EXHIBIT 10.1
NORTH AMERICAN NATURAL GAS, INC.
(“NANG”)
- and -
PURERAY ACQUISITION INC.
(the “Purchaser”)
- and -
MICKAEL JOASIL, DEREK BLACKBURN, F.W.F. ROBINSON, FRANK O’DEA,
KAIROS PARTNERS, LLC, THOMAS J. BROESKI, RAJ KURICHH, MEGS
PADIACHY, RAMILA PADIACHY, PATRICK PIERRE AND MATTHEW SICOLI
(the “Shareholders”)
- and -
PURERAY CORPORATION
(the “Corporation”)
SHARE PURCHASE AGREEMENT
July 24, 2008

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TABLE OF CONTENTS

         
Section 1 INTERPRETATION
    2  
 
       
1.1 Definitions
    2  
1.2 Headings and References
    6  
1.3 Extended Meanings
    6  
1.4 Currency
    6  
1.5 Schedules
    6  
 
       
Section 2 PURCHASE AND SALE
    6  
 
       
2.1 Purchase and Sale
    6  
2.2 Purchase Price
    6  
2.3 Payment
    7  
2.4 Section 85 Election
    7  
 
       
Section 3 Section 116 Certificates
    7  
 
       
3.1 Section 116 Certificate
    7  
3.2 Tax Escrow
    7  
3.3 Remittance
    7  
3.4 Indemnity
    8  
 
       
Section 4 REPRESENTATIONS OF THE SHAREHOLDERS
    8  
 
       
4.1 Title to Purchased Shares
    9  
4.2 No Other Purchase Agreements
    9  
4.3 Contractual and Regulatory Approvals
    9  
4.4 Authorization of Purchase
    9  
4.5 Enforceability
    9  
4.6 Residence
    10  
 
       
Section 5 REPRESENTATIONS OF THE SHAREHOLDERS
    10  
 
       
5.1 Corporate Matters
    10  
5.2 Share Capital, Dividends and Shares
    11  
5.3 Financial Matters
    12  
5.4 Property
    15  
5.5 Conduct of Business
    20  
5.6 General Matters
    20  
 
       
Section 6 ACKNOWLEDGMENTS OF THE SHAREHOLDERS
    21  
 
       
Section 7 REPRESENTATIONS AND WARRANTIES OF NANG
    22  
 
       
7.1 Corporate Matters
    22  
7.2 Share Capital, Dividends and Shares
    23  

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7.3 Financial Matters
    24  
7.4 Property
    28  
7.5 Employees
    28  
7.6 General Matters
    28  
 
       
Section 8 SURVIVAL AND INDEMNITY
    29  
 
       
8.1 Survival
    29  
8.2 General Indemnity
    29  
8.3 Notice and Participation
    30  
8.4 Purchaser’s Indemnity
    30  
 
       
Section 9 CLOSING
    30  
 
       
Section 10 MISCELLANEOUS
    30  
 
       
10.1 Further Assurances
    30  
10.2 Expenses
    31  
10.3 Notice
    31  
10.4 Time
    32  
10.5 Governing Law
    32  
10.6 Entire Agreement
    33  
10.7 Severability
    33  
10.8 Assignment and Enurement
    33  
10.9 Counterparts and Facsimile
    33  
10.10 Independent Legal Advice
    33  

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SHARE PURCHASE AGREEMENT
THIS AGREEMENT is made July 24, 2008,
BETWEEN:
NORTH AMERICAN NATURAL GAS, INC., a corporation formed under the laws of the
State of Washington
(“NANG”)
- and -
PURERAY ACQUISITION INC., a corporation formed under the laws of Canada
(the “Purchaser”)
- and -
MICKAEL JOASIL, DEREK BLACKBURN, F.W.F. ROBINSON, FRANK O’DEA, KAIROS PARTNERS,
LLC, THOMAS J. BROESKI, RAJ KURICHH, MEGS PADIACHY, RAMILA PADIACHY, PATRICK
PIERRE AND MATTHEW SICOLI
(the “Shareholders”)
- and -
PURERAY CORPORATION, a corporation formed under the laws of Canada
(the “Corporation”)
RECITALS:

A.   The Shareholders are the registered and beneficial owners of all of the
issued and outstanding shares of the Corporation.

B.   The Shareholders wish to sell, and NANG wishes to acquire, directly or
indirectly, all of the issued and outstanding shares of the Corporation (the
“Purchased Shares”).

C.   NANG will cause the Purchaser to acquire the Purchased Shares and to
satisfy payment of the Purchase Price therefor by issuing one exchangeable share
of the Purchaser (each, an “Exchangeable Share”) for each Purchased Share
acquired pursuant to the terms of this Agreement.

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FOR VALUE RECEIVED, the parties agree as follows:
SECTION 1
INTERPRETATION

1.1   Definitions       In this Agreement:

  (a)   “1933 Act” means the United States Securities Act of 1933, as amended.  
  (b)   “Accounts Receivable” means all accounts receivable, book debts and
other debts owing to the Corporation.     (c)   “Agreement” means this agreement
including any recitals and schedules to this agreement, as amended, supplemented
or restated from time to time.     (d)   “Applicable Law”, in respect of any
Person, property, transaction or event, means all statutes, regulations,
treaties, judgments and decrees applicable to that Person, property, transaction
or event and, whether or not having the force of law, all applicable
requirements, requests, official directives, rules, consents, approvals,
authorizations, guidelines, orders and policies of any Governmental Authority
having or purporting to have authority over that Person, property, transaction
or event.     (e)   “Business Day” means a day on which banks are open for
business in Toronto but does not include a Saturday, Sunday and any other day
which is a legal holiday in such city.     (f)   “Closing” means the completion
of the transactions pursuant to this Agreement on the Closing Date.     (g)  
“Closing Date” means July 24, 2008 or such other date as agreed between NANG and
the Shareholders, provided such date is on or before September 15, 2008.     (h)
  “Comfort Letter” has the meaning given to it in Section 3.3(2).     (i)  
“Disclosure Documents” has the meaning given to it in Section 7.1(10).     (j)  
“Encumbrances” means any charge, mortgage, hypothec, deed of trust, option,
covenant, license, easement, right-of-way, title defect, lien, deemed or
statutory trust, pledge, claim, restriction, security interest or other
encumbrance, whether created or arising by agreement, statute or otherwise at
law, attaching to property, interests or rights and whether or not they
constitute specific or floating charges as those terms are understood under
Applicable Law.     (k)   “Exchange Act” has the meaning given to it in
Section 7.1(9).

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  (l)   “Exchangeable Shares” has the meaning given to it in Recital C.     (m)
  “Financial Statements” means the audited financial statements of the
Corporation as at and for the fiscal period ended on April 30, 2008, consisting
of a balance sheet and statements of operations and deficit and cash flows,
together with the notes thereto.     (n)   “GAAP” means generally accepted
accounting principles in effect in the United States of America at the relevant
time.     (o)   “Government Assistance Programs” has the meaning given to it in
Section 5.6(2).     (p)   “Governmental Authority” means any domestic or foreign
government, including any federal, provincial, state, territorial or municipal
government, and any government agency, tribunal, commission or other authority
exercising or purporting to exercise executive, legislative, judicial,
regulatory or administrative functions of, or pertaining to, government.     (q)
  “Indebtedness” of a Person means, without duplication:

  (i)   all debts and liabilities of that Person for borrowed money (including
revolving bank debt and all issued and outstanding cheques not otherwise
reflected in the Closing Balance Sheet);     (ii)   all debts and liabilities to
such Person’s shareholders for borrowed money and all accrued management
salaries and bonuses and interest payable relating thereto not otherwise
reflected in the Closing Balance Sheet;     (iii)   all capital leases of that
Person;     (iv)   all debts and liabilities of that Person representing the
deferred acquisition cost of property and services;     (v)   all guarantees
given by that Person; and     (vi)   deferred Taxes of that Person,

      including, for greater certainty, all interest, and penalties relating to
the foregoing, but does not include short-term non-interest bearing obligations
of that Person payable to outside suppliers and incurred in the ordinary course
of business of that Person.     (r)   “Intellectual Property” means all right,
title and interest in and to the following property owned, used, or licensed by
the Corporation:

  (i)   all patents, patent applications, reissues, divisions, continuations,
renewals, extensions, continuations-in-part and registrations, inventions

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      (whether or not patentable), trademarks, trade names, corporate names,
domain names, website names and world wide web addresses, common law
trade-marks, trade dress and logos, trademark applications and registrations,
trade name registrations, service marks, designs, copyrights, copyright
applications and registrations, mask works, mask work registrations and
applications, integrated circuit topographies, integrated circuit topography
registrations and applications, and industrial designs, domestic or foreign;

  (ii)   all proprietary and non-public business information, including trade
secrets, know-how, inventions, invention disclosures, improvements, discoveries,
confidential information, methods, processes, technology, technical data,
schematics, formulae, customer lists and documentation relating to any of the
foregoing, and other intellectual property;     (iii)   computer software; and  
  (iv)   any other intellectual property.

  (s)   “Kairos Escrow Agreement” means the escrow and share purchase agreement
dated June 24, 2008 between Kairos Partners, LLC, the Corporation and Wildeboer
Dellelce LLP, as escrow agent, pursuant to which 4,355,000 Purchased Shares
registered in the name of Kairos Partners LLC, are held in, and subject to
release from, escrow;     (t)   “Leases” has the meaning given to it in
Section 5.4(3)(a).     (u)   “Leased Premises” has the meaning given to it in
Section 5.4(3)(b).     (v)   “Liabilities” means all Indebtedness, obligations
and other liabilities of a Person whether absolute, accrued, contingent, fixed
or otherwise, or whether due or to become due.     (w)   “Licences and Permits”
has the meaning given to it in Section 5.1(6).     (x)   “NANG Financial
Statements” means the audited financial statements of NANG as at and for the
fiscal year period ended on April 30, 2008, consisting of a balance sheet and
statements of operations and deficit and cash flows, together with the notes
thereto, and the unaudited interim financial statements of NANG as at and for
the fiscal period ended on April 30, 2008, consisting of a balance sheet and
statements of operations and deficit and cash flows, together with the notes
thereon.     (y)   “Non-Resident Purchase Price” has the meaning given to it in
Section 3.1.     (z)   “Non-Resident Shareholder” means the Shareholders as set
forth in Schedule 4.1.

