0.38”
 
(c) The Total Purchase Price shall be paid by delivery to the Target Company of
the number of Langley Shares (the “Langley Consideration Shares”) equal to the
Total Purchase Price divided by the conversion rate of the British Pound
Sterling to purchase US Dollars determined below on the July 30, 2004. The
Langley Shares shall have a value of £1 per share. The number of Langley Shares
to be issued will be based on the conversion rate of the British Pound Sterling
to the US Dollar in effect as of the close of business on the day preceding the
closing of the transaction, as quoted by Coutts & Co. as the commercial rate it
gives to purchase US Dollars. For example, if the effective conversion rate is
$1.80/£ 1 and the Total Purchase Price is $8,000,000, then the number of Langley
Shares the Target Company will receive shall equal the $8,000,000/$1.80, or
4,444,444 Langley Shares. The Langley Consideration Shares shall be subject to
the “Downside Price Protection” provided in Section 2 of the Escrow Agreement.
 
 

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2.2   Execution and Delivery of Documents; The Closing.
 
(a)   The Closing of the purchase and sale of the shares of Consideration Stock
(the “Closing”) shall take place within sixty (60) days from the date hereof
(the “Closing Date”). On the Closing Date,
 
(i)   the Target Company shall execute and deliver to the Escrow Agent a
certificate in the name of Langley representing shares of Consideration Stock;
 
(ii)   the Target Company shall execute and deliver to Langley a certificate of
its President, in the form of Exhibit B annexed hereto, certifying that attached
thereto is a copy of resolutions duly adopted by the Board of Directors of the
Target Company authorizing the Target Company to execute and deliver the
Transaction Documents and to enter into the transactions contemplated thereby;
 
(iii)    the Target Company, Langley and the Escrow Agent shall execute and
deliver to each other the Escrow Agreement;
 
(iv)    Langley shall deliver the Langley Consideration Shares to the Escrow
Agent; and
 
(v)   the Target Company shall wire the monies owed to G&P pursuant to Section
5.1 hereof for legal fees with the following wire instructions:
Citibank, N.A.
488 Madison Avenue
New York, NY
   ABA Routing No.: 021000089
   Account Name: Gottbetter & Partners, LLP
   Account No. 49061322

Reference: Galaxy Minerals, Inc.
 
 

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ARTICLE III
REPRESENTATIONS AND WARRANTIES

3.1   Representations, Warranties and Agreements of the Target Company. The
Target Company hereby makes the following representations and warranties to
Langley, all of which shall survive the Closing:
 
(a)   Organization and Qualification. The Target Company is a corporation, duly
incorporated, validly existing and in good standing under the laws of the State
of Florida, with the requisite corporate power and authority to own and use its
properties and assets and to carry on its business as currently conducted. The
Target Company has no subsidiaries other than as set forth on Schedule 3.1(a)
attached hereto (collectively, the “Subsidiaries”). Each of the Subsidiaries is
a corporation, duly incorporated, validly existing and in good standing under
the laws of the jurisdiction of its incorporation, with the full corporate power
and authority to own and use its properties and assets and to carry on its
business as currently conducted. Each of the Target Company and the Subsidiaries
is duly qualified to do business and is in good standing as a foreign
corporation in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the
failure to be so qualified or in good standing, as the case may be, would not,
individually or in the aggregate, have a material adverse effect on the results
of operations, assets, prospects, or financial condition of the Target Company
and the Subsidiaries, taken as a whole (a “Material Adverse Effect”).
 
(b)   Authorization, Enforcement. The Target Company has the requisite corporate
power and authority to enter into and to consummate the transactions
contemplated hereby and by each other Transaction Document and to otherwise to
carry out its obligations hereunder and thereunder. The execution and delivery
of this Agreement and each of the other Transaction Documents by the Target
Company and the consummation by it of the transactions contemplated hereby and
thereby has been duly authorized by all necessary action on the part of the
Target Company. Each of this Agreement and each of the other Transaction
Documents has been or will be duly executed by the Target Company and when
delivered in accordance with the terms hereof or thereof will constitute the
valid and binding obligation of the Target Company enforceable against the
Target Company in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally the enforcement
of, creditors’ rights and remedies or by other equitable principles of general
application.
 
