EXHIBIT 2.7
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (this "Agreement") is entered
into as of the 12th day of March 2003, by and among JUPITER ENTERPRISES, INC., a
Nevada corporation ("JPTR"); BEIJING BLUESKY KSPAN STEEL CONSTITUTION COMPANY
LTD., a Chinese corporation ("BLUESKY"); and the shareholders of BLUESKY
identified on the signature page hereto ("BLUESKY Shareholders").
RECITALS
WHEREAS, BLUESKY Shareholders own 100% of the issued and outstanding
shares of BLUESKY; and
WHEREAS, JPTR desires to acquire all of the issued and outstanding
shares of BLUESKY owned by BLUESKY Shareholders, and BLUESKY Shareholders desire
to exchange all of their shares of BLUESKY for an aggregate of 65 million shares
of JPTR restricted common stock.
WHEREAS, as a result of the above-referenced transactions, JPTR will
own 100% of the outstanding stock of BLUESKY, and BLUESKY will be a wholly-owned
subsidiary of JPTR.
NOW, THEREFORE, for and in consideration of the mutual covenants and
representations and warranties contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, JPTR, BLUESKY and
BLUESKY Shareholders agree as follows:
1. THE REORGANIZATION.
1.1 Acquisition. At the Closing (as defined in section 3, below), JPTR
shall acquire from BLUESKY Shareholders and BLUESKY Shareholders shall sell,
transfer, assign and convey to JPTR 100% of all the issued and outstanding
shares of BLUESKY (the "BLUESKY Shares"), in exchange for 65 million shares of
JPTR's common stock (the "JPTR Shares"). JPTR shall cause to be issued 65
million shares to BLUESKY Shareholders immediately upon execution of this
Agreement. The JPTR Shares to be issued to BLUESKY Shareholders shall have the
rights, restrictions and privileges set forth in JPTR's Articles of
Incorporation and in the stock certificates therefor. Upon the Closing, BLUESKY
shall become a wholly-owned subsidiary of JPTR.
1.2 Taxes. It is the intent of the parties that this reorganization
will constitute a tax-free reorganization within the meaning of Section 368(a)
of the Internal Revenue Code of 1986, as amended. Each party shall be
responsible for and shall pay any and all taxes, charges or fees attributable to
such party, including individual state and federal income taxes, arising out of,
or by reason of, the exchange of JPTR Shares for the BLUESKY Shares, or
otherwise in connection with the transactions contemplated hereby. Each party
hereto represents and warrants that it has relied solely on the opinions or
advice of its own professional advisors with respect to the tax consequences of
this transaction, if any, and has not relied on the opinions or advice of the
other parties or its professional advisors in any way with respect to the tax
consequences of this transaction.
2. CHANGE IN MANAGEMENT OF JPTR. By execution of this Agreement, Xx Xxxxxxxx
shall be appointed to serve as Chairman, Chief Executive Officer and a Director
of XXXX.
0. CLOSING. The closing of the reorganization and the transactions contemplated
in this Agreement (the "Closing") shall be deemed to take place upon execution
of this Agreement by all of the parties hereto, whereupon the BLUESKY
Shareholders shall be deemed to have accepted delivery of the certificates of
JPTR Shares to be issued in their names, and in connection therewith, shall make
delivery of their BLUESKY Shares to JPTR.
3.1 Closing and Delivery of Shares. Closing shall occur upon execution
of this Agreement, whereupon BLUESKY Shareholders shall deliver their respective
certificates and/or other documents
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representing the BLUESKY Shares duly endorsed in blank, free and clear of all
claims and encumbrances, to JPTR, and JPTR shall be irevocably obligated to
issue and deliver the JPTR Shares to the BLUESKY Shareholders. The JPTR Shares
shall be duly issued in the name of the BLUESKY Shareholders, and shall be duly
recorded on the books and records of JPTR. The names of the BLUESKY Shareholders
and their respective addresses, and the number of shares that will be issued to
each respective BLUESKY Shareholder is set forth on the signature page hereto.
