EXHIBIT 8(B)
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AGREEMENT AND PLAN OF REORGANIZATION
Between and Among
OnCOURSE TECHNOLOGIES, INC.
(a Nevada business corporation)
as the Parent
CAM SOLUTIONS, INC.
(a Minnesota business corporation)
as the Subsidiary
and
XXXXX XXXX
(an individual resident of Minnesota)
as the Subsidiary Shareholder
Dated: December 30, 1998
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AGREEMENT AND PLAN OF REORGANIZATION
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AGREEMENT AND PLAN OF REORGANIZATION ("Reorganization Agreement"), dated as
of December 30, 1998, between and among OnCOURSE TECHNOLOGIES, INC., a Nevada
corporation ("Parent"), CAM SOLUTIONS, INC., a Minnesota corporation
("Subsidiary"), and XXXXX XXXX, an individual resident of Minnesota and the sole
shareholder of Subsidiary (the "Subsidiary Shareholder").
RECITALS
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A. OnCOURSE TECHNOLOGIES, INC., the acquiring corporation, is a Nevada
business corporation incorporated under and in accordance with the provisions of
the Nevada Private Corporations Law (NRS SectionSection 78.010 et seq.). The
address of its current registered office in Nevada is Resident Agents of Nevada,
Inc., 000 X. Xxxxxx, Xxxxx 0, Xxxxxx Xxxx, XX, 00000.
B. CAM SOLUTIONS, INC., the acquired corporation, is a Minnesota business
corporation incorporated under and in accordance with the provisions of the
Minnesota Business Corporation Act (MS SectionSection 302A.001 et seq.). The
address of its current registered office in Minnesota is 0000 Xxxx 00xx Xxxxxx,
Xxxxx 000, Xxxxxxxxxxx, XX 00000.
C. Parent, Subsidiary and Subsidiary Shareholder desire that Parent
acquire Subsidiary by the exchange of some of the stock of Parent for all of the
outstanding shares of stock of Subsidiary (the "Exchange").
D. The Boards of Directors of Parent and Subsidiary have approved the
Exchange and recommended it to their respective shareholders upon the terms and
subject to the conditions set forth herein and in the Plan of Exchange, Exhibit
"A" attached hereto and made a part hereof (the "Plan of Exchange").
E. For federal income tax purposes, it is intended that the Exchange
shall qualify as a tax free reorganization within the meaning of Section
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended (the "Code").
F. The parties to this Reorganization Agreement desire to establish the
manner and basis of exchanging the shares of Subsidiary for the shares of
Parent, and each of the parties hereto desires to make certain representations,
warranties and agreements in connection with the Exchange and also to prescribe
various conditions thereto.
AGREEMENT
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Therefore, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
ARTICLE I
THE EXCHANGE
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SECTION 1.01 THE EXCHANGE
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(a) At the Effective Time (as defined in Section 1.02) and subject to the
terms and conditions of this Reorganization Agreement and the Plan of Exchange,
Subsidiary Shareholder shall endorse and deliver to Parent 25,000 shares of
voting common stock of Subsidiary, representing all of its then issued and
outstanding shares (the "Subsidiary Common Stock"). On the same date, Parent
shall issue and deliver to Subsidiary Shareholder three hundred thousand
(300,000) shares of voting common stock of Parent (the "Parent Common Stock").
(b) On and after the Effective Time, Subsidiary will continue to be
governed by the laws of the State of Minnesota, and the separate corporate
existence of Subsidiary and all of its rights, privileges, immunities and
franchises, public or private, and all its duties and liabilities as a
corporation organized under the Minnesota Business Corporation Act, will
continue unaffected by the Exchange.
(c) The Exchange will have the effects specified by the Minnesota Business
Corporation Act and the Nevada Private Corporations Law.
SECTION 1.02 EFFECTIVE TIME. As soon as practicable following fulfillment
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of the conditions specified in Sections 4.05 and 5.05 hereof and provided that
this Reorganization Agreement has not been terminated or abandoned pursuant to
Section 7.01 hereof or the Plan of Exchange has not been terminated or abandoned
pursuant to Section 4.01 thereof, Parent and Subsidiary will execute and cause
Articles of Exchange substantially in the form of Exhibit "B" attached hereto
and made a part hereof (the "Articles of Exchange"), to be filed with the
Secretary of State of Nevada as provided in Section 200 of Chapter 92A of the
Nevada Private Corporations Law (NRS Section92A.200) and Section 615 of the
Minnesota Business Corporation Act (MS Section302A.615). The Articles of
Exchange and the Plan of Exchange shall become effective on December 31, 1998 at
11:59:59 PM Pacific Standard Time (the "Effective Time") unless otherwise agreed
by the parties hereto in writing prior to such Effective Time.
