STOCK PURCHASE AGREEMENT
Agreement dated as of March 5, 2000 between Tianrong Building Material
Holdings, Ltd., a Utah corporation ("TNRG"), on the one hand, and MAS
Capital Inc. ("MASC").
1. THE ACQUISITION.
1.1 Purchase and Sale Subject to the Terms and Conditions of this Agreement.
At the Closing to be held as provided in Section 2, MASC shall sell the MAS
XVIII Shares (defined below) to TNRG, free and clear of all Encumbrances other
than restrictions imposed by Federal and State securities laws.
1.2 Purchase Price. TNRG will pay $200,000 cash to MASC for 8,250,000 shares
of MAS Acquisition XVIII Corp. ("MAS XVIII"), representing approximately 96.8%
of the issued and outstanding common shares of MAS XVIII (the "MAS XVIII
Shares").
2. THE CLOSING.
2.1 Place and Time. The closing of the sale the MAS XVIII Shares (the
"Closing") shall take place at the office of MAS Acquisition XVIII Corp., 1710
E. Division St., Evansville, IN 47711 no later than the close of business
(Central time) on or before March 6, 2000 or at such other place, date and time
as the parties may agree in writing.
2.2 Deliveries by MASC. At the Closing, the MASC shall deliver the following
to TNRG:
1. Certificates representing the MAS XVIII Shares, duly endorsed for
transfer to TNRG and accompanied by appropriate guaranteed stock powers; MASC
shall immediately change those certificates for, and to deliver to TNRG at the
Closing, a certificate representing the MAS XVIII Shares registered in the name
of TNRG (without any legend or other reference to any Encumbrance other than
appropriate federal securities law limitations).
2. The documents contemplated by Section 3.
3. All other documents, instruments and writings required by this
Agreement to be delivered by MASC at the Closing and any other documents or
records relating to MAS XVIII's business reasonably requested by TNRG in
connection with this Agreement.
2.3 Deliveries by TNRG. At the Closing, TNRG shall deliver the following to
MASC:
a. $200,000 cash by wire transfer to the account of MASC contemplated by
section 1.
2. The documents contemplated by Section 4.
3. All other documents, instruments and writings required by this
Agreement to be delivered by TNRG at the Closing.
3. CONDITIONS TO TNRG'S OBLIGATIONS.
The obligations of TNRG to effect the Closing shall be subject to the
satisfaction at or prior to the Closing of the following conditions, any one or
more of which may be waived by TNRG:
3.1 No Injunction. There shall not be in effect any injunction, order or
decree of a court of competent jurisdiction that prevents the consummation of
the transactions contemplated by this Agreement, that prohibits TNRG's
acquisition of the MAS XVIII Shares or that will require any divestiture as a
result of TNRG's acquisition of the MAS XVIII Shares or that will require all or
any part of the business of TNRG to be held separate and no litigation or
proceedings seeking the issuance of such an injunction, order or decree or
seeking to impose substantial penalties on TNRG or MAS XVIII if this Agreement
is consummated shall be pending.
3.2 Representations, Warranties and Agreements. (a) The representations and
warranties of MASC set forth in this Agreement shall be true and complete in all
material respects as of the Closing Date as though made at such time, and (b)
MASC shall have performed and complied in all material respects with the
agreements contained in this Agreement required to be performed and complied
with by it at or prior to the Closing.
3.3 Regulatory Approvals. All licenses, authorizations, consents, orders and
regulatory approvals of Governmental Bodies necessary for the consummation of
TNRG's acquisition of the MAS XVIII Shares shall have been obtained and shall be
in full force and effect.
3.4 Resignations of Director. Effective on the Closing Date, all of officers
and directors shall have resigned as an officer, director and employee of MAS
XVIII.
4. CONDITIONS TO MASC'S OBLIGATIONS.
The obligations of MASC to effect the Closing shall be subject to the
satisfaction at or prior to the Closing of the following conditions, any one or
more of which may be waived by MASC:
4.1 No Injunction. There shall not be in effect any injunction, order or
decree of a court of competent jurisdiction that prevents the consummation of
the transactions contemplated by this Agreement, that prohibits TNRG's
acquisition of the MAS XVIII Shares or that will require any divestiture as a
result of TNRG's acquisition of the MAS XVIII Shares or that will require all or
any part of the business of TNRG or MAS XVIII to be held separate and no
litigation or proceedings seeking the issuance of such an injunction, order or
decree or seeking to impose substantial penalties on TNRG or MAS XVIII if this
Agreement is consummated shall be pending.