THE PARTIES EXPRESSLY ACKNOWLEDGE THAT THE 65 MILLION JPTR SHARES WILL BE ISSUED
AND DELIVERED TO THE BLUESKY SHAREHOLDERS AFTER THE SHAREHOLDERS OF JPTR APPROVE
AN AMENDMENT TO JPTR'S ARTICLES OF INCORPORATION TO INCREASE THE AUTHORIZED
CAPITAL OF JPTR FROM 5 MILLION SHARES OF COMMON STOCK TO 100 MILLION SHARES.
4. REPRESENTATIONS OF BLUESKY SHAREHOLDERS AND BLUESKY. BLUESKY represents and
warrants, and to the best knowledge of the BLUESKY Shareholders, the BLUESKY
Shareholders hereby represent and warrant, that effective this date, the
representations and warranties listed below are true and correct:
4.1 Organization. BLUESKY is a company duly organized, validly existing
and in good standing under the laws of the Peoples Republic of China, with full
power and authority to own and use its properties and conduct its business as
presently conducted by it. BLUESKY shall furnish JPTR with copies of its
corporate organizational documents, including all amendments thereto. Such
copies are true, correct and complete and contain all amendments through the
date hereof, which, together with this Agreement, are sufficient to effect the
transactions hereunder and evidence the intent of the parties hereto.
4.2 Capitalization. All of the issued and outstanding shares of BLUESKY
are duly and validly authorized and issued and are fully paid and
non-assessable. BLUESKY does not have outstanding any security convertible into,
or any warrant, option or other right to subscribe for or acquire any equity
securities of BLUESKY; nor is BLUESKY under any obligation, whether written or
oral, to issue any of its securities.
4.3 Authority. BLUESKY has the requisite corporate authority to enter
into and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby in accordance with the terms hereof. The
execution and delivery of this Agreement by BLUESKY and the consummation of the
transactions contemplated hereby will not violate or conflict with any
provisions of its the corporate organizational documents, as amended, or
contravene any law, rule, regulation, court or administrative order binding on
it, or result in the breach of or constitute a default in the performance of any
material obligation, agreement, covenant or condition contained in any material
contract, lease, judgment, decree, order, award, note, loan or credit agreement
or any other material agreement or instrument to which BLUESKY is a party or by
which it is bound, the default or breach of which would have a material adverse
effect on the property and assets of BLUESKY, considered as a whole. BLUESKY has
taken all requisite corporate action to authorize and approve the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby. Upon due execution and delivery of this
Agreement, this Agreement will constitute a valid, legal and binding obligation
of BLUESKY and BLUESKY Shareholders enforceable against them in accordance with
its terms.
4.4 BLUESKY Shareholders. BLUESKY Shareholders are the owners of 100%
of the issued and outstanding equity interest of BLUESKY. Such BLUESKY Shares
are free and clear from any security interests, claims, liens, or other
encumbrances and BLUESKY Shareholders have the unqualified right to transfer and
dispose of their BLUESKY Shares.
4.5 Due Diligence. BLUESKY shall furnish to JPTR copies of all
documents requested by JPTR. No due diligence investigations undertaken by JPTR
shall in any event relieve BLUESKY or BLUESKY Shareholders of their
responsibilities for the accuracy and completeness of any representation or
warranty of BLUESKY or of BLUESKY Shareholders contained herein or the
performance of any covenant or agreement of BLUESKY or of BLUESKY Shareholders
contained herein.
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4.6 Approvals and Consent. No approval, authorization or other action
by, or filing with, any third-party, including a governmental authority is
required in connection with the execution, delivery and performance by BLUESKY
and BLUESKY Shareholders of their obligations under this Agreement and their
respective performance of the transactions contemplated hereby.
4.7 Undisclosed Liabilities. BLUESKY has no liabilities or obligations
whatsoever, either accrued, absolute, contingent or otherwise, except as
disclosed herein or on the financial statements to be provided and those
incurred in or as a result of the ordinary course of business of BLUESKY
subsequent to the date of the financial statements.
4.8 Assets. The assets of BLUESKY have been acquired in bona fide
transactions, fully supported by appropriate instruments of assignment, sale, or
transfer, where appropriate, and are offset by no liabilities or contingencies,
contractual or otherwise, except as indicated in its financial statements.