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  (aa)   “Notice” means any notice, approval, demand, direction, consent,
designation, request, document, instrument, certificate or other communication
required or permitted to be given under this Agreement.     (bb)   “Person”
means any natural person, sole proprietorship, partnership, corporation, trust,
joint venture, any Governmental Authority or any incorporated or unincorporated
entity or association of any nature.     (cc)   “Purchase” means the transaction
of purchase and sale of the Purchased Shares contemplated by this Agreement.    
(dd)   “Purchase Price” has the meaning given to it in Section 2.1.     (ee)  
“Purchased Shares” has the meaning given to it in Recital B.     (ff)  
“Remittance Date” has the meaning given to it in Section 3.1.     (gg)   “SEC
Reports” has the meaning given to it in Section 7.1(10).     (hh)   “Section 116
Certificate” has the meaning given to it in Section 3.1.     (ii)   “Tax Act”
means the Income Tax Act (Canada), and the regulations promulgated thereunder,
as amended.     (jj)   “Tax Escrow Agreement” has the meaning given to it in
Section 3.1.     (kk)   “Tax Returns” means any return (including an information
return), declaration, report, statement, claim for a refund, rebate or credit,
amended return, declaration of estimated Taxes or other document (including any
attached schedule and any attached related or supporting information) relating
to Taxes required to be filed under any applicable Tax legislation or in fact
filed with any Tax authority.     (ll)   “Taxes” includes all present and future
taxes, surtaxes, duties, levies, imposts, rates, fees, assessments,
withholdings, dues and other charges of any nature imposed by any Governmental
Authority, including income, capital (including large corporations),
withholding, consumption, sales, use, transfer, goods and services or other
value-added, excise, customs, anti-dumping, countervail, net worth, stamp,
registration, franchise, payroll, employment, health, education, business,
school, property, local improvement, development, education development and
occupation taxes, surtaxes, duties, levies, imposts, rates, fees, assessments,
withholdings, dues and charges, together with all fines, interest, penalties on
or in respect of, or in lieu of or for non-collection of, those taxes, surtaxes,
duties, levies, imposts, rates, fees, assessments, withholdings, dues and other
charges, and any liability for the payment of any amount of the type described
above as a result of being a “transferee” (within the meaning of Section 160 of
the Tax Act or any other applicable Tax legislation) of another Person or a
member of an affiliated or combined group.

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1.2   Headings and References

     The division of this Agreement into sections and subsections and the
insertion of headings are for convenience of reference only and shall not affect
the construction or interpretation of this Agreement. The terms “this
Agreement”, “hereof’, “hereunder” and similar expressions refer to this
Agreement and not to any particular section, subsection or other portion hereof
and include any agreement supplemental hereto. Unless something in the subject
matter or context is inconsistent therewith, references herein to “Sections” are
to sections, subsections and further subdivisions of sections of this Agreement.

1.3   Extended Meanings

     Unless otherwise specified, words importing the singular include the plural
and vice versa and words importing gender include the feminine and the
masculine. The term “including” means “including without limitation”.

1.4   Currency

     All references to currency or dollar amounts in this Agreement are to the
currency of Canada, unless otherwise stated.

1.5   Schedules

     The following are the schedules attached to and incorporated by reference
into this Agreement:

         
Schedule 4.1
  -   Shareholders and Purchased Shares
Schedule 5.4(3)
  -   Leases and Leased Premises
Schedule 5.4(9)
  -   Intellectual Property
Schedule A
  -   Tax Escrow Agreement (form of)

SECTION 2
PURCHASE AND SALE

2.1   Purchase and Sale

     The Shareholders hereby sell, and the Purchaser hereby purchases, all of
the Purchased Shares upon and subject to the terms and conditions of this
Agreement.

2.2   Purchase Price

     The aggregate purchase price (the “Purchase Price”) payable by the
Purchaser to the Shareholders for the Purchased Shares shall be the fair market
value of the Purchased Shares as at the date hereof. The Purchaser and the
Shareholders hereby agree and determine that the fair market value of the
Purchased Shares as at the date hereof is US$35,855,000 (being US$1.00 per
share).

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2.3   Payment

     The Purchaser shall satisfy payment of the Purchase Price by allotting and
issuing one fully paid and non-assessable Exchangeable Share for each Purchased
Share.

2.4   Section 85 Election

     The Purchaser agrees to jointly elect with each Shareholder, pursuant to
subsection 85(1) of the Tax Act and within the time limits imposed by subsection
85(6) of the Tax Act, at an amount to be determined by each Shareholder, which
amount shall not be less than the Shareholder’s adjusted cost base of the
Purchased Shares. It shall be the responsibility of each Shareholder to prepare
and file the T2057 election form with the Canada Revenue Agency. The Purchaser
shall not be liable for any damages arising to a Shareholder for a late filing
of a form T2057 or any error or omissions on a form T2057.
SECTION 3
SECTION 116 CERTIFICATES

3.1   Section 116 Certificate

     Each Non-Resident Shareholder shall deliver to the Purchaser as soon as
practicable following the date of this Agreement a tax clearance certificate
under section 116 of the Tax Act (the “Section 116 Certificate”) with an
aggregate certificate limit at least equal to the amount of the Purchase Price
multiplied by the number of Purchased Shares purchased from the Non-Resident
Shareholder (the “Non-Resident Purchase Price”) and expressed in Canadian
dollars.

3.2   Tax Escrow

     Each Non-Resident Shareholder shall, at Closing, deliver 25% of the
Exchangeable Shares issued to it pursuant to the terms of the Agreement (the
“Tax Escrow Shares”), an executed escrow agreement (the “Tax Escrow Agreement”)
dated the date hereof between the Non-Resident Shareholder, the Purchaser and
Wildeboer Dellelce LLP in the form attached as Schedule A hereto and an executed
power of attorney to Wildeboer Dellelce LLP with instructions the Wildeboer
Dellelce LLP: (i) hold the Escrowed Shares in escrow; and (ii) release the Tax
Escrow Shares from escrow in accordance with the terms of this Agreement and the
Tax Escrow Agreement.

3.3   Remittance   (1)   If on or before the twenty-eighth day of the month
following the calendar month in which Closing occurs (the “Remittance Date”) the
Purchaser receives from the Non-Resident Shareholder a Section 116 Certificate
with an aggregate certificate limit at least equal to the amount of the
Non-Resident Purchase Price paid to the Non-Resident Shareholder expressed in
Canadian dollars, the Purchaser shall, immediately after receipt of such
Section 116 Certificate, cause Wildeboer Dellelce LLP to deliver to the
Non-Resident Shareholder the Tax Escrow Shares.

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(2)   If by the Remittance Date the Purchaser does not receive the Section 116
Certificate or receives a Section 116 Certificate with a certificate limit that
is less than the Non-Resident Purchase Price then, unless the Canada Revenue
Agency shall have issued a letter confirming that the Canada Revenue Agency will
not require the remittance of funds as is normally required under subsection
116(5) of the Tax Act and that the Purchaser may delay the remittance of amounts
in respect of the purchase of the Purchased Shares until further instructed by
Canada Revenue Agency (a “Comfort Letter”), Wildeboer Dellelce LLP shall deliver
the Tax Escrow Shares to the Purchaser and the Purchaser, as agent for the
Non-Resident Shareholder, shall sell or otherwise dispose, outside the United
States in compliance with Rule 903 of Regulation S under the 1933 Act and in
compliance with applicable Canadian securities laws, of such portion of the Tax
Escrow Shares as is necessary to provide sufficient funds to the Purchaser to
enable it to comply with such deduction or withholding requirement and the
Purchaser shall notify the Non-Resident Shareholder thereof and remit to the
Non-Resident Shareholder any unapplied balance of the net proceeds of such sale,
and the balance, if any, of the Tax Escrow Shares. If the proceeds of such sale
are insufficient to fund the required withholding, the Non-Resident Shareholder
shall forthwith pay to the Purchaser or remit to the applicable taxing authority
the deficiency. The Non-Resident Shareholder shall bear all reasonable costs and
expenses associated with any sale by the Purchaser pursuant to the two
immediately preceding sentences.

(3)   If the Canada Revenue Agency has provided a Comfort Letter, Wildeboer
Dellelce LLP shall not deliver the Tax Escrow Shares to the Purchaser on the
date that would otherwise be the Remittance Date and if the relevant Section 116
Certificate is received while the Comfort Letter remains in effect, with an
aggregate certificate limit at least equal to the Purchase Price in Canadian
dollars, or if proof, in the Purchaser’s sole discretion, is provided that the
appropriate remittances have been made to the Canada Revenue Agency, Wildeboer
Dellelce LLP shall, promptly after receipt of such certificate or proof of
remittance, deliver to the Non-Resident Shareholder the Tax Escrow Shares. If
notification from the Canada Revenue Agency is received that the Comfort Letter
is no longer in effect, such date of receipt shall be deemed to be the
Remittance Date for the purposes of this Section 3.3(3).   3.4   Indemnity

     The Purchaser shall be liable to the Non-Resident Shareholder for and
shall, in addition, indemnify the Non-Resident Shareholder from and against, all
losses, cost, claims, damages, expenses and liabilities suffered, sustained,
paid or incurred by the Non-Resident Shareholder arising out of the Purchaser’s
failure to remit funds with respect to amounts owing by the Purchaser, as is
normally required under subsection 116(5) of the Tax Act.
SECTION 4
REPRESENTATIONS OF THE SHAREHOLDERS
     Each of the Shareholders severally but not jointly represents and warrants
with respect to himself of herself only as stated below in this Section 4 and
acknowledges that NANG is relying

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on the accuracy of each such representation and warranty in entering into this
Agreement and causing the Purchaser to complete the Purchase.

4.1   Title to Purchased Shares

     Except as provided under the Kairos Escrow Agreement, each of the
Shareholders legally and beneficially owns and controls with a good and
marketable title thereto free of any Encumbrances, adverse claims or claims of
others, all of the issued and outstanding shares in the capital of the
Corporation as listed in Schedule 4.1.

4.2   No Other Purchase Agreements

     No Person, other than NANG and the Purchaser, has any agreement, option,
understanding or commitment, or any right or privilege (whether by law,
pre-emptive or contractual) capable of becoming an agreement, option or
commitment, including a right of conversion or exchange attached to convertible
securities, warrants or convertible obligations of any nature, for the purchase
of the Purchased Shares from any of the Shareholders, except as provided under
the Kairos Escrow Agreement.

4.3   Contractual and Regulatory Approvals

     Except as provided under the Kairos Escrow Agreement, none of the
Shareholders is under any obligation, contractual or otherwise, to request or
obtain the consent or approval of any Person, and no permits, licences,
certifications, authorizations or approvals of, or notifications to, any
Governmental Authority are required to be obtained by any of the Shareholders:

  (a)   by virtue of or in connection with the execution, delivery or
performance by any of the Shareholders or the completion of any of the
transactions contemplated herein;     (b)   to avoid the loss of any Licence or
Permit or other authorization or the violation, breach or termination of, or any
default under, or the creation of any Encumbrance under the terms of, any
Applicable Law; or     (c)   in order that the authority and ability of the
Corporation to carry on its business in the ordinary course and in the same
manner as presently conducted remains in good standing and in full force and
effect as of and following the Purchase.

4.4   Authorization of Purchase

     The execution and delivery of this Agreement and the consummation of the
Purchase have been duly and validly authorized by each of the Shareholders.