SECTION 1.03 RESTRICTED SECURITIES. The Parent Common Stock to be issued
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hereunder, upon issuance and transfer to the Subsidiary Shareholder, will not
have been "registered" and therefore will be "restricted securities", as those
terms are used under the Securities Act of 1933, as amended (the "1933 Act"),
and the rules and regulations thereunder. By execution of this Reorganization
Agreement, Subsidiary Shareholder agrees, represents and warrants that (a) his
acquisition of the Parent Common Stock hereunder is for investment only, for his
own account (both of record and beneficially) and not with a view to
"distribution" as that term is used under the 1933 Act; (b) that his Parent
Common Stock may not be transferred or disposed of unless the Parent receives an
opinion of Subsidiary Shareholders' counsel, at the request of the President of
Parent, satisfactory to Parent and its counsel, that such transfer or other
disposition can be made without registration under the 1933 Act and all
applicable federal and state securities laws; and (c) that he will not sell or
otherwise dispose of any of his Parent Common Stock without compliance with this
Reorganization Agreement and either registration under or other compliance with
the aforesaid Act, all other applicable federal and state securities laws, and
the rules and regulations thereunder. Parent Common Stock to be issued hereunder
shall bear a legend substantially as follows:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE
SECURITIES LAW, AND MAY NOT BE TRANSFERRED UNLESS THE CORPORATION RECEIVES
AN OPINION OF COUNSEL, AT THE REQUEST OF THE PRESIDENT, SATISFACTORY TO THE
CORPORATION AND ITS COUNSEL, THAT SUCH TRANSFER OR OTHER DISPOSITION CAN BE
MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND ALL
APPLICABLE FEDERAL AND STATE SECURITIES LAWS. BY ACQUIRING THE SHARES OF
STOCK REPRESENTED BY THIS CERTIFICATE, THE STOCKHOLDER REPRESENTS THAT HE
HAS ACQUIRED SUCH SHARES OF STOCK FOR INVESTMENT AND THAT HE WILL NOT SELL
OR OTHERWISE DISPOSE OF THE SHARES OF STOCK WITHOUT REGISTRATION OR OTHER
COMPLIANCE WITH THE AFORESAID ACT AND THE RULES AND REGULATIONS THEREUNDER.
ARTICLE II
THE SUBSIDIARY
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SECTION 2.01 ARTICLES OF INCORPORATION. The Articles of Incorporation of
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Subsidiary as in effect immediately prior to the Effective Time shall be the
Articles of Incorporation of Subsidiary immediately after the Effective Time
until amended in accordance with the Minnesota Business Corporation Act.
SECTION 2.02 BYLAWS. The Bylaws of Subsidiary as in effect immediately
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prior to the Effective Time shall be the Bylaws of the Subsidiary immediately
after the Effective Time until amended in accordance with the provisions of said
Bylaws and the Articles of Incorporation of the Subsidiary.
SECTION 2.03 BOARD OF DIRECTORS. The sole Director of Subsidiary
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immediately prior to the Effective Time shall continue to be the sole Director
of Subsidiary immediately after the Effective Time until his successor or
successors shall be elected and duly qualified, or until his death, resignation
or removal.
ARTICLE III
CONTINGENT CONSIDERATION
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SECTION 3.01 CONTINGENT CONSIDERATION. Within ninety (90) days following
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the end of each of the five (5) calendar years after the Effective Time (the
"Contingent Consideration Period"), if the Subsidiary shall have Net Profits for
the immediately preceding calendar year, then one (1) additional share of Parent
Common Stock shall be issued by Parent and delivered to Subsidiary Shareholder
for each one ($1.00) dollar of such Net Profits (the "Contingent
Consideration"). Any shares not earned by application of this provision by the
end of the Contingent Consideration Period shall not be delivered. The rights of
Subsidiary Shareholder to receive such Contingent Consideration shall not be
assignable. The maximum number of shares of Parent Common Stock which may be
issued as Contingent Consideration hereunder shall be three hundred thousand
(300,000) shares.
SECTION 3.02 SALE OF BUSINESS CONTINGENCY. If at any time during the
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Contingent Consideration Period, Parent or Subsidiary sell or in any other
manner transfer or convey all or a substantial part of Parent's interest in
Subsidiary, substantially all of the assets of Subsidiary, or substantially all
of the Subsidiary business, at a time when the number of additional shares of
Parent Common Stock issued to Subsidiary Shareholder pursuant to Section 3.01
above aggregates less than three hundred thousand (300,000) shares, Parent shall
forthwith, and prior to any such transfer or conveyance, issue and deliver to
Subsidiary Shareholder such additional shares of Parent Common Stock as shall be
required to aggregate three hundred thousand (300,000) shares of Contingent
Consideration to Subsidiary Shareholder.
