UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
February 1, 2012
Date of Report (Date of earliest event reported)
ECOLAND INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
Nevada | 333-140396 | 20-3061959 | |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |
7669 Kimbal Street Mississauga, Ontario Canda |
L5S 1A7 | |
(Address of principal executive offices) | (Zip Code) |
(905) 672-7669
Registrant’s telephone number, including area code
14 The Link, Mornigside
Sandton 2196 South Africa
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ X ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
[ X ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
[ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
[ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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SECTION 1. REGISTRANT’S BUSINESS AND OPERATIONS
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Share Exchange Agreement
Ecoland International, Inc., a Nevada corporation (the “Corporation”), D&R Technology Inc., a private corporation (“D&R Technology”) and the shareholders of D&R Technology Inc. (the “D&R Shareholders”) entered into that certain share exchange agreement dated January 27, 2012 (the “Share Exchange Agreement”). The Board of Directors of the Corporation approved the execution and consummation of the transaction under the Share Exchange Agreement on February 1, 2012. In accordance with the terms and provisions of the Share Exchange Agreement, the Corporation issued an aggregate of 59,000,000 shares of its restricted common stock to the D&R Shareholders in exchange for 100% of the total issued and outstanding shares of D&R Technology, thus making D&R Technology its wholly-owned subsidiary.
The Corporation previously announced that certain controlling shareholders of the Corporation (the “Controlling Shareholders”) and D&R Technology entered into a stock purchase agreement dated November 7, 2011 (the “Stock Purchase Agreement”), pursuant to which D&R Technology was to acquire 59,000,000 shares of common stock of the Corporation. Subsequently, the Controlling Shareholders and D&R Technology entered into that certain termination agreement dated January 27, 2011 (the “Termination Agreement”), pursuant to which the parties rescinded the Stock Purchase Agreement and the Controlling Shareholders returned to the Corporation their respective share certificates evidencing the aggregate 59,000,000 shares of common stock of the Corporation. The respective share certificates received from the Controlling Shareholders were cancelled and the 59,000,000 shares of common stock were returned to treasury.
SECTION 1. REGISTRANT’S BUSINESS AND OPERATIONS
ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT
In further accordance with the terms and provisions of the Share Exchange Agreement, the Corporation and David Wallce, the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and sole member of the Board of Directors of the Corporation (“Wallace”), entered into that certain termination agreement dated February 1, 2012 (the “Termination Agreement”).
The Corporation and Wallace had entered into that certain employment agreement dated June 1, 2009 (the “Employment Agreement”) Furthermore, Wallace had loaned the Corporation an aggregate of $359,477, which is reflected on the financial statements of the Corporation for the quarter ended November 30, 2011 (the “Note Payable”).
In accordance with the terms and provisions of the Termination Agreement, the Employment Agreement shall be terminated and the amounts due and owing under the Note Payable to Wallace shall be waived by Wallace.
Business Operations
A subsequent Current Report on Form 8-K will be filed together with pro forma financial statements of D&R Technology Inc. regarding current business operations of the Corporation.
SECTION 3. SECURITIES AND TRADING MATTERS
ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES
Effective on February 1, 2012, the Corporation issued an aggregate of 59,000,000 shares of its resticted common stock to the D&R Shareholder, which are non-United States residents. In accordance with the terms and provisions of the Share Exchange Agreement, the D&R Shareholders acquired an aggregate of 59,000,000 shares of the Corporation’s restricted common stock in exchange for one hundred percent (100%) of the total issued and outstanding shares of D&R Technology held of record by the D&R Shareholders in a private transaction.
The shares were issued to three non-United States residents in reliance on Regulation S promulgated under the United States Securities Act of 1933, as amended (the “Securities Act”). The shares of common stock have not been registered under the Securities Act or under any state securities laws and may not be offered or sold without registration with the United States Securities and Exchange Commission or an applicable exemption from the registration requirements. The D&R Shareholders acknowledged that the securities to be issued have not been registered under the Securities Act, that they understood the economic risk of an investment in the securities, and that they had the opportunity to ask questions of and receive answers from the Corporation’s management concerning any and all matters related to acquisition of the securities.
Beneficial Ownership Chart
The following table sets forth certain information, as of the date of this Current Report, with respect to the beneficial ownership of the outstanding common stock by: (i) any holder of more than five (5%) percent; (ii) each of the Corporation’s executive officers and directors; and (iii) the Corporation’s directors and executive officers as a group. Except as otherwise indicated, each of the stockholders listed below has sole voting and investment power over the shares beneficially owned. Unless otherwise indicated, each of the stockholders named in the table below has sole voting and investment power with respect to such shares of common stock. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated. As of the date of this Current Report, there are 88,650,000 shares of common stock issued and outstanding.
