EXHIBIT 2.1
AGREEMENT FOR EXCHANGE OF STOCK
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AND
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PLAN OF REORGANIZATION
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THIS AGREEMENT, made this ____ day of August 1996, between GENERAL
GENETICS CORPORATION, a publicly traded, Delaware Corporation, hereinafter
referred to as "GENG" and PRIVATE MORTGAGE BANKERS, INC. AND ITS WHOLLY OWNED
SUBSIDIARIES, Texas based Corporations, hereinafter referred to as "PMB."
1. PLAN OF REORGANIZATION: STOCKHOLDER is the owner of all
of the issued and outstanding capital stock of PMB. It is the intention of
the parties hereto that all of the issued and outstanding capital stock of PMB
be acquired by GENG in exchange for certain of its capital stock, as
hereinafter set forth.
2. GENG CAPITALIZATION: The authorized capital stock of
GENG consists of five million (5,000,000) shares of common stock, with a par
value of one one-thousandth of a dollar ($0.001) per share, of which, as of
the date hereof, and as of the closing date, five million (5,000,000) shares
are issued and outstanding and owned of record by stockholders as appears in
the records of the Continental Stock Transfer and Trust Co. of New York, NY
(Transfer Agent), and no other shares of GENG have been issued or are
outstanding.
On or before fifteen (15) days prior to the closing date as hereinafter
set forth, a stockholder list, certified as accurate by the Transfer Agent,
shall be furnished to PMB and STOCKHOLDER.
All issued and outstanding shares of the capital stock of GENG have been
duly authorized, validly issued and are fully paid and non-assessable. At the
closing date, there will exist no pre-emptive rights on the part of any holder
of any class of securities of GENG and no options, warrants, conversions or
other rights, agreements or commitments of any kind obligating GENG, or its
stockholders, contingently or otherwise, to issue or sell any shares of GENG
stock of any class or any securities convertible into or exchangeable for any
such shares OTHER THAN WHAT IS COVERED IN PARAGRAPH 9 (B). All issued and
outstanding shares shall contain no liens, claims or encumbrances of any kind.
The shares of GENG are trading in the "over the counter" market and the
bid and ask price on the date of this Agreement as quoted by NASDAQ Bulletin
Board is; ask,bid. It is the representation of GENG that GENG is a
publicly-trading company and that all filings required by state and federal
agencies have been complied with and are current. This matter is further
addressed in Paragraph 7 (i) hereof.
3. EXCHANGE OF SHARES AND ACQUISITION OF PMB: As set forth
above, GENG capitalization consists of five million (5,000,000) shares of
common stock with five million (5,000,000) shares issued and outstanding. It
is a specific representation by GENG that the officers, directors and
shareholders of GENG shall forthwith do such things as are incidental and
necessary to cause a change in the authorized capital from 5,000,000 to
500,000,000 common shares with a par value of $.001, add 100 million
Preferred Class A shares; 50 million Class B Preferred shares; and 150 million
warrants to purchase common stock and a twenty-to-one (20:1) reverse stock
split, which will result in two hundred fifty thousand (250,000) new shares
being exchanged for the five million (5,000,000) shares presently outstanding.
In this connection, the officers and directors will be instructed to do all
things necessary to accomplish this end, including, but not limited to the
following:
(a) adopt appropriate reorganization resolutions in compliance with
the Articles of Incorporation and the appropriate Bylaw provisions which will
amend the Articles of Incorporation in a manner necessary to accommodate the
change in the authorized capital from 5,000,000 Common Shares par value $.001
to 500,000,000 Common Shares par value $.001, add 100 million Preferred Class
A shares; 50 million Class B Preferred shares; and 150 million warrants to
purchase common stock, the issuance of four hundred six million two hundred
sixty thousand (406,260,000) pre-rollback (20:1) shares to STOCKHOLDER in
compliance with the Plan of Reorganization as set forth herein, and the
reverse split of twenty-to-one (20:1);
(b) adopt a resolution calling a special shareholders meeting, in
compliance with all Articles of Incorporation and Bylaw provisions, to present
the Plan of Reorganization contemplated herein which will include all
necessary authority for the reverse split provisions, including an amendment
to the Articles of Incorporation in a form and manner necessary and provide
for the acquisition of PMB by the issuance of four hundred six million two
hundred sixty thousand (406,260,000) pre-rollback (20:1) shares to
STOCKHOLDER;
(c) thereafter provide the Transfer Agent with appropriate notices to
be sent to all shareholders and to otherwise ensure that proper notice and
information filings be done to comply with any and all state and federal
regulatory agencies to ensure the continuity of the publicly tradable share
characterization, including but not limited to the maintenance of the original
stock issue date and to cause a notice of this action to be communicated to
any GENG market maker and published in a securities publication in a manner
that will provide due diligence notice to the securities industry.