SECTION 3.03 "NET PROFITS" DEFINED. For the purpose of this
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Reorganization Agreement, "Net Profits" for each calendar year shall be as
defined and computed in accordance with generally accepted accounting principles
applied on a consistent basis from year to year. The determination of Net
Profits shall include net losses from any one or more years of the Contingent
Consideration Period, but shall not include net losses prior to such Contingent
Consideration Period. The determination of Net Profits for each year of the
Contingent Consideration Period and the computation of Contingent Consideration
shall be made by independent certified public accountants regularly employed by
Parent for the purpose of preparing the financial reports of Parent. The term
"Net Profits" shall include the Net Profits of Subsidiary and the Net Profits of
such other subsidiary or subsidiaries and such division or divisions of Parent
as are then carrying on any part of the business formerly carried on by
Subsidiary (herein referred to as the Subsidiary Business) to the extent such
Net Profits of such subsidiary or subsidiaries and such division or divisions of
Parent derived from the Subsidiary Business. If Parent or any division,
subsidiary, or affiliate of Parent or Subsidiary in any manner directly or
indirectly sells, deals in or manufactures software or performs services which
were not previously sold, dealt in, manufactured or performed by Parent or such
division, subsidiary, or affiliate of Parent but which were previously sold,
dealt in, manufactured or performed by Subsidiary, or which are marketed under
the trade name "CAM Solutions", or any product or service trade name utilized by
Subsidiary, but not utilized by Parent or any division, subsidiary, or affiliate
of Parent, prior to the Effective Time, or any variant thereof, Parent or such
division, subsidiary, or affiliate shall be conclusively presumed to be carrying
on a part of Subsidiary Business.
SECTION 3.04 REPORTS; ARBITRATION OF DISPUTES. The Subsidiary Shareholder
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shall be entitled to receive on or before April 15 of each year of the
Contingent Consideration Period and the next calendar year following the end of
the Contingent Consideration Period, or until Parent shall have issued and
delivered to Subsidiary Shareholder the maximum Contingent Consideration,
whichever is the earlier, (a) financial statements of Subsidiary, including at
least a balance sheet and an income statement as of the end of each calendar
year, prepared on the basis of generally accepted accounting principles
consistently applied, which may be consolidated statements of Parent,
Subsidiary, and any other subsidiaries of Parent provided that such financial
statements include a balance sheet and income statement for the Subsidiary; and
(b) an appropriate written report prepared by the independent certified public
accountants of Parent, which report shall show the Net Profits for the calendar
year then ended computed in accordance with Section 3.01 and 3.02 hereof, as
well as a statement of the number of shares of Parent Common Stock previously
issued to Subsidiary Shareholder each year as Contingent Consideration and the
number of shares of Parent Common Stock to be issued to Subsidiary Shareholder
for the immediately preceding calendar year. The computation made by such
independent certified public accountants shall be final and conclusive unless
Subsidiary Shareholder shall, by written notice to Parent, within thirty (30)
days after receipt of any such statement, have made objection thereto. In the
event the objecting Subsidiary Shareholder and Parent are unable to resolve any
disputes as to the proper amount of Net Profits for any one year, within thirty
(30) days after receipt by Parent of the written objection by the objecting
Subsidiary Shareholder, the Subsidiary Shareholder and/or Parent may submit such
dispute to arbitration in Carson City, Nevada (or such other place as Parent and
Subsidiary Shareholder may mutually agree) under the rules then obtaining of the
American Arbitration Association, and judgment upon any award in such
arbitration may be entered in any court having jurisdiction thereof.
SECTION 3.05 CHANGES IN CAPITAL STRUCTURE. In the event there is any
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change in the Parent Common Stock by reason of a stock dividend issued with
respect to Parent Common Stock, or a recapitalization, reclassification, stock
split, or combination of shares with respect to such Parent Common Stock, or if
the outstanding Parent Common Stock should, by reason of a merger,
consolidation, liquidation or other reorganization, be exchanged for other
shares of Parent or of another corporation which is a party to such transaction,
the shares to be issued and delivered to Subsidiary Shareholder as Contingent
Consideration under Sections 3.01 and 3.02 of this Reorganization Agreement
shall be the shares into or for which the Parent Common Stock to be issued and
delivered under this Reorganization Agreement would have been changed or
exchanged had such shares already been issued and delivered to Subsidiary
Shareholder and become outstanding at the time of such event.