4.9 Litigation. BLUESKY is not involved in any pending litigation or
governmental investigation or proceeding and, to the best knowledge of BLUESKY
and BLUESKY Shareholders, no litigation, claims, assessments, or governmental
investigation or proceeding is threatened against BLUESKY, its shareholders or
properties.
4.10 Applicable Laws. BLUESKY has complied with all applicable laws in
connection with its formation, issuance of securities, organization,
capitalization and operations, and no contingent liabilities have been
threatened or claims made, and no basis for the same exists with respect to said
operations, formation or capitalization, including claims for violation of any
state or federal securities laws.
4.11 Taxes. BLUESKY has filed all governmental, tax or related returns
and reports due or required to be filed and has paid all taxes or assessments
which have become due as of the date of this Agreement, including any employment
related taxes and withholdings, and BLUESKY, to the best of its knowledge, is
not subject to a tax audit by any federal, state or local tax authority and its
properties are not subject to any tax liens.
4.12 Breach of Contracts. BLUESKY has not breached, nor is there any
pending or threatened claims or any legal basis for a claim that BLUESKY has
breached, any of the terms or conditions of any agreements, contracts or
commitments to which it is a party or is bound and the execution and performance
hereof will not violate any provisions of applicable law of any agreement to
which BLUESKY is subject.
4.13 BLUESKY Disclosure. At the date of this Agreement, BLUESKY has
disclosed all events, conditions and facts materially affecting the business and
prospects of BLUESKY. BLUESKY has not withheld disclosure of any such events,
conditions, and facts which it, through management, has knowledge of, or has
reasonable grounds to know, which may materially affect the business and
prospects of BLUESKY.
4.14 Shareholder Disclosure. BLUESKY Shareholders hereby represent that
the materials prepared and delivered by JPTR to BLUESKY Shareholders will have
been read and understood by BLUESKY Shareholders, that each is familiar with the
business of JPTR, that each is acquiring the JPTR Shares under Section 4(2) of
the Securities Act of 1933, (the "Act"), commonly known as the private offering
exemption, and that the shares are restricted and may not be resold, except if
duly registered or transferred in reliance upon an exemption under the Act.
5. REPRESENTATIONS OF JPTR. JPTR hereby represents and warrants that effective
this date, the representations and warranties listed below are true and correct:
5.1 Organization. JPTR is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada with full
power and authority to own and use its properties and conduct its business as
presently conducted by it. JPTR is duly qualified and in good standing to do
business as a foreign corporation in any other jurisdiction where failure to so
qualify would have a material
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adverse effect on its business or assets. JPTR has made available to BLUESKY
Shareholders copies of the Articles of Incorporation and the Bylaws of JPTR,
including all amendments thereto. Such copies are true, correct and complete and
contain all amendments through the date hereof, together with this Agreement,
which are sufficient to effect the transactions hereunder and evidence the
intent of the parties hereto.
5.2 Capitalization. All of the issued and outstanding equity securities
of JPTR are duly and validly authorized and issued and are fully paid and
non-assessable. At the time of their issuance and delivery pursuant to this
Agreement, all JPTR Shares to be issued pursuant to the terms hereof shall be
duly and validly authorized and issued, fully paid and nonassessable. JPTR does
not have outstanding any security convertible into, or any warrant, option or
other right to subscribe for or acquire any equity securities of stock of JPTR;
nor is JPTR under any obligation, whether written or oral, to issue any of its
securities.
5.3 Authority. JPTR has the requisite corporate authority to enter into
and perform its obligations under this Agreement and to consummate the
transactions contemplated hereby in accordance with the terms hereof. The
execution and delivery of this Agreement by JPTR and the consummation of the
transactions contemplated hereby will not violate or conflict with any
provisions of the Articles of Incorporation, as amended, or Bylaws of JPTR or
contravene any law, rule, regulation, court or administrative order binding on
it, or result in the breach of or constitute a default in the performance of any
material obligation, agreement, covenant or condition contained in any material
contract, lease, judgment, decree, order, award, note, loan or credit agreement
or any other material agreement or instrument to which JPTR is a party or by
which it is bound, the default or breach of which would have a material adverse
effect on the property and assets of JPTR, considered as a whole. JPTR has taken
all requisite corporate action to authorize and approve the execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby. Upon due execution and delivery of this Agreement, this
Agreement will constitute a valid, legal and binding obligation of JPTR
enforceable against it in accordance with its terms.