(c)   Capitalization. The authorized, issued and outstanding capital stock of
the Company is set forth on Schedule 3.1(c). No shares of Common Stock are
entitled to preemptive or similar rights, nor is any holder of the Common Stock
entitled to preemptive or similar rights arising out of any agreement or
understanding with the Target Company by virtue of this Agreement. Except as
disclosed in Schedule 3.1(c), there are no outstanding options, warrants,
script, rights to subscribe to, registration rights, calls or commitments of any
character whatsoever relating to securities, rights or obligations convertible
into or exchangeable for, or giving any person any right to subscribe for or
acquire, any shares of Common Stock, or contracts, commitments, understandings,
or arrangements by which the Target Company or any Subsidiary is or may become
bound to issue additional shares of Common Stock, or securities or rights
convertible or exchangeable into shares of Common Stock. Neither the Target
Company nor any Subsidiary is in violation of any of the provisions of its
Certificate of Incorporation, bylaws or other charter documents.
 
 

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(d)   Issuance of Securities. The shares of Consideration Stock have been duly
and validly authorized for issuance, offer and sale pursuant to this Agreement
and, when issued and delivered as provided hereunder against payment in
accordance with the terms hereof, shall be valid and binding obligations of the
Target Company enforceable in accordance with their respective terms.
 
(e)   No Conflicts. The execution, delivery and performance of this Agreement
and the other Transaction Documents by the Target Company and the consummation
by the Target Company of the transactions contemplated hereby and thereby do not
and will not (i) conflict with or violate any provision of its Certificate of
Incorporation or bylaws (each as amended through the date hereof) or (ii) be
subject to obtaining any consents except those referred to in Section 3.1(f),
conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which the Target Company is a party, or (iii) result
in a violation of any law, rule, regulation, order, judgment, injunction, decree
or other restriction of any court or governmental authority to which the Target
Company or its Subsidiaries is subject (including, but not limited to, those of
other countries and the federal and state securities laws and regulations), or
by which any property or asset of the Target Company or its Subsidiaries is
bound or affected, except in the case of clause (ii), such conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect. The
business of the Target Company and its Subsidiaries is not being conducted in
violation of any law, ordinance or regulation of any governmental authority.
 
(f)   Consents and Approvals. Except as specifically set forth in Schedule
3.1(f), neither the Target Company nor any Subsidiary is required to obtain any
consent, waiver, authorization or order of, or make any filing or registration
with, any court or other federal, state, local or other governmental authority
or other Person in connection with the execution, delivery and performance by
the Target Company of this Agreement and each of the other Transaction Documents
(together with the consents, waivers, authorizations, orders, notices and
filings referred to in Schedule 3.1(f), the “Required Approvals”).
 
(g)   Litigation; Proceedings. Except as specifically disclosed in Schedule
3.1(g), there is no action, suit, notice of violation, proceeding or
investigation pending or, to the best knowledge of the Target Company,
threatened against or affecting the Target Company or any of its Subsidiaries or
any of their respective properties before or by any court, governmental or
administrative agency or regulatory authority (federal, state, county, local or
foreign) which (i) relates to or challenges the legality, validity or
enforceability of any of the Transaction Documents or the shares of
Consideration Stock, (ii) could, individually or in the aggregate, have a
Material Adverse Effect or (iii) could, individually or in the aggregate,
materially impair the ability of the Target Company to perform fully on a timely
basis its obligations under the Transaction Documents.
 
 

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(h)   No Default or Violation. Except as set forth in Schedule 3.1(h) hereto,
neither the Target Company nor any Subsidiary (i) is in default under or in
vio­lation of any indenture, loan or credit agreement or any other agreement or
instrument to which it is a party or by which it or any of its properties is
bound, except such conflicts or defaults as do not have a Material Adverse
Effect, (ii) is in violation of any order of any court, arbitrator or
governmental body, except for such violations as do not have a Material Adverse
Effect, or (iii) is in violation of any statute, rule or regu­lation of any
governmental authority which could (individually or in the aggregate) (a)
adversely affect the legality, validity or enforceability of this Agree­ment,
(b) have a Material Adverse Effect or (c) adversely impair the Target Company’s
ability or obligation to perform fully on a timely basis its obligations under
this Agreement.
 
(i)   Disclosure Documents. The Disclosure Documents are accurate in all
material respects and do not contain any untrue statement of material fact or
omit to state any material fact necessary in order to make the statements made
therein, in light of the circumstances under which they were made, not
misleading.
 