SECTION 3.06 TERMINATION OF CONTINGENT CONSIDERATION. In the event of
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termination of the Employment Agreement (as defined in Section 6.02 below) for
any reason, the Contingent Consideration Period shall automatically terminate as
of the first (1st) day of the calendar year of the termination of the Employment
Agreement, and any Contingent Consideration not earned prior to such date shall
terminate.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT
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Parent represents and warrants to Subsidiary, as of the date hereof and the
Effective Time, which representations and warranties shall survive the Exchange,
as follows:
SECTION 4.01 ORGANIZATION. Parent is duly organized and validly exists as
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a business corporation under the laws of the State of Nevada, and it is duly
authorized, qualified and licensed under all applicable laws, regulations,
ordinances and orders of public authorities to carry on its business in the
places and in the manner as now conducted. The character and location of the
assets now owned or regularly leased by Parent in the conduct of its business
and the nature of the business as now transacted by it do not require
qualification as a foreign corporation in any jurisdiction in which it is not so
registered. As soon as practicable after the execution of this Reorganization
Agreement, but in any event within fifteen (15) days after execution hereof,
Parent will deliver to Subsidiary true and correct copies of its Articles of
Incorporation and Bylaws, which Articles of Incorporation and Bylaws shall not
be amended prior to the Effective Time without the prior written consent of
Subsidiary and Subsidiary Shareholder.
SECTION 4.02 CAPITAL STOCK. The authorized capital stock of Parent
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consists of one hundred million (100,000,000) shares of common stock, par value
one tenth of a cent ($0.001) per share, of which twenty-one million three
hundred and thirty-three thousand (21,333,000) shares are validly issued, fully
paid, non-assessable and outstanding and none of which are issued in violation
of the preemptive rights of any shareholder. In addition, Parent has issued and
outstanding four hundred thousand (400,000) Redeemable Common Stock Purchase
Warrants entitling each Warrant Holder to purchase on or before December 31,
1999 one (1) share of Parent common stock per Purchase Warrant for the sum of
one dollar and fifty cents ($1.50). Lastly, pursuant to Article IV of an
Agreement and Plan of Reorganization dated July 23, 1998, Parent granted four
million (4,000,000) shares of its voting common stock as contingent
consideration to the Majority Target Shareholder and Minority Target Shareholder
defined therein. There are no other securities, subscriptive rights, warrants,
options, contracts, understandings or commitments providing for issuance of, or
granting rights to acquire any capital stock of Parent or securities convertible
into or exchangeable for capital stock of Parent.
SECTION 4.03 FINANCIAL STATEMENTS. Parent has delivered to Subsidiary
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copies of its financial statements for the period(s) indicated therein
("Parent's Financial Statement"). Parent's Financial Statements present fairly
the financial condition of parent as of the dates indicated thereon.
SECTION 4.04 ASSETS AND BUSINESS. The business of Parent is substantially
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as described in Parent's Financial Statements. To the knowledge and belief of
Parent, Parent has good and marketable title to all properties, assets and
leasehold estates, real, personal and mixed, tangible and intangible (including
by way of example and not limitation all patents, copyrights and other
intellectual property), owned by or used in its business, and which is material
to the operation of that business including those reflected on Parent's
Financial Statements (except as since sold or otherwise disposed of in the
ordinary course of business), subject to no mortgage, pledge, lien, conditional
sales agreement, encumbrance or charge, except for: (a) liens reflected on
Parent's Financial Statements as securing specified liabilities (with respect to
which no default exists); (b) liens for current taxes and assessments not in
default; and (c) liens arising by operation of law of which, except to the
extent disclosed on Parent's Financial Statements, Parent has no knowledge of
any such liens existing.
SECTION 4.05 AUTHORITY. On or before the Effective Time, Parent will have
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taken all necessary legal action to approve the execution and delivery of this
Reorganization Agreement and the performance of its obligations hereunder and
all transactions contemplated hereby will have been duly authorized by all
requisite corporate action on the part of Parent and the Directors and
Shareholders of Parent, and no further authorization, approval or consent is or
shall be necessary.
SECTION 4.06 LEGAL ACTIONS. There are no legal actions, suits,
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arbitrations, or other legal, administrative or other governmental proceedings
pending or threatened against Parent, its properties, assets or business, and
Parent is unaware of any fact which might result in such action, suit,
arbitration or other proceeding.
SECTION 4.07 OPERATION PENDING CLOSING. On and after execution hereof and
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until the Effective Time, Parent will not enter into any transaction or perform
any act that would constitute a material adverse breach of the representations,
warranties or agreements contained herein and Parent and its officers and
employees, will comply with all applicable material provisions of this
Reorganization Agreement. On and after execution hereof and until the Effective
Time:
(a) Parent will afford to the officers and authorized representatives of
Subsidiary access to the plants, properties, books and records of Parent
and will furnish Subsidiary with such additional financial and operating
data and other information as to the business and properties of the Parent
as Subsidiary may from time to time reasonably request.