4.2 Representations, Warranties and Agreements. (a) The representations and
warranties of TNRG set forth in this Agreement shall be true and complete in all
material respects as of the Closing Date as though made at such time, and (b)
TNRG shall have performed and complied in all material respects with the
agreements contained in this Agreement required to be performed and complied
with by it at or prior to the Closing.
4.3 Regulatory Approvals. All licenses, authorizations, consents, orders and
regulatory approvals of Governmental Bodies necessary for the consummation of
TNRG's acquisition of the MAS XVIII Shares shall have been obtained and shall be
in full force and effect.
5. REPRESENTATIONS AND WARRANTIES OF MASC.
MASC represents and warrants to TNRG that, to the knowledge of MASC, and
except as set forth in an MAS XVIII Disclosure Letter:
5.1 Authorization. MASC is a corporation duly organized, validly existing
and in good standing under the laws of the state of Indiana. This Agreement
constitutes a valid and binding obligation of MASC, enforceable against it in
accordance with its terms.
5.2 Capitalization. The authorized capital stock of MAS XVIII consists of
80,000,000 authorized shares of stock, par value $.001, and 20,000,000 preferred
shares, par value $.001, of which 8,519,900 common shares are presently issued
and outstanding. No shares have been registered under state or federal
securities laws. As of the Closing Date there will not be outstanding any
warrants, options or other agreements on the part of MAS XVIII obligating MAS
XVIII to issue any additional shares of common or preferred stock or any of its
securities of any kind.
5.3 Ownership of MAS XVIII Shares. The delivery of certificates to TNRG
provided in Section 2.2 will result in TNRG's immediate acquisition of record
and beneficial ownership of the MAS XVIII Shares, free and clear of all
Encumbrances subject to applicable State and Federal securities laws.
5.4 Consents and Approvals of Governmental Authorities. Except with respect
to applicable State and Federal securities laws, no consent, approval or
authorization of, or declaration, filing or registration with, any Governmental
Body is required to be made or obtained by MAS XVIII or TNRG or any of its
Subsidiaries in connection with the execution, delivery and performance of this
Agreement by MAS XVIII or the consummation of the sale of the MAS XVIII Shares
to TNRG.
5.5 Financial Statements. MAS XVIII has delivered to TNRG the balance sheet
of MAS XVIII as at June 30, 1998 and June 30, 1999, and statements of income and
changes in financial position for the fiscal years then ended and the period
from inception to the period then ended, together with the report thereon of MAS
XVIII's independent accountant (the "MAS XVIII Financial Statements"). The MAS
XVIII Financial Statements are accurate and complete in accordance with
generally accepted accounting principles. The independent accountants for MAS
XVIII will furnish any and all work papers required by TNRG and will sign any
and all consent required to be signed to include the financial statements of
TNRG in any subsequent filing by TNRG.
5.6 Litigation. There is no action, suit, inquiry, proceeding or
investigation by or before any court or Governmental Body pending or threatened
in writing against or involving MAS XVIII which is likely to have a material
adverse effect on the business or financial condition of MAS XVIII.
5.7 Absence of Certain Changes. Since the date of the MAS XVIII Financial
Statements, MAS XVIII has not:
1. suffered the damage or destruction of any of its properties or assets
(whether or not covered by insurance) which is materially adverse to the
business or financial condition of MAS XVIII or made any disposition of any of
its material properties or assets other than in the ordinary course of business;
2. made any change or amendment in its certificate of incorporation or
by-laws, or other governing instruments;
3. issued or sold any Equity Securities or other securities, acquired,
directly or indirectly, by redemption or otherwise, any such Equity Securities,
reclassified, split-up or otherwise changed any such Equity Security, or granted
or entered into any options, warrants, calls or commitments of any kind with
respect thereto;
4. organized any new Subsidiary or acquired any Equity Securities of any
Person or any equity or ownership interest in any business;
5. borrowed any funds or incurred, or assumed or become subject to,
whether directly or by way of guarantee or otherwise, any obligation or
liability with respect to any such indebtedness for borrowed money;
6. paid, discharged or satisfied any material claim, liability or
obligation (absolute, accrued, contingent or otherwise), other than in the
ordinary course of business;
7. prepaid any material obligation having a maturity of more than 90
days from the date such obligation was issued or incurred;
8. canceled any material debts or waived any material claims or rights,
except in the ordinary course of business;
9. disposed of or permitted to lapse any rights to the use of any
material patent or registered trademark or copyright or other intellectual
property owned or used by it;
10. granted any general increase in the compensation of officers or
employees (including any such increase pursuant to any employee benefit plan);
11. purchased or entered into any contract or commitment to purchase any
material quantity of raw materials or supplies, or sold or entered into any
contract or commitment to sell any material quantity of property or assets,
except (i) normal contracts or commitments for the purchase of, and normal
purchases of, raw materials or supplies, made in the ordinary course business,
(ii) normal contracts or commitments for the sale of, and normal sales of,
inventory in the ordinary course of business, and (iii) other contracts,
commitments, purchases or sales in the ordinary course of business;
12. made any capital expenditures or additions to property, plant or
equipment or acquired any other property or assets (other than raw materials and
supplies) at a cost in excess of $100,000 in the aggregate;
13. written off or been required to write off any notes or accounts
receivable in an aggregate amount in excess of $2,000;
14. written down or been required to write down any inventory in an
aggregate amount in excess of $ 2,000;
15. entered into any collective bargaining or union contract or
agreement; or
16. other than the ordinary course of business, incurred any liability
required by generally accepted accounting principles to be reflected on a
balance sheet and material to the business or financial condition of MAS XVIII.