(j)   Non-Registered Offering. Neither the Target Company nor any Person acting
on its behalf has taken or will take any action (including, without limitation,
any offering of any securities of the Target Company under circumstances which
would require the integration of such offering with the offering of the
Securities under the Securities Act) which might subject the offering, issuance
or sale of the Securities to the registration requirements of Section 5 of the
Securities Act.
 
(k)   Placing Agent. The Target Company accepts and agrees that Dungarvon
Associates, Inc. (“Dungarvon”) is acting for Langley and does not regard any
person other than Langley as its customer in relation to this Agreement, and
that it has not made any recommendation to the Target Company, in relation to
this Agreement and is not advising the Target Company, with regard to the
suitability or merits of the Langley Shares and in particular Dungarvon has no
duties or responsibilities to the Target Company for the best execution of the
transaction contemplated by this Agreement.
 
(l)   Private Placement Representations. The Target Company (i) has received and
carefully reviewed such information and documentation relating to Langley that
the Target Company has requested, including, without limitation, Langley’s
Confidential Private Offering Memorandum dated June 17, 2004; (ii) has had a
reasonable opportunity to ask questions of and receive answers from Langley
concerning the Langley Shares, and all such questions, if any, have been
answered to the full satisfaction of the Target Company; (iii) has such
knowledge and expertise in financial and business matters that it is capable of
evaluating the merits and risks involved in an investment in the Langley Shares;
(iii) understands that Langley has determined that the exemption from the
registration provisions of the Securities Act of 1933, as amended (the
“Securities Act”), provided by Section 4(2) of the Securities Act is applicable
to the offer and sale of the Langley Shares, based, in part, upon the
representations, warranties and agreements made by the Target Company herein;
and (iv) except as provided herein and in the Private Placement Memorandum,
dated June 17, 2004, no representations or warranties have been made to the
Target Company by Langley or any agent, employee or affiliate of Langley and in
entering into this transaction the Target Company is not relying upon any
information, other than the results of independent investigation by the Target
Company.
 
 

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Langley acknowledges and agrees that the Target Company makes no representation
or warranty with respect to the transactions contemplated hereby other than
those specifically set forth in Section 3.1 hereof.
 
3.2   Representations and Warranties of Langley. Langley hereby represents and
warrants to the Target Company as follows:
 
(a)   Organization; Authority. Langley is a corporation, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
formation with the requisite power and authority to enter into and to consummate
the transactions contemplated hereby and by the other Transaction Documents and
otherwise to carry out its obligations hereunder and thereunder. The acquisition
of the shares of Consideration Stock to be purchased by Langley hereunder has
been duly authorized by all necessary action on the part of Langley. This
Agreement has been duly executed and delivered by Langley and constitutes the
valid and legally binding obligation of Langley, enforceable against it in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to, or affecting generally the enforcement of, creditors rights and
remedies or by other general principles of equity.
 
(b)   Investment Intent. Langley is acquiring the shares of Consideration Stock
to be purchased by it hereunder, for its own account for investment purposes
only and not with a view to or for distributing or reselling such shares of
Consideration Stock, or any part thereof or interest therein, without prejudice,
however, to Langley’s right, subject to the provisions of this Agreement, at all
times to sell or otherwise dispose of all or any part of such shares of
Consideration Stock in compliance with applicable federal and state securities
laws.
 
(c)   Experience of Langley. Langley, either alone or together with its
representatives, has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
an investment in the shares of Consideration Stock to be acquired by it
hereunder, and has so evaluated the merits and risks of such investment.
 
 

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(d)   Ability of Langley to Bear Risk of Investment. Langley is able to bear the
economic risk of an investment in the Securities to be acquired by it hereunder
and, at the pre­sent time, is able to afford a complete loss of such investment.
 
(e)   Access to Information. Langley acknowledges that it has been afforded (i)
the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Target Company concerning the terms
and conditions of the Securities offered hereunder and the merits and risks of
investing in such securities; (ii) access to information about the Target
Company and the Target Company’s financial condition, results of operations,
business, properties, management and prospects sufficient to enable it to
evaluate its investment in the Securities; and (iii) the opportunity to obtain
such additional information which the Target Company possesses or can acquire
without unreasonable effort or expense that is necessary to make an informed
investment decision with respect to the investment and to verify the accuracy
and completeness of the information that it has received about the Target
Company.
 