(b) Parent will cooperate with Subsidiary, its representatives and counsel
in the preparation of any documents or other material which may be required
in connection with the Exchange.
(c) Parent will: (1) carry on its business in substantially the same manner
as it has heretofore and not introduce any material new method of
management, operation or accounting; (2) maintain its properties and
facilities in as good working order and condition as at present, ordinary
wear and tear excepted; (3) perform all its material obligations under
agreements relating to or affecting its assets, properties and rights; (4)
keep in full force and effect present insurance policies or other
comparable insurance coverage; and (5) use its best efforts to maintain and
preserve its business organization intact, retain its present employees and
maintain its relationships with suppliers, customers and others having
business relations with it.
(d) Without the prior written consent of Subsidiary and Subsidiary
Shareholder, Parent will not: (1) make any change in its Articles of
Incorporation or Bylaws; (2) issue any securities; (3) declare or pay any
dividend or make any distribution in respect of its stock whether now or
hereafter outstanding, or purchase, redeem or otherwise acquire or retire
for value any shares of its stock; (4) enter into any contract or
commitment or incur any liability or make any capital expenditures except
in the normal course of business; (5) increase the compensation payable or
to become payable to any officer, employee or agent, or make any bonus
payment to any such person; (6) create, assume or permit to exist any
mortgage, pledge or other lien or encumbrance upon any assets or properties
whether now owned or hereafter acquired; (7) sell, assign, lease, license
or otherwise transfer or dispose of any property or equipment except in the
normal course of business; or (8) merge, consolidate or otherwise
reorganize or agree to merge or consolidate or otherwise reorganize with or
into any other corporation.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF SUBSIDIARY AND SUBSIDIARY SHAREHOLDER
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Subsidiary and Subsidiary Shareholder jointly and severally represent and
warrant to Parent, as of the date hereof and the Effective Time, which
representations and warranties shall survive the Exchange, as follows:
SECTION 5.01 ORGANIZATION. Subsidiary is duly organized and validly
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exists as a business corporation under the laws of the State of Minnesota, and
it is duly authorized, qualified and licensed under all applicable laws,
regulations, ordinances and orders of public authorities to carry on its
business in the places and in the manner as now conducted. The character and
location of the assets now owned or regularly leased by Subsidiary in the
conduct of its business and the nature of the business as now transacted by it
do not require qualification as a foreign corporation in any jurisdiction in
which it is not so registered. As soon as practicable after the execution of
this Reorganization Agreement, but in any event within fifteen (15) days after
execution hereof, Subsidiary will deliver to Parent true and correct copies of
its Articles of Incorporation and Bylaws, which Articles of Incorporation and
Bylaws shall not be amended prior to the Effective Time without the prior
written consent of Parent. Subsidiary Shareholder is the sole director and all
of the officers of Subsidiary.
SECTION 5.02 CAPITAL STOCK. The authorized capital stock of Subsidiary
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consists of twenty-five thousand (25,000) shares of voting common stock, par
value ($0) dollars per share, of which twenty-five thousand (25,000) shares are
validly issued, fully paid, non-assessable and outstanding and none of which
are issued in violation of the preemptive rights of any shareholder. There are
no other securities, subscriptive rights, warrants, options, contracts,
understandings or commitments providing for issuance of, or granting rights to
acquire any capital stock of Subsidiary or securities convertible into or
exchangeable for capital stock of Subsidiary. Subsidiary Shareholder is the sole
shareholder of Subsidiary.
SECTION 5.03 FINANCIAL STATEMENTS. Subsidiary has delivered to Parent
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copies of its financial statements for the period(s) indicated therein
(Subsidiary's Financial Statements). Subsidiary's Financial Statements present
fairly the financial condition of subsidiary as of the date indicated thereon.
SECTION 5.04 ASSETS AND BUSINESS. The business of Subsidiary is
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substantially as described in Subsidiary's Financial Statements. To the
knowledge and belief of Subsidiary and Subsidiary Shareholder, Subsidiary has
good and marketable title to all properties, assets and leasehold estates, real,
personal and mixed, tangible and intangible (including by way of example and not
limitation all patents, copyrights and other intellectual property), owned by or
used in its business, and which is material to the operation of that business
including those reflected on Subsidiary's Financial Statements (except as since
sold or otherwise disposed of in the ordinary course of business), subject to no
mortgage, pledge, lien, conditional sales agreement, encumbrance or charge,
except for: (1) liens reflected on Subsidiary's Financial Statements as securing
specified liabilities (with respect to which no default exists); (2) liens for
current taxes and assessments not in default; and (3) liens arising by operation
of law of which, except to the extent disclosed on Subsidiary's Financial
Statements, the Subsidiary and Subsidiary Shareholder have no knowledge of any
such liens existing. By way of example and not limitation, Subsidiary is the
exclusive owner of any and all copyrights, patents, trade secrets and know how
and other proprietary rights relating to all software and computer products it
produces and sells.