4.5   Enforceability

     This Agreement has been duly and validly executed and delivered by each of
the Shareholders and is a valid and legally binding obligation of each of them
enforceable against

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each of them in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency and other laws affecting creditors’ rights generally and
to general principles of equity.

4.6   Residence

     Except as set out in Schedule 4.1, none of the Shareholders is a
non-resident of Canada within the meaning of the Tax Act.
SECTION 5
REPRESENTATIONS OF THE SHAREHOLDERS
     Each of the Shareholders severally but not jointly represents and warrants
as stated below in this Section 5 and acknowledges that NANG is relying on the
accuracy of each such representation and warranty in entering into this
Agreement and causing the Purchaser to complete the Purchase.

5.1   Corporate Matters   (1)   Enforceability. This Agreement has been duly and
validly executed and delivered by the Corporation and is a valid and legally
binding agreement of the Corporation enforceable against the Corporation in
accordance with its terms, subject, as enforcement, to bankruptcy, insolvency
and other laws affecting creditors’ rights generally and to general principles
of equity.   (2)   Due Authorization. The execution and delivery of this
Agreement has been duly and validly authorized by the Corporation and no other
corporate proceedings on the part of the Corporation are necessary to authorize
this Agreement, and the execution and delivery of this Agreement is within the
power of the Corporation without the need for any further sanction, approval,
licence or consent.   (3)   Investments. The Corporation does not own, directly
or indirectly, any shares or other equity securities of any corporation or any
equity or ownership interest in any business or Person. The Corporation is not
subject to any obligation or requirement to provide funds to or make any
investment in any business or Person by way of loan, capital contribution or
otherwise.   (4)   Corporate Records. The corporate records and minute books of
the Corporation contain complete and accurate minutes of all meetings of and
corporate actions or written resolutions of the directors, committees of
directors and shareholders of the Corporation, including all by-laws and
resolutions passed by the directors, committees of directors and shareholders of
the Corporation since formation. All such meetings were duly called and held,
all such corporate actions and written resolutions were duly taken or validly
signed and all such by-laws and resolutions were duly passed. The share
certificate books, register of shareholders, register of transfers, register of
directors and similar corporate records of the Corporation are complete,
accurate and current.

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(5)   Shareholders Agreements. There are no shareholders agreements, pooling
agreements, voting trusts or other similar agreements with respect to the
ownership or voting of any of the shares of the Corporation, except as provided
under the Kairos Escrow Agreement.   (6)   Licences and Permits. The Corporation
holds all licences, permits and authorizations requisite for, and has complied
with all Applicable Laws applicable to, the conduct of its business
(collectively, the “Licences and Permits”). All of the Licences and Permits are
in good standing and in full force and effect.   (7)   Operations and Assets.
The Corporation has carried on business only in the Province of Ontario.   5.2  
Share Capital, Dividends and Shares   (1)   Authorized and Issued Share Capital.
The authorized capital of the Corporation consists of an unlimited number of
Class A shares and an unlimited number of Class B shares, of which 35,855,000
Class A shares and no Class B shares have been duly issued and are outstanding
as fully paid and non-assessable shares of the Corporation. No Person has any
option, warrant, right, call, commitment, conversion right, right of exchange or
other agreement or any right or privilege (whether by law, pre-emptive or
contractual) capable of becoming an option, warrant, right, call, commitment,
conversion right, right of exchange or other agreement for the purchase,
subscription, allotment or issuance of any unissued shares or other securities
of the Corporation.   (2)   Dividends. The Corporation has not, directly or
indirectly, authorized, declared or paid any dividends or declared or made any
other distribution or return of capital in respect of any of its shares of any
class and has not, directly or indirectly, redeemed, purchased or otherwise
acquired any of its shares of any class or agreed to do so.   (3)   Contractual
and Regulatory Approvals. The Corporation is not under any obligation,
contractual or otherwise, to request or obtain the consent or approval of any
Person, and no permits, licences, certifications, authorizations or approvals
of, or notifications to, any Governmental Authority are required to be obtained
by the Corporation:

  (a)   by virtue of or in connection with the execution, delivery or
performance by the Corporation of this Agreement or the completion of any of the
transactions contemplated herein;     (b)   to avoid the loss of any Licence or
Permit or other authorization or the violation, breach or termination of, or any
default under, or the creation of any Encumbrance under the terms of, any
Applicable Law; or     (c)   in order that the authority and ability of the
Corporation to carry on its business in the ordinary course and in the same
manner as presently conducted remains in good standing and in full force and
effect following the Purchase.

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5.3   Financial Matters   (1)   Books and Records. All material financial
transactions of the Corporation have been properly recorded in its books and
records, which have been maintained in accordance with GAAP and all other
applicable legal and accounting requirements and good business practice. Such
books and records:

  (a)   accurately reflect the basis for the financial condition and the
revenues, expenses and results of operations of the Corporation shown in the
Financial Statements; and     (b)   present fairly the financial condition and
the revenues, expenses and results of the operations of the Corporation as of
and to the date hereof.

    No information, records, systems, controls or data pertaining to or required
for the operation or administration of the Corporation, are recorded, stored,
maintained by, or are otherwise dependent upon, any computerized or other
system, program or device that is not exclusively owned and controlled or leased
by the Corporations.   (2)   Financial Statements. The Financial Statements have
been prepared in accordance with GAAP and present fairly the assets, liabilities
(whether accrued, absolute, contingent or otherwise) and financial condition of
the Corporation as at the applicable date provided thereon.   (3)   Liabilities
of the Corporation. The Corporation does not have any Liabilities (contingent or
otherwise) of any kind whatsoever, and there is no basis for any assertion
against the Corporation of any Liabilities of any kind, including liabilities
relating to any failure to comply with product specifications other than:

  (a)   the liabilities disclosed, reflected in or provided for in the Financial
Statements; and     (b)   liabilities incurred since the formation of the
Corporation which were incurred in the ordinary course of business and, in the
aggregate, are not materially adverse to its business.

(4)   Product Guarantees, Warranties and Discounts.

  (a)   The Corporation has not given any guarantee or warranty in respect of
any of the products sold or the services provided by it, except warranties made
in the ordinary course of business and except for warranties implied by
Applicable Law.     (b)   No claim has been made against the Corporation for
breach of warranty or contract requirement or negligence or for a price
adjustment or other concession in respect of any defect in or failure to perform
or deliver any product, service or work.

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  (c)   The Corporation is not subject to any agreement or commitment to any
customer of its business which would require the Corporation to repurchase any
products sold to such customers or to adjust any price or grant any refund,
discount or other concession to such customer.     (d)   The Corporation is not
required to provide any letters of credit, bonds or other financial security
arrangements in connection with any transactions entered into as part of its
business.

(5)   Accounts Receivable. All Accounts Receivable are reflected in the
Financial Statements and all Accounts Receivable arising since the date of the
Financial Statements arose from bona fide transactions in the ordinary course of
business, and all such Accounts Receivable owing to the Corporation are good,
valid and enforceable. Such Accounts Receivable are not subject to any defence,
set-off or counterclaim.

(6)   Inventories. The inventories reflected in the Financial Statements conform
in all material respects to applicable designs and specifications, are free from
material defects in workmanship and material, have been accurately valued in
accordance with GAAP, and the valuation thereof accurately reflects inventory
that is damaged, obsolete, defective, unsuitable for its intended use or
otherwise unsaleable in the ordinary course of business at normal prices. The
inventories are in good and merchantable condition and are usable or saleable in
the ordinary course of business for the purposes for which they are intended.

(7)   Debt Obligations. Except as disclosed in the Financial Statements, the
Corporation does not have outstanding any bonds, debentures, mortgages,
promissory notes or other Indebtedness, is not under any obligation to create or
issue any bonds, debentures, mortgages, promissory notes or other Indebtedness
maturing more than one year after the date of creation or issue, and is not a
party to or bound by any Guarantee, indemnification, assumption or endorsement
or any other like commitment of the obligations, liabilities (contingent or
otherwise) or Indebtedness of any Person.

(8)   Absence of Certain Changes or Events. Except as disclosed in the Financial
Statements, the Corporation has not:

  (a)   incurred any obligation or liability (fixed or contingent) or
Indebtedness, except normal trade or business obligations incurred in the
ordinary course of business, none of which is materially adverse to its
business;     (b)   paid or satisfied any obligations or liability (fixed or
contingent), except:

  (i)   current liabilities included in the Financial Statements;     (ii)  
current liabilities incurred in the ordinary course of business; and     (iii)  
scheduled payments pursuant to obligations under loan agreements or other
contracts or commitments described in this Agreement;

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  (c)   created any Encumbrance upon any of its properties or assets, except as
described in this Agreement;     (d)   sold, assigned, transferred, leased or
otherwise disposed of any of its properties or assets, except in the ordinary
course of business;     (e)   purchased, leased or otherwise acquired any
properties or assets, except in the ordinary course of business;     (f)  
waived, cancelled or written off any rights, claims, accounts receivable or any
amounts payable to it, except in the ordinary course of business;     (g)  
entered into any transaction, contract, agreement or commitment, except in the
ordinary course of business;     (h)   terminated, discontinued, closed or
disposed of any plant, facility or business operation;     (i)   made any
material change in its method of billing customers or the credit terms made
available to its customers;     (j)   made any material change with respect to
any method of management, operation or accounting in respect of its business;  
  (k)   suffered any damage, destruction or loss (whether or not covered by
insurance) which has materially adversely affected or could materially adversely
affect its business or its financial condition;     (l)   suffered any
extraordinary loss relating to its business;     (m)   made or incurred any
material change in, or become aware of any event or condition which is likely to
result in a material change in, its business or its financial condition; or    
(n)   authorized, agreed or otherwise become committed to do any of the
foregoing.

(9)   Tax Matters

  (a)   The Corporation has duly and on a timely basis prepared and filed all
Tax Returns and other documents required to be filed by it in respect of all
Taxes, and such Tax Returns and documents are complete and correct.     (b)  
The Corporation has paid, collected and remitted all Taxes which are due and
payable, collectible or remittable, as applicable, by it on or before the date
hereof. Adequate provision has been made in the Financial Statements for all
Taxes for the periods covered by the Financial Statements. The Corporation does
not have any liability for Taxes other than those provided for in the Financial
Statements and those arising in the ordinary course of business.

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  (c)   There are no actions, suits, proceedings, investigations, enquiries or
claims now pending or made or, to the best of the Shareholders’ knowledge,
threatened against the Corporation in respect of Taxes.     (d)   There are no
agreements, waivers or other arrangements providing for any extension of time
with respect to the filing of any Tax Return or other document or the payment of
any Taxes by the Corporation for any assessment or reassessment of Taxes.    
(e)   Except in respect of the $25,000 distributed by the Corporation to each of
Mickael Joasil and Derek Blackburn, the Corporation has withheld from each
amount paid or credited to any Person the amount of Taxes required to be
withheld therefrom and has remitted such Taxes to the proper Tax or other
Governmental Authorities within the time required under Applicable Law.