(f)   Reliance. Langley understands and acknowledges that (i) the shares of
Consideration Stock being offered and sold to it hereunder are being offered and
sold without registration under the Securities Act in a private placement that
is exempt from the registration provisions of the Securities Act under Section
4(2) of the Securities Act and (ii) the availability of such exemption depends
in part on, and that the Target Company will rely upon the accuracy and
truthfulness of, the foregoing representations and Langley hereby consents to
such reliance.
 
(g)   Regulation S. Langley understand and acknowledge that (A) the shares of
Consideration Stock have not been registered under the Securities Act, are being
sold in reliance upon an exemption from registration afforded by Regulation S;
and that such shares of Consideration Stock have not been registered with any
state securities commission or authority; (B) pursuant to the requirements of
Regulation S, the shares of Consideration Stock may not be transferred, sold or
otherwise exchanged unless in compliance with the provisions of Regulation S
and/or pursuant to registration under the Securities Act, or pursuant to an
available exemption hereunder; and (C) Langley is under no obligation to
register the shares of Consideration Stock under the Securities Act or any state
securities law, or to take any action to make any exemption from any such
registration provisions available.

(h)    Neither Langley nor any of its affiliates, directors or officers shall
either for its own account or procure others to engage in the manipulation of
the Target Company’s stock price before the expiry of the Escrow Agreement.
 
Langley is not a U.S. person and is not acquiring the shares of Consideration
Stock for the account of any U.S. person; (B) no director or executive officer
of Langley is a national or citizen of the United States; and (C) it is not
otherwise deemed to be a “U.S. Person” within the meaning of Regulation S.
 
 

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Langley was not formed specifically for the purpose of acquiring the shares of
Consideration Stock purchased pursuant to this Agreement.

Langley is purchasing the shares of Consideration Stock for its own account and
risk and not for the account or benefit of a U.S. Person as defined in
Regulation S and no other person has any interest in or participation in the
shares of Consideration Stock or any right, option, security interest, pledge or
other interest in or to the shares of Consideration Stock. Langley understands,
acknowledges and agrees that it must bear the economic risk of its investment in
the shares of Consideration Stock for an indefinite period of time and that
prior to any such offer or sale, the Target Company may require, as a condition
to effecting a transfer of the shares of Consideration Stock, an opinion of
counsel, acceptable to the Target Company, as to the registration or exemption
therefrom under the Securities Act and any state securities acts, if applicable.

Langley will, after the expiration of the Restricted Period, as set forth under
Regulation S Rule 903(b)(3)(iii)(A), offer, sell, pledge or otherwise transfer
the shares of Consideration Stock only in accordance with Regulation S, or
pursuant to an available exemption under the Securities Act and, in any case, in
accordance with applicable state securities laws. The transactions contemplated
by this Agreement have neither been pre-arranged with a purchaser who is in the
U.S. or who is a U.S. Person, nor are they part of a plan or scheme to evade the
registration provisions of the United States federal securities laws.

The offer leading to the sale evidenced hereby was made in an “offshore
transaction.” For purposes of Regulation S, Langley understands that an
“offshore transaction” as defined under Regulation S is any offer or sale not
made to a person in the United States and either (A) at the time the buy order
is originated, the purchaser is outside the United States, or the seller or any
person acting on his behalf reasonably believes that the purchaser is outside
the United States; or (B) for purposes of (1) Rule 903 of Regulation S, the
transaction is executed in, or on or through a physical trading floor of an
established foreign exchange that is located outside the United States or (2)
Rule 904 of Regulation S, the transaction is executed in, on or through the
facilities of a designated offshore securities market, and neither the seller
nor any person acting on its behalf knows that the transaction has been
prearranged with a buyer in the U.S.

Neither Langley nor any affiliate or any person acting on Langley’s behalf, has
made or is aware of any “directed selling efforts” in the United States, which
is defined in Regulation S to be any activity undertaken for the purpose of, or
that could reasonably be expected to have the effect of, conditioning the market
in the United States for any of the shares of Consideration Stock being
purchased hereby.