Name and Address of Beneficial Owner (1) | Amount and Nature of Beneficial Ownership (1) | Percentage of Beneficial Ownership |
Directors and Officers: | ||
Berardino Paolucci 7669 Kimbal Street Mississauga, Ontario Canada L5S 1A7
|
28,320,000 | 31.95% |
Drasko Karanovic 7669 Kimbal Street Mississauga, Ontario Canada L5S 1A7
|
14,160,000 | 15.97% |
Velijko Pjevac 7669 Kimbal Street Mississauga, Ontario Canada L5S 1A7
|
-0- | 0% |
All executive officers and directors as a group (3 person) | 42,480,000 | 47.93% |
Beneficial Shareholders Greater than 10% | ||
D Mecatronics Inc. 7669 Kimbal Street Mississauga, Ontario Canada L5S 1A7 |
16,520,000 | 18.63% |
* Less than one percent.
(1) Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding as of the date of this Current Report. As of the date of this Current Report, there are 88,650,000 shares issued and outstanding.
SECTION 5 – CORPORATE GOVERNANCE AND MANAGEMENT
Item 5.01 Changes in Control of Registrant
The Corporation refers to Item 1.01 and Item 3.02 above concerning the change in control.
Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.
Following the Share Exchange Agreement: (i) David Wallace resigned as a member of the Board of Directors and the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer of the Corporation effective February 1, 2012; (ii) Berardino Paolucci was appointed as the President/Chief Executive Officer, Secretary, Treasurer/Chief Financial Officer and a member of the Board of Directors of the Corporation effective February 1, 2012; and (iii) Drasko Karanovic and Velijko Pjevac were appointed as additional members of the Board of Directors of the Corporaiton effective February 1, 2012. Thus as of the date of this Current Report, the Board of Directors consistes of Berardino Paolucci, Drasko Karanovic and Velijko Pjevac.
The biographies of the new directors and officers are set forth below as follows:
Berardino Paolucci. Mr. Paolucci is the President/Chief Executive Officer, Secretary and Treasurer/Chief Financial Officer and a member of the Board of Directors of the Corporation. Mr. Paolucci has over twenty years experience in customer and quality-focused business and provides a strategic vision and leadership qualities that drive operational process, productivity, efficiency and improvement at multisite manufacturing organizations. He is an expert in combining financial and business planning with tactical execution to optimize long-term gains in performance, revenues and profitability. His breadth of experience includes quality and manufacturing operations, lean concept, root cause and corrective action preventive action (CAPA) analysis, team concepts, total preventive maintenance, set-up reduction and standard work. Mr. Paolucci has been employed by D&R Technologies Inc. from 1994 through 2004 where he held the position of manufacturing supervisor. His previous responsibilities included: (i) manage and direct all electrical, mechanical, hydraulic and process functions within departments; (ii) continuously impact and improve the key performance indicators across the process such as machine mechanical, hydraulic, pneumatic and electrical build, process improvement, identification and sourcing of new equipment as well as the payout and reallocation of equipment and workforce; (iii) develop and initiate appropriate actions that lead to optimizing production capabilities of all machinery, equipment and resources resuling in improved machine utilization, labor efficiency, expense reduction and on-time delivery; (iv) recommend solutions to customers for preventative maintenance, machine layouts and configuration of machinery for the purpose of proaction planning as well as responding to day to day service issues; and (v) manage and develop department’s team members by conducting regular appraisal, developing performance improvement plans, administering salary and compensation as per company policy and providing direction and support for the development of individuals within the deparment.
Drasko Karanovic. Mr. Karanovi is a member of the Board of Directors of the Corporation. Mr. Karanovic has over sixteen years of experience in progressive design, supervisory and management experience in engineering fields, comprehensive knowledge of engineering technology, strong management, communication, interpersonal and customer service skills, extensive knowledge of CAD systems and tooling engineering and development expertise. He was employed with Dieco Technologies from 1994 through 2004 and D Mecatronics Inc. from 2004 to current date. His responsbilities included: (i) member of senior management team in setting strategic operation direction; (ii) prepare proposals, evaluating future equipment performance and recommend improvements for new and existing products; (iii) direct personnel activities of staff, i.e. hire, train, appraise, reward, motivate, discipline, recommend termination (iv) direct,coordinate and exercise functional authority for planning, organization, control, integration and completion of engineering projects; (v) supervising staff of mechanical, electrical and hydraulic designers, production engineering support staff in the custom design, development, improvement and modification of machinery; (vi) direct the research and development effort leading to new or improved products; and (vii) develop and maintain overall product development plan so that new or improved products are timely delivered to market.