5.8 No Material Adverse Change. Since the date of the MAS XVIII Financial
Statements, there has not been any material adverse change in the business or
financial condition of MAS XVIII.
5.9 Brokers or Finders. MASC has not employed any broker or finder or
incurred any liability for any brokerage or finder's fees or commissions or
similar payments in connection with the sale of the MAS XVIII Shares to TNRG.
6. REPRESENTATIONS AND WARRANTIES OF TNRG.
TNRG represents and warrants to MASC that, to the Knowledge of TNRG
(which limitation shall not apply to Section 6.3). Such representations and
warranties shall survive the Closing for a period of two years.
6.1 Organization of TNRG; Authorization. TNRG is a corporation duly
organized, validly existing and in good standing under the laws of Utah with
full corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder. The execution, delivery and performance of
this Agreement have been duly authorized by all necessary corporate action of
TNRG and this Agreement constitutes a valid and binding obligation of TNRG;
enforceable against it in accordance with its terms.
6.2 No Conflict as to TNRG and Subsidiaries. Neither the execution and
delivery of this Agreement will (a) violate any provision of the certificate of
incorporation or by-laws (or other governing instrument) of TNRG or any of its
Subsidiaries or (b) violate, or be in conflict with, or constitute a default (or
an event which, with notice or lapse of time or both, would constitute a
default) under, or result in the termination of, or accelerate the performance
required by, or excuse performance by any Person of any of its obligations
under, or cause the acceleration of the maturity of any debt or obligation
pursuant to, or result in the creation or imposition of any Encumbrance upon any
property or assets of TNRG or any of its Subsidiaries under, any material
agreement or commitment to which TNRG or any of its Subsidiaries is a party or
by which any of their respective property or assets is bound, or to which any of
the property or assets of TNRG or any of its Subsidiaries is subject, or (c)
violate any statute or law or any judgment, decree, order, regulation or rule of
any court or other Governmental Body applicable to TNRG or any of its
Subsidiaries except, in the case of violations, conflicts, defaults,
terminations, accelerations or Encumbrances described in clause (b) of this
Section 6.4, for such matters which are not likely to have a material adverse
effect on the business or financial condition of TNRG and its Subsidiaries,
taken as a whole.
6.3 Consents and Approvals of Governmental Authorities. No consent, approval
or authorization of, or declaration, filing or registration with, any
Governmental Body is required to be made or obtained by TNRG or any of either of
their Subsidiaries in connection with the execution, delivery and performance of
this Agreement by TNRG.
6.4 Other Consents. No consent of any Person is required to be obtained by
MAS XVIII or TNRG to the execution, delivery and performance of this Agreement
including, but not limited to, consents from parties to leases or other
agreements or commitments, except for any consent which the failure to obtain
would not be likely to have a material adverse effect on the business and
financial condition of MAS XVIII or TNRG.
6.5 Financial Statements. After closing, TNRG ackwledge and agrees that
within 60 days from the effective date of this agreement, TNRG shall have file
on Form 8-K which includes two years of audited and unaudited consolidated
financial statements of TNRG. Such TNRG Financial Statements and notes shall
fairly present the financial condition and results of operations of TNRG and its
Subsidiaries as at the respective dates thereof and for the periods therein
referred to, all in accordance with generally accepted United States accounting
principles consistently applied throughout the periods involved, except as set
forth in the notes thereto, and shall be utilizable in any SEC filing in
compliance with Rule 310 of Regulation S-B promulgated under the Securities Act.