Langley understands that the Target Company is the seller of the shares of
Consideration Stock which are the subject of this Agreement, and that, for
purpose of Regulation S, a “distributor” is any underwriter, dealer or other
person who participates, pursuant to a contractual arrangement, in the
distribution of securities offered or sold in reliance on Regulation S and that
an “affiliate” is any partner, officer, director or any person directly or
indirectly controlling, controlled by or under common control with any person in
question. Langley agrees that Langley will not, during the Restricted Period set
forth under Rule 903(b)(iii)(A), act as a distributor, either directly or though
any affiliate, nor shall it sell, transfer, hypothecate or otherwise convey the
shares of Consideration Stock other than to a non-U.S. Person.

 

  11  

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Langley acknowledges that the shares of Consideration Stock will bear a legend
in substantially the following form:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD IN AN
“OFFSHORE TRANSACTION” IN RELIANCE UPON REGULATION S AS PROMULGATED BY THE
SECURITIES AND EXCHANGE    COMMISSION. ACCORDINGLY, THE SECURITIES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
(THE “SECURITIES ACT”) AND MAY NOT BE TRANSFERRED OTHER THAN IN ACCORDANCE WITH
REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE CANNOT BE THE SUBJECT OF HEDGING
TRANSACTIONS UNLESS SUCH TRANSACTIONS ARE CONDUCTED IN COMPLIANCE WITH THE
SECURITIES ACT.
 
The Target Company acknowledges and agrees that Langley makes no representations
or warranties with respect to the transactions contemplated hereby other than
those specifically set forth in this Section 3.2.
 
ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES

4.1   Manner of Offering. The Securities are being issued pursuant to section
4(2) of the Securities Act and Regulation S thereunder. The Langley
Consideration Shares are being issued pursuant to section 4(2) of the Securities
Act and Rule 506 of Regulation D thereunder.
 
4.2   Notice of Certain Events. The Target Company shall, on a continuing basis,
(i) advise Langley promptly after obtaining knowledge of, and, if requested by
Langley, confirm such advice in writing, of (A) the issuance by any state
securities commission of any stop order suspending the qualification or
exemption from qualification of the shares of Consideration Stock, for offering
or sale in any jurisdiction, or the initiation of any proceeding for such
purpose by any state securities commission or other regulatory authority, or
(B) any event that makes any statement of a material fact made by the Target
Company in Section 3.1 or in the Disclosure Documents untrue or that requires
the making of any additions to or changes in Section 3.1 or in the Disclosure
Documents in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading, (ii) use its best
efforts to prevent the issuance of any stop order or order suspending the
qualification or exemption from qualification of the Securities under any state
securities or Blue Sky laws, and (iii) if at any time any state securities
commission or other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Securities under any such
laws, and use its best efforts to obtain the withdrawal or lifting of such order
at the earliest possible time.
 
 

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4.3   Blue Sky Laws. The Target Company agrees that it will execute all
necessary documents and pay all necessary state filing or notice fees to enable
the Target Company to sell the Securities to Langley.
 
4.4   Integration. The Target Company shall not and shall use its best efforts
to ensure that no Affiliate shall sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in Section 2 of
the Securities Act) that would be integrated with the offer or sale of the
Securities in a manner that would require the registration under the Securities
Act of the sale of the Securities to Langley.
 
4.5   Furnishing of Rule 144(c) Materials. The Target Company shall, for so long
as any of the Securities remain outstanding and during any period in which the
Target Company is not subject to Section 13 or 15(d) of the Exchange Act, make
available to any registered holder of the Securities (“Holder” or “Holders”) in
connection with any sale thereof and any prospective purchaser of such
Securities from such Person, such information in accordance with Rule 144(c)
promulgated under the Securities Act as is required to sell the Securities under
Rule 144 promulgated under the Securities Act.
 
4.6   Solicitation Materials. The Target Company shall not (i) distribute any
offering materials in connection with the offering and sale of the shares of
Consideration Stock other than the Disclosure Documents and any amendments and
supplements thereto prepared in compliance herewith or (ii) solicit any offer to
buy or sell the shares of Consideration Stock by means of any form of general
solicitation or advertising.
 
4.7   Listing of Common Stock. If the Common Stock is or shall become listed on
the OTCBB or on another exchange, the Target Company shall (a) use its best
efforts to maintain the listing of its Common Stock on the OTCBB or such other
exchange on which the Common Stock is then listed until two years from the date
hereof, and (b) shall provide to Langley evidence of such listing.
 