SECTION 5.05 AUTHORITY. On or before the Effective Time, Subsidiary and
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Subsidiary Shareholder will have taken all necessary legal action to approve the
execution and delivery of this Reorganization Agreement and the performance of
their obligations hereunder and all transactions contemplated hereby will have
been duly authorized by all requisite corporate action on the part of Subsidiary
and the Directors and Shareholders of Subsidiary, and no further authorization,
approval or consent is or shall be necessary. Subsidiary Shareholder agrees to
vote all of his Subsidiary Common Stock in favor of the Plan of Exchange.
SECTION 5.06 LEGAL ACTIONS. There are no legal actions, suits,
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arbitrations, or other legal, administrative or other governmental proceedings
pending or threatened against Subsidiary, its properties, assets or business,
and neither Subsidiary nor Subsidiary Shareholder is aware of any fact which
might result in such action, suit, arbitration or other proceeding.
SECTION 5.07 OPERATION PENDING CLOSING. On and after execution hereof and
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until the Effective Time, Subsidiary will not, Subsidiary Shareholder will not,
and Subsidiary Shareholder will not cause Subsidiary to, enter into any
transaction or perform any act that would constitute a material adverse breach
of the representations, warranties or agreements contained herein and Subsidiary
Shareholder and Subsidiary and its officers and employees will comply, and
Subsidiary Shareholder will cause Subsidiary to comply, with all applicable
material provisions of this Reorganization Agreement. On and after execution
hereof and until the Effective Time:
(a) Subsidiary and Subsidiary Shareholder will afford to the officers and
authorized representatives of Parent access to the plants, properties,
books and records of Subsidiary and will furnish Parent with such
additional financial and operating data and other information as to the
business and properties of the Subsidiary as Parent may from time to time
reasonably request.
(b) Subsidiary and Subsidiary Shareholder will cooperate with Parent, its
representatives and counsel in the preparation of any documents or other
material which may be required in connection with the Exchange.
(c) Subsidiary will, and Subsidiary Shareholder will cause Subsidiary, to:
(1) carry on its business in substantially the same manner as it has
heretofore and not introduce any material new method of management,
operation or accounting; (2) maintain its properties and facilities in as
good working order and condition as at present, ordinary wear and tear
excepted; (3) perform all its material obligations under agreements
relating to or affecting its assets, properties and rights; (4) keep in
full force and effect present insurance policies or other comparable
insurance coverage; and (5) use its best efforts to maintain and preserve
its business organization intact, retain its present employees and maintain
its relationships with suppliers, customers and others having business
relations with it.
(d) Without the prior written consent of Parent, Subsidiary will not, and
Subsidiary Shareholder will not permit Subsidiary, to: (1) make any change
in its Articles of Incorporation or Bylaws; (2) issue any securities; (3)
declare or pay any dividend or make any distribution in respect of its
stock whether now or hereafter outstanding, or purchase, redeem or
otherwise acquire or retire for value any shares of its stock; (4) enter
into any contract or commitment or incur any liability or make any capital
expenditures except in the normal course of business; (5) increase the
compensation payable or to become payable to any officer, employee or
agent, or make any bonus payment to any such person; (6) create, assume or
permit to exist any mortgage, pledge or other lien or encumbrance upon any
assets or properties whether now owned or hereafter acquired; (7) sell,
assign, lease, license or otherwise transfer or dispose of any property or
equipment except in the normal course of business; or (8) merge,
consolidate or otherwise reorganize or agree to merge or consolidate or
otherwise reorganize with or into any other corporation.
ARTICLE VI
FURTHER AGREEMENTS
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SECTION 6.01 CONTINUITY OF INTEREST AGREEMENT. On the date hereof,
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Subsidiary Shareholder, Subsidiary and Parent shall execute a continuity of
interest agreement (the "Continuity of Interest Agreement") substantially in the
form of Exhibit "C" attached hereto and made a part hereof.
SECTION 6.02 EMPLOYMENT AGREEMENT. On the date hereof, Subsidiary
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Shareholder, as Employee, and Subsidiary, as Employer shall execute an
employment agreement (the "Employment Agreement") substantially in the form of
Exhibit "D" attached hereto and made a part hereof.