5.4   Property   (1)   Title to Assets. The Corporation is the owner of and has
good and marketable title to all of its properties and assets, including all
properties and assets reflected in the Financial Statements, free and clear of
all Encumbrances, except for:

  (a)   the Encumbrances disclosed or reflected in the Financial Statements; and
    (b)   liens for Taxes not yet due and payable.

    No other Person owns any assets which are being used in the business of the
Corporation, except for the Leased Premises described in Schedule 5.4(6). There
are no agreements or commitments to purchase property or assets by the
Corporation, other than in the ordinary course of business.   (2)   Real
Properties. The Corporation does not own any real property.   (3)   Lease and
Leased Premises

  (a)   Schedule 5.4(3)(a) describes all leases or agreements to lease under
which the Corporation leases any real or immovable property (the “Leases”). The
names of the other parties to the Leases, the description of the Leased
Premises, the term, rent and other amounts payable under the Leases and all
renewal options available under the Leases are accurately described in
Schedule 5.4(3)(a).     (b)   The Corporation is exclusively entitled to all
rights and benefits as lessee under the Leases, and the Corporation has not
sublet, assigned, licensed or otherwise conveyed any rights in the premises
subject to the Leases (the “Leased Premises”) or in the Leases to any other
Person.     (c)   All rental and other payments and other obligations required
to be paid and performed by the Corporation pursuant to the Leases have been
duly paid and

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      performed. The Corporation is not in default of any of its obligations
under the Leases and, to the best of the Shareholders’ knowledge, none of the
landlords or other parties to the Leases are in default of any of their
obligations under the Leases.

  (d)   The terms and conditions of the Leases will not be affected by, nor will
any of the Leases be in default as a result of, the completion of the Purchase.

(4)   Status of Property. The use by the Corporation of the Leased Premises is
not in breach of any building, zoning or other statute, by-law, ordinance,
regulation, covenant, restriction or official plan, and the Corporation has
adequate rights of ingress and egress for the operation of its business in the
ordinary course and, specifically:

  (a)   no alteration, repair, improvement or other work that has not been
completed has been ordered, directed or requested in writing by any competent
Governmental Authority to be done in respect of the Leased Premises or any of
the plumbing, heating, elevating, water, drainage or electrical systems,
fixtures or works;     (b)   all accounts for work and services performed and
materials furnished in respect of the Leased Premises have been paid and no
Person is entitled to claim a lien under the Construction Lien Act (Ontario)
against the Leased Premises or any part thereof, other than for current accounts
in respect of which the due date has not yet passed;     (c)   no amount is
owing by the Corporation in respect of the Leased Premises to any municipal
corporation, or to any other corporation or commission owning or operating a
public utility for water, gas, electrical power or energy, steam or hot water,
or for the use thereof, other than current accounts in respect of which the due
date has not yet passed; and     (d)   no part of the Leased Premises has been
taken or expropriated by any Governmental Authority nor has any notice or
proceeding in respect thereof been given or commenced.

(5)   Environmental Matters

  (a)   For the purposes of this Section 5.4(5):

  (i)   Contaminant means any substance, product, element, radiation, vibration
or matter included in any definition of “hazardous product”, “dangerous goods”,
“waste”, “toxic substance”, “contaminant”, “pollutant”, “deleterious substance”
or words of similar import under any Environmental Law, or the presence of which
in the environment is likely to affect adversely the quality of the environment
in any way.     (ii)   Environmental Claim includes a claim, notice,
administrative order, citation, complaint, summons, writ, proceeding or demand
relating to

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      remediation, investigation, monitoring, emergency response,
decontamination, restoration or other action under any Environmental Law or any
notice, claim, demand or other communication alleging or asserting liability,
either direct or indirect, and either in whole or by way of contribution or
indemnity, for investigatory, monitoring or cleanup costs, Governmental
Authority response costs, damages, personal injuries, fines, penalties or for
other relief, and arising out of, based on or resulting from (A) the presence,
or Release into the environment, of any Contaminant, or (B) any non-compliance
or alleged non-compliance with any Environmental Law.

  (iii)   Environmental Laws means all applicable statutes, regulations,
ordinances, by-laws, guidelines and codes and all international treaties and
agreements, now or hereafter in existence in Canada (whether federal, provincial
or municipal and whether or not having the force of law) relating to the
protection and preservation of the environment, occupational health and safety,
product safety, product liability or Contaminant, including the Environmental
Protection Act (Ontario), as amended from time to time, and the Canadian
Environmental Protection Act, as amended from time to time.     (iv)  
Environmental Permits includes all orders, permits, certificates, approvals,
consents, registrations and licences issued by any Governmental Authority.    
(v)   Property means the Leased Premises, the Corporation’s interest in the
Leases, and any real property now or previously owned or occupied by the
Corporation.     (vi)   Release means any release, spill, leak, emission,
pumping, injection, deposit, discharge, dispersal, leaching, migration,
spraying, abandonment, pouring, emptying, throwing, dumping, placing or
exhausting of a Contaminant, and when used as a verb has a like meaning.

  (b)   The operation of the business, the property and assets owned or used by
the Corporation and the use, maintenance and operation thereof have been and are
in compliance with all Environmental Laws. The Corporation has complied with all
reporting and monitoring requirements under all Environmental Laws. The
Corporation has not received any notice of any non-compliance with any
Environmental Laws, and the Corporation has not been convicted of an offence for
non-compliance with any Environmental Laws or been fined or otherwise sentenced
or settled such prosecution short of conviction since its formation.     (c)  
To the best of the Shareholders’ knowledge, there is no pending or threatened
Environmental Claim against the Corporation.

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  (d)   There are no Environmental Permits necessary to conduct the business of
the Corporation or to own, use and operate the Properties.     (e)   There are
no Contaminants located on or in the Property or assets owned or used by the
Corporation, and no Release of any Contaminant has occurred on or from the
Properties or has resulted from the operation of the business of the Corporation
and the conduct of any other activities of the Corporation. The Corporation has
not used any of its Property or assets to produce, generate, store, handle,
transport or dispose of any Contaminant and none of the Property has been or is
being used as a landfill or waste disposal site.     (f)   Without limiting the
generality of the foregoing, to the best of the Shareholders’ knowledge, there
are no underground or surface storage tanks or urea formaldehyde foam
insulation, asbestos, polychlorinated biphenyls or radioactive substances
located on or in any of the Properties. The Corporation is not, and there is no
basis upon which the Corporation could become, responsible for any clean-up or
corrective action under any Environmental Laws. The Corporation has not
conducted or caused to be conducted an environmental assessment or study of any
of the Properties or assets of the Corporation.     (g)   To the best of the
Shareholders’ knowledge, there are no pending or proposed changes to
Environmental Laws which would render illegal or restrict the manufacture or
sale of any products manufactured or sold or services provided by the
Corporation.

(6)   Personal Property. The Corporation is not the lessee of any personal or
movable property and is not a party to any conditional sale or other title
retention agreement.

(7)   Work Orders and Deficiencies. To the best of the Shareholders’ knowledge,
there are no outstanding work orders, non-compliance orders, deficiency notices
or other such notices relative to the Leased Premises or the other properties
and assets of the Corporation which have been issued by any police or fire
department, sanitation, environment, labour, health or other Governmental
Authorities. There are no matters under discussion with any such department or
authority relating to work orders, non-compliance orders, deficiency notices or
other such notices. The Corporation’s business is not being operated in a manner
which is in contravention of any statute, regulation, rule, code, standard,
policy or other Applicable Law.

(8)   Plants, Facilities and Equipment. To the best of the Shareholders’
knowledge, the buildings and structures comprising the Leased Premises, are free
of any material structural defect.

(9)   Intellectual Property. Schedule 5.4(9) lists and contains a description of
all of the Intellectual Property described in paragraphs (i) and (iii) of the
definition of Intellectual Property. The Intellectual Property constitutes all
of the Intellectual Property necessary for the conduct of the business of the
Corporation as presently conducted.

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  (a)   The Corporation has good and valid title to all of its Intellectual
Property, free and clear of any and all Encumbrances. No royalty or other fee is
required to be paid by the Corporation to any Person in respect of the use of
any of the Intellectual Property. The Corporation has registered its respective
rights in the Intellectual Property in the manner and to the extent described in
Schedule 5.4(9), and all registrations and applications for the Intellectual
Property registrations have been properly maintained and renewed by the
Corporation in accordance with all Applicable Laws in all jurisdictions where
the Corporation’s business is carried on. The Corporation has the exclusive
right to sell and use all of the Intellectual Property in all jurisdictions
where it carries on business. The Corporation has not granted any license or
other rights to any other Person in respect of the Intellectual Property.    
(b)   There are no restrictions on the ability of the Corporation to sell,
assign, convey, use or exploit all rights in the Intellectual Property in all
jurisdictions where its business is carried on or is contemplated to be carried
on. All statements contained in all applications for registration of the
Intellectual Property were true and correct as of the date of such applications.
Each of the trademarks and trade names included in the Intellectual Property is
in use. None of the rights of the Corporation in the Intellectual Property will
be impaired or affected in any way by the transactions contemplated by this
Agreement.     (c)   The conduct of the Corporation’s business and the use of
the Intellectual Property in connection therewith does not infringe, and none of
the Shareholders has received any notice, complaint, threat or claim alleging
infringement of, any patent, trade-mark, trade name, copyright, industrial
design, trade secret or other Intellectual Property or proprietary right of any
other Person, and the conduct of the Corporation’s business does not include any
activity which may constitute passing off.     (d)   The Corporation legally and
beneficially owns or is entitled to sell and use free of Encumbrances all of its
Intellectual Property and all processes, formulae, computer programs, product
formulations, product manufacturing instructions, technology, research and
development and know-how and other rights (including any applications for any of
the foregoing) that are necessary for the operation of its business as currently
conducted. Nothing has come to the attention of any of the Shareholders to the
effect that: (A) any product, licence, patent, process, method, substance, part
or other material currently being used or sold by the Corporation may infringe
on any rights owned, held or claimed by any other Person; (B) there is pending
or threatened any claim or litigation against the Corporation contesting the
right of the Corporation to use or sell any such product, licence, patent,
process, method, substance, part or material; (C) any product, licence, patent,
process, method, substance, part or material currently being used or sold by any
other Person may infringe any rights of the Corporation. No third party has any
right to disclosure or use of any proprietary technology or rights of the
Corporation used in its business, present or future.

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  (e)   None of the Shareholders is aware of any state of facts that casts doubt
on the validity or enforceability of any of the Intellectual Property.