5.4 Due Diligence. JPTR has furnished to BLUESKY Shareholders copies of
all documents requested by BLUESKY Shareholders. No due diligence investigations
undertaken by BLUESKY Shareholders shall in any event relieve JPTR or its
current officers and directors of their responsibilities for the accuracy and
completeness of any representation or warranty of JPTR contained herein or the
performance of any covenant or agreement of JPTR contained herein.
5.5 Approvals and Consent. No approval, authorization or other action
by, or filing with, any third-party, including a governmental authority is
required in connection with the execution, delivery and performance by JPTR of
its obligations under this Agreement and its performance of the transactions
contemplated hereby.
5.6 Litigation. JPTR is not involved in any pending litigation or
governmental investigation or proceeding and, to the best knowledge of JPTR, no
litigation, claims, assessments, or governmental investigation or proceeding is
threatened against JPTR, its shareholders or properties.
5.7 Applicable Laws. JPTR has complied with all state, federal and
local laws in connection with its formation, issuance of securities,
organization, capitalization and operations, and no contingent liabilities have
been threatened or claims made, and no basis for the same exists with respect to
said operations, formation or capitalization, including claims for violation of
any state or federal securities laws.
5.8 Breach of Contracts. JPTR has not breached, nor is there any
pending or threatened claims or any legal basis for a claim that JPTR has
breached, any of the terms or conditions of any agreements, contracts or
commitments to which it is a party or is bound and the execution and performance
hereof will not violate any provisions of applicable law of any agreement to
which JPTR is subject.
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5.9 Taxes. JPTR has filed all governmental, tax or related returns and
reports due or required to be filed and has paid all taxes or assessments which
have become due as of the date of this Agreement, including any employment
related taxes and withholdings, and JPTR, to the best of its knowledge, is not
subject to a tax audit by any federal, state or local tax authority and its
properties are not subject to any tax liens. JPTR will cause to be filed or
prepared, as applicable, by the date of this Agreement, all federal, state,
county and local income, excise, property and other tax returns, forms, or
reports, which are due or required to be filed by it prior to the date of this
Agreement.
5.10 JPTR Disclosure. At the date of this Agreement, JPTR has disclosed
all events, conditions and facts materially affecting the business and prospects
of JPTR. JPTR has not withheld disclosure of any such events, conditions, and
facts which it, through management, has knowledge of, or has reasonable grounds
to know, which may materially affect the business and prospects of JPTR.
5.11 Undisclosed Liabilities. Except as disclosed in its periodic
reports filed with the U.S. Securities and Exchange Commission ("SEC"), JPTR has
no material liabilities or obligations whatsoever, either accrued, absolute,
contingent or otherwise.
5.12 SEC Reporting. JPTR is current in its requirements to file
periodic reports with the SEC. JPTR will use its best efforts to remain current
in its periodic reports required to be filed with the SEC.
6. AUDIT.
6.1 Audit of BLUESKY Financial Statements. Within 75 days after
Closing, BLUESKY shall obtain and deliver to JPTR an audit of BLUESKY financial
statements and any other financial statements which may be required by
Regulations S-X or S-B for purposes of complying with the Securities Act of 1933
and the Securities Exchange Act of 1934. JPTR shall assist BLUESKY and its
auditors as reasonably requested.
7. MUTUAL COVENANTS OF THE PARTIES. JPTR, BLUESKY and BLUESKY Shareholders each
covenant and agree to execute any further documents or agreements and to take
any further acts that may be reasonably necessary to effect the transactions
contemplated hereunder, including, but not limited to, obtaining any consents or
approvals of any third-party required to be obtained to consummate the
transactions contemplated by this Agreement.
8. RESTRICTIONS ON TRANSFER OF SHARES. The parties hereto acknowledge that all
securities transferred and/or issued in connection with the transactions
contemplated hereby are restricted as to transfer and the certificates therefore
shall bear legends to such effect and no transfer of any shares may be effected,
except pursuant to an effective registration statement prepared and filed
pursuant to the Act or pursuant to an exemption from registration thereunder, as
evidenced by an opinion of counsel or as otherwise allowed under the laws of
descent and distribution.