(d) the four hundred six million two hundred sixty thousand
(406,260,000) pre-rollback (20:1) shares mentioned herein, which shall be
issued to STOCKHOLDER at the closing as hereinafter defined, shall be
delivered to STOCKHOLDER in such denominations as STOCKHOLDER may instruct,
solely in exchange for STOCKHOLDER's forty thousand (40,000) shares of
no par stock value in PMB as set forth herein. Such shares shall be issued
and certificates delivered in such denomination amount(s) and name(s) as may
be requested by STOCKHOLDER. STOCKHOLDER represents and warrants that the
shares will be held for investment and not for resale, and in this connection
STOCKHOLDER if required will execute an Investment Letter prepared by GENG's
attorney and made a part hereof. The certificates shall contain the transfer
restriction legend prepared by GENG's attorney.
4. DELIVERY OF PMB SHARES: On the closing date,
STOCKHOLDER will deliver, at its expense, certificates for the forty
thousand (40,000) common shares of no par stock value of PMB duly
endorsed with signature(s) guaranteed and, if GENG's counsel requires,
document stamps will be affixed thereto so as to make GENG the sole owner
thereof, free and clear of all claims and encumbrances. On such closing date,
delivery of the duly endorsed four hundred six million two hundred sixty
thousand (406,260,000) pre-rollback (20:1) GENG shares on which documentary
stamp taxes, if the opinion of counsel requires, will have been paid by GENG.
Delivery of these shares will be made to STOCKHOLDER as above set forth.
5. REPRESENTATIONS OF STOCKHOLDER: STOCKHOLDER represents and
warrants as follows:
(a) At this date and on the closing date, STOCKHOLDER will be the
sole owner of all outstanding shares of PMB. Such shares will be free from
claims, liens or other encumbrances and STOCKHOLDER will have unqualified
right to transfer such shares.
(b) The shares constitute validly issued shares of PMB, fully paid
and non-assessable. There is attached hereto, marked Exhibit "B" and made a
part hereof, a Financial Statement of PRIVATE MORTGAGE BANKERS, INC. AND ITS
WHOLLY OWNED SUBSIDIARIES. These Financial Statements have been prepared in
compliance with and in accordance with generally accepted accounting practices
and procedures in the state of Texas.
(c) Since the date of Exhibit "B" there have not been, and prior to
the closing date there will not be, any material changes in the financial
position of PMB except changes arising in the ordinary course of business.
The Financial Statement as above set forth shall reasonably reflect the
statement (Exhibit "B") delivered herewith.
(d) PMB is not involved in any pending litigation or governmental
investigation or proceeding not reflected in such Financial Statement or
otherwise disclosed in writing to GENG and to the knowledge of PMB or
STOCKHOLDER, no litigation or governmental investigation or proceeding is
threatened against PMB.
(e) As of the closing date, PMB will be in good standing as an Texas
corporation and a closing document will reflect this status.
6. OPINION OF COUNSEL: At closing, PMB shall deliver an
attorney's opinion reflecting that PMB is a Texas corporation in good standing
and the person executing this document and any other document(s) necessary to
complete this transaction has been duly authorized by the board of directors
and STOCKHOLDER to do so and that such action is taken in compliance with all
of the terms and conditions of the Articles of Incorporation and Bylaws of
PMB.