5.5   Conduct of Business   (1)   Necessary Assets. None of the Shareholders,
nor any other Person, owns or leases any assets which are being used in or are
reasonably necessary to carry on the business or operations of the Corporation
in the normal course, except assets leased or licensed to the Corporation as
disclosed in this Agreement.   (2)   Restrictions on Doing Business. The
Corporation is not a party to or bound by any agreement or commitment which
would restrict or limit its rights to carry on or compete in any business or
activity or to solicit business from any Person or in any geographical area or
otherwise to conduct its business. The Corporation is not subject to any
legislation or any judgment, order or requirement of any court or Governmental
Authority which is not of general application to Persons carrying on a business
similar to the business of the Corporation.   5.6   General Matters   (1)  
Compliance with Constating Documents, Agreements and Laws. The execution,
delivery and performance of this Agreement and each of the other agreements
contemplated or referred to herein by the Shareholders and the Corporation, and
the completion of the Purchase, will not constitute or result in a violation or
breach of or default under, or cause the acceleration of any obligations under:

  (a)   any term or provision of the articles or by-laws of the Corporation;    
(b)   the terms of any agreement (written or oral), indenture, instrument or
understanding or other obligation or restriction to which the Corporation or any
of the Shareholders is a party or by which any of them is bound; or     (c)  
any term or provision of any of the Licences or Permits, any order of any court
or Governmental Authority or regulatory body or any Applicable Law of any
jurisdiction in which the Corporation’s business is carried on.

(2)   Government Assistance. There are no agreements, loans, other funding
arrangements and assistance programs (collectively, “Government Assistance
Programs”) which are outstanding in favour of the Corporation from any federal,
provincial, municipal or other Governmental Authority.

(3)   Compliance with Applicable Laws. The Corporation is not carrying on
business in violation of any Applicable Law relating to, without limitation, its
operations, products, manufacturing processes, advertising, sales practices,
which violation could reasonably be expected to have a material adverse effect
on the Corporation. For greater certainty, neither the Corporation nor any
director, officer, agent, employee or other person acting on behalf of the
Corporation has, in the course of his or her actions for, or on behalf of,

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    the Corporation, used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expenses relating to political activity;
made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; violated or is in
violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977; or
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or employee; or is
engaged in any unfair labour practices under Applicable Laws.

(4)   Litigation. There are no actions, suits or proceedings, judicial or
administrative (whether or not purportedly on behalf of the Corporation or any
of the Shareholders) pending or, to the best of the Shareholders’ knowledge,
threatened, by or against or affecting the Corporation, at law or in equity, or
before or by any court or any federal, provincial, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign. To the best of the Shareholders’ knowledge, there are no
grounds on which any such action, suit or proceeding might be commenced with any
reasonable likelihood of success. Without restricting the generality of the
foregoing, no claims have been asserted or made, and continue to be outstanding,
against the Corporation alleging any defect in the design, manufacture or
materials of any of its products.

SECTION 6
ACKNOWLEDGMENTS OF THE SHAREHOLDERS
     The Shareholders understand and acknowledge that they are acquiring the
Exchangeable Shares pursuant to an exemption from the requirements of the
Purchaser to provide the Shareholder with a prospectus and to issue the
Exchangeable Shares through a person registered to sell securities under the
securities laws of the jurisdiction in which the Shareholder is resident or is
otherwise subject to and, as a consequence:

  (a)   certain protections, rights and remedies provided by the Applicable
Laws, including Canadian statutory rights of rescission or damages, will not be
available to the Shareholders;     (b)   no securities commission or similar
regulatory authority has reviewed or passed on the merits of the Exchangeable
Shares;     (c)   there are risks associated with the purchase of the
Exchangeable Shares;     (d)   there are restrictions on the Shareholders’
ability to resell the Exchangeable Shares under applicable securities laws and
it is the responsibility of the Shareholders to find out what those restrictions
are and to comply with them before selling any of the Exchangeable Shares; and  
  (e)   the Corporation is relieved from certain obligations that would
otherwise apply under Applicable Law.

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SECTION 7
REPRESENTATIONS AND WARRANTIES OF NANG
     NANG represents and warrants to the Shareholders as stated below and
acknowledges that the Shareholders are relying on the accuracy of all such
representations and warranties in entering into this Agreement and completing
the Purchase.

7.1   Corporate Matters   (1)   Status. NANG is a corporation incorporated under
the laws of the State of Washington and has full corporate power and authority
to execute, deliver and perform its obligations under this Agreement and to
cause the Purchaser to consummate the Purchase. The Purchaser is a corporation
incorporated under the laws of Canada and has full corporate power and authority
to executive, deliver and perform its obligations under this Agreement.   (2)  
Due Authorization. The execution and delivery of this Agreement has been duly
and validly authorized by NANG and the Purchaser and no other corporate
proceedings on the part of NANG or the Purchaser are necessary to authorize this
Agreement, and the execution and delivery of this Agreement is within the powers
of NANG and the Purchaser without the need for any further sanction, approval,
licence or consent.   (3)   Enforceability. This Agreement has been duly and
validly executed and delivered by NANG and the Purchaser and is a valid and
legally binding agreement enforceable against each of them in accordance with
its terms, subject, as enforcement, to bankruptcy, insolvency and other laws
affecting creditors’ rights generally and to general principles of equity.   (4)
  Investments. Neither NANG nor the Purchaser owns, directly or indirectly, any
shares or other equity securities of any corporation or any equity or ownership
interest in any business or Person, other than the 100 common shares of PureRay
Holdings ULC issued and outstanding held by NANG. Neither NANG nor the Purchaser
is subject to any obligation or requirement to provide funds to or make any
investment in any business or Person by way of loan, capital contribution or
otherwise.   (5)   Corporate Records. The corporate records and minute books of
each of NANG and the Purchaser contain complete and accurate minutes of all
meetings of and corporate actions or written resolutions of the directors,
committees of directors and shareholders of NANG or the Purchaser, as the case
may be, including all by-laws and resolutions passed by the directors,
committees of directors and shareholders of NANG and the Purchaser, as the case
may be, since formation. All such meetings were duly called and held, all such
corporate actions and written resolutions were duly taken or validly signed and
all such by-laws and resolutions were duly passed. The share certificate books,
register of shareholders, register of transfers, register of directors and
similar corporate records of NANG and the Purchaser are complete, accurate and
current.

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(6)   Shareholders Agreements. There are no shareholders agreements, pooling
agreements, voting trusts or other similar agreements with respect to the
ownership or voting of any of the shares of NANG or the Purchaser, other than
those contemplated under this Agreement.   (7)   Licences and Permits. NANG
holds all licences, permits and authorizations requisite for, and has complied
with all Applicable Laws applicable to, the conduct of its business. All such
licences and permits are in good standing and in full force and effect.   (8)  
Operations and Assets. NANG has carried on business only in the State of
Washington. The Purchaser has not carried on business since formation.   (9)  
Reporting Company. NANG is subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and has a
class of securities registered under section 12 or section 15 of the Exchange
Act.   (10)   Corporate Condition. NANG has timely filed all forms, reports and
documents with the United States Securities and Exchange Commission required to
be filed by it under the Exchange Act through the date hereof (collectively, the
“SEC Reports”). Each of the SEC Reports, at the time filed, complied in all
material respects with the requirements of the Exchange Act. There have been no
material adverse changes in NANG’s business, operations or financial condition
since the date of the most recent SEC Report. The SEC Reports, together with
this Agreement, and any other documents listed herein and furnished by NANG to
the Shareholders are referred to collectively, at the “Disclosure Documents”.
The financial statements contained in the Disclosure Documents have been
prepared in accordance with generally accepted accounting principles,
consistently applied, and fairly present, in all material respects, the
consolidated financial position of NANG and the Purchaser as of the dates of the
balance sheets included therein, and the consolidated results of its operations
and cash flows for the periods then ended. Without limiting the foregoing, there
are no material liabilities, contingent or actual, that are not disclosed in the
Disclosure Documents (other than liabilities incurred by NANG in the ordinary
course of its business, consistent with its past practise, after the periods
covered by the Disclosure Documents).   7.2   Share Capital, Dividends and
Shares   (1)   Authorized and Issued Share Capital. The authorized capital of
NANG consists of 120,000,000 shares consisting of 100,000,000 shares of Common
Stock having a par value of $0.0001 per share and 20,000,000 shares of Preferred
Stock having a par value of $0.0001 per share (10,000,000 of which have been
designated as “Special Voting Stock”), of which 34,870,000 shares of Common
Stock and no shares of Preferred Stock have been duly issued and are outstanding
as fully paid and non-assessable shares of NANG. No Person has any option,
warrant, right, call, commitment, conversion right, right of exchange or other
agreement or any right or privilege (whether by law, pre-emptive or contractual)
capable of becoming an option, warrant, right, call, commitment, conversion
right, right of exchange or other agreement for the purchase, subscription,
allotment or issuance of any unissued shares or other securities of NANG.

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    The authorized capital of the Purchaser consists of an unlimited number of
common shares and an unlimited number of Exchangeable Shares, of which 100
common shares and no Exchangeable Shares have been duly issued and are
outstanding as fully paid and non-assessable shares of the Purchaser. Except for
the Shareholders rights under this Agreement, no Person has any option, warrant,
right, call, commitment, conversion right, right of exchange or other agreement
or any right or privilege (whether by law, pre-emptive or contractual) capable
of becoming an option, warrant, right, call, commitment, conversion right, right
of exchange or other agreement for the purchase, subscription, allotment of
issuance of any unissued shares or other securities of the Purchaser.   (2)  
Dividends. Neither NANG nor the Purchaser has, directly or indirectly,
authorized, declared or paid any dividends or declared or made any other
distribution or return of capital in respect of any of its shares of any class
and has not, directly or indirectly, redeemed, purchased or otherwise acquired
any of its shares of any class or agreed to do so.   (3)   Contractual and
Regulatory Approvals. Neither NANG nor the Purchaser is under any obligation,
contractual or otherwise, to request or obtain the consent or approval of any
Person, and no permits, licences, certifications, authorizations or approvals
of, or notifications to, any Governmental Authority are required to be obtained
by NANG or the Purchaser:

  (a)   by virtue of or in connection with the execution, delivery or
performance of this Agreement or the completion of any of the transactions
contemplated herein;     (b)   to avoid the loss of any licence or permit or
other authorization or the violation, breach or termination of, or any default
under, or the creation of any Encumbrance under the terms of, any Applicable
Law; or     (c)   in order that the authority and ability of NANG to carry on
its business in the ordinary course and in the same manner as presently
conducted remains in good standing and in full force and effect following the
Purchase.

7.3   Financial Matters   (1)   Books and Records. All material financial
transactions of NANG have been properly recorded in its books and records, which
have been maintained in accordance with GAAP and all other applicable legal and
accounting requirements and good business practice. Such books and records:

  (a)   accurately reflect the basis for the financial condition and the
revenues, expenses and results of operations of NANG shown in the NANG Financial
Statements; and     (b)   present fairly the financial condition and the
revenues, expenses and results of the operations of NANG as of and to the date
hereof.