9. NATURE AND SURVIVAL OF REPRESENTATIONS. All representations, warranties and
covenants made by any party in this Agreement shall survive the Closing
hereunder and the consummation of the transactions contemplated hereby for two
(2) years from the date hereof. All of the parties hereto are executing and
carrying out the provisions of this Agreement in reliance solely on the
representations, warranties and covenants and agreements contained in this
Agreement or at the Closing of the transactions herein provided for and not upon
any investigation upon which it might have made or any representations,
warranty, agreement, promise or information, written or oral, made by the other
party or any other person other than as specifically set forth herein.
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10. MISCELLANEOUS.
10.1 Undertakings and Further Assurances. At any time, and from time to
time, hereafter, each party will execute such additional instruments and take
such action as may be reasonably requested by the other party to carry out the
intent and purposes of this Agreement.
10.2 Waiver. Any failure on the part of any party hereto to comply with
any of its obligations, agreements or conditions hereunder may be waived in
writing by the party to whom such compliance is owed.
10.3 Notices. All notices, requests, demands, claims, and other
communications hereunder shall be in writing and will be effective when
hand-delivered or upon delivery if sent by commercial courier service such as
Federal Express or Airborne, and addressed by the sender to the addresses as
designated on the signature page hereof.
10.4 Headings. The paragraph and subparagraph headings in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
10.5 Governing Law and Jurisdiction. The parties agree that this
Agreement and the transactions contemplated hereby shall be construed and
enforced in accordance with the laws of the Peoples' Republic of China, and that
any action or proceeding that may be brought arising out of, in connection with
or by reason of this Agreement shall be brought only in a court of competent
jurisdiction within the city of Beijing, China. Each of the parties hereto
hereby submits, unconditionally and irrevocably, to the jurisdiction to the
aforesaid courts for the purpose of any such lawsuits, agree to accept service
of process by express mail courier, and hereby waive any jurisdictional or venue
defenses otherwise available to it.
10.6 Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors and assigns. This Agreement shall not be
assigned by any party hereto, except upon the consent, in writing, of the other
parties hereto.
10.7 Entire Agreement. This Agreement, including any documents
delivered pursuant to the terms hereof, is the entire agreement of the parties
covering everything agreed upon or understood with respect to the transactions
contemplated hereby and supersedes all prior agreements, covenants,
representations or warranties, whether written or oral, by any party hereto.
There are no oral promises, conditions, representations, understandings,
interpretations or terms of any kind as conditions or inducements to the
execution hereof.
10.8 Time. Time is of the essence. The parties each agree to proceed
promptly and in good faith to consummate the transactions contemplated herein.
10.9 Expenses. Each of the parties hereto shall pay its own expenses
incurred in connection with the authorization, preparation, execution and
performance of this Agreement and obtaining any necessary regulatory approvals,
including, without limitation, all fees and expenses of its respective counsel.
10.10 Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force and
effect.
10.11 Counterparts and Facsimile Signatures. This Agreement and any
exhibits, attachments, or documents ancillary hereto, may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute one and the same
instrument. Execution and delivery of this Agreement by exchange of facsimile
copies bearing the facsimile signature of a party hereto shall constitute a
valid and binding execution and delivery of this Agreement by such party. Such
facsimile copies shall constitute enforceable original documents.
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IN WITNESS WHEREOF, the parties have executed this Agreement the day and year
first above written.
JUPITER ENTERPRISES, INC.
/s/
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Xxxxxxx Xxxxxx, President
00 Xxx xx Xxxxxxxx
XX0000, Xxxxxx Xxxxxxxxxxx
BEIJING BLUESKY KSPAN STEEL CONSTITUTION COMPANY LTD.
/s/
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Xx Xxxxxxxx, President
address:
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BLUESKY SHAREHOLDERS:
PERCENTAGE OWNERSHIP
OF BLUESKY NO. OF JPTR SHARES
NAME TO BE EXCHANGED TO BE RECEIVED
Xx Xxxxxxxx 77% 50,050,000
/s/
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(signature)
address:
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Xxxxxx & Xxxxxx, Ltd. 23% 14,950,000
/s/
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(signature)
address:
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