4.8   Indemnification.
 
(a)   Indemnification.
 
(i)   The Target Company shall, notwithstanding termination of this Agreement
and without limitation as to time, indemnify and hold harmless Langley and its
officers, directors, agents, employees and affiliates, each Person who controls
or Langley (within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) (each such Person, a “Control Person”) and the officers,
directors, agents, employees and affiliates of each such Control Person, to the
fullest extent permitted by applicable law, from and against any and all losses,
claims, damages, liabilities, costs (including, without limitation, costs of
preparation and attorneys’ fees) and expenses (collectively, “Losses”), as
incurred, arising out of, or relating to, a breach or breaches of any
representation, warranty, covenant or agreement by the Target Company under this
Agreement or any other Transaction Document.
 
 

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(ii)   Langley shall, notwithstanding termination of this Agreement and without
limitation as to time, indemnify and hold harmless the Target Company, its
officers, directors, agents and employees, each Control Person and the officers,
directors, agents and employees of each Control Person, to the fullest extent
permitted by application law, from and against any and all Losses, as incurred,
arising out of, or relating to, a breach or breaches of any representation,
warranty, covenant or agreement by Langley under this Agreement or the other
Transaction Documents, except for Losses solely arising out of negligence, bad
faith or breach of this Agreement.
 
(iii)    The Target Company and Langley acknowledge that in the SEC’s opinion,
directors, officers and persons controlling a company subject to the Securities
Act can not be indemnified for liabilities arising under the Securities Act by
such company.
 
(b)   Conduct of Indemnification Proceedings. If any Proceeding shall be brought
or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party promptly shall notify the Person from whom
indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying
Party shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Indemnified Party and the payment of all fees and
expenses incurred in connection with defense thereof; provided, that the failure
of any Indemnified Party to give such notice shall not relieve the Indemnifying
Party of its obligations or liabilities pursuant to this Agreement, except (and
only) to the extent that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further review)
that such failure shall have proximately and materially adversely prejudiced the
Indemnifying Party.
 
An Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (1) the Indemnifying Party has agreed to pay such fees and expenses; or
(2) the Indemnifying Party shall have failed promptly to assume the defense of
such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified Party
and the Indemnifying Party, and such Indemnified Party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense of the
claim against the Indemnified Party but will retain the right to control the
overall Proceedings out of which the claim arose and such counsel employed by
the Indemnified Party shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding.
 
 

  14  

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All fees and expenses of the Indemnified Party to which the Indemnified Party is
entitled hereunder (including reasonable fees and expenses to the extent
incurred in connection with investigating or preparing to defend such Proceeding
in a manner not inconsistent with this Section) shall be paid to the Indemnified
Party, as incurred, within ten (10) Business Days of written notice thereof to
the Indemnifying Party.
 
No right of indemnification under this Section shall be available as to a
particular Indemnified Party if the Indemnifying Party obtains a non-appealable
final judicial determination that such Losses arise solely out of the negligence
or bad faith of such Indemnified Party in performing the obligations of such
Indemnified Party under this Agreement or a breach by such Indemnified Party of
its obligations under this Agreement.
 
(c)   Contribution. If a claim for indemnification under this Section is
unavailable to an Indemnified Party or is insufficient to hold such Indemnified
Party harmless for any Losses in respect of which this Section would apply by
its terms (other than by reason of exceptions provided in this Section), then
each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses in such proportion as is appropriate to reflect the relative
benefits received by the Indemnifying Party on the one hand and the Indemnified
Party on the other and the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions or omissions that resulted in
such Losses as well as any other relevant equitable considerations. The relative
fault of such Indemnifying Party and Indemnified Party shall be determined by
reference to, among other things, whether there was a judicial determination
that such Losses arise in part out of the negligence or bad faith of the
Indemnified Party in performing the obligations of such Indemnified Party under
this Agreement or the Indemnified Party’s breach of its obligations under this
Agreement. The amount paid or payable by a party as a result of any Losses shall
be deemed to include any attorneys’ or other fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party.
 
(d)   Non-Exclusivity. The indemnity and contribution agreements contained in
this Section are in addition to any obligation or liability that the
Indemnifying Parties may have to the Indemnified Parties.
 