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    No information, records, systems, controls or data pertaining to or required
for the operation or administration of NANG, are recorded, stored, maintained
by, or are otherwise dependent upon, any computerized or other system, program
or device that is not exclusively owned and controlled or leased by NANG.   (2)
  Financial Statements. The NANG Financial Statements have been prepared in
accordance with GAAP and present fairly the assets, liabilities (whether
accrued, absolute, contingent or otherwise) and financial condition of NANG as
at the applicable date provided thereon.   (3)   Liabilities of NANG. NANG does
not have any Liabilities (contingent or otherwise) of any kind whatsoever, and
there is no basis for any assertion against NANG of any Liabilities of any kind,
including liabilities relating to any failure to comply with product
specifications other than:

  (a)   the liabilities disclosed, reflected in or provided for in the NANG
Financial Statements; and     (b)   liabilities incurred since the formation of
NANG which were incurred in the ordinary course of business and, in the
aggregate, are not materially adverse to its business.

(4)   Product Guarantees, Warranties and Discounts.

  (a)   NANG has not given any guarantee or warranty in respect of any of the
products sold or the services provided by it, except warranties made in the
ordinary course of business and except for warranties implied by Applicable Law.
    (b)   No claim has been made against NANG for breach of warranty or contract
requirement or negligence or for a price adjustment or other concession in
respect of any defect in or failure to perform or deliver any product, service
or work.     (c)   NANG is not subject to any agreement or commitment to any
customer of its business which would require it to repurchase any products sold
to such customers or to adjust any price or grant any refund, discount or other
concession to such customer.     (d)   NANG is not required to provide any
letters of credit, bonds or other financial security arrangements in connection
with any transactions entered into as part of its business.

(5)   Accounts Receivable. All accounts receivable of NANG are reflected in the
NANG Financial Statements and all accounts receivable arising since the date of
the NANG Financial Statements arose from bona fide transactions in the ordinary
course of business, and all such accounts receivable owing to NANG are good,
valid and enforceable. Such accounts receivable are not subject to any defence,
set-off or counterclaim.

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(6)   Inventories. The inventories reflected in the NANG Financial Statements
conform in all material respects to applicable designs and specifications, are
free from material defects in workmanship and material, have been accurately
valued in accordance with GAAP, and the valuation thereof accurately reflects
inventory that is damaged, obsolete, defective, unsuitable for its intended use
or otherwise unsaleable in the ordinary course of business at normal prices. The
inventories are in good and merchantable condition and are usable or saleable in
the ordinary course of business for the purposes for which they are intended.

(7)   Debt Obligations. Except as disclosed in the NANG Financial Statements,
NANG does not have outstanding any bonds, debentures, mortgages, promissory
notes or other Indebtedness, is not under any obligation to create or issue any
bonds, debentures, mortgages, promissory notes or other Indebtedness maturing
more than one year after the date of creation or issue, and is not a party to or
bound by any Guarantee, indemnification, assumption or endorsement or any other
like commitment of the obligations, liabilities (contingent or otherwise) or
Indebtedness of any Person.

(8)   Absence of Certain Changes or Events. Except as disclosed in the NANG
Financial Statements, NANG has not:

  (a)   incurred any obligation or liability (fixed or contingent) or
Indebtedness, except normal trade or business obligations incurred in the
ordinary course of business, none of which is materially adverse to its
business;     (b)   paid or satisfied any obligations or liability (fixed or
contingent), except:

  (i)   current liabilities included in the NANG Financial Statements;     (ii)
  current liabilities incurred in the ordinary course of business; and     (iii)
  scheduled payments pursuant to obligations under loan agreements or other
contracts or commitments described in this Agreement;

  (c)   created any Encumbrance upon any of its properties or assets, except as
described in this Agreement;     (d)   sold, assigned, transferred, leased or
otherwise disposed of any of its properties or assets, except in the ordinary
course of business;     (e)   purchased, leased or otherwise acquired any
properties or assets, except in the ordinary course of business;     (f)  
waived, cancelled or written off any rights, claims, accounts receivable or any
amounts payable to it, except in the ordinary course of business;     (g)  
entered into any transaction, contract, agreement or commitment, except in the
ordinary course of business;

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  (h)   terminated, discontinued, closed or disposed of any plant, facility or
business operation;     (i)   made any material change in its method of billing
customers or the credit terms made available to its customers;     (j)   made
any material change with respect to any method of management, operation or
accounting in respect of its business;     (k)   suffered any damage,
destruction or loss (whether or not covered by insurance) which has materially
adversely affected or could materially adversely affect its business or its
financial condition;     (l)   suffered any extraordinary loss relating to its
business;     (m)   made or incurred any material change in, or become aware of
any event or condition which is likely to result in a material change in, its
business or its financial condition; or     (n)   authorized, agreed or
otherwise become committed to do any of the foregoing.

(9)   Tax Matters

  (a)   NANG has duly and on a timely basis prepared and filed all Tax Returns
and other documents required to be filed by it in respect of all Taxes, and such
Tax Returns and documents are complete and correct.     (b)   NANG has paid,
collected and remitted all Taxes which are due and payable, collectible or
remittable, as applicable, by it on or before the date hereof. Adequate
provision has been made in the NANG Financial Statements for all Taxes for the
periods covered by the NANG Financial Statements. NANG does not have any
liability for Taxes other than those provided for in the NANG Financial
Statements and those arising in the ordinary course of business.     (c)   There
are no actions, suits, proceedings, investigations, enquiries or claims now
pending or made or, to the best of the Shareholders’ knowledge, threatened
against NANG in respect of Taxes.     (d)   There are no agreements, waivers or
other arrangements providing for any extension of time with respect to the
filing of any Tax Return or other document or the payment of any Taxes by NANG
for any assessment or reassessment of Taxes.     (e)   NANG has withheld from
each amount paid or credited to any Person the amount of Taxes required to be
withheld therefrom and has remitted such Taxes to the proper Tax or other
Governmental Authorities within the time required under Applicable Law.

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7.4   Property   (1)   Title to Assets. NANG is the owner of and has good and
marketable title to all of its properties and assets, including all properties
and assets reflected in the NANG Financial Statements, free and clear of all
Encumbrances, except for:

  (a)   the Encumbrances disclosed or reflected in the NANG Financial
Statements; and     (b)   liens for Taxes not yet due and payable.

    No other Person owns any assets which are being used in the business of
NANG. There are no agreements or commitments to purchase property or assets by
NANG, other than in the ordinary course of business.   (2)   Real Properties.
NANG does not and never has owned or leased any real property.   7.5   Employees
  (1)   Employees. NANG does not and never has had any employees.   7.6  
General Matters   (1)   Compliance with Constating Documents, Agreements and
Laws. The execution, delivery and performance of this Agreement and each of the
other agreements contemplated or referred to herein by NANG or the Purchaser,
and the completion of the Purchase, will not constitute or result in a violation
or breach of or default under, or cause the acceleration of any obligations
under:

  (a)   any term or provision of the articles or by-laws of NANG or the
Purchaser;     (b)   the terms of any agreement (written or oral), indenture,
instrument or understanding or other obligation or restriction to which NANG or
the Purchaser is a party or by which any of them is bound; or     (c)   any term
or provision of any of the licences or permits, any order of any court or
Governmental Authority or regulatory body or any Applicable Law of any
jurisdiction in which NANG’s or the Purchaser’s business is carried on.

(2)   Government Assistance. There are no agreements, loans, other funding
arrangements and assistance programs which are outstanding in favour of NANG
from any federal, national, state, provincial, municipal or other Governmental
Authority.

(3)   Compliance with Applicable Laws. NANG is not carrying on business in
violation of any Applicable Law relating to, without limitation, its operations,
products, manufacturing processes, advertising, sales practices or product
safety, which violation could reasonably be expected to have a material adverse
effect on NANG. For greater certainty, neither NANG nor any director, officer,
agent, employee or other person acting on behalf of NANG has, in the course of
his or her actions for, or on behalf of, NANG,

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    used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expenses relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; violated or is in violation of any provision of
the U.S. Foreign Corrupt Practices Act of 1977; or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment to any foreign or
domestic government official or employee; or is engaged in any unfair labour
practices under Applicable Laws.

(4)   Litigation. There are no actions, suits or proceedings, judicial or
administrative (whether or not purportedly on behalf of NANG) pending or, to the
best of NANG’s knowledge, threatened, by or against or affecting NANG, at law or
in equity, or before or by any court or any federal, provincial, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign. To the best of NANG’s, there are no
grounds on which any such action, suit or proceeding might be commenced with any
reasonable likelihood of success. Without restricting the generality of the
foregoing, no claims have been asserted or made, and continue to be outstanding,
against NANG alleging any defect in the design, manufacture or materials of any
of its products.

SECTION 8
SURVIVAL AND INDEMNITY
8.1 Survival
     The representations, warranties and obligations contained in this Agreement
or in any document delivered hereunder shall survive the closing of the
transaction contemplated by this Agreement to the extent permitted under
Applicable Laws, provided that:

  (a)   the representations, warranties and obligations of the Shareholders
relating to any Tax liability shall terminate upon the expiration of the last to
expire of any time within which an assessment, reassessment or similar document
may be issued under applicable legislation;     (b)   the representations,
warranties and obligations of the Shareholders relating to title and any fraud
and/or intentional misrepresentation shall survive forever; and     (c)   all
other representations, warranties and obligations shall terminate upon the
expiration of two years from the Closing Date.

8.2 General Indemnity
     The Shareholders shall severally fully indemnify NANG and the Purchaser on
an after-Tax basis against:

  (a)   all loss, Liability and expense arising out of any misrepresentation or
breach of warranty of the Shareholders under this Agreement or obligation by the
Shareholders under this Agreement;

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  (b)   all Liabilities of the Corporation including Liabilities for any Taxes,

and such indemnity shall include, without limitation, reasonable expenses of
investigation fees for reports or opinions of experts, and legal fees and
expenses in connection with any action or proceeding against the Corporation,
NANG or the Purchaser. If the amount required to satisfy any claim so disclosed
or provided for shall exceed the amount so disclosed or provided for, the excess
shall be considered to be a separate liability in respect of which no disclosure
or provision has been made.

8.3   Notice and Participation

     NANG shall give the Shareholders prompt Notice of any loss, liability or
expense for which the Shareholders may be liable under this Section and the
Shareholders shall be entitled, at their expense, to participate in any
negotiations, to assume the defence of any action or proceeding and to settle
for monetary damages any claim in respect of which indemnification is sought
under this Section provided, however, that the failure to give prompt written
notice shall not affect the liability of the Indemnifying Party hereunder.
Neither the Shareholders nor NANG or the Purchaser shall settle or compromise
any such claim without the prior written consent of the other party.