7. REPRESENTATIONS OF GENG:GENG represents and warrants as follows:
(a) GENG has delivered to STOCKHOLDER and PMB form 10KSB, which does
not reflect a transition period covered by the 10KSB, but contains Financial
Statements prepared by, Xxxx Xxxxxxxxx Certified public accountants,
dated, June 30, 1995, and form 10Q for the quarter ended, March
31, 1996 which contains an unaudited Financial Statement dated March 31,
1996 . The 10KSB and 10Q referred to are by reference made a part of this
Agreement. The Financial Statement of GENG will be delivered at closing and
will reflect substantially the financial information as contained in said
10KSB and 10Q.
(b) GENG's board of directors and shareholders will adopt resolutions
as set forth in Paragraph Three (3) hereof and will thereafter immediately
call a shareholders meeting pursuant to the Articles of Incorporation and
Bylaws of GENG and within the least period of time provided in said Bylaws
present all of the matters contained in this Agreement to a vote of the
shareholders with recommendation of passage. In addition to the matters set
forth in said Paragraph Three (3) above, a resolution shall be presented
ratifying and confirming all actions taken by the officers and directors of
GENG in the furtherance of this Agreement.
(c) As of the closing date, GENG's shares to be delivered to
STOCKHOLDER will constitute the valid and legally issued shares of GENG, fully
paid and non-assessable, and will be legally equivalent in all respects to the
common stock of GENG issued and outstanding as of the date hereof, except as
reflected in the reverse split provision.
(d) The officers of GENG are duly authorized to execute this
Agreement pursuant to authorization of its shareholders.
(e) GENG's Financial Statements as reflected in the forms 10KSB and
10Q are true and complete statements of its financial condition as of those
dates. Prior to the closing, 10Qs for March 1996, be provided. There
are no substantial liabilities, either fixed or contingent, not reflected in
such Financial Statements and the corporation will have done nothing that will
alter its financial condition as reflected in such Financial Statements.
(f) GENG is not involved in any pending litigation or governmental
investigation or proceeding not reflected in such Financial Statement or
otherwise disclosed in writing to STOCKHOLDER and PMB and to the knowledge of
GENG, no litigation or governmental investigation or proceeding is threatened
against GENG.
(g) As of the closing date, GENG will be in good standing as a
Delaware corporation and as a closing document, a Certificate of Good Standing
will be delivered.
(h) The shares of PMB are being acquired by GENG as an investment and
there is no present intention on the part of GENG to dispose of such shares.
(i) The company attorney representing GENG shall deliver to
STOCKHOLDER and PMB at closing an opinion acceptable to STOCKHOLDER and PMB
that all actions taken by GENG in connection with the Plan of Reorganization,
including a duly called shareholders meeting and ratification and confirmation
of such plan; its standing as a publicly-traded company is in good standing
with all filings current; and that all actions taken in connection with
complying with the provisions of this Agreement, including but not limited to
the Plan of Reorganization, the issuance of the four hundred six million two
hundred sixty thousand (406,260,000) pre-rollback shares to STOCKHOLDER, the
compliance with the Bylaws and Articles of Incorporation in the adoption of
the Plan of Reorganization, the amendment to the Articles of Incorporation and
any other action taken incidental to this Agreement, have complied with the
laws of Delaware, CONFORM TO THE RULES AND REGULATIONS OF THE SECURITIES AND
EXCHANGE COMMISSION, and are in compliance with the terms, conditions and
provisions of the Articles of Incorporation and the Bylaws of GENG and that
the person(s) executing the documents have the legal authority to do so.
Copies of all reorganization documents will be available at closing.
8. CONDITIONS AND CLOSING DATE: The closing date hereof
and referred to variously herein shall be a date not later than, September
15, 1996 unless extended by written mutual consent of the parties. All
representations and covenants herein shall survive the closing. At the
closing, STOCKHOLDER and PMB hereby designate, nominate, constitute and
appoint E. Xxxxxx XxXxxxx as agent and attorney-in-fact to accept delivery
of the certificate of GENG's stock, to be issued in such manner as said
attorney-in-fact may designate, to acknowledge compliance with the closing
provisions contained herein, to give a good and sufficient receipt for the
same, and in connection therewith, to make delivery of PMB's stock to GENG and
to do such other things as may be incidental or necessary in the closing of
this transaction. This Power of Attorney shall cease and be of no further
force and effect in the event STOCKHOLDER shall be available at closing.