4.9   Sale of Langley Consideration Shares. Langley shall assist the Target
Company in setting up and maintaining a trading account at a registered broker
in the United Kingdom to facilitate the sale of the Langley Consideration
Shares. Broker’s commissions in the trading account shall not exceed one half
percent (0.5%).
 
4.10   Lock Up by Langley. Langley shall not sell, transfer or assign all or any
of the shares of Consideration Stock for a period of two (2) years following the
Closing, without the written consent of the Target Company, which consent may be
withheld in the Target Company’s sole discretion.
 
 

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ARTICLE V
MISCELLANEOUS

5.1   Fees and Expenses. Except as set forth in this Agreement, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement.
The Target Company shall pay all stamp and other taxes and duties levied in
connection with the issuance of the shares of Consideration Stock pursuant
hereto. Langley shall be responsible for any taxes payable by Langley that may
arise as a result of the investment hereunder or the transactions contemplated
by this Agreement or any other Transaction Document. The Target Company agrees
to pay a total Langley’s counsel $7,500 for legal fees associated with the
transactions contemplated by this Agreement at Closing. The Target Company shall
pay all costs, expenses, fees and all taxes incident to and in connection with:
(A) the issuance and delivery of the Securities, (B) the exemption from
registration of the Securities for offer and sale to Langley under the
securities or Blue Sky laws of the applicable jurisdictions, and (C) the
preparation of certificates for the Securities (including, without limitation,
printing and engraving thereof), and (D) all fees and expenses of counsel and
accountants of the Target Company.
 
5.2   Entire Agreement This Agreement, together with all of the Exhibits annexed
hereto, and any other Transaction Document contains the entire understanding of
the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, oral or written, with respect to such matters.
This Agreement shall be deemed to have been drafted and negotiated by both
parties hereto and no presumptions as to interpretation, construction or
enforceability shall be made by or against either party in such regard.
 
5.3   Notices. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be deemed to have been duly given
upon facsimile transmission (with written transmission confirmation report) at
the number designated below (if delivered on a Business Day during normal
business hours where such notice is to be received), or the first Business Day
following such delivery (if delivered other than on a Business Day during normal
business hours where such notice is to be received) whichever shall first occur.
The addresses for such communications shall be:
 

         If to the Target Company  Galaxy Minerals, Inc.      500 Park Avenue,
Suite 203      Lake Villa, IL 60046      Attn: President       Tel: (847) 265
7600       Fax: (847) 265 0995     

           

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         With copies to:  The Lebrecht Group, APLC      22342 Avenida Empressa  
   Suite 220      Rancho Santa Margarita      CA 92688      Attn: Brian A.
Lebrecht      Tel: 949 635 1240      Fax: 949 635 1244                        If
to Langley: Langley Park Investments PLc     30 Farringdon Street     London
EC4A 4HJ     Attn: Harry Pearl     Tel: 44.207.569.0044     Fax: 44.207.724.0090
 

 

        With copies to: Gottbetter & Partners, LLP     488 Madison Ave. 12th
Floor     New York, New York 10022     Attn: Adam S. Gottbetter, Esq.     Tel:
(212) 400-6900     Fax: (212) 400-6901  

 
or such other address as may be designated hereafter by notice given pursuant to
the terms of this Section 5.3.
 
5.4   Amendments; Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed, in the case of an amendment, by
both the Target Company and Langley, or, in the case of a waiver, by the party
against whom enforce­ment of any such waiver is sought. No waiver of any default
with respect to any provision, condition or require­ment of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
either party to exercise any right hereunder in any manner impair the exercise
of any such right accruing to it thereafter.
 
5.5   Headings. The headings herein are for convenience only, do not constitute
a part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
 
5.6   Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns. The assignment by a party of this Agreement or any rights hereunder
shall not affect the obligations of such party under this Agreement.
 
5.7   No Third Party Beneficiaries. This Agreement is intended for the benefit
of the parties hereto and their respective permitted successors and assigns and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person.
 
 

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5.8   Governing Law; Venue; Service of Process. The parties hereto acknowledge
that the transactions contemplated by this Agreement and the exhibits hereto
bear a reasonable relation to the State of New York. The parties hereto agree
that the internal laws of the State of New York shall govern this Agreement and
the exhibits hereto, including, but not limited to, all issues related to usury.
Any action to enforce the terms of this Agreement or any of its exhibits, or any
other Transaction Document shall be brought exclusively in the state and/or
federal courts situated in the County and State of New York. If and only if New
York declines jurisdiction within the State of New York, such action shall be
brought in the State and County where the Target Company’s principle place of
business is situated. Service of process in any action by Langley or the Target
Company to enforce the terms of this Agreement may be made by serving a copy of
the summons and complaint, in addition to any other relevant documents, by
commercial overnight courier to the other party at its principal address set
forth in this Agreement.
 