8.4   Purchaser’s Indemnity

     NANG shall fully indemnify the Shareholders on an after-Tax basis against
any loss, liability or expense resulting from all loss, liability and expense
arising out of any misrepresentation or breach of warranty or covenant of NANG
or the Purchaser under this Agreement or the Purchaser pursuant to this Section.
SECTION 9
CLOSING
     Closing shall take place at the offices of Wildeboer Dellelce LLP located
in Toronto, Ontario, and the Shareholders shall deliver to the Purchaser
certificates for the Purchased Shares duly endorsed in blank for transfer
against delivery by the Purchaser to the Shareholders of certificates for the
Exchangeable Shares.
SECTION 10
MISCELLANEOUS

10.1   Further Assurances

     Each party shall from time to time promptly execute and deliver all further
documents and take all further action necessary or appropriate to give effect to
the provisions of this Agreement and to complete the Purchase.

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10.2   Expenses

     Each of the parties shall be responsible for their own fees and expenses
incurred in connection with the transactions contemplated in this Agreement.

10.3   Notice

     Unless otherwise specified, each Notice to a party must be given in writing
and delivered personally or by courier, sent by prepaid registered mail or
transmitted by fax to the party as follows:

  (a)   If to a Shareholder, to the address of such Shareholder set forth on the
signature page of this Agreement.     (b)   If to NANG or the Purchaser, to NANG
at:

         
 
  Address:   Suite 490,
 
      580 Hornby Street
 
      Vancouver, BC
 
      V6C 3B6
 
       
 
  Attention:   President
 
  Fax No:   604-687-3496

  (c)   If to the Corporation, to the Corporation at:

         
 
  Address:   Suite 310
 
      900 Greenbank Road
 
      Nepean, ON
 
      K2J 4P6
 
       
 
  Attention:   President
 
  Fax No:   888-385-2035
 
            with a copy to:
 
       
 
  Address:   Wildeboer Dellelce LLP
 
      Suite 800, Wildeboer Dellelce Place
 
      365 Bay Street
 
      Toronto, Ontario
 
      M5H 2V1
 
       
 
  Attention:   Rory Cattanach
 
  Facsimile No.:   (416) 361-1790

or to any other address, fax number or Person that the party designates. Any
Notice, if delivered personally or by courier, will be deemed to have been given
when actually received, if

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transmitted by fax before 3:00 p.m. on a Business Day, will be deemed to have
been given on that Business Day, and if transmitted by fax after 3:00 p.m. on a
Business Day, will be deemed to have been given on the Business Day after the
date of the transmission.

10.4   Time

     Time shall be of the essence of this Agreement.

10.5   Governing Law

     This Agreement shall be governed by and interpreted in accordance with the
laws of the Province of Ontario without regard to principles of conflicts of
law, and each of the parties irrevocably attorns to the non-exclusive
jurisdiction of the courts of Ontario.

10.6   Entire Agreement

     This Agreement constitutes the entire agreement between the parties with
respect to the subject matter and supersede all prior negotiations and
understandings, including the letter agreement dated April 28, 2008 between
NANG, Derek Blackburn, Mickael Joasil and the Corporation. No provision may be
amended or waived except in writing.

10.7   Severability

     Any provision of this Agreement which is invalid or unenforceable shall not
affect any other provision and shall be deemed to be severable.

10.8   Assignment and Enurement

     No party may assign this Agreement without the prior written consent of the
other parties. This Agreement enures to the benefit of and binds the parties and
their respective heirs, executors, administrators, personal and legal
representatives, successors and permitted assigns. For greater certainty, any
assignor of this Agreement shall continue to be bound by its terms.

10.9   Counterparts and Facsimile

     This Agreement and any amendment, supplement, restatement or termination of
any provision of this Agreement may be executed and delivered in any number of
counterparts, each of which when executed and delivered is an original but all
of which taken together constitute one and the same instrument. A party’s
transmission by facsimile of a copy of this Agreement duly executed by that
party shall constitute effective delivery by that party of an executed copy of
this Agreement to the party receiving the transmission.

10.10   Independent Legal Advice

     The parties hereto acknowledge that they have entered into this Agreement
willingly with full knowledge of the obligations imposed by the terms of this
Agreement. The parties to this Agreement by execution hereof, acknowledge that
they have been afforded the opportunity to obtain independent legal advice and
confirm by the execution hereof that they have either done

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- 33 -

     so or waived their right to do so and agree that this Agreement constitutes
a binding legal obligation and they are estopped from raising any claim on the
basis that they have not obtained such advice.
- SIGNATURE PAGES FOLLOW -

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     The parties have executed this Agreement as of the date first written
above.

              NORTH AMERICAN NATURAL GAS, INC.
 
       
 
  Per:   /s/ Jim Glavas
 
       
 
      Authorized Signatory
 
            PURERAY CORPORATION
 
       
 
  Per:   /s/ Derek Blackburn
 
       
 
      Authorized Signatory

                 
SIGNED, SEALED AND DELIVERED
    )          
     In the presence of:
    )          
 
    )                 )     /s/ Mickael Joasil               Witness (signature)
    )     Mickael Joasil
 
    )     Address:   Suite 310,
Witness Name (please print)
  )        900 Greenbank Road
 
    )         Nepean, ON K2J 4P6
 
    )     Fax:   888-385-2035
 
    )          
 
    )                 )     /s/ Derek Blackburn               Witness
(signature)     )     Derek Blackburn
 
    )     Address:   1388 River Road
 
    )         Manitock, ON K4M 1B4
Witness Name (please print)
               
 
    )     Fax:   888-366-9627
 
    )          
 
    )                 )     /s/ F.W.F. Robinson               Witness
(signature)     )     F.W.F. Robinson
 
    )     Address:   5851 Knights Drive
 
    )         Manitock, ON K4M 1K3
 
               
Witness Name (please print)
    )     Fax:   613-692-5495
 
    )          

- SIGNATURES CONTINUE ON THE NEXT PAGE -

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SIGNED, SEALED AND DELIVERED
    )          
     In the presence of:
    )          
 
    )                 )     /s/ Francis Donald O’Dea               Witness
(signature)     )     Francis Donald O’Dea, as trustee of       )     The O’Dea
Family Trust
 
    )     Address:   421 Lansdown Road North
 
    )         Ottawa, ON K1M 0X8
Witness Name (please print)
               

    )     Fax:   (613) 741-2039
 
    )          
 
    )                 )     /s/ Thomas J. Broeski               Witness
(signature)     )     Thomas J. Broeski
 
    )     Address:   32 Mount View Drive
 
    )         Afton, VA 22920
Witness Name (please print)
               
 
    )     Fax:   540-943-4178
 
    )          
 
    )                 )     /s/ Raj Kurichh               Witness (signature)  
  )     Raj Kurichh
 
    )     Address:   2009 Cherington Crescent
 
    )         Orleans, ON K4A 4Z8
Witness Name (please print)
               

    )     Fax:   613-841-9250
 
    )          
 
    )                 )     /s/ Megs Radiachy               Witness (signature)
    )     Megs Radiachy
 
    )          
Witness Name (please print)
                    )     /s/ Ramila Radiachy                     )     Ramila
Radiachy
 
    )     Address:   91 Baroness Drive
 
    )         Nepean, ON K2G 6S2
 
    )     Fax:   613-884-0427
 
    )          
 
    )                 )     /s/ Patrick Pierre               Witness (signature)
    )     Patrick Pierre
 
    )     Address:   P.O. Box 7883
 
    )         Naples, FL 34101
 
               
Witness Name (please print)
    )     Fax:   888-293-1114

- SIGNATURES CONTINUE ON THE NEXT PAGE -

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SIGNED, SEALED AND DELIVERED
    )          
In the presence of:
    )          
 
    )          
 
    )                 )     /s/ Matthew Sicoli              
Witness (signature)
    )                       Matthew Sicoli
 
          Address:   23 Eleanor Drive
 
              Ottawa, ON K2E 6A3
 
          Fax:   N/A

              KAIROS PARTNERS, LLC
 
       
 
  Per:   /s/ Jefrey M. Wallace
 
       
 
      (Authorized Signatory)
 
  Address:   Suite 600
 
      3625 Cumberland Blvd.
 
      Atlanta, GA 30339
 
  Fax:   678-202-8911

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              PURERAY ACQUISITION INC.
 
       
 
  Per:   /s/ Jim Glavas
 
       
 
      Authorized Signatory

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

 

 

Schedule 4.1

Purchasers and Purchased Shares

                      Number of Purchased   Non-Resident Name of Shareholder  
Shares   Shareholder
Mickael Joasil
    12,835,000       —  
Derek Blackburn
    12,835,000       —  
F.W.F. Robinson
    3,000,000       —  
Francis Donald O’Dea, as trustee of The O’Dea Family Trust
    1,000,000       —  
Kairos Partners, LLC
    5,355,000     Yes
Thomas J. Broeski
    250,000     Yes
Raj Kurichh
    50,000       —  
Megs Padiachy and Ramila Padiachy, jointly
    150,000       —  
Patrick Pierre
    200,000     Yes
Matthew Scioli
    180,000       —  
Total:
    35,855,000          

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Schedule 5.4(3)
Leases
The Corporation’s registered office is located at Suite 310, 900 Greenbank Road,
Nepean, Ontario. It maintains limited office space at such location on a
rent-free basis.
Also, the Corporation currently maintains limited office space at 3490 Piedmont
Road, Suite 1120, Atlanta, Georgia. Monthly rent at the rate of $4,500 is
payable until December, 2009.

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Schedule 5.4(9)
Intellectual Property

     
US Provisional Patent Application #60/943,166
  Self-Charging Light Bulb System
US Provisional Patent Application #60/911,158
  System for Recharging Battery-Operated Devices
US Provisional Patent Application #60/968,980
  System for Recharging Battery-Operated Devices
International Patent Application #PCT/CA2008/000687
  System for Recharging Battery-Operated Devices
US Non-Provisional Patent Application #12/100,030
  System for Recharging Battery Operated Devices
US Trademark Application 77400641
  PURERAY
US Trademark Application 77307618
  PURERAY

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Schedule A
Tax Escrow Agreement (form of)
ESCROW AGREEMENT
THIS ESCROW AGREEMENT made the ___day of
                                        , 2008.
AMONG:
PURERAY ACQUISITION INC., a corporation incorporated under the laws of Canada,
(the “Purchaser”)
AND:
[ • ], [an individual residing in the state of [ • ],
(the “Vendor”)
AND:
WILDEBOER DELLELCE LLP, a limited liability partnership established under the
laws of Ontario
(the “Escrow Agent”)
WHEREAS the Vendor and Purchaser are parties to a share purchase agreement dated
                                        , 2008 (the “Share Purchase Agreement”),
the Vendor and the Purchaser have agreed to enter into this agreement to provide
for the Purchaser’s obligations under section 3 of the Share Purchase Agreement
and to provide for the remittance to, and the holding and release by, the Escrow
Agent of certain Exchangeable Shares to be delivered by the Purchaser to the
Escrow Agent on the terms set out herein.
NOW, THEREFORE, THIS AGREEMENT WITNESSES as follows:

1.   Definitions   1.1   Unless the context otherwise requires or unless
otherwise defined herein, all capitalized terms used in this Escrow Agreement
shall have the meanings ascribed to them in the Share Purchase Agreement.   2.  
Delivery of Escrowed Shares   2.1   The Purchaser hereby delivers to the Escrow
Agent [ • ] Exchangeable Shares (the “Escrowed Shares”), which Exchangeable
Shares shall be held by the Escrow Agent pending release in accordance with, and
on the terms set out in, this Escrow Agreement.