6.6 Brokers or Finders. TNRG has not employed any broker or finder or
incurred any liability for any brokerage or finder's fees or commissions or
similar payments in connection with the purchase of the MAS XVIII Shares.
6.7 Purchase for Investment. TNRG is purchasing the MAS XVIII Shares solely
for its own account for the purpose of investment and not with a view to, or for
sale in connection with, any distribution of any portion thereof in violation of
any applicable securities law.
7. ACCESS AND REPORTING; FILINGS WITH GOVERNMENTAL AUTHORITIES; OTHER COVENANTS.
7.1 Access Between the date of this Agreement and the Closing Date. Each of
MASC and TNRG shall (a) give to the other and its authorized representatives
reasonable access to all plants, offices, warehouse and other facilities and
properties of MAS XVIII or TNRG, as the case may be, and to its books and
records, (b) permit the other to make inspections thereof, and (c) cause its
officers and its advisors to furnish the other with such financial and operating
data and other information with respect to the business and properties of such
party and its Subsidiaries and to discuss with such and its authorized
representatives its affairs and those of its Subsidiaries, all as the other may
from time to time reasonably request.
7.2 Regulatory Matters. MASC and TNRG shall (a) file with applicable
regulatory authorities any applications and related documents required to be
filed by them in order to consummate the contemplated transaction and (b)
cooperate with each other as they may reasonably request in connection with the
foregoing.
8. CONDUCT OF MAS XVIII'S BUSINESS PRIOR TO THE CLOSING. MASC shall use its best
efforts to ensure the following:
8.1 Operation in Ordinary Course. Between the date of this Agreement and the
Closing Date, MAS XVIII shall cause conduct its businesses in all material
respects in the ordinary course.
8.2 Business Organization. Between the date of this Agreement and the
Closing Date, MAS XVIII shall (a) preserve substantially intact the business
organization of MAS XVIII; and (b) preserve in all material respects the present
business relationships and good will of MAS XVIII.
8.3 Corporate Organization. Between the date of this Agreement and the
Closing Date, MAS XVIII shall not cause or permit any amendment of its
certificate of incorporation or by-laws (or other governing instrument) and
shall not:
1. issue, sell or otherwise dispose of any of its Equity Securities, or
create, sell or otherwise dispose of any options, rights, conversion rights or
other agreements or commitments of any kind relating to the issuance, sale or
disposition of any of its Equity Securities;
2. create or suffer to be created any Encumbrance thereon, or create,
sell or otherwise dispose of any options, rights, conversion rights or other
agreements or commitments of any kind relating to the sale or disposition of any
Equity Securities;
3. reclassify, split up or otherwise change any of its Equity
Securities; be party to any merger, consolidation or other business combination;
4. sell, lease, license or otherwise dispose of any of its properties or
assets (including, but not limited to rights with respect to patents and
registered trademarks and copyrights or other proprietary rights), in an amount
which is material to the business or financial condition of MAS XVIII except in
the ordinary course of business; or
5. organize any new Subsidiary or acquire any Equity Securities of any
Person or any equity or ownership interest in any business.
8.4 Other Restrictions. Between the date of this Agreement and the Closing
Date, MAS XVIII shall not:
1. borrow any funds or otherwise become subject to, whether directly or
by way of guarantee or otherwise, any indebtedness for borrowed money;
2. create any material Encumbrance on any of its material properties or
assets;
3. increase in any manner the compensation of any director or officer or
increase in any manner the compensation of any class of employees;
4. create or materially modify any material bonus, deferred
compensation, pension, profit sharing, retirement, insurance, stock purchase,
stock option, or other fringe benefit plan, arrangement or practice or any other
employee benefit plan (as defined in section 3(3) of ERISA);
5. make any capital expenditure or acquire any property or assets;
6. enter into any agreement that materially restricts TNRG, MAS XVIII or
any of their Subsidiaries from carrying on business;
7. pay, discharge or satisfy any material claim, liability or
obligation, absolute, accrued, contingent or otherwise, other than the payment,
discharge or satisfaction in the ordinary course of business of liabilities or
obligations reflected in the MAS XVIII Financial Statements or incurred in the
ordinary course of business and consistent with past practice since the date of
the MAS XVIII Financial Statements; or
8. cancel any material debts or waive any material claims or rights.
9. DEFINITIONS.
As used in this Agreement, the following terms have the meanings
specified or referred to in this Section 9.
9.1 "Business Day" = Any day that is not a Saturday or Sunday or a day on
which banks located in the City of New York are authorized or required to be
closed.