ARTICLE VII
TERMINATION AND AMENDMENT
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SECTION 7.01 TERMINATION. This Reorganization Agreement shall terminate
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in the event of and upon termination of the Plan of Exchange. Notwithstanding
shareholder approval of this Reorganization Agreement, this Reorganization
Agreement may be terminated at any time prior to the Effective Time by any party
by written notice to the other parties prior to the Effective Time. In the event
of termination of this Reorganization Agreement and the Plan of Exchange, the
Continuity of Interest Agreement and the Employment Agreement shall
automatically terminate. Each party agrees that, in the event this
Reorganization Agreement is terminated, it will not disclose to any individual,
corporation, partnership, joint venture, sole proprietorship, association,
syndicate, trust or other person or entity any confidential or proprietary
information (including but not limited to any software, customer lists, pricing
policies, profit margins, training and instruction manuals, reports,
recommendations, work-product, and other information) heretofore or hereafter
acquired by it concerning or relating to the operations, business or affairs of
the other parties. The purpose of this Section is to protect a party from the
disclosure of or use by another party of proprietary or other confidential
business information of a party obtained through this Reorganization Agreement,
but not to prevent any party from using, in connection with its future business
ventures, information which it previously knew or which is generally known in
the industry.
SECTION 7.02 AMENDMENT. This Reorganization Agreement may be amended by
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the parties hereto, at any time before or after approval hereof by the
Subsidiary Shareholder, but only by an instrument in writing signed on behalf of
each of the parties hereto.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
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SECTION 8.01 WAIVER. At any time prior to the Effective Time, the parties
------------ ------
hereto may (a) extend the time for the performance of any of the obligations or
other acts of the other parties hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any document delivered
pursuant hereto and (c) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party hereto to any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed on behalf of such party.
SECTION 8.02 NOTICES. All notices required or permitted to be given
------------ -------
hereunder shall be in writing and shall be deemed given when delivered in person
or sent by confirmed facsimile, or when received if given by Federal Express or
other nationally recognized overnight courier service, or five (5) business days
after being deposited in the United States mail, postage prepaid, registered or
certified mail, addressed to the applicable party as follows:
OnCOURSE TECHNOLOGIES, INC.
0000 Xxxxx 000xx Xxxxxx
Xxx Xxxxxx, XX 00000
CAM SOLUTIONS, INC.
0000 Xxxx 00xx Xxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
XXXXX XXXX
0000 Xxxx 00xx Xxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
SECTION 8.03 ENTIRE AGREEMENT. This Reorganization Agreement, the Plan of
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Exchange, the Articles of Exchange, the Continuity of Interest Agreement and the
Employment Agreement constitute the entire agreement between the parties as to
the Exchange and shall be binding upon and inure to the benefit of the parties
hereto and their respective legal representatives, successors and permitted
assigns. The parties and their respective affiliates make no representations or
warranties to each other, except as contained in this Reorganization Agreement,
and any and all prior representations and statements made by any party or its
representatives, whether verbally or in writing, are deemed to have been merged
into this Reorganization Agreement and the Plan of Exchange, it being intended
that no such representations or statements shall survive the execution and
delivery of this Reorganization Agreement and the Plan of Exchange.
SECTION 8.04 NON-WAIVER. The failure in any one or more instances of a
------------ ----------
party to insist upon performance of any of the terms, covenants or conditions of
this Reorganization Agreement, to exercise any right or privilege conferred in
this Reorganization Agreement, or the waiver by said party of any breach of any
of the terms, covenants or conditions of this Reorganization Agreement, shall
not be construed as a subsequent waiver of any such terms, covenants,
conditions, rights or privileges, but the same shall continue and remain in full
force and effect as if no such forbearance or waiver had occurred. No waiver
shall be effective unless it is in writing and signed by an authorized
representative of the waiving party.
SECTION 8.05 COUNTERPARTS. This Reorganization Agreement may be executed
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in counterparts, each of which shall be deemed to be an original, and all such
counterparts shall constitute but one instrument.
SECTION 8.06 SEVERABILITY. The invalidity of any provision of this
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Reorganization Agreement or portion of a provision shall not affect the validity
of any other provision of this Reorganization Agreement or the remaining portion
of the applicable provision.
SECTION 8.07 GOVERNING LAW. This Reorganization Agreement and the Plan of
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Exchange shall be construed in accordance with the laws of the State of Nevada
applicable to contracts entered into and to be performed entirely therein.
SECTION 8.08 BINDING EFFECT; BENEFIT. This Reorganization Agreement shall
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inure to the benefit of and be binding upon the parties hereto and their
successors and permitted assigns. Nothing in this Reorganization Agreement,
express or implied, is intended to confer on any person other than the parties
hereto and their respective successors and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this Reorganization
Agreement, including, without limitation, third party beneficiary rights.
SECTION 8.09 ASSIGNABILITY. This Reorganization Agreement shall not be
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assignable by any party without the prior written consent of the other parties;
provided, however, that Parent shall have the right at the Effective Date or
subsequently thereto, to cause the stock of Subsidiary to be transferred to a
wholly-owned subsidiary of Parent.
