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EXHIBIT 10.9
REORGANIZATION AGREEMENT
THIS AGREEMENT (the "Agreement") is entered into this 27th day of August
1996, between Third Quarter, Inc. ("Third Quarter"), Xxxx Xxxxx, Xxxx Xxxxx
(Xxxx Xxxxx and Xxxx Xxxxx collectively referred to as "Xxxxx") and Toy
Paradise Partnership, an Illinois General Partnership ("Paradise").
WHEREAS, Third Quarter and Paradise jointly formed an Illinois Limited
Liability Company, Toy Stratagem, L.L.C. ("Stratagem"), in which each were
members and each had a 50% ownership interest and a 50% profit sharing
interest.
WHEREAS, the parties are desirous of forming a new corporation by the name
of Fundex Games, Ltd. ("Fundex").
WHEREAS, the parties are desirous of transferring their respective
interest in Stratagem to Fundex.
WHEREAS, the parties anticipate causing an initial public offering (the
"IPO") of shares of common stock of Fundex (the "Common Stock").
For good and valuable consideration the parties hereby agree to cause the
following to occur:
1. Third Quarter, Inc. shall be reorganized pursuant to the provisions of
and qualifying under the provisions of IRC Section 368(a)(1)(F), under the name
"Fundex Games, Ltd.," to be domiciled as a Nevada Corporation (the
"Reorganization").
2. In connection with the Reorganization, Paradise shall transfer its
interest in Stratagem to Fundex.
3. In connection with the Reorganization, Xxxxx are relinquishing their
shares in Third Quarter, Inc., in exchange for 1,000,000 shares of Fundex
Common Stock.
4. Solely in exchange for the transfer of its interest in Stratagem, Toy
Paradise shall receive 75,000 shares of Common Stock and 75,000 warrants (the
"Warrants"), each Warrant entitling the holder thereof to acquire one (1) share
of Common Stock at an exercise price equal to 120% of the initial public
offering price ("IPO Price") of the Common Stock; provided, however, that if
the IPO does not occur within twelve months from the date hereof, then the
Warrants shall have an exercise price of $9.60.
5. In connection with the Reorganization, Paradise and Xxxxx shall be in
control of Fundex, collectively holding 100% of Fundex's outstanding common
stock; the above transactions shall be consummated in a manner so as to
facilitate compliance with IRC Section 351 for both parties.
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6. Miscellaneous.
6.1 Governing Law. This Agreement shall be governed in all respects by the
laws of the State of Illinois as it applies to agreements between Illinois
residents to be entered into and performed entirely within Illinois.
6.2 Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been duly given (i)
on the date of delivery if delivered personally, (ii) one (1) business day
after transmission by telex or facsimile transmission, or (iii) two (2) days
after mailing if mailed by first class mail, to the following addresses:
If to Third Quarter: If to Toy Paradise: If to Xxxx Xxxxx or Xxxx Xxxxx:
-------------------- ------------------- -------------------------------
Third Quarter, Inc. Toy Paradise Partnership Xxxx Xxxxx
X.X. Xxx 00000 x/x Xxxxxxx Xxxxxx 00 X.X. Xxx 00000
Xxxxxxxxxxxx, XX Xxxxxx Xxxxx, Xxxxx X Xxxxxxxxxxxx, XX
00000 Xxxxxxxxxx, XX 00000-0000 46222
6.3 Binding Effect. This Agreement shall be binding upon both parties and
upon the heirs, legal representatives, successors and assigns of each of them.
6.4 Benefit. This Agreement shall inure to the benefit of the parties
hereto and their permitted successors and assigns.
6.5 Word Forms. In this Agreement, the singular includes the plural and
the masculine includes the feminine and neuter.
6.6 Entire Agreement. This Agreement constitutes the entire agreement
between the parties regarding the matter at hand. All prior representations,
agreements and understandings, written or oral, have been merged and superseded
hereby.
6.7 Modifications. No alteration or attempted modification of any of the
provisions hereof shall be binding unless in writing and signed by all parties
hereto.
6.8 Invalid Provisions. If any provision or provisions of this Agreement
shall be held to be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not, in any way, be
affected or impaired thereby, unless it is readily apparent that the purpose of
this Agreement is defeated thereby.
6.9 Authorized Signatories. The parties hereto and the individuals
executing this document on their behalf, covenant that the signatories to this
Agreement are duly authorized and empowered to so execute and bind their
respective entity.
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The parties hereby agree to be bound and to comply with all of the
foregoing terms and conditions.
DATED: /s/ August 27, 1996
Third Quarter, Inc. Toy Paradise Partnership:
By: /s/ Xxxx Xxxxx By: /s/ Xxxxxxx Xxxxxx
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President General Partner
Xxxx Xxxxx: Xxxx Xxxxx:
/s/ Xxxx Xxxxx /s/ Xxxx Xxxxx
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