Velijko Pjevac. Mr. Pjevac is a member of the Board of Directors of the Corporation. Mr. Pjevac has over thirty-five years of experience as an engineer and worldwide industrial manager in the industrial automation field. He has successfully dealt with strategy and engineering issues within small companies and large corporations, all at management levels .He also has extensive knowledge of strategic planning, resource allocation, leadership techniques, production methods and coordination of people and resources. Mr. Pjevac was previously employed with Dieco Technologies Inc. from 1998 through 2004 and has been employed with D&R Technologies from 2004 to current date as an engineering manager. He provides the strategic vision and leadership qualities that drive engineering process, productivity, efficiency and bottom-line improvements. Mr. Pjevac’s responsbilities include: (i) provides technical direction for the development, design, and systems from definition phase through implementation; (ii) applies significant knowledge of industry trends and developments to improve service to our clients; and (iii) reviews work of development and sales team.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Business Acquired.
Not applicable.
(b) Pro forma Financial Information .
Not applicable.
(c) Shell Company Transaction.
Not applicable.
(d) Exhibits.
10.1 Rescission Agreement dated January 27, 2012 among the Controlling Shareholders and D&R Technology Inc.
10.2 Share Exchange Agreement dated January 27, 2012, effective February 1, 2012, among Ecoland International Inc., D&R Technology Inc. and the shareholders of D&R Technology Inc.
10.3 Termination Agreement dated January 27, 2012, effective February 1, 2012, between Ecoland International Inc. and David Wallace.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ECOLAND INTERNATIONAL INC.
|
|
DATE: February 3, 2012 |
___________________________________ Name: Berardino Paolucci Title: President/Chief Executive Officer |
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SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT (this “Agreement”), dated this 27 th day of January, 2012 and effective as of this 1 st day of February, 2012 (the "Effective Date"), is entered into by and between Ecoland International Inc., a corporation formed under the laws of the State of Nevada (“ECIT”), D&R Technology, Inc., a corporation formed under the laws of Ontario (“D&R”), and the shareholders of D&R (the “D&R Shareholders”), as listed on Exhibit A attached hereto.
WHEREAS the D&R Shareholders are the registered and beneficial owners of all of the issued and outstanding shares of common stock of D&R (the “D&R Shares”);
WHEREAS ECIT is a publicly trading corporation, whose shares of common stock trade on the OTC Market under the symbol “ECIT”);
WHEREAS subject to approval by the respective Board of Directors, ECIT desires to acquire one hundred percent (100%) of the total issued and outstanding D&R Shares in exchange for 59,000,000 shares of the common stock, par value $0.001, of ECIT representing approximately __ % of the total issued and outstanding shares of ECIT (the “ECIT Shares”);
WHEREAS ECIT desires to acquire D&R in exchange for all of the issued and outstanding shares of D&R resulting in D&R becoming a wholly-owned subsidiary of ECIT in a tax-free exchange;
WHEREAS certain controlling shareholders of ECIT (the “ECIT Controlling Shareholders”) and D&R entered into a stock purchase agreement dated November 7, 2011 (the “Stock Purchase Agreement”), pursuant to which D&R was to acquire 59,000,000 shares of common stock of ECIT;
WHEREAS the ECIT Controlling Shareholders and D&R have rescinded the Stock Purchase Agreement and the ECIT Controlling Shareholders have returned to ECIT their respective share certificates evidencing the aggregate 59,000,000 shares of common stock of ECIT and ECIT shall cancel and return to treasury the 59,000,000 shares of common stock;
WHEREAS, the parties to this Agreement have agreed to the share exchange subject to the terms and conditions set forth below.
NOW THEREFORE THIS AGREEMENT WITNESSES that for and in consideration of the mutual premises and the mutual covenants and agreements contained herein, the parties covenant and agree each with the other as follows:
ARTICLE I
EXCHANGE OF STOCK
Section 1.01. Exchange. Upon the terms and subject to the conditions of this Agreement, the D&R Shareholders agree to exchange the D&R Shares for the ECIT Shares and ECIT agrees to proportionately issue to the D&R Shareholders an aggregate of 59,000,001 ECIT Shares on a one-for-one basis for each share held of record by the D&R Shareholder. The parties intend that the share exchange shall qualify as a tax free reorganization under Section 368 of the Internal Revenue Code. However, ECIT makes no representations or warranties regarding the qualification of the share exchange as “tax free”. ECIT shall cooperate with D&R in executing any reasonably necessary documents to qualify the share exchange as tax free.
Section 1.02. Delivery of Stock. (a) Upon the execution hereof, the D&R Shareholders shall deliver to ECIT all of the stock certificates representing the total issued and outstanding D&R Shares, duly endorsed in blank;
(b) Upon execution hereof, ECIT shall deliver to the D&R Shareholders stock certificates representing the ECIT Shares in the names and denominations as set forth on Exhibit A hereto.
(c) The execution and delivery of this Agreement shall take place on January 27, 2012 or by counterpart signatures to be sent to such offices by facsimile transmission. Closing shall occur as soon as possible after the effective date of this Agreement but in no event after January 31, 2012 unless extend by agreement by the parties hereto (the “Closing”).
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF D&R
AND D&R SHAREHOLDERS
Section 2.01. Organization, Standing and Authority; Foreign Qualification. (a) D&R is a corporation duly organized, validly existing and in good standing under the laws of the Province of Ontario with all requisite power and authority to enter into, and perform the obligations under this Agreement. D&R has all requisite power and authority to own, lease and operate its assets, properties and business and to carry on its business as now being and as heretofore conducted.
(b) D&R is duly qualified or otherwise authorized as a corporation to transact business and is in good standing in each jurisdiction as necessary to conduct business as required by law. D&R does not file any franchise, income or other tax returns in any other jurisdiction other than the Province of Ontario, if applicable, based upon the ownership or use of property therein or the derivation of income there from.
Section 2.02. Capitalization. The authorized capital of D&R consists of _____ shares of common stock. A total of _____ shares of common stock are issued and outstanding. The D&R Shares are the only class of D&R’s capital stock that is outstanding. All of the outstanding D&R Shares are duly authorized, validly issued, fully paid and non-assessable and free of preemptive rights.
Section 2.03. Certificate of Incorporation and By-Laws. D&R has heretofore delivered to ECIT true, correct and complete copies of its Articles of Incorporation or other documentation evidencing a corporation and By-laws. The minute books of D&R accurately reflect all actions taken at all meetings and consents in lieu of meetings of its stockholders, and all actions taken at all meetings and consents in lieu of meetings of each of their boards of directors and all committees.
Section 2.04. Execution and Delivery. This Agreement has been duly executed and delivered by each D&R Shareholder and each constitutes the valid and binding agreement of each D&R Shareholder enforceable against the D&R Shareholders in accordance with its terms.
Section 2.05. Consents and Approvals. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof do not require any D&R Shareholder to obtain any consent, approval or action of, or make any filing with or give any notice to, any person or entity.
Section 2.06. No Conflict. The execution, delivery and performance of each of this Agreement and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof will not (a) violate any provisions of the Articles of Incorporation, By-laws or organizational document of D&R; (b) violate, conflict with or result in any modification of the effect of, otherwise give any other contracting party the right to terminate, or constitute (or with notice or lapse of time or both, constitute) a default under, and contract to which any D&R Shareholder or D&R is a party to by or to which any of them or any of their respective assets or properties may be bound or subject; (c) violate any order, judgment, injunction, award or decree of any court, arbitrator or governmental or regulatory body against, or binding upon or any agreement with, or condition imposed by, any governmental or regulatory body, foreign or domestic, binding upon any D&R Shareholder or D&R or upon the D&R Shares or the properties or business of D&R; (d) violate any statute, law or regulation of any jurisdiction as such statute, law or regulation relates to any D&R Shareholders or D&R; or (e) result in the breach of any of the terms or conditions of, constitute a default under, or otherwise cause an impairment of, any permit.
Section 2.07. Title to Stock. Each D&R Shareholder has valid title to their respective portion of the D&R Shares free and clear of all liens or encumbrances, including, without limitation, any community property claim. Upon delivery of the D&R Shares to be made on the Closing, ECIT shall acquire good and marketable title thereto, free and clear of any lien, including, without limitation, any community property claim.
Section 2.08. Options or Other Rights. (a) There are no outstanding rights, subscriptions, warra nts, calls, preemptive rights, options, contracts or other agreements of any kind to purchase or otherwise to receive from any D&R Shareholder or from D&R any of the outstanding, unauthorized or treasury shares of the D&R Shares; and (b) there is no outstanding security of any kind convertible into any security of D&R and there is no outstanding contract or other agreement to purchase, redeem or otherwise acquire any of the D&R Shares.
Section 2.09. Material Information. This Agreement, the financial statements of Avixy and all other information provided in writing by the D&R Shareholders or D&R or representatives thereof to ECIT, taken as a whole, do not contain any untrue statement of a material fact or omit to state a material fact necessary to make any statement contained herein or therein not misleading. There are no facts or conditions, which have not been disclosed to ECIT in writing which, individually or in the aggregate, could have a material adverse effect on ECIT or a material adverse effect on the ability of any D&R Shareholder to perform any of his or her obligations pursuant to this Agreement.
Section 2.10. Absence of Certain Changes. There has been no event, change or development which could have a material adverse effect on D&R.
Section 2.11. Undisclosed Liabilities. D&R has not incurred, any direct or indirect indebtedness, liability, claim, loss, damage, deficiency, obligation or responsibility, fixed or unfixed, choate or inchoate, liquidated or un liquidated, secured or unsecured, accrued, absolute, contingent or otherwise, of a kind required by generally accepted accounting principles to be reflected or reserved against on a financial statement (“Liabilities”), which individually or in the aggregate exceeds $10,000.
Section 2.12 C ompliance with Laws. D&R is not in violation of any applicable order, judgment, injunction, award or decree nor is it in violation of any Federal, provincial, state, local or foreign law, ordinance or regulation or any other requirement of any governmental or regulatory body, court or arbitrator, other than those violations which, in the aggregate, would not have a material adverse effect on D&R, neither D&R nor any D&R Shareholder has received written notice that any violation is being alleged.
Section 2.13. Actions and Proceedings. There are no outstanding orders, judgments, injunctions, awards or decrees of any court, governmental or regulatory body or arbitration tribunal against or involving D&R, or against or involving any of the D&R Shares. There are no actions, suits or claims or legal, regulatory, administrative or arbitration proceedings pending or, to the knowledge of any of the D&R Shareholders threatened against or involving D&R.
Section 2.14. Contracts. Exhibit B sets forth all of the contracts to which D&R is a party or by or to which D&R or its assets or properties are bound or subject. There have been delivered or made available to ECIT true, correct and complete copies of each of the contracts set forth in Exhibit B. Each such contract is valid, subsisting, in full force and effect and binding upon the parties thereto in accordance with its terms, and neither D&R nor any of D&R other affiliates, as the case may be, is in default in any respect under any of them.
Section 2.15. Liens. D&R has marketable title to all of its assets and properties free and clear of any lien.
Section 2.16. Brokerage. No brokerage fees are to be paid in relation to this transaction.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF ECIT
ECIT represents and warrants to D&R and to the D&R Shareholders as follows:
Section 3.01. Organization, Standing and Authority of ECIT. ECIT is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada and has all requisite corporate power and authority to own or lease its assets as now owned or leased by it and to otherwise conduct its business. All corporate proceedings required by law or by the provisions of this Agreement to be taken by ECIT on or before the Closing in connection with the execution and delivery of this Agreement and the consummation of the transactions contemplated by this Agreement have been or will be duly and validly taken.
Section 3.02. Execution and Delivery. This Agreement has been duly authorized, executed and delivered by ECIT and constitutes the valid and binding agreement of ECIT enforceable against ECIT in accordance with its terms.
Section 3.03. Consents and Approvals. The execution, delivery and performance by ECIT of this Agreement and the consummation by ECIT of the transactions contemplated hereby do not require ECIT to obtain any consent, approval or action of, or make any filing with or give any notice to, any person.
Section 3.04. No Conflict. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby in accordance with the terms and conditions hereof will not: (a) violate any provision of the Certificate of Incorporation, By-laws or other organizational document of ECIT; (b) violate, conflict with or result in the breach of any of the terms of, result in any modification of the effect of, otherwise give any other contracting party the right to terminate, or constitute (or with notice or lapse of time or both constitute) a default under, any contract to which ECIT is a party or by or to which its assets or properties may be bound or subject; (c) violate any order, judgment, injunction, award or decree of any court, arbitrator or governmental or regulatory body against, or binding upon, or any agreement with, or condition imposed by, any governmental or regulatory body, foreign or domestic, binding upon ECIT or upon the securities, assets or business of ECIT; or (d) violate any statute, law or regulation of any jurisdiction as such statute, law or regulation relates to ECIT or to the securities, properties or business of ECIT.
Section 3.05. Capitalization. The authorized capital of ECIT consists of 500,000,000 shares of common stock, par value $0.001, of which a total of 88,650,000 shares are issued and outstanding. In addition, ECIT has 100 shares of Series A Preferred and 1,000 shares of Series B Preferred Shares, none of which are issued and outstanding. The ECIT Shares are the only class of ECIT’s capital stock that is outstanding. All of the outstanding ECIT Shares are duly authorized, validly issued, fully paid and non-assessable and free of preemptive rights. There are no outstanding options or warrants of ECIT.
Section 3.06. Brokerage. No broker or finder has acted, directly or indirectly, for ECIT, nor has ECIT incurred any obligation to pay any brokerage, finder’s fee or other commission in connection with the transactions contemplated by this Agreement.
Section 3.07. Articles of Incorporation and By-Laws. ECIT has heretofore delivered to D&R and the D&R Shareholders a true, correct and complete copies of the Articles of Incorporation and By-laws or comparable instruments of ECIT.
Section 3.08. Status of ECIT Shares. Upon consummation of the transactions contemplated by this Agreement, the ECIT Shares to be issued to the D&R Shareholders, when issued and delivered, will be free of any and all liens, claims or encumbrances.
Section 3.09 No Bankruptcy. Neither ECIT nor its assets are the subject of any proceeding involving either a voluntary or an involuntary bankruptcy, insolvency or receivership.
Section 3.10 Contracts and Commitments . Notwithstanding that certain employment agreement dated June 1, 2009 (the “Employment Agreement”) between ECIT and David Wallace (“Wallace”), all other agreements which materially affect ECIT to which ECIT is a party or by which ECIT or any of its property is bound which exist as of the date of execution of this Agreement have been reviewed by the parties and ECIT is not in default with respect to any material term or condition of any such contract, nor has any event occurred which through the passage of time or the giving of notice, or both, would constitute a default hereunder.
The Employment Agreement is terminated in accordance with Section 5.4 and Wallace has waived any and all rights or claims to compensation due and owing under the terms of the Employment Agreement, including any liquidated damages due and owing Wallace under the any currently existing severance pay plan for employees and any payments of benefits under any existing Benefit Coverages in which Wallace was participating in accordance with the terms of such Benefit Coverages (as that term is defined in the Employment Agreement).
3.11 Liabilities. ECIT will provide to D&R the reviewed balance sheet and statements of income, changes in stockholders' equity and cash flows as of and for the quarter ended November 30, 2011 (the “Financial Statements”). ECIT has three liabilities reflected on the balance sheet of the Financial Statements: (i) $359,477 in notes payable – related parties, which related party is David Wallace (the “Related Party Debt”); (ii) $26,574 in accounts payable and accrued liabilities (“Accounts Payable”); and (ii) $250,622 in notes payable, which consist of those certain convertible notes as follows: (a) convertible promissory note dated April 15, 2008 in the principal amount of $30,000 issued to Donna Boyle, (b) convertible promissory note dated December 15, 2006 in the principal amount of $50,000 issued to Raymond Russell, and (c) convertible promissory note dated December 15, 2006 in the principal amount of $50,000 issued to Stephen Treanor (collectively, the Convertible Promissory Notes”).
ECIT warrants and represents that it will cause the Convertible Promissory Notes to be assigned and transferred at Closing to those individuals and in those denominations as specified by D&R. ECIT warrants and represents that Wallace waived payment of the Related Party Debt as reflected in the waiver and settlement agreement between ECIT and Wallace dated January 27, 2012. ECIT further warrants and represents that it has satisfied or will satisfy in full by Closing all amounts due and owing under the Accounts Payable. The Company does not have any other liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or un-accrued, whether liquidated or un-liquidated, and whether due or to become due), including any liability for taxes, except for liabilities expressly specified in the Financial Statements referenced above (none of which results from, arises out of, relates to, is in the nature of, or was caused by any breach of contract, breach of warranty, tort, infringement, or violation of law).
Section 3.12 C ompliance with Laws. To its knowledge, ECIT is not in violation of any applicable order, judgment, injunction, award or decree nor is it in violation of any Federal, state, local or foreign law, ordinance or regulation or any other requirement of any governmental or regulatory body, court or arbitrator, other than those violations which, in the aggregate, would not have a material adverse effect on ECIT and ECIT has not received written notice that any violation is being alleged.
Section 3.13 Corporate Records . All of the minute books and corporate and financial records of ECIT are, or prior to the Closing will be made available for review. In the event of the absence of a complete minute book, representation and warranty by the board of directors shall take precedence over the minute book and shall be incorporated to the minute book.
ARTICLE IV
COVENANTS AND AGREEMENTS
The D&R Shareholders, D&R and ECIT covenant and agree as follows:
Section 4.01. Conduct of Business in the Ordinary Course. From the date hereof through the Closing Date, the D&R Shareholders shall cause D&R to conduct its business substantially in the manner in which it is currently conducted.
Section 4.02 Appointment of Directors and Executive Officers. The directors of ECIT shall upon Closing appoint those certain additional directors as members of the Board of Directors and those certain executive officers as designated by D&R.
Section 4.03. Board and Shareholder Approval. Prior to the Closing, D&R will obtain from its Board of Directors and the D&R Shareholders approval of this Agreement and the transactions contemplated hereby. Prior to the Closing, ECIT will obtain from its Board of Directors approval of this Agreement and the transactions contemplated hereby, including the issuance of the ECIT Shares.
ARTICLE V
MISCELLANEOUS
Section 5.1 Timing. Time is of the essence of this Agreement and each party hereto agrees and covenants to use their reasonably best efforts to complete the transactions contemplated hereby in a timely manner.
Section 5.2 Additional Documentation. The parties will execute and deliver such further documents and instruments and do all such acts and things as may be reasonably necessary or requisite to carry out the full intent and meaning of this Agreement and to effect the transactions contemplated by this Agreement.
Section 5.3 Assignment. This Agreement may not be assigned by any party hereto without the prior written consent of all parties to this Agreement.
Section 5.4 Execution in Counterparts. This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which will together constitute one and the same instrument.
Section 5.5 Expenses. Each party will pay its legal expenses incurred in connection with the transactions contemplated hereby, whether or not such transactions are consummated.
Section 5.6 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Nevada, without regard to principles of conflicts of law.
IN WITNESS WHEREOF the parties hereto have set their hand and seal as of the day and year first above written.
ECOLAND INTERNATIONAL CORP.
Date: January __, 2012 By:_______________________________________
Title
D&R TECHNOLOGY INC.
Date: January __, 2012 By:_______________________________________
Title
D&R Shareholders
Date: January __, 2012 ________________________________________
Date: January __, 2012 ________________________________________
Date: January __, 2012 ________________________________________
TERMINATION AGREEMENT
THIS TERMINATION AGREEMENT is entered into as of this 1 st day of February, 2012 by and among Ecoland International Inc., a Nevada corporation (the “Company”) and David Wallace, an individual (the “Executive”).
RECITALS:
WHEREAS the Company has entered into that certain employment agreement dated June 1, 2009 with the Executive;
WHEREAS the Executive has loaned the Company an aggregate of $359,477, which is reflected on the financial statements for the quarter ended November 30, 2011 (the “Note Payable”);
WHEREAS the Company shall enter into a share exchange agreement dated January 27, 2012 with D&R Technology, Inc., a private company (“D&R”), pursuant to which D&R shall become the wholly-owned subsidiary of the Company (the “Share Exchange Agreement”);
WHEREAS in accordance with the terms and provisions of the Share Exchange Agreement, the Employment Agreement shall be terminated D&R (the “Termination”) and the amounts due and owing under the Note Payable to the Executive shall be waived by the Executive (the “Waiver of Note Payable”);
WHEREAS the Company and the Executive wish to set forth their agreement relating to the Termination and the Waiver of Note Payable.
NOW, THEREFORE, in consideration of the aforesaid recitals and mutual promises contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:
AGREEMENT
1. In accordance with Section 5.4 of the Employment Agreement, the Company and the Executive hereby agree to waive the sixty (60) day written notice of termination and further agree to the Termination as of the date above.
2. The Executive further agrees to waive all right and interest in and to: (i) any amounts due and owing to the Executive as compensation under the terms of the Employment Agreement; (ii) any liquidated damages, any amount including Base Salary (as that term is defined in the Employment Agreement) and annual bonus due and owing under the terms of the Employment Agreement, including any existing severance pay plan for employees; (iii) any other payments or benefits under any existing Benefit Coverages (as that term is defined in the Employment Agreement) in which the Executive is participating; and (iv) any amount equal to the lesser of one-half (1/2) of any remaiing options to be vested under the Ecoland Stock Option Agreements; and (iv) continuation of those certain Benefit Coverages as in effect at the time of such termination.
3. The Executive agrees to waive any and all amounts due under the Note Payable, including any accrued interest, and agree to the Waiver of Note Payable as of the date above.
3. The Company represents and acknowledges that the execution and delivery by the Company of this Termination Agreement is within the power of the Company, has been duly authorized by all necessary corporate action on behalf of the Company and does not: (i) require the consent of any other person or party; (ii) contravene or conflict with any provision of applicable law or the certificate of incorporation or other corporate agreement of the Company; or (iii) contravene or conflict with or result in a default under any other instrument or contract to which the Company is a party.
4. The Company and the Executive shall agree to release each other and forever discharge any and all claims, manner of actions, whether at law or in equity suits, judgments, debts, liens, liabilities, demands, damages, losses, sums of money, expenses or disputes, known or unknown, fixed or contingent, which it now has or may have hereafter, directly or indirectly, individually or in any capacity against each other, their successors and assigns, as well as its present or former owners, directors, officers, stockholders, employees, agents, heirs, by reason of any act, omission, matter, cause, or thing whatsoever, from the beginning of time to, and including the date of the execution of this Termination Agreement, relating to the aforesaid Termination and Waiver of Note Payable.
5. This Termination Agreement shall be effective as of the date first above written and shall be binding upon and insure to the benefit of the parties hereto and their respective successors.
ECOLAND INTERNATIONAL INC.
Date: February 1, 2012 By:_____________________________
President/Chief Executive Officer
February 1, 2012 ________________________________
David Wallace
RESCISSION AGREEMENT
THIS RESCISSION AGREEMENT is entered into as of this 27 th day of January, 2012 by and among D&R Technology Inc., a private corporation organized under the laws of the Province of Ontario (“D&R”) and those certain sellers identified on Exhibit A attached hereto (the “Controlling Shareholders”).
RECITALS:
WHEREAS D&R and the Controlling Shareholders had entered into a stock purchase agreement dated November 7, 2011 (the “Stock Purchase Agreement”), pursuant to which D&R was to acquire an aggregate of 59,000,000 shares of common stock of Ecoland International Inc.., a corporation organized under the laws of the State of Nevada and a publicly traded corporation (“ECIT”);
WHEREAS D&R and the Controlling Shareholders entered into the Stock Purchase Agreement with the intent to effect a transaction in which D&R would become the wholly-owned subsidiary of ECIT;
WHEREAS upon advice of legal counsel and auditors: (i) D&R and the Controlling Shareholders desire to rescind the Stock Purchase Agreement (the “Rescission”); (ii) the Controlling Shareholders desire to return to ECIT their respective share certificates evidencing the aggregate 59,000,000 shares of common stock of ECIT for cancellation and return to treasury; (iii) the shareholders of D&R agree to pay $262,000.00 to the Controlling Shareholders proportionately as consideration for the rescission of the Stock Purchase Agreement and the cancellation of the share certificates; and (iv) the shareholders of D&R and ECIT shall enter into a share exchange agreement pursuant to which D&R shall become the wholly-owned subsidiary of ECIT;
WHEREAS, D&R and the Controlling Shareholders have settled their differences regarding the Rescission and D&R and the Controlling Shareholders agree that it is desirable to rescind and set aside the Stock Purchase Agreement, which includes the return by D&R to the Controlling Shareholders and the subsequent return by the Controlling Shareholders to ECT of the aggregate 59,000,000 shares of common stock and the resulting cancellation and return to treasury of the 59,000,000 shares of common stock;
WHEREAS D&R and the Controlling Shareholders wish to set forth their agreement relating to the Rescission and this Rescission Agreement;
WHEREAS the Board of Directors of D&R have approved the execution of this Rescission Agreement;
NOW, THEREFORE, in consideration of the aforesaid recitals and mutual promises contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:
AGREEMENT
1. D&R and the Controlling Shareholders agree to hereby rescind, cancel and set aside the Stock Purchase Agreement in exchange for the payment by D&R to the Controlling Shareholders of an aggregate $262,000.00.
2. The Controlling Shareholders shall return to ECIT the share certificates evidencing the aggregate 59,000,000 shares of restricted common stock of ECIT and such 59,000,000 shares shall be cancelled and returned to treasury.
3 . D&R represents and acknowledges that the execution and delivery by D&R of this Rescission Agreement is within the power of D&R, has been duly authorized by all necessary corporate action on behalf of D&R and does not: (i) require the consent of any other person or party; (ii) contravene or conflict with any provision of applicable law or the certificate of incorporation or other corporate agreement of D&R; or (iii) contravene or conflict with or result in a default under any other instrument or contract to which D&R is a party.
4 . The Controlling Shareholders represent and acknowledge that the execution and delivery by the Controlling Shareholders of this Rescission Agreement is within the power of the Controlling Shareholders and does not: (i) require the consent of any other person or party; (ii) contravene or conflict with any provision of applicable law; or (iii) contravene or conflict with or result in a default under any other instrument or contract to which any of the Controlling Shareholders is a party.
5. This Rescission Agreement shall be effective as of the date first above written and shall be binding upon and insure to the benefit of the parties hereto and their respective successors.
6. D&R and the Controlling Shareholders shall agree to release each other and forever discharge any and all claims, manner of actions, whether at law or in equity suits, judgments, debts, liens, liabilities, demands, damages, losses, sums of money, expenses or disputes, known or unknown, fixed or contingent, which it now has or may have hereafter, directly or indirectly, individually or in any capacity against each other, their successors and assigns, as well as its present or former owners, directors, officers, stockholders, employees, agents, heirs, by reason of any act, omission, matter, cause, or thing whatsoever, from the beginning of time to, and including the date of the execution of this Rescission Agreement, relating to the aforesaid Stock Purchase Agreement and Rescission.
D&R TECHNOLOGY INC.
Date: January __, 2012 By:_____________________________
President/Chief Executive Officer
CONTROLLING SHAREHOLDERS
Date: January 27, 2012 _________________________________
David Wallace
Capitalsense Ltd.
Date: January 27, 2012 By:_________________________________
Cimarron Capital Ltd.
Date: January 27, 2012 By: ________________________________
Altimo Ltd.
Date: January __, 2012 By: ________________________________