5.9   Survival. The representa­tions and warranties of the Target Company and
Langley contained in Article III and the agreements and covenants of the parties
contained in Article IV and this Article V shall survive the Closing.
 
5.10   Counterpart Signatures. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
 
5.11   Publicity. The Target Company and Langley shall consult with each other
in issuing any press releases or otherwise making public statements with respect
to the transactions contemplated hereby and neither party shall issue any such
press release or otherwise make any such public statement without the prior
written consent of the other, which consent shall not be unreasonably withheld
or delayed, unless counsel for the disclosing party deems such public statement
to be required by applicable federal and/or state securities laws. Except as
otherwise required by applicable law or regulation, the Target Company will not
disclose to any third party (excluding its legal counsel, accountants and
representatives) the names of Langley.
 
5.12   Severability. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefore, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
 
5.13   Limitation of Remedies. With respect to claims by the Target Company or
any person acting by or through the Target Company, or by Langley or any person
acting through Langley, for remedies at law or at equity relating to or arising
out of a breach of this Agreement, liability, if any, shall, in no event,
include loss of profits or incidental, indirect, exemplary, punitive, special or
consequential damages of any kind.
 

 

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[ SIGNATURE PAGE FOLLOWS ]
 
 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first indicated above.
                   

Target Company:
 
Galaxy Minerals, Inc.
 
 
 
By:   /s/ Richard N.
Jobling                                                                           
 
Name: Richard N. Jobling
Title: President
 
 
 
 
Langley:
 
 
Dungarvon Associates, Inc. on behalf of Langley Park Investments Plc.
 
 
 
By:        /s/ name
unknown                                                                             
Name:    ____________________________________________________
Title:      ____________________________________________________

 

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Schedule 3.1(a)

Subsidiaries

Yellow Jacket Finance Limited                                100%
Yellow Jacket Finance limited / Stealth Corporation Joint Venture            51%

  21  

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Schedule 3.1(c)

Capitalization and Registration Rights

Common Stock
Common Stock par value $0.001
250,067,500
 
 
Total
 
Options and Warrants
NIL

   
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Schedule 3.1(d)

Equity and Equity Equivalent Securities

 
Authorized
Issued

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 
 
 
Common Stock par value $0.001
500,000,000
250,067,500
 
 
 
 
 
 
Preferred Stock par value $0.001
10,000,000
Nil

 

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Schedule 3.1(e)
 

 
Conflicts

None
 
 
 

  24  

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Schedule 3.1(f)

Consents and Approvals

None
 

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Schedule 3.1(g)

Litigation

The Company was informed that an action may have been filed in District Court
against another company and that the Company may have been listed as a party
under its former name, HeavenExpress.Com, Inc. The Company believes the action
may have been filed on November 14, 2003, but that at no time since that date,
has the Company been served with process nor to its knowledge has any effort
been made to serve it with process. Pursuant to Federal Rule of Civil Procedure
4(m), since March 16, 2004, more than 120 days has passed since the filing of
this action without the plaintiff ever attempting to serve the Company, the
action is subject to being dismissed, and there has not been any effort by the
plaintiff to seek to extend the time period within which to serve the Company.

In light of the foregoing, this action does not appear to constitute pending or
threatened legal action against the Company at this point.

- The action was a spurious claim involving parties outside Galaxy.

- The statutory 120 day time limit for service, expired some time ago, the
Company has never received a summons or notice.

- The note above appears in the 10Q, because the Directors insisted it appear in
the 10Q in accordance with our policy of transparency, and given the sometime
litigious nature of the USA, it was felt pertinent.

- Galaxy has never been served.

- We do not for any moment believe the action or more correctly the non action
will cause any material harm to Galaxy, it is for all intents and purposes a
“Dead Issue” that we believed should have been mentioned as it was in our 10Q.
and thus it was recorded.
 

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Schedule 3.1(h)

Defaults and Violations

None

 

 

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