9. PROHIBITED ACTS: GENG and PMB agree not to do any of
the following things prior to the closing date and STOCKHOLDER agrees that
prior to the closing date STOCKHOLDER will not request or permit PMB to do any
of the following things:
(a) Declare or pay any dividends or other distribution on its stock
or purchase or redeem any of its stock.
(b) Issue any stock or other securities, including any right or
option to purchase or otherwise acquire any of its stock or issue any notes or
other evidence of indebtedness not in the usual course of business. OTHER THAN
GENG ISSUING 24,540,000 MILLION PRE-ROLLBACK SHARES OF REG S TO A GROUP OF
EUROPEAN INVESTORS AND 5,000,000 MILLION PRE-ROLL BACK RESTRICTED UNDER RULE
144 TO COVER CONSULTING FEES.
10. DELIVERY OF RECORDS: STOCKHOLDER and PMB agree that on or
before the closing date they will cause to be delivered to GENG such corporate
records or other documents as GENG may request. GENG shall deliver to
STOCKHOLDER and PMB a certified shareholder list prepared by the Transfer
Agent. The Transfer Agent's certification must reflect any restrictions of
any kind or nature placed on the transferability or otherwise with respect to
any of the shares of GENG outstanding.
11. NOTICES: Any notice which any of the parties hereto may
desire to serve upon any of the other parties hereto shall be in writing and
shall be conclusively deemed to have been received by the party to whom
addressed if mailed, postage prepaid, United States certified mail, to the
following addresses:
GENG 0000 Xx Xx Xxxx Xxxxx 000
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Xxxxx Xxxxx, XX 00000
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PMB 000 Xxxxx Xxxx Xxx Xxxx, #000
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Xxxxxxx, XX 00000-0000
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12. CONSTRUCTION: This Agreement shall be construed under the
laws of the State of Texas and any action taken by any party shall be brought
in the State of Texas and the execution hereof confers jurisdiction in Texas
to all of the parties to this Agreement.
13. BINDING NATURE: This Agreement shall be binding upon and
insure to the benefit of the heirs, personal representatives, successors and
assigns of the parties.
14. CONFIDENTIALITY: All matters contained in this Agreement
are to be held confidential except as is necessary to accomplish the purposes
of this Agreement. There shall be no news releases or announcements of any
kind until such time as GENG and PMB's counsel advises the parties that such
publication and notice is in compliance with security trading rules generally
relating to the contents, execution and culmination of the terms of this
Agreement. Provided further that any release of any kind by either party
prior to closing must be approved by all parties to this Agreement.
15. FAX TRANSMISSIONS: Fax transmissions of executed documents
with hard copies mailed per this Agreement shall be considered as binding on
the parties from the time of such fax transmission.
16. MULTIPLE ORIGINALS: This Agreement shall be executed
in multiple counterparts, each of which shall be deemed duplicate originals as
of the date first above written.
17. EXPENSES: Each party hereto shall pay its own expenses
incurred in connection with this Agreement.
18. BROKERS: The parties certify and agree that there were no
brokers involved in this transaction and there are no fees payable to brokers
as a result of this transaction.
19. NON-ASSIGNABILITY: Each party agrees that it will not
assign, sell, transfer, delegate or otherwise dispose of any right or
obligation under this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
GENERAL GENETICS CORPORATION PRIVATE MORTGAGE BANKERS, INC.
By /S/ Xxxx Xxxxxxx By /S/ Xxxxx X. Xxxxx
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PRESIDENT XXXXX X. XXXXX/PRESIDENT
STOCKHOLDERS
By /S/ Xxxxx X. Xxxxx
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XXXXX X. XXXXX/40,000 SHARES - 100%