9.2 "Code" = The Internal Revenue Code of 1986, as amended.
9.3 "Encumbrances" = Any security interest, mortgage, lien, charge, adverse
claim or restriction of any kind, including, but not limited to, any restriction
on the use, voting, transfer, receipt of income or other exercise of any
attributes of ownership, other than a restriction on transfer arising under
Federal or state securities laws.
9.4 "Equity Securities" = See Rule 3aB11B1 under the Securities Exchange Act
of 1934.
9.5 "ERISA" = The Employee Retirement Income Security Act of 1974, as
amended.
9.6 "Governmental Body" = Any domestic or foreign national, state or
municipal or other local government or multi-national body (including, but not
limited to, the European Economic Community), any subdivision, agency,
commission or authority thereof.
9.7 "Knowledge" = Actual knowledge, after reasonable investigation.
9.8 "Person" = Any individual, corporation, partnership, joint venture,
trust, association, unincorporated organization, other entity, or Governmental
Body.
9.9 "Subsidiary" = With respect to any Person, any corporation of which
securities having the power to elect a majority of that corporation's Board of
Directors (other than securities having that power only upon the happening of a
contingency that has not occurred) are held by such Person or one or more of its
Subsidiaries.
10. TERMINATION.
10.1 Termination. This Agreement may be terminated before the Closing occurs
only as follows:
1. By MASC at any time on or after March 8, 2000, if $200,000 cash is
not received by MASC at MASC's account.
2. By TNRG, by notice to MASC at any time, if one or more of the
conditions
specified in Section 3 is not satisfied at the time at which the Closing (as it
may be deferred pursuant to Section 2.1) would otherwise occur or if
satisfaction of such a condition is or becomes impossible.
3. By MASC, by notice to TNRG at any time, if one or more of the
conditions specified in Section 4 is not satisfied at the time at which the
Closing (as it may be deferred pursuant to Section 2.1), would otherwise occur
of if satisfaction of such a condition is or becomes impossible.
10.2 Effect of Termination. If this Agreement is terminated pursuant to
Section 10.1, this Agreement shall terminate without any liability or further
obligation of any party to another.
13. NOTICES. All notices, consents, assignments and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given
when (a) delivered by hand, (b) sent by telex or facsimile (with receipt
confirmed), provided that a copy is mailed by registered mail, return receipt
requested, or (c) received by the delivery service (receipt requested), in each
case to the appropriate addresses, telex numbers and facsimile numbers set forth
below (or to such other addresses, telex numbers and facsimile numbers as a
party may designate as to itself by notice to the other parties).
(a) If to TNRG:
Tianrong Building Material Holdings, Ltd.
Eight West 38th, St., 9th Floor
New York, NY 10018
Facsimile No.: (718) 357-0643
Attn: James A. Tilton, President
(b) If to MASC:
MAS Capital Inc.
1710 E. Division St.
Evansville, IN 47711
Facsimile No.: (812) 479-7266
Attention: Aaron Tsai, President
14. MISCELLANEOUS.
14.2 Expenses. Each party shall bear its own expenses incident to the
preparation, negotiation, execution and delivery of this Agreement and the
performance of its obligations hereunder.
14.3 Captions. The captions in this Agreement are for convenience of
reference only and shall not be given any effect in the interpretation of this
agreement.
14.4 No Waiver. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing.
14.5 Exclusive Agreement; Amendment. This Agreement supersedes all prior
agreements among the parties with respect to its subject matter with respect
thereto and cannot be changed or terminated orally.
14.6 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be considered an original, but all of which
together shall constitute the same instrument.
14.7 Governing Law, Venue. This Agreement and (unless otherwise provided) all
amendments hereof and waivers and consents hereunder shall be governed by the
internal law of the State of Indiana, without regard to the conflicts of law
principles thereof. Venue for any cause of action brought to enforce any part of
this Agreement shall be in Indiana.
14.8 Binding Effect. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns,
provided that neither party may assign its rights hereunder without the consent
of the other, provided that, after the Closing, no consent of MAS XVIII or the
MASC shall be needed in connection with any merger or consolidation of TNRG with
or into another entity.
IN WITNESS WHEREOF, the corporate parties hereto have caused this
Agreement to be executed by their respective offi-cers, hereunto duly
authorized, and entered into as of the date first above written.
Tianrong Building Material Holdings, Ltd.
a Utah corporation
By:/s/James A. Tilton
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James A. Tilton, President
MAS CAPITAL INC.
By:/s/Aaron Tsai
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Aaron Tsai, President