SECTION 8.10 HEADINGS. The description headings in this Reorganization
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Agreement are inserted for convenience of reference only and are not intended to
be part of or to affect the meaning or interpretation of this Reorganization
Agreement. Words used in this Reorganization Agreement, regardless of the gender
or number specifically used, shall be deemed to include any other gender,
masculine, feminine or neuter, and any other number, singular or plural, as the
context may require.
SECTION 8.11 FURTHER ASSURANCES. Subsidiary and Subsidiary Shareholder
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shall at any time, or from time to time, as and when requested by Parent, or its
successors and assigns, execute and deliver, or cause to be executed and
delivered, all such conveyances, assignments, transfers, deeds or other
instruments, and shall take or cause to be taken such further action as Parent,
or its successors and assigns, may deem necessary or desirable in order to
evidence the Exchange contemplated herein and otherwise to carry out the intent
and purposes of this Reorganization Agreement.
SECTION 8.12 CONTRACT INTERPRETATION. This Reorganization Agreement shall
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not be more strictly construed against any party regardless of who was
responsible for the preparation hereof. For purposes of contract interpretation
and for the purpose of resolving any ambiguity herein and therein, the parties
agree that this Reorganization Agreement and the other Exchange documents were
prepared jointly by their respective attorneys.
SECTION 8.13 NO BROKERS. Parent represents, warrants and covenants with
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Subsidiary and Subsidiary Shareholder, and Subsidiary and Subsidiary Shareholder
jointly and severally represent, warrant and covenant with Parent, that no
brokerage fees or commissions or finders' fees have been incurred by any of them
or are payable, to the best of their respective knowledge, in connection with
the transactions contemplated by this Reorganization Agreement. Each of Parent,
Subsidiary and Subsidiary Shareholder shall bear their own legal, accounting and
other costs and expenses incurred in connection with this Reorganization
Agreement.
SECTION 8.14 SUBMISSION OF AGREEMENT. The submission of this
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Reorganization Agreement for examination does not constitute a reservation of or
option to the Exchange described herein, and this Reorganization Agreement shall
become effective only upon the execution hereof by all of Parent, Subsidiary and
Subsidiary Shareholder.
IN WITNESS WHEREOF, the Parent has caused this Reorganization Agreement to
be executed by its duly authorized officers on the date first above written with
the intent to be legally bound.
PARENT:
------
ATTEST: OnCOURSE TECHNOLOGIES, INC.
/s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxx
(Corporate Seal) Its: (President)
IN WITNESS WHEREOF, the Subsidiary has caused this Reorganization Agreement
to be executed by its duly authorized officers on the date first above written
with the intent to be legally bound.
SUBSIDIARY:
-----------
ATTEST: CAM SOLUTIONS, INC.
/s/ Xxxxx X. Xxxx By: /s/ Xxxxx X. Xxxx
(Corporate Seal) Its: (President)
IN WITNESS WHEREOF, the Subsidiary Shareholder has executed this
Reorganization Agreement on the date first above written with the intent to be
legally bound.
SUBSIDIARY SHAREHOLDER:
-----------------------
WITNESS: XXXXX XXXX
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxx X. Xxxx
ACKNOWLEDGMENT
--------------
STATE OF WISCONSIN )
) SS:
COUNTY OF WAUKESHA )
On this, the Thirtieth (30) day of December, 1998, before me, a Notary
Public, personally appeared XXXXXXX X. XXXXX, who acknowledged themselves to be
the President and Assistant Secretary, respectively, of OnCOURSE TECHNOLOGIES,
INC., and that as such President and Secretary, being duly authorized to do so,
executed the foregoing Agreement and Plan of Reorganization for and on behalf of
OnCOURSE TECHNOLOGIES, INC. for the purposes therein contained.
IN WITNESS WHEREOF I hereunto set my hand and official seal.
/s/ Xxxxxx Xxxxxxx
Notary Public
STATE OF Wisconsin)
) SS:
COUNTY OF Waukesha)
On this, the Thirtieth (30) day of December, 1998, before me, a Notary
Public, personally appeared XXXXX XXXX, who acknowledged himself to be the
Subsidiary Shareholder and the President and Secretary of CAM SOLUTIONS, INC.,
and that as such Subsidiary Shareholder and President and Secretary, being duly
authorized to do so, executed the foregoing Agreement and Plan of Reorganization
for and on behalf of CAM SOLUTIONS, INC. for the purposes therein contained.
IN WITNESS WHEREOF I hereunto set my hand and official seal.
/s/ Xxxxxx Xxxxxxx
Notary Public