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3.   Release of Escrowed Shares   3.1   The Escrow Agent shall hold the Escrowed
Shares deposited with it in trust to be released by the Escrow Agent only on the
following terms:

  (1)   the Vendor shall deliver to the Purchaser as soon as practicable
following the date of this agreement a tax clearance certificate issued pursuant
to section 116 of the Income Tax Act (Canada) (each a “Section 116 Certificate”)
with an aggregate certificate limit at least equal to the amount of the Purchase
Price multiplied by the number of PureRay Shares purchased from the Vendor (the
“Non-Resident Total Purchase Price”) and expressed in Canadian dollars;     (2)
  the Vendor agrees at Closing, to deliver the Escrowed Shares along with an
executed power of attorney to the Escrow Agent with instructions that the Escrow
Agent (i) hold the Escrowed Shares in escrow and (ii) release the Escrowed
Shares from escrow in accordance with the terms of the Share Purchase Agreement
and this Agreement;     (3)   if on or before the twenty-eighth day of the month
following the calendar month in which the Closing occurs (the “Remittance Date”)
the Purchaser receives from the Vendor a Section 116 Certificate with an
aggregate certificate limit at least equal to the amount of the Non-Resident
Total Purchase Price paid to the Vendor expressed in Canadian dollars, the
Purchaser shall, immediately after receipt of such Section 116 Certificate,
cause the Escrow Agent to deliver to the Vendor the Escrowed Shares;     (4)  
in the event that on or before the Remittance Date, the Purchaser does not
receive the Section 116 Certificate or receives a Section 116 Certificate with a
certificate limit that is less than the Non-Resident Total Purchase Price then,
unless the Canada Revenue Agency shall have issued a letter confirming that the
Canada Revenue Agency will not require the remittance of funds as is normally
required under subsection 116(5) of the Income Tax Act (Canada) and that the
Purchaser may delay the remittance of amounts in respect of the purchase of the
PureRay Shares until further instructed by the Canada Revenue Agency (a “Comfort
Letter”), the Escrow Agent shall deliver the Escrowed Shares to the Purchaser
and the Purchaser, as agent for the Vendor, shall sell or otherwise dispose,
outside the United States in compliance with Rule 903 of Regulation S under the
1933 Act and in compliance with applicable Canadian securities laws, of such
portion of the Escrowed Shares as is necessary to provide sufficient funds to
the Purchaser to enable it to comply with such deduction or withholding
requirement and the Purchaser shall notify the Vendor thereof and remit to the
Vendor any unapplied balance of the net proceeds of such sale, and the balance,
if any, of the Escrowed Shares. If the proceeds of such sale are insufficient to
fund the required withholding, the Vendor shall forthwith pay to the Purchaser
or remit to the applicable taxing authority the deficiency. The Vendor shall
bear all reasonable costs and expenses associated with any sale by the Purchaser
pursuant to the two immediately preceding sentences; and

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  (5)   if the Canada Revenue Agency has provided a Comfort Letter, the Escrow
Agent shall not deliver the Escrowed Shares to the Purchaser on the date that
would otherwise be the Remittance Date and if the relevant Section 116
Certificate is received while the Comfort Letter remains in effect, with an
aggregate certificate limit at least equal to the Purchase Price in Canadian
dollars, or if proof, in the Purchaser’s sole discretion, is provided that the
appropriate remittances have been made to the Canada Revenue Agency, the Escrow
Agent shall, promptly after receipt of such certificate or proof of remittance,
deliver to the Vendor the Escrowed Shares. If notification from the Canada
Revenue Agency is received that the Comfort Letter is no longer in effect, such
date of receipt shall be deemed to be the Remittance Date for the purposes of
this Section 3.1(e).

3.2   Without restricting the generality of section 3.1(e), the Vendor shall
indemnify, hold harmless and defend the Purchaser and the Escrow Agent from and
against any and all actions, causes of action, claims, demands, damages, losses,
costs, liabilities, expenses, taxes and penalties, and any interest thereon, of
any nature or kind, including reasonable legal fees, which may be made or
brought against the Purchaser or the Escrow Agent or which the Purchaser or
Escrow Agent may suffer or incur as a result of or in respect of any reliance on
a Comfort Letter. The obligation of the Vendor pursuant to this section 3.2
shall terminate effective as and from the date upon which the Escrow Agent
receives a Section 116 Certificate in form and content satisfactory to the
Escrow Agent (acting in its capacity as the Purchaser’s solicitors) and showing
a certificate limit or proceeds of disposition in an amount not less than the
Purchase Price.   4.   Escrow Agent   4.1   The acceptance by the Escrow Agent
of its duties under this Escrow Agreement is subject to the following terms and
conditions which shall govern and control the rights, duties, liabilities and
immunities of the Escrow Agent:

  (a)   The Escrow Agent is not a party to, and is not bound by, any agreement
which may be evidenced by, or arising out of, the foregoing instructions, other
than as expressly set forth herein.     (b)   The Escrow Agent shall be
protected in acting upon any written notice, declaration, request, waiver,
consent, receipt or other paper or document which the Escrow Agent in good faith
believes to be genuine and what it purports to be.     (c)   The Escrow Agent
shall not be required to determine the authenticity of signatures or the power
and authority of any signatory to execute such confirmation, instruction or
order and will be entitled to assume the authorization, due execution, validity
and effectiveness of the same.     (d)   The Escrow Agent shall not be liable
for any error of judgment, or for any act done or step taken or omitted by it in
good faith, or for any mistake of fact or law, or for anything which it may do
or refrain from doing in connection herewith, except for its own negligence or
wilful misconduct.

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  (e)   The Escrow Agent shall incur no liability hereunder or in connection
herewith for anything whatsoever other than as a result of its own negligence or
wilful misconduct. The Vendor and the Purchaser shall, jointly and severally,
indemnify, hold harmless and defend the Escrow Agent from and against any and
all actions, causes of action, claims, demands, damages, losses, costs,
liabilities and expense, of any nature or kind including reasonable legal fees,
which may be made or brought against it or which it may suffer or incur as a
result of or in respect of or arising out of this Agreement or the Escrow
Agent’s duties and responsibilities hereunder, except such as shall result
solely and directly from its own gross negligence or wilful misconduct.     (f)
  In the event of any disagreement between any of the parties hereto resulting
in adverse claims or demands with respect to the Escrowed Shares, the Escrow
Agent shall be entitled, at its option, to refuse to comply with any claims or
demands on it with respect thereto as long as such disagreement shall continue,
and in so refusing, the Escrow Agent may elect to make no delivery of Escrowed
Shares. In so doing, the Escrow Agent shall not be or become liable in any way
to the parties hereto for its failure or refusal to comply with such claims or
demands. The Escrow Agent shall be entitled to refrain from acting or refusing
to act until such claims or demands (i) shall have been finally determined in a
court of competent jurisdiction, or (ii) shall have been settled by agreement
and the Escrow Agent shall have been notified thereof by the Vendor and the
Purchaser in writing.     (g)   The Escrow Agent may pay the Escrowed Shares
into court in the Province of Ontario for a determination by such court as to
the entitlement to the Escrowed Shares at any time and the Escrow Agent shall
thereupon be released from any obligation hereunder.     (h)   The Escrow Agent
may employ such counsel and advisers as it may reasonably require for the
purpose of discharging its duties under this Escrow Agreement and the Escrow
Agent may act and shall be protected in acting in good faith on the opinion or
advice of or information obtained from any such counsel or adviser in relation
to any matter arising under this Escrow Agreement.     (i)   Nothing in acting
as Escrow Agent hereunder shall preclude the Escrow Agent from acting, in any
manner, as counsel to the Purchaser in connection with any matter or dispute,
including disputes pertaining to the Share Purchase Agreement or this Escrow
Agreement and the Vendor agrees that it will not raise any objection in any
forum to the Escrow Agent acting as counsel to the Purchaser.     (j)   The
Escrow Agent may resign at any time as Escrow Agent upon written notice to the
Purchaser and the Vendor and appointment of a replacement escrow agent by the
Escrow Agent, which shall be a trust company duly licensed in the Province of
Ontario.     (k)   The Escrow Agent shall not have any duties or
responsibilities except as set out in this Escrow Agreement.

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  (l)   The Vendor shall pay all of the fees, costs and expenses of the Tax
Escrow Agent for its services provided hereunder.

4.2   Any notices required or permitted to be given under the terms of this
Escrow Agreement shall be sufficiently given if delivered by hand, e-mail or by
fax to the parties at their following respective addresses:       To the Vendor:

§
Attention: §
Fax:            §
Email:         §
     To the Purchaser:
§
Attention: §
Fax:            §
Email:         §
     To the Escrow Agent:
Wildeboer Dellelce LLP
Suite 800, Wildeboer Dellelce Place
365 Bay Street
Toronto Ontario, M5H 2V1
Attention: Kevin Fritz
Fax: (416) 361-1790
Email: kfritz@wildlaw.ca
Any notice personally delivered before 4:30 p.m. local time at the place of
delivery on a business day shall be deemed to have been received and given on
the day of delivery and any notice personally delivered after 4:30 p.m. local
time at the place of delivery shall be deemed to have been received and given on
the next following business day. Any notice mailed as aforesaid shall be deemed
to have been received and given 6 clear days after the day it is mailed, unless
there is a postal strike or other disruption affecting mail delivery, in which
event the notice shall be deemed to have been received and given when it is
actually received. Any notice transmitted by facsimile before 4:30 p.m. local
time on a business day at the place to which it is sent shall be deemed to have
been received and given on the day of transmission and any notice transmitted by
facsimile after 4:30 p.m. local time at the place to which it is sent shall be
deemed to have been received and given on the next following business day.

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5.   General   5.1   This Escrow Agreement shall enure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns.  
5.2   Time shall be of the essence hereof.   5.3   This Escrow Agreement shall
be governed by and construed in accordance with the laws of the Province of
Ontario and the laws of Canada applicable therein.   5.4   This Escrow Agreement
may be executed by facsimile or otherwise in one or more counterparts, each of
which shall constitute an original and all of which taken together shall
constitute one and the same instrument.

[the next page is the signing page]

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     IN WITNESS WHEREOF the parties have duly executed this Escrow Agreement on
the date first set forth above.

       
 
)    
 
)    
 
   
Witness
)    
 
)    
 
)    

            PURERAY ACQUISITION INC.
      By:           Name:           Title:        

            WILDEBOER DELLELCE LLP
      By:           Name:           Title: