Exhibit 2.1
DEFINITIVE SHARE EXCHANGE AGREEMENT
THIS DEFINITIVE SHARE EXCHANGE AGREEMENT (hereinafter referred to as the
"Agreement") is dated for reference the 15th day of November, 2005, by and among
UPSNAP, INC. (formerly known as MANU FORTI GROUP INC.), a corporation
incorporated under the laws of the State of Nevada, (hereinafter referred to as
"Manu Forti", or the "Corporation") and all of the shareholders (the "Up2004snap
Shareholders") of UP2004SNAP, INC., a corporation incorporated under the laws of
the State of Nevada (hereinafter referred to as "Up2004Snap"), who are all
executing this Agreement.
WHEREAS:
A. Manu Forti is a shell company listed on the OTC Bulletin Board; and
B. The respective boards of directors of Manu Forti and Up2004snap each deem it
advisable and in the best interests of their respective shareholders to combine
their respective businesses by Manu Forti acquiring from the Up2004snap
Shareholders all of the shares in the capital stock of Up2004snap pursuant to
the terms of this Agreement in exchange for 11,730,000 shares of Manu Forti
common stock.
NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the foregoing
premises, the mutual representations, warranties, covenants and agreements
hereinafter set forth, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I. DEFINITIONS
1.1 Definitions. The following terms, as used herein, have the following
meanings: "Affiliate" means, with respect to any Person, any Person
directly or indirectly controlling, controlled by or under direct or
indirect common control with such other Person.
"Agreement" means this Definitive Share Exchange Agreement.
"Applicable Law" means, with respect to any Person, any United States
(whether federal, territorial, state or local), Canadian (whether federal,
territorial, provincial, municipal or local) or foreign statute, law,
ordinance, rule, administrative interpretation, regulation, order, writ,
injunction, directive, judgment, decree or other requirement, all as in
effect as of the Closing, of any Governmental Authority (including any
Environmental Laws) applicable to such Person or any of its Affiliates or
any of their respective properties, assets, officers, directors,
employees, consultants or agents (in connection with such officer's,
director's, employee's, consultant's or agent's activities on behalf of
such Person or any of its Affiliates).
"Business Day" means a day other than a Saturday, Sunday or other day on
which commercial banks in San Diego, California are authorized or required
by law to close.
"Governmental Authority" means any United States (whether federal,
territorial, state, municipal or local), Canadian (whether federal,
territorial, provincial, municipal or local) or foreign government,
governmental authority, quasi-governmental authority, instrumentality,
court, government or self-regulatory organization, commission, tribunal or
organization or any regulatory, administrative or other agency, or any
political or other subdivision, department or branch of any of the
foregoing.
"GST" means all goods and services taxes, sales taxes levied by the
federal government of United States, value added taxes or multi-stage
taxes and all provincial sales taxes integrated with such federal taxes,
assessed, rated or charged upon the Corporation.
"Interim Period" means the period from and including the date of this
Agreement to and including the Closing Date.
"Liability" means, with respect to any Person, any liability or obligation
of such Person of any kind, character or description, whether known or
unknown, absolute or contingent, accrued or unaccrued, liquidated or
unliquidated, secured or unsecured, joint or several, due or to become
due, vested or unvested, determined, determinable or otherwise and whether
or not the same is required to be accrued on the financial statements of
such Person.
"Lien" means, with respect to any asset, any mortgage, assignment, trust
or deemed trust (whether contractual, statutory or otherwise arising),
title defect or objection, lien, pledge, charge, security interest,
hypothecation, restriction, encumbrance or charge of any kind in respect
of such assets.
"Material Adverse Effect" means a change in, or effect on, the operations,
affairs, prospects, financial condition, results of operations, assets,
Liabilities, reserves or any other aspect of a party to this Agreement or
to its business that results in a material adverse effect on, or a
material adverse change in, any such aspect of the party or to its
business.
"Person" includes an individual, body corporate, partnership, company,
unincorporated syndicate or organization, trust, trustee, executor,
administrator and other legal representative.
"Proceeding" means any and all administrative, regulatory or judicial
actions or causes of action, suits, petitions, proceedings (including
arbitration proceedings), investigations, hearings, demands, demand
letters, claims or notice of noncompliance or violation delivered by any
Governmental Authority or other Person.
"SEC" means the United States Securities and Exchange Commission.
"Tax" means all taxes imposed of any nature including any United States
(whether federal, territorial, state or local), Canadian (whether federal,
territorial, provincial or local) or foreign income tax, alternative or
add-on minimum tax, profits or excess profits tax, franchise tax, gross
income, adjusted gross income or gross receipts tax, employment related
tax (including employee withholding or employer payroll tax or employer
health tax), capital tax, real or personal property tax or ad valorem tax,
sales or use tax, excise tax, stamp tax or duty, any withholding or back
up withholding tax, value added tax, GST, severance tax, prohibited tax,
premiums tax, occupation tax, customs and import duties, together with any
interest or any penalty, addition to tax or additional amount imposed by
any Governmental Authority responsible for the imposition of any such tax
or in respect of or pursuant to any United States (whether federal,
territorial, state or local), Canadian (whether federal, territorial,
provincial or local) or other Applicable Law.
"Tax Return" means all returns, reports, forms or other information
required to be filed with respect to any Tax.
"33 Act" means the United States Securities Act of 1933 and all amendments
thereto.
"34 Act" means the United States Securities Exchange Act of 1934 and all
amendments thereto.
ARTICLE II.
SHARE EXCHANGE
2.1 Share Exchange. On the terms and subject to the conditions set forth herein,
at the Closing Manu Forti shall issue and deliver to Up2004snap Shareholders,
Eleven Million, Seven Hundred and Thirty Thousand (11,730,000) validly issued,
fully-paid and non-assessable shares of Manu Forti Common Stock (the "Manu Forti
Shares") and the Up2004snap Shareholders shall deliver to Manu Forti 9,999,999
shares of Up2004snap common stock, $0.0001 par value per share (the "Up2004snap
Shares") constituting all of the issued and outstanding capital stock of
Up2004snap.
2.2 Closing, and Post-Closing Transactions. The closing (the "Closing") of the
transactions contemplated by this Agreement shall take place on November 15,
2005 or such other date as the parties hereto may mutually agree in writing (the
"Closing Date").
(a) At or prior to the Closing, Manu Forti shall deliver to Up2004snap
Shareholders certificate(s) evidencing the Manu Forti Shares, which certificates
shall bear a legend referring to the applicable transfer restrictions under the
33 Act.
(b) After the Closing, Manu Forti shall: within 60 days or as soon
thereafter as all financial statements of Up2004snap and other related
information required to be filed under the 34 Act has been filed, cause an SB-2
registration statement (or other registration statement available to Manu Forti)
to be filed with the Securities and Exchange Commission (hereinafter referred to
as the "Registration Statement) covering the underlying common stock issued or
issuable as part of the units consisting of one share of common stock and one
Series A Warrants , as well as the common stock underlying the 1,500,000 and
700,000 Series B Warrants held by Sundar Communications and Executive Forums LLC
respectively, which allow the holders of the Warrants to purchase one common
share of Xxxx Xxxxx'x common stock for each Warrant held at an exercise price of
$1.10 per share and 370,000 shares of common stock and warrants for the purchase
of 560,000 shares of common stock held by Viant Capital LLC.
(c) At the Closing, Up2004snap Shareholders shall:
(i) Deliver to Manu Forti stock certificates that represent the
Up2004snap Shares, constituting all of the issued and
outstanding capital stock of Up2004snap along with stock
powers that are undated and executed in blank.
(ii) Retain right to all appointments of individuals to Xxxx
Xxxxx'x Board of Directors.
ARTICLE III.
REPRESENTATIONS AND
WARRANTIES OF MANU FORTI
As an inducement to Up2004snap to enter into this Agreement and to consummate
the transactions provided for herein, Manu Forti represents and warrants to
Up2004snap that except as set forth in the disclosure letter attached hereto
(the "Disclosure Letter") the representations and warranties of Manu Forti
contained in this Article III are true and correct and complete as of the date
of this Agreement and that Up2004snap is relying upon the accuracy of each of
such representations and warranties in connection with the purchase of the Manu
Forti Shares and the completion of the transactions set out herein.
3.1 Organization and Good Standing. Manu Forti is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada with
full corporate power and authority to carry on its business as it is now being
conducted, to own or hold under lease the properties and assets which it owns or
holds under lease and perform all its obligations under the agreements and
instruments to which it is a party or by which it is bound. The Corporation is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each state or other jurisdiction in which the ownership or
leasing of the properties owned by it or the nature of the activities conducted
by it requires such qualification.
3.2 Authority; No Conflict. This Agreement constitutes the legal, valid and
binding obligation of Manu Forti, enforceable against Manu Forti in accordance
with its terms. Upon the execution and delivery by Manu Forti of the Agreement
the document will constitute a legal, valid and binding obligation of Manu
Forti, enforceable against Manu Forti in accordance with their respective terms.
Manu Forti has the absolute and unrestricted right, power, authority and
capacity to execute and deliver this Agreement, and each other document
contemplated hereunder or thereunder and to perform their obligations hereunder
and thereunder. Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the Contemplated Transactions will,
directly or indirectly:
(a) contravene, conflict with or result (with or without notice or lapse
of time) in a violation of (i) any of the provisions of the certificate of
incorporation or bylaws of Manu Forti or other organizational documents of Manu
Forti or (ii) any resolution adopted by the board of directors or the
stockholders of the Manu Forti;
(b) contravene, conflict with or result (with or without notice or lapse
of time) in a violation of any Applicable Law to which Manu Forti, or any of the
assets owned or used by Manu Forti, may be subject, except that, which could not
have a Material Adverse Effect;
(c) cause Up2004snap or Manu Forti to become subject to, or to become
liable for the payment of, any Tax;
(d) cause any of the assets owned by the Manu Forti to be reassessed or
revalued by any taxing authority or other Governmental Authority;
(e) contravene, conflict with or result (with or without notice or lapse
of time) in a violation of any of the terms or requirements of, or give any
Governmental Authority the right (with or without notice or lapse of time) to
revoke, withdraw, suspend, cancel, terminate or modify, any governmental
authorization that is held by the Manu Forti or that otherwise relates to the
business of, or any of the assets owned or used by, any Manu Forti, except that,
which could not have a Material Adverse Effect;
(f) contravene, conflict with or result (with or without notice or lapse
of time) in a violation or breach of any of the provisions of, or give any
Person the right (with or without notice or lapse of time) to declare a default
or exercise any remedy under, or to accelerate the maturity or performance of or
cancel, terminate or modify, any Contract to which Manu Forti has any rights, or
by which Manu Forti or any of the assets owned or used by Manu Forti, may be
bound, except that, which could not have a Material Adverse Effect; or
(g) result (with or without notice or lapse of time) in the imposition or
creation of any Lien upon or with respect to any of the assets owned or used by
Manu Forti.
Manu Forti is not nor will be required to give any notice to or obtain any
consent from, any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the transactions
contemplated hereby.
The Up2004snap Shareholders acknowledge that they have had the opportunity to
ask questions of and receive answers from, or obtain additional information
from, the executive officers of Manu Forti concerning the financial and other
affairs of Manu Forti, and to the extent deemed necessary in light of such
personal knowledge of Xxxx Xxxxx'x affairs, Up2004snap has asked such questions
and received answers to its full satisfaction.
3.3 Capitalization. The authorized capital stock of the Manu Forti consists of
97,500,000 shares of common stock , with full voting rights par value $0.001 per
share, of which 4,013,100 shares are issued and outstanding. In addition to its
common stock outstanding, Manu Forti has 2,384,668 series A warrants outstanding
with an exercise price of $1.50 and 2,200,000 series B Warrants with an exercise
price of $1.10. All of the outstanding equity securities of Manu Forti have been
duly authorized and validly issued and are fully paid and nonassessable. Except
as set forth in Section 3.3 of the Disclosure Letter, there are no outstanding
options, rights, conversion rights, agreements or commitments of any kind
relating to the issuance, sale or transfer of any equity securities or other
securities of Manu Forti. None of the outstanding equity securities or other
securities of Manu Forti was issued in violation of the 33 Act or the securities
or blue sky of any state or other jurisdiction.
3.4 Reports; Financial Statements.
(a) Manu Forti has made available to Up2004snap, each financial statement,
report, proxy statement or information statement prepared by Manu Forti since
September 18, 2003 (the "SEC Reports"). To the knowledge of Manu Forti, the
Corporation's Reports did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements made therein, in light of the circumstances in which they were
made, not misleading. Each of the consolidated balance sheets included in or
incorporated by reference into Xxxx Xxxxx'x SEC Reports (including the related
notes and schedules) fairly presents the consolidated financial position of Manu
Forti as of such SEC Report's date and each of the consolidated statements of
income and of cash flows included in or incorporated by reference into its SEC
Reports (including any related notes and schedules) fairly presents the
consolidated results of operations, retained earnings and cash flows, as the
case may be, of Manu Forti for the periods set forth therein (subject, in the
case of unaudited statements, to notes and normal year-end audit adjustments
that will not be material in amount or effect), in each case in accordance with
GAAP consistently applied during the periods involved, except as may be noted
therein. (the March 31, 2005 balance sheet being referred to hereinafter as the
"Balance Sheet" and the September 30, 2005 balance sheet being referred to
hereinafter as the "Interim Balance Sheet").
(b) Since Xxxx Xxxxx'x inception, wherever required to make filings under
any Applicable Law Manu Forti has filed with the applicable Governmental
Authority all material forms, statements, reports and documents (including
exhibits, annexes and any amendments thereto) required to be filed by it, and
each such filing complied in all material respects with all applicable laws,
rules and regulations, other than such failures to file and non-compliance that
could not have a Material Adverse Effect.
(c) As of the date hereof, there are no reports or statements on file with
the SEC to which the SEC has provided comments and Manu Forti has not responded.
As of the date hereof, there are no registration statements on file with the SEC
for which a formal withdrawal should have been delivered to the SEC by the
Company, but for which a formal withdrawal has not been so delivered. Manu Forti
warrants that it is not currently subject or has not been subject to any
investigation or enquiry by the SEC, and is up to date with its filings to the
SEC and any other Governmental Authority.
3.5 Books and Records. The books of account, minute books, stock record books
and other records of Manu Forti, all of which have been made available to
Up2004snap, are complete and correct in all material respects and have been
maintained in accordance with sound business practices and the requirements of
Section 13(b)(2) of the 34 Act (regardless of whether or not the Manu Forti is
subject to that Section), including, but not limited to, the maintenance of an
adequate system of internal controls. To the best knowledge of Manu Forti, the
minute books of Manu Forti containing records of all meetings held of, and
corporate action taken by, the stockholders, the Boards of Directors and
committees of the Board of Directors of Manu Forti are accurate and complete in
all material respects and no meeting of any such stockholders, Board of
Directors or committee has been held for which minutes have not been prepared
and are not contained in such minute books. At the Closing, all of those books
and records will be in the possession of Manu Forti with the original copies
being available to Up2004snap.
3.6 Title to Properties; Encumbrances. As reflected in the Balance Sheet and
Interim Balance Sheet Manu Forti does not own, nor lease or have any interest in
any properties. Manu Forti hereby represents that it does not own or is not in
possession of any real property.
3.7 Accounts Receivable. As reflected in the Balance Sheet and Interim Balance
Sheet, and as of the date of this Agreement, Manu Forti hereby represents that
it does not have any accounts receivable.
3.8 Inventory. As reflected in the Balance Sheet and Interim Balance Sheet, and
as of the date of this Agreement, Manu Forti hereby represents that it does not
have any inventory.
3.9 No Undisclosed Liabilities. Manu Forti has no undisclosed Liabilities or
obligations of any nature (known or unknown, absolute, accrued, contingent or
otherwise) that were not fully reflected or reserved against in the Balance
Sheet or the Interim Balance Sheet.
3.10 Taxes. Manu Forti has filed or caused to be filed (on a timely basis) all
Tax Returns that are or were required to be filed by or with respect to any of
them, either separately or as a member of a group of corporations, pursuant to
the Applicable Law of each Governmental Authority with taxing power over them or
their assets. Manu Forti has made available to Up2004snap copies of all such Tax
Returns filed since fiscal year ended March 31, 2003. Manu Forti has paid, or
made provision for the payment of, all Taxes that have or may have become due
pursuant to those Tax Returns, or otherwise, or pursuant to any assessment
received by the Corporation. The United States federal and state income and
franchise Tax Returns of Manu Forti subject to such Taxes have not been audited
by the Internal Revenue Service or relevant state tax authorities or are closed
by the applicable statute of limitations for all taxable years through March 31,
2004. Manu Forti has not given nor has it been requested to give waivers or
extensions (or is or would be subject to a waiver or extension given by any
other Person) of any statute of limitations relating to the payment of Taxes of
Manu Forti or for which Manu Forti may be liable. The charges, accruals and
reserves with respect to Taxes on the respective books of Manu Forti are
adequate (determined in accordance with GAAP). All Taxes that Manu Forti is or
was required by Applicable Law to withhold or collect have been duly withheld or
collected and, to the extent required, have been paid to the proper Governmental
Authority or other Person, except where the failure to withhold, collect or pay
could not have a Material Adverse Effect. All Tax Returns filed by (or which
include on a consolidated basis) Manu Forti are true, correct and complete in
all material respects. There is no tax sharing agreement that will require any
payment by Manu Forti after the date of this Agreement.
3.11 No Material Adverse Change. Since the date of the Balance Sheet, there has
not been any material adverse change in the business, operations, properties,
prospects, assets or condition of Manu Forti or any event, condition or
contingency that is likely to result in such a material adverse change.
3.12 Benefit Plans. Manu Forti hereby represents that it does not have any
employee benefit plan, pension, profit sharing, Section 401(k), thrift-savings,
individual retirement account, excess benefit plan, deferred compensation,
incentive compensation, stock bonus, stock option, restricted stock, cash bonus,
employee stock ownership (including, without limitation, payroll related
employee stock ownership), severance pay, cafeteria, flexible compensation, life
insurance, medical, dental, disability, welfare, or vacation plans or
arrangements of any kind nor any other Employee Pension Benefit Plan or Employee
Welfare Benefit Plan (as defined in Section 3 of ERISA), incentive compensation
plan or fringe benefit or any combination of the foregoing established,
maintained, sponsored, contributed to or otherwise participated in.
3.13 Compliance with Applicable Law.
(a) Manu Forti, and at all times has been, in full compliance with all
Applicable Laws, except where such failure to comply could not result in a
Material Adverse Effect;
(b) No event has occurred, and no condition or circumstance exists, that
might (with or without notice or lapse of time) constitute or result directly or
indirectly in a violation by Manu Forti of, or a failure on the part of Manu
Forti to comply with, any Applicable Law, except where such violation or failure
could not result in a Material Adverse Effect; and
(c) Manu Forti has not received any notice or other communication (whether
oral or written) from any Governmental Authority or any other Person regarding
(A) any actual, alleged, possible or potential violation of, or failure to
comply with, any term or requirement of any authorization by any Governmental
Authority or (B) any actual, alleged, possible or potential revocation on the
part of Manu Forti to undertake, or to bear all or any portion of the cost of,
any remedial action of any nature.
3.14 Legal Proceedings; Orders.
(a) There is no pending Proceeding:
(i) that has been commenced by or against Manu Forti or that
otherwise relates to or might affect the business of, or any
of the assets owned or used by, Manu Forti; or
(ii) that challenges, or that might have the effect of preventing,
delaying, making illegal or otherwise interfering with, any of
the transactions contemplated by this Agreement.
(b) To the knowledge of Manu Forti, (1) no such Proceeding has been
threatened and (2) no event has occurred, and no condition or circumstance
exists, that might give rise to or serve as a basis for the commencement of any
such Proceeding.
3.15 Absence of Certain Changes and Events.
(a) Except as set forth in any of its SEC Reports, since December 31,
2003, Manu Forti has conducted its businesses only in the ordinary course of
business and there has not been any:
(i) Change in Xxxx Xxxxx'x authorized or issued capital stock;
grant of any stock option or right to purchase shares of
capital stock of Manu Forti; issuance of any security
convertible into such capital stock; grant of any registration
rights; purchase, redemption, retirement or other acquisition
by Manu Forti of any shares of any such capital stock; or
declaration or payment of any dividend or other distribution
or payment in respect of shares of capital stock;
(ii) amendment to Xxxx Xxxxx'x certificate of incorporation, bylaws
or other organizational documents;
(iii) payment or increase by Manu Forti of any bonuses, salaries, or
other compensation to any director, officer, employee, or
stockholder (except to directors, officers, employees, or
stockholders in the Ordinary Course of Business) or entry into
any employment, severance, or similar Contract with any
director, officer, or employee;
(iv) adoption of, or increase in, any profit sharing, bonus,
deferred compensation, savings, insurance, pension,
retirement, or other employee benefit plan for or with any
employees of Manu Forti;
(v) damage, destruction, or loss to any asset or property of Manu
Forti, whether or not covered by insurance, affecting
materially and adversely the properties, assets, business,
financial condition, or prospects of Manu Forti, taken as a
whole;
(vi) entry into, termination, or receipt of notice of termination
of (a) any license, distributorship, dealer, sales
representative, joint venture, credit, or similar agreement,
or (b) any Contract or transaction involving a total remaining
commitment by Manu Forti of at least $25,000;
(vii) sale (other than sales of inventory in the ordinary course of
business), lease, or other disposition of any asset or
property of Manu Forti or mortgage, pledge, or imposition of
any Lien on any material asset or property of Manu Forti,
including, without limitation, the sale, lease, or other
disposition of any intellectual property of Manu Forti;
(viii) cancellation or waiver of any claims or rights with a value
to Manu Forti in excess of $25,000;
(ix) conduct of business or entering into any transaction, other
than in the ordinary course of business of Manu Forti;
(x) material change in the accounting methods followed by Manu
Forti; and
(xi) agreement, whether or not in writing, to do any of the
foregoing by Manu Forti.
3.16 Brokers of Finders. Manu Forti has incurred no obligation or liability,
contingent or otherwise, for brokerage or finders' fees or agents' commissions
or other like payment in connection with this Agreement and will indemnify and
hold Up2004snap harmless from any such payment alleged to be due by or through
Manu Forti as a result of the action of Manu Forti or its agents.
3.17 Disclosure.
(a) No representation or warranty of Manu Forti contained in this
Agreement or statement in the Disclosure Letter contains any untrue statement.
No representation or warranty of Manu Forti contained in this Agreement or
statement in the Disclosure Letter omits to state a material fact necessary in
order to make the statements herein or therein, in light of the circumstances
under which they were made, not misleading.
(b) There is no fact known to Manu Forti which has specific application to
Manu Forti (other than general economic or industry conditions) and which
materially adversely affects or, so far it can reasonably foresee, materially
threatens, the assets, business, prospects, financial condition or results of
operations of Manu Forti considered as a whole which has not been set forth in
this Agreement or the Disclosure Letter.
(c) The disclosures in the Disclosure Letter, and those in any supplement
thereto, shall relate only to the representations and warranties in the Section
of the Agreement to which they expressly relate and to no other representation
or warranty in this Agreement.
(d) In the event of any inconsistency between the statements in the body
of this Agreement and those in the Disclosure Letter (other than an exception
expressly set forth as such is in the Disclosure Letter in relation to a
specifically identified representation or warranty), those in this Agreement
shall control.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF THE
UP2004SNAP SHAREHOLDERS
As an inducement to Manu Forti to enter into this Agreement and to consummate
the transactions provided for herein, the Up2004snap Shareholders, represents
and warrants to Manu Forti that except as set forth in the Disclosure Letter,
the representations and warranties of the Up2004snap Shareholders contained in
this Article IV are true and correct and complete as of the date of this
Agreement.
4.1 Organization and Good Standing. Up2004snap is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada.
4.2 Authority; No Conflict. Up2004snap has full corporate power and authority to
execute and deliver this Agreement and to perform its obligations hereunder and
thereunder. This Agreement has been duly authorized, executed, and delivered and
will constitute, as the case may be, the legal, valid and binding obligation of
the Up2004snap Shareholders enforceable against the Up2004snap Shareholders with
its respective terms. Neither the execution and delivery of this Agreement by
Up2004snap Shareholders nor the consummation of transactions contemplated by
this Agreement will:
(a) violate or conflict with any provision of the certificate of
incorporation, bylaws or other organizational documents of Up2004snap;
(b) violate or conflict with any provision of any Applicable Law binding
upon Up2004snap except that which could not have a Material Adverse Effect on
Up2004snap; or
(c) result in a breach of, or constitute a default under (or with notice
or lapse of time or both result in a breach of or constitute a default under) or
otherwise give any Person the right to terminate, any Contract to which
Up2004snap is a party or by which it is bound, except that which could not have
a Material Adverse Effect on Up2004snap.
Neither Up2004snap nor any of the Up2004snap Shareholders is required to give
prior notice to, or obtain any consent of, any Person in connection with the
Up2004snap Shareholders' execution and delivery of this Agreement or the
consummation of the transactions contemplated by this Agreement.
4.3 Investment Intent. Up2004snap Shareholders are acquiring the Manu Forti
Shares for their own account, and not with a view to their distribution within
the meaning of Section 2.11 of the 33 Act.
4.4 Capitalization. The authorized capital stock of Up2004snap consists of (i)
25,000,000 shares of Common Stock, par value $0.0001 per share, of which
9,999,999 shares are issued and outstanding on November 15, 2005, and 10,000,000
shares of Preferred Stock, par value $0.0001 per share, none of which are issued
and outstanding on November 15, 2005. All of the outstanding shares of
Up2004snap Common Stock and Up2004snap Preferred Stock have been duly authorized
and are validly issued, fully paid and non-assessable. Up2004snap has no shares
of Up2004snap Common Stock or Up2004snap Preferred Shares reserved for or
subject to issuance. Up2004snap was not obligated to issue any shares of
Up2004snap Common Stock pursuant to any stock ownership plan, stock incentive
plan, stock option plan or any other qualified retirement plan (the "Up2004snap
Stock Plans"). Each of the outstanding shares of capital stock of each of
Up2004snap's Subsidiaries is duly authorized, validly issued, fully paid and
nonassessable and owned by Up2004snap or a direct or indirect wholly-owned
subsidiary of Up2004snap, free and clear of any lien, pledge, security interest,
claim or other encumbrance. There are no preemptive or other outstanding rights,
options, warrants, conversion rights, stock appreciation rights, redemption
rights, repurchase rights, agreements, arrangements or commitments to issue or
to sell any shares of capital stock or other securities of Up2004snap or any of
its Subsidiaries or any securities or obligations convertible or exchangeable
into or exercisable for, or giving any Person a right to subscribe for or
acquire, any securities of Up2004snap or any of its Subsidiaries, and no
securities or obligation evidencing such rights are authorized, issued or
outstanding. Up2004snap does not have outstanding any bonds, debentures, notes
or other obligations the holders of which have the right to vote (or convertible
into or exercisable for securities having the right to vote) with the
stockholders of Up2004snap on any matter.
4.5 Reports; Financial Statements; Liabilities.
(a) Attached hereto as Schedule "A" are true and complete copies of
Up2004snap's unaudited Balance Sheet as of June 30, 2005 and the related
statements of income and retained earnings and changes of financial position for
the nine month period ended June 30, 2005 (collectively, the "Up2004snap's
Financials").
(b) Up2004snap's Financials: (i) have been prepared on a consistent basis
and are based on the books and records of the Up2004snap in accordance with U.S.
GAAP and present fairly the financial position, results of operations and
statements of changes in the Up2004snap's financial position as of the dates
indicated or the periods indicated, except that no notes have been provided;
(ii) contain and reflect all necessary adjustments and accruals for a fair
presentation of its financial position and the results of its operations for the
periods covered by said financial statements; (iii) contain and reflect adequate
provisions for all reasonably anticipated Liabilities (including Taxes) with
respect to the periods then ended and all prior periods; and (iv) with respect
to Up2004snap's Contracts and commitments for the sale of goods or the provision
of services by the Corporation, contain and reflect adequate reserves for all
reasonably anticipated material losses and costs and expenses in excess of
expected receipts.
(c) To the best of the knowledge of Up2004snap, there are no Liabilities
of Up2004snap other than: (i) any Liabilities accrued as Liabilities on
Up2004snap's Balance Sheet; (ii) Liabilities incurred since the date of
Up2004snap's Balance Sheet that do not, and could not, individually or in the
aggregate have a Material Adverse Effect; and (iii) other Liabilities disclosed
in this Agreement or in any schedules attached hereto.
4.6 Absence of Certain Changes and Events.
(a) Since September 30, 2004, Up2004snap has conducted its businesses only
in the ordinary course of business and there has not been any:
(i) Change in Up2004snap's authorized or issued capital stock;
grant of any stock option or right to purchase shares of
capital stock of Up2004snap; issuance of any security
convertible into such capital stock; grant of any registration
rights; purchase, redemption, retirement or other acquisition
by Manu Forti of any shares of any such capital stock; or
declaration or payment of any dividend or other distribution
or payment in respect of shares of capital stock;
(ii) amendment to the certificate of incorporation, bylaws or other
organizational documents of Up2004snap;
(iii) payment or increase by Up2004snap of any bonuses, salaries, or
other compensation to any director, officer, employee, or
stockholder (except to directors, officers, employees, or
stockholders in the ordinary course of business) or entry into
any employment, severance, or similar Contract with any
director, officer, or employee;
(iv) adoption of, or increase in, any profit sharing, bonus,
deferred compensation, savings, insurance, pension,
retirement, or other employee benefit plan for or with any
employees of Up2004snap;
(v) damage, destruction, or loss to any asset or property of
Up2004snap, whether or not covered by insurance, affecting
materially and adversely the properties, assets, business,
financial condition, or prospects of Up2004snap, taken as a
whole;
(vi) entry into, termination, or receipt of notice of termination
of (a) any license, distributorship, dealer, sales
representative, joint venture, credit, or similar agreement,
or (b) any Contract or transaction involving a total remaining
commitment by Up2004snap of at least $25,000;
(vii) sale (other than sales of inventory in the ordinary course of
business), lease, or other disposition of any asset or
property of Up2004snap or mortgage, pledge, or imposition of
any lien or other encumbrance on any material asset or
property of Up2004snap, including, without limitation, the
sale, lease, or other disposition of any intellectual
property;
(viii) cancellation or waiver of any claims or rights with a value
to Up2004snap in excess of $25,000;
(ix) conduct of business or entering into any transaction, other
than in the ordinary course of business of Up2004snap;
(x) material change in the accounting methods followed by
Up2004snap; and
(xi) agreement, whether or not in writing, to do any of the
foregoing by Up2004snap.
4.7 Legal Proceedings; Orders.
(a) There is no pending Proceeding:
(i) that has been commenced by or against Up2004snap or that
otherwise relates to or might affect the business of, or any
of the assets owned or used by, Up2004snap; or
(ii) that challenges, or that might have the effect of preventing,
delaying, making illegal or otherwise interfering with, any of
the transactions contemplated by this Agreement.
(iii) To the knowledge of Up2004snap, (1) no such Proceeding has
been threatened and (2) no event has occurred, and no
condition or circumstance exists, that might give rise to or
serve as a basis for the commencement of any such Proceeding.
4.8 Material Contracts. All Up2004snap Contracts are legal, valid and binding
obligations of Up2004snap and each other Person who is a party thereto,
enforceable against Up2004snap and each such Person in accordance with its
terms, and none are subject to any material default thereunder.
4.9 Up2004snap Intellectual Property.
(a) Schedule "B" sets forth a complete and correct list of each patent,
patent application and invention, trademark, tradename, trademark or tradename
registration or application, copyright or copyright registration or application
for copyright registration, and each license or licensing agreement, for any of
the foregoing relating to Up2004snap's Business as conducted by it or held by it
("Up2004snap Intellectual Property Rights"). Up2004snap Intellectual Property
Rights also include any trade secrets that are material to the conduct of
Up2004snap's Business in the manner that it has heretofore been conducted.
(b) Up2004snap has not during the three years preceding the date of this
Agreement been a party to any proceeding, nor to the knowledge of it, is any
proceeding threatened as to which there is a reasonable possibility of a
determination adverse to Up2004snap, involving a claim of infringement by any
Person (including any Governmental Authority) of any Up2004snap Intellectual
Property Right that would result in a Material Adverse Effect. No Up2004snap
Intellectual Property Right is subject to any outstanding order, judgment,
decree, stipulation or agreement restricting the use thereof by Up2004snap or
restricting the licensing thereof by Up2004snap to any Person, except where any
such restriction would not have a Material Adverse Effect. To the knowledge of
Up2004snap, the Up2004snap Intellectual Property Rights and the conduct of its'
Business does not conflict with, infringe upon or violate any patent, patent
license, patent application, trademark, tradename, trademark or tradename
registration, copyright, copyright registration, service xxxx, brand xxxx or
brand name or any pending application relating thereto, or any trade secret,
know-how, programs or processes, or any similar rights, of any Person.
(c) To the knowledge of Up2004snap, it either owns the entire right, title
and interest in, to and under, or has acquired rights to use, any and all
patents, trademarks, trade names, brand names and copyrights that are material
to the conduct of Up2004snap's Business in the manner that Up2004snap's Business
has heretofore, been conducted. The Up2004snap Intellectual Property Rights are
in full force and effect and have not been used or enforced or failed to be used
or enforced in a manner that would result in the abandonment, cancellation or
unenforceability of any of the Up2004snap Intellectual Property Rights. All
registrations and filings necessary to preserve the rights of Up2004snap in and
to the Up2004snap Intellectual Property Rights have been made, except where the
failure to make any such filing would not result in a Material Adverse Effect.
4.11 Taxes. Up2004snap has filed or will cause to be filed (on a timely basis)
all Tax Returns that are or were required to be filed by or with respect to any
of them, either separately or as a member of a group of corporations, pursuant
to the Applicable Law of each Governmental Authority with taxing power over them
or their assets. Up2004snap has made available to Manu Forti copies of all such
Tax Returns filed since fiscal year ended December 31, 2003. Up2004snap has
paid, or made provision for the payment of, all Taxes that have or may have
become due pursuant to those Tax Returns, or otherwise, or pursuant to any
assessment received by Up2004snap, except such Taxes, if any, as have been made
known to Manu Forti by Up2004snap in writing that are being contested in good
faith and as to which adequate reserves (determined in accordance with GAAP)
have been provided in Up2004snap's Financials. The United States federal and
state income and franchise Tax Returns of Up2004snap subject to such Taxes have
not been audited by the Internal Revenue Service or relevant state tax
authorities or are closed by the applicable statute of limitations for all
taxable years through December 31, 2004. Up2004snap has not given nor has it
been requested to give waivers or extensions (or is or would be subject to a
waiver or extension given by any other Person) of any statute of limitations
relating to the payment of Taxes of Up2004snap or for which it may be liable.
The charges, accruals and reserves with respect to Taxes on the respective books
of Up2004snap are adequate (determined in accordance with GAAP). All Taxes that
Up2004snap is or was required by Applicable Law to withhold or collect have been
duly withheld or collected and, to the extent required, have been paid to the
proper Governmental Authority or other Person, except where the failure to
withhold, collect or pay could not have a Material Adverse Effect. All Tax
Returns filed by (or which include on a consolidated basis) Up2004snap are true,
correct and complete in all material respects. There is no tax sharing agreement
that will require any payment by Up2004snap after the date of this Agreement.
4.11 Disclosure.
(a) No representation or warranty of Up2004snap contained in this
Agreement contains any untrue statement. No representation or warranty of
Up2004snap contained in this Agreement or statement in the Disclosure Letter
omits to state a material fact necessary in order to make the statements herein
or therein, in light of the circumstances under which they were made, not
misleading.
(b) There is no fact known to Up2004snap which has specific application to
Up2004snap (other than general economic or industry conditions) and which
materially adversely affects or, so far as it can reasonably foresee, materially
threatens, the assets, business, prospects, financial condition or results of
operations of Up2004snap considered as a whole which has not been set forth in
this Agreement or the Disclosure Letter..
ARTICLE V.
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF UP2004SNAP.
The obligations of Up2004snap to effect the transactions contemplated under this
Agreement at the Closing are subject to the fulfillment on or prior to the
Closing Date of the following conditions, any one or more of which may be waived
in whole or in part by the Up2004snap Shareholders in writing:
5.1 Representation and Warranties True at the Closing Date. The representations
and warranties of Manu Forti contained in this Agreement and the Disclosure
Letter (without giving effect to any updating or corrective information provided
pursuant to Article VII or otherwise) shall have been true and correct in all
material respects (except for those representations and warranties qualified as
to materiality, which shall be true and correct in all respects) when made and
as of the Closing Date, and Manu Forti shall have delivered to Up2004snap a
certificate, executed by Xxxx Xxxxx'x Board of Directors and dated the Closing
Date, to the foregoing effect.
5.2 No Material Adverse Change. During the period from the date of the Interim
Balance Sheet to the Closing Date, there shall not have been any material
adverse change in the financial condition, results of operations, business or
prospects of Manu Forti, individually or taken as a whole, nor any material loss
or damage to its assets, whether or not insured, which materially affects the
ability of Manu Forti to conduct its business. Manu Forti shall have delivered
to Up2004snap a certificate, executed by Xxxx Xxxxx'x Board of Directors and
dated the Closing Date, to the foregoing effect.
5.3 Xxxx Xxxxx'x Performance. Manu Forti shall have performed and complied with
all covenants and agreements required by this Agreement and each other agreement
entered into in connection herewith to be performed or complied with by Manu
Forti on or before the Closing Date. At the Closing, Xxxx Xxxxx'x Board of
Directors shall have delivered to Up2004snap a certificate, dated the Closing
Date, to the foregoing effect.
5.4 Distribution of Shares. Manu Forti shall have distributed the Manu Forti
Shares to the Up2004snap Shareholders, free and clear of all Encumbrances. No
claim shall have been filed, made or threatened by any Person asserting that
such Person is entitled to any part of the Manu Forti Shares. The parties agree
that Up2004snap's acquisition of the Manu Forti Shares pursuant to the terms and
conditions of this Agreement will not trigger any transfer taxes.
5.5 No Prohibition of Transaction. No Proceeding or regulation or legislation
shall have been instituted, threatened or proposed before, nor any order issued
by, any Governmental Authority to enjoin, restrain, prohibit or obtain
substantial damage (a) in respect of, or which is related to, or arises out of,
this Agreement or the consummation of the transactions contemplated hereby or
(b) which, in the reasonable judgment of Up2004snap, could have a Material
Adverse Effect.
5.6 Compliance with Law. There shall have been obtained any and all permits,
approvals and consents of any Governmental Authority which counsel for
Up2004snap may reasonably deem necessary or appropriate so that consummation of
the transactions contemplated hereby will be in compliance with Applicable Law.
5.7 Documentation and Consents. Manu Forti shall have made all deliveries
required pursuant to Article II of this Agreement. In addition, Manu Forti shall
have delivered all assignments, consents, approvals and other documents,
certificates and instruments as Up2004snap may reasonably request for the
purpose of (a) enabling its counsel to provide the opinion required under this
Agreement, (b) evidencing the accuracy and completeness of any representations
or warranties, the performance of any covenants and agreements of Manu Forti, or
the satisfaction any conditions, all as contained or referred to in this
Agreement or (c) effectuating or confirming the conveyance and transfer of the
Manu Forti Shares to the Up2004snap Shareholders.
5.8 Consents to Assignments. On or prior to the Closing Date, Manu Forti shall
have furnished Up2004snap with evidence of consents as Manu Forti shall know or
Up2004snap shall determine to be required to enable Up2004snap to continue to
enjoy the benefit of any Contract or authorization of any Governmental Authority
to or of which Manu Forti is a party or a beneficiary and which can, by its
terms (with consent) and consistent with Applicable Law, be so enjoyed after the
transfer of the Manu Forti Shares to the Up2004snap Shareholders.
5.9 Resignations. Up2004snap shall have received the resignation of Xxxx X.
Xxxxxxx as Chief Executive Officer of Manu Forti and the resignations of all
other individuals who are officers or directors of Manu Forti immediately prior
to the Closing that Up2004snap deems appropriate and in such form as Up2004snap
may require.
5.10 Xxxx Xxxxx'x Member Release. Up2004snap shall have received a release in a
form acceptable to Up2004snap executed by each director and officer of Manu
Forti and each holder of ten percent or more of Xxxx Xxxxx'x outstanding capital
stock (the "Xxxx Xxxxx'x Release").
5.11 Due Diligence. Up2004snap shall have been satisfied, in its sole and
absolute discretion, with its due diligence investigation and review of the
financial condition, business and operations of the Company..
5.12 Records. Up2004snap shall retain possession of all corporate, accounting,
business and tax records of Manu Forti.
5.13 Other Documents and Aspects of the Transaction. Up2004snap shall have
received such other documents, instruments, certificates and opinions as may be
required by this Agreement or as may be reasonably requested by Up2004snap.
5.14 Actions Satisfactory. All certificates, opinions and other documents to be
delivered by Manu Forti and all other matters to be accomplished prior to or at
the Closing shall be satisfactory in the reasonable judgment of Up2004snap and
its counsel.
5.15 Continued Listing. Xxxx Xxxxx'x Common Stock shall continue to be eligible
for trading on the Over-The-Counter Bulletin Board or NASDAQ.
5.16 Financing. Manu Forti shall provide the Up2004snap Shareholders with
evidence satisfactory to them that the proceeds of the financing is in an
account of the Corporation and will be accessible to the Corporation following
the Closing.
ARTICLE VI.
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF MANU FORTI
The obligations of Manu Forti to effect the transactions contemplated under this
Agreement at the Closing are subject to the fulfillment on or prior to the
Closing Date of the following conditions, any one or more of which may be waived
in whole or in part by Manu Forti in writing:
6.1 Representations and Warranties True at the Closing Date. The representations
and warranties of Up2004snap contained in Article IV of this Agreement shall
have been true and correct when made and as of the Closing Date.
6.2 No Prohibition of Transaction. No Proceeding or regulation or legislation
shall have been instituted, threatened or proposed before, nor any order issued
by, any Governmental Authority to enjoin, restrain, prohibit or obtain
substantial damage (a) in respect of, or which is related to, or arises out of,
this Agreement or the consummation of the transactions contemplated by this
Agreement, or (b) which, in the reasonable judgment of Manu Forti, could have a
Material Adverse Effect.
6.3 Compliance with Law. There shall have been obtained upon Xxxx Xxxxx'x
request any and all permits, approvals and consents of any Governmental
Authority which counsel for Manu Forti may reasonably deem necessary or
appropriate so that consummation of the transactions contemplated hereby will be
in compliance with Applicable Law.
6.4 Documentation and Consents. Up2004snap shall have made all deliveries
required pursuant to Article II of this Agreement. In addition, Up2004snap shall
have delivered all assignments, consents, approvals and other documents,
certificates and instruments as Manu Forti may reasonably request for the
purpose of (a) enabling its counsel to provide the opinion required under this
Agreement, (b) evidencing the accuracy and completeness of any representations
or warranties, the performance of any covenants and agreements of the Manu
Forti, or the satisfaction any conditions, all as contained or referred to in
this Agreement or (c) effectuating or confirming the conveyance and transfer of
the Up2004snap Shares to Manu Forti.
ARTICLE VII.
COVENANTS OF MANU FORTI PRIOR TO CLOSING DATE
7.1 Access and Investigation. During the period from the date of this Agreement
to the Closing Date, Manu Forti shall afford Up2004snap and its representatives
(including legal counsel, financial and other advisors, consultants and
independent accountants) full and free access to Xxxx Xxxxx'x personnel,
properties, contracts, books and records and other documents and data, including
tax returns, and shall furnish Up2004snap with copies of all documents and with
such additional financial and operating data and other information as Up2004snap
shall, from time to time, reasonably request for the purpose of enabling
Up2004snap to investigate the affairs of Manu Forti and the accuracy of the
representations and warranties of Manu Forti made in this Agreement. During such
investigation, Up2004snap and its representatives shall have the right to make
copies of such contracts, books and records, tax returns and other documents and
data as it may deem advisable. The furnishing of such information to Up2004snap
any such investigation by Up2004snap shall not affect Up2004snap's right to rely
on any of the representations and warranties made in this Agreement.
7.2 Operation of the Business of Manu Forti. During the period the date of this
Agreement to the Closing Date, Manu Forti shall conduct its business only in the
ordinary course and in a manner consistent with its past practices; use its best
efforts to preserve intact its current business organization, keep available the
services of its current officers, employees and agents, and maintain its
relations and good will with suppliers, customers, landlords, creditors,
employees, agents and others having business relationships with it; confer with
Up2004snap concerning operational matters of material nature; and report
periodically to Up2004snap concerning the status of the business, operations and
finances of Manu Forti.
7.3 Negative Covenant. Except as otherwise expressly permitted by this
Agreement, Manu Forti shall not, without the prior consent of Up2004snap, take
any action described in Section 3.15 of this Agreement.
7.4 Approvals of Governmental Authorities. Between the date of this Agreement
the Closing Date, Manu Forti will use its best efforts, and will cooperate with
Up2004snap in taking all steps necessary, promptly to (i) make any filing and
(ii) obtain any consent, approval or authorization of any Governmental
Authority, in each case required by Applicable Law to allow the consummation of
this Agreement and the transactions contemplated by this Agreement.
7.5 Notification. Between the date of this Agreement and the Closing Date, Manu
Forti will promptly notify Up2004snap in writing if Manu Forti becomes aware of
any fact or condition which makes untrue any representation or breaches any
warranty made by Manu Forti in this Agreement or if Manu Forti becomes aware of
the occurrence after the date of this Agreement of any fact or condition that
would (except as expressly contemplated by this Agreement) make untrue any such
representation or breach any such warranty had such representation or warranty
been made as of the time of occurrence or discovery of such fact or condition.
Should any such fact or condition require any change in the Disclosure Letter if
such Disclosure Letter were dated the date of the occurrence or discovery of any
such fact or condition, Manu Forti shall deliver to Up2004snap a Supplement to
the Disclosure Letter specifying such change. Delivery of such Supplements shall
be for information purposes only and shall not modify in any such respect any
representation, warranty, covenant or condition contained herein. During the
same period, Manu Forti will promptly notify Up2004snap of the occurrence of any
breach of any covenant of Manu Forti set forth in this Section 7 or of the
occurrence of any event that may make the satisfaction of the conditions set
forth in Section 5 impossible or unlikely.
7.6 No Negotiation. Until such time, if any, as this Agreement is terminated
pursuant to Section 11.1, Manu Forti shall not, and shall cause Manu Forti not
to, directly or indirectly solicit or entertain offers from, negotiate with, or
in any manner discuss, encourage, recommend or agree to any proposal of, any
potential buyer or buyers of the assets or stock of Manu Forti regardless of the
structure of any such transaction.
7.7 Best Efforts. Between the date of this Agreement and the Closing Date, Manu
Forti will use its Best Efforts to cause the conditions specified in Article V
to be satisfied.
7.8 Other Actions. Manu Forti shall take such other action as may be reasonably
required by the Up2004snap Shareholders, Up2004snap and counsel to Up2004snap in
connection with the transactions contemplated hereby or in order to facilitate
such transactions and, without limiting the generality of the foregoing, Manu
Forti shall file such reports with the Securities and Exchange Commission as may
be required under the 33 Act or the 34 Act and make such other filings as may be
requested by Up2004snap in connection with the transactions contemplated hereby,
including, without limitation, the filing of an information statement in
accordance with Rule 14f-1 under the 34 Act.
ARTICLE VIII.
COVENANTS OF UP2004SNAP PRIOR TO CLOSING DATE.
8.1 Access and Investigation. During the period from the date of this Agreement
to the Closing Date, Up2004snap shall afford Manu Forti and its representatives
(including legal counsel, financial and other advisors, consultants and
independent accountants) full and free access to Up2004snap's personnel,
properties, contracts, books and records and other documents and data, including
tax returns, and shall furnish Manu Forti with copies of all documents and with
such additional financial and operating data and other information as Manu Forti
shall, from time to time, reasonably request for the purpose of enabling Manu
Forti to investigate the affairs of Up2004snap and the accuracy of the
representations and warranties of Up2004snap made in this Agreement. During such
investigation, Manu Forti and its representatives shall have the right to make
copies of such contracts, books and records, tax returns and other documents and
data as it may deem advisable. The furnishing of such information to Manu Forti
any such investigation by Manu Forti shall not affect Xxxx Xxxxx'x right to rely
on any of the representations and warranties made in this Agreement.
8.2 Operation of the Business of Up2004snap. During the period the date of this
Agreement to the Closing Date, Up2004snap shall conduct its business only in the
ordinary course and in a manner consistent with its past practices; use its best
efforts to preserve intact its current business organization, keep available the
services of its current officers, employees and agents, and maintain its
relations and good will with suppliers, customers, landlords, creditors,
employees, agents and others having business relationships with it; confer with
Manu Forti concerning operational matters of material nature; and report
periodically to Manu Forti concerning the status of the business, operations and
finances of Up2004snap.
8.3 Negative Covenant. Except as otherwise expressly permitted by this
Agreement, Manu Forti shall not, without the prior consent of Up2004snap, take
any action described in Section 4.6 of this Agreement.
8.4 Approvals of Governmental Authorities. Between the date of this Agreement
and the Closing Date, Up2004snap will use its best efforts, and will cooperate
with Manu Forti in taking all steps necessary, promptly to (i) make any filing
and (ii) obtain any consent, approval or authorization of any Governmental
Authority, in each case required by Applicable Law to allow the consummation of
this Agreement and the transactions contemplated hereby, provided that nothing
herein shall require Up2004snap to dispose of, or make any change in, any
portion of its business or to incur any other burden in order to obtain any
consent, approval or authorization.
8.5 Notification. Between the date of this Agreement and the Closing Date,
Up2004snap will promptly notify Manu Forti in writing if it becomes aware of any
fact or condition which makes untrue any representation or breaches any warranty
made by Up2004snap in this Agreement or if it becomes aware of the occurrence
after the date of this Agreement of any fact or condition that would (except as
expressly contemplated by this Agreement) make untrue any such representation or
breach any such warranty had such representation or warranty been made as of the
time of occurrence or discovery of such fact or condition.
8.6 No Negotiation. Until such time, if any, as this Agreement is terminated
pursuant to Section 11.1, Up2004snap shall not, and shall cause Up2004snap not
to, solicit or entertain offers from, negotiate with, or in any manner discuss,
encourage, recommend or agree to any proposal of, any potential buyer or buyers
of the assets or stock of Up2004snap.
8.7 Best Efforts. Between the date of this Agreement and the Closing Date,
Up2004snap will use its best Efforts to cause the conditions specified in
Article VI hereof to be satisfied.
ARTICLE IX.
COVENANTS OF MANU FORTI AND
UP2004SNAP SUBSEQUENT TO THE CLOSING DATE.
9.1 Further Assurances. Manu Forti will, upon request of Up2004snap from time to
time after the Closing, execute and deliver, and use its best efforts to cause
other Persons to execute and deliver, to Up2004snap all such further documents
and instruments, and will do or use their best efforts to cause to be done such
other acts, as Up2004snap may reasonably request more completely to consummate
and make effective the Contemplated Transactions.
9.2 SEC Reports. On and after the Closing Date, Manu Forti shall timely file, or
cause to be timely filed, with the SEC, such reports and/or statements required
to be filed by it in connection with the consummation of the Contemplated
Transactions.
ARTICLE X.
MUTUAL COVENANTS
10.1 Expenses. Except as expressly otherwise provided herein, each party to this
Agreement shall bear its respective expenses incurred in connection with the
preparation, execution and performance of this Agreement and the transactions
contemplated hereby, including all fees and expenses of agents, representatives,
counsel and accountants. In the case of termination of this Agreement, the
obligation of each party to pay its own expenses shall be subject to any rights
of such party arising from a breach of this Agreement by another party.
10.2 Public Announcements. Any public announcement or similar publicity,
including any reports or statements required to be filed with the SEC with
respect to this Agreement or the transactions contemplated hereby shall be
issued, if at all, at such time and in such manner as Up2004snap and Manu Forti
shall mutually determine; provided that the parties agree that (i) a press
release announcing the signing of this Agreement shall be issued and filed by
Manu Forti and Up2004snap within 24 hours of execution of this Agreement by
Up2004snap and Manu Forti and (ii) a Form 8-K shall be filed by each of the
Up2004snap and the Company and a Schedule 13D, as deemed necessary to comply
with Rule 13d-1 promulgated under the 34 Act, shall be filed by each of
Up2004snap and each Up2004snap Shareholder, within the time frames provided
under the applicable rules and regulation of the Securities and Exchange
Commission. Unless consented to by the Up2004snap in advance or required by
Applicable Law, prior to the Closing, Manu Forti shall keep the provisions of
this Agreement strictly confidential and make no disclosure thereof to any
Person. Manu Forti and Up2004snap will consult with each other concerning the
means by which the Up2004snap's employees, customers and suppliers and others
having dealings with Up2004snap will be informed of the transactions
contemplated by this Agreement, and Up2004snap shall have the right to be
present for any such communication.
10.3 Confidentiality. Between the date of this Agreement and the Closing date,
each party will maintain in confidence, and cause its directors, officers,
employees, agents and advisors to maintain in confidence, and not use to the
detriment of one another any written, oral or other information obtained in
confidence in connection with this Agreement or the transactions contemplated by
this Agreement unless such information is already known to some third party or
to others not bound by a duty of confidentiality or unless such information
becomes publicly available through no fault of such party, unless the use of
such information is necessary or appropriate in making any filing or obtaining
any consent or approval required for the consummation of the transactions
contemplated by this Agreement or unless the furnishing or use of such
information is required by or necessary or appropriate in connection with legal
proceedings.
If the transactions contemplated by this Agreement are not consummated, each
party will return or destroy as much of such written information as may
reasonably be requested. Whether or not the Closing takes place, Up2004snap
waives any cause of action, right or claim arising out of the access of Manu
Forti or its representatives to any trade secrets or other confidential
information of Manu Forti except for the intentional competitive misuse by Manu
Forti of such trade secrets or confidential information.
ARTICLE XI.
TERMINATION
11.1 Termination Events. Subject to the provisions of Section 11.2, this
Agreement may, by written notice given at or prior to the Closing in the manner
hereinafter provided, be terminated:
(a) by either the Up2004snap Shareholders or Manu Forti if a default or
breach shall be made by the other party hereto with respect to the due and
timely performance of any of its covenants and agreements contained herein, or
with respect to the due compliance with any of its representations, warranties
or covenants, and such default cannot be cured and has not been waived;
(b) (i) by the Up2004snap Shareholders if all of the conditions set
forth in Article V shall not have been satisfied at the time
the Closing would otherwise occur or if satisfaction of such a
condition is or becomes impossible, other than through failure
of the Up2004snap Shareholders to fully comply with their
obligations hereunder, and shall not have been waived by the
Up2004snap Shareholder or before such date; or
(ii) by Manu Forti, if all of the conditions set forth in Article
VI shall not have been satisfied at the time the Closing would
otherwise occur or if satisfaction of such a condition is or
becomes impossible, other than through failure of Manu Forti
to fully comply with its obligations hereunder, and shall not
have been waived by Manu Forti on or before such date;
(c) by mutual consent of the Up2004snap Shareholders and Manu Forti; or
(d) by either Up2004snap or Manu Forti if the Closing shall not have
occurred, other than through failure of any such party to fulfill its
obligations hereunder, on or before 45 days from the date this Agreement is
executed or such later date as may be agreed upon in writing by the parties.
Each party's right of termination hereunder is in addition to any other rights
it may have hereunder or otherwise and the exercise of a right of termination
shall not be an election of remedies.
(e) by the Up2004snap Shareholders, wherein the Up2004snap Shareholders
have the sole right to rescind this Agreement. within a 45-day period following
the execution of this Agreement if Xxxx Xxxxx'x fails to execute the Financing
as defined in Section 5.17.
11.2 Effect of Termination. In the event this Agreement is terminated pursuant
to Section 11.1, all further obligations of the parties hereunder shall
terminate, except that the obligations set forth in Sections 10.1 and 10.3 shall
survive; provided that, if this Agreement is so terminated by a party because
one or more of the conditions to such party's obligations hereunder is not
satisfied as a result of the other party's willful failure to comply with its
obligations under this Agreement, the terminating party's right to pursue all
legal remedies for breach of contract or otherwise, including, without
limitation, damages relating thereto, shall also survive such termination
unimpaired.
ARTICLE XII.
MISCELLANEOUS
12.1 Survival. The representations and warranties of the parties contained
herein shall not survive the Closing. The agreements contained in this Agreement
that are applicable to the period following the Closing shall survive the
Closing.
12.2 Notices. Notices, requests, instructions or other documents to be in given
under this Agreement shall be in writing and shall be deemed given and received,
(i) when sent if sent by facsimile, provided that the fax is promptly confirmed
by telephone confirmation thereof, (ii) when delivered, if delivered personally
to the intended recipient, and (iii) one Business Day later, if sent by
overnight delivery via a national courier service, and in each case, addressed
to a party at the following address for such party:
if to Manu Forti:
Attention: Xxxx X. Xxxxxxx, Chairman
Facsimile: 000-000-0000
0000 Xxxxxxx Xxxx Xxxxx 000-000
Xxx Xxxxx, XX 00000
At the same address, with a copy to:
Attention: Xxxxxxx X. Xxxxxxxx
Facsimile:
if to the Up2004snap Shareholders, to the address as specified on the
signature page hereto or to such other persons or addresses as may be designated
in writing by the party to receive such notice as provided above.
12.3 Governing Law and Venue; Waiver of Jury Trial.
(a) THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL RESPECTS SHALL
BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH THE LAW OF THE
STATE OF CALIFORNIA WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
The parties hereby irrevocably submit to the jurisdiction of the Federal courts
of the United States of America and the state courts located in San Francisco,
State of California in respect of the interpretation and enforcement of the
provisions of this Agreement and of the documents referred to in this Agreement,
and in respect of the transactions contemplated hereby, and hereby waive, and
agree not to assert, as a defense in any action, suit or proceeding for the
interpretation or enforcement hereof or of any such document, that it is not
subject thereto or that such action, suit or proceeding may not be brought or is
not maintainable in said courts or that the venue thereof may not be appropriate
or that this Agreement or any such document may not be enforced in or by such
courts, and the parties hereto irrevocably agree that all claims with respect to
such action or proceeding shall be heard and determined in such a Federal or
state court.
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY
ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT,
OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH
PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH SUCH PARTY HAS BEEN INDUCED
TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 12.3.
(c) Further Assurances. The parties hereto agree (i) to furnish upon
request to each other such further information, (ii) to execute and deliver to
each other such other documents, and (iii) to do such other acts and things, all
as the other party hereto may at any time reasonably request for the purpose of
carrying out the intent of this Agreement and the documents referred to herein.
(d) Waiver. The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay on the part of
any party in exercising any right, power or privilege under this Agreement or
the documents referred to herein shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or privilege preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. To the maximum extent permitted by applicable law, (i) no claim or
right arising out of this Agreement or the documents referred to herein can be
discharged by one party hereto, in whole or in part, by a waiver or renunciation
of the claim or right unless in writing signed by the other party hereto; (ii)
no waiver which may be given by a party hereto shall be applicable except in the
specific instance for which it is given; and (iii) no notice to or demand on one
party hereto shall be deemed to be a waiver of any obligation of such party or
of the right of the party giving such notice or demand to take further action
without notice or demand as provided in this Agreement or the documents referred
to herein.
12.4 Entire Agreement and Modification. This Agreement supersedes all prior
agreements among the parties with respect to its subject matter (including, but
not limited to, any letter of intent among Up2004snap and Manu Forti and is
intended (with the documents referred to herein) as a complete and exclusive
statement of the terms of the agreement among the parties with respect thereto.
This Agreement may not be changed or terminated, except by a written agreement
executed by Up2004snap and Manu Forti.
12.5 Assignments, Successors, and No Third-Party Rights. This Agreement shall
apply to and be binding in all respects upon, and shall inure to the benefit of,
the successors and assigns of the parties hereto. Nothing expressed or referred
to in this Agreement is intended or shall be construed to give any Person other
than the parties to this Agreement any legal or equitable right, remedy or claim
under or with respect to this Agreement, or any provision hereof, it being the
intention of the parties hereto that this Agreement and all of its provisions
and conditions are for the sole and exclusive benefit of the parties to this
Agreement, their successors and assigns, and for the benefit of no other Person.
12.6 Severability. In the event any provisions of this Agreement shall be held
invalid or unenforceable by any court of competent jurisdiction, such holding
shall not invalidate or render unenforceable any other provisions hereof. Any
provision of this Agreement held invalid or unenforceable only in part or degree
shall remain in full force and effect to the extent no held invalid or
unenforceable.
12.7 Section Headings, Construction. The headings of Sections contained in this
Agreement are provided for convenience only. They form no part of this Agreement
and shall not affect its construction or interpretation. All references to
Sections in this Agreement refer to the corresponding Sections of this
Agreement. All words used herein shall be construed to be of such gender or
number as the circumstances require. Unless otherwise specifically noted, the
words "herein," "hereof," "hereby," "hereinabove," "hereinbelow," "hereunder,"
and words of similar import, refer to this Agreement as a whole and not to any
particular Section, subsection, paragraph, clause or other subdivision hereof.
12.8 Counterparts; Facsimile Execution. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original copy of this
Agreement, and all of which, when taken together, shall be deemed to constitute
but one and the same agreement. Facsimile execution and delivery of this
Agreement is legal, valid and binding for all purposes.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by
the duly authorized officers of the parties hereto as of the date first written
above.
CORPORATION:
UPSNAP, INC.
By:
--------------------------------------------------
Name: Xxxx X Xxxxxxx
Title: CEO
UP2004SNAP SHAREHOLDERS
Xxxx Xxxxxxx
Address:
------------------------------------
Xxxxxxx Xxxxx
Address:
------------------------------------
Xxxxxxx Xxxxx
Address:
------------------------------------
