EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "AGREEMENT") dated as of the 21st
day of March, 2002 by and among Global Realty Management Group, Inc., a Florida
corporation ("GRMG"), GRMG Acquisition Corporation, a Texas corporation, and a
wholly-owned subsidiary of GRMG ("ACQUISITION CORP."), Excalibur Holdings, Inc.,
a Texas corporation ("EXCALIBUR"), and Xxxxxxx X. Xxxxxx, a principal
shareholder (the "PRINCIPAL SHAREHOLDER") of GRMG for the limited purpose of the
indemnification provisions set forth in paragraph 17 hereto.
WITNESSETH:
WHEREAS, 10,483,699 shares of the common stock, $.001 par value, of
Excalibur ("EXCALIBUR COMMON STOCK") are issued and outstanding as of the date
hereof;
WHEREAS, the Board of Directors of each of GRMG, Acquisition Corp., and
Excalibur have adopted, approved and authorized the execution and delivery of
this Agreement so as to implement the Merger (as such term is hereinafter
defined in Section 1 hereof) in compliance with the provisions of the General
Corporation Law of the State of Florida ("FGCL") and with the Texas Business
Corporation Act ("TBCA") with the result that Excalibur shall continue as the
surviving corporation and the separate existence of Acquisition Corp. (except as
it may be continued by operation of law) shall cease;
WHEREAS, GRMG, Acquisition Corp., and Excalibur intend that the merger
of Acquisition Corp. with and into Excalibur will qualify as a tax-free
reorganization pursuant to Section 368(a) of the Internal Revenue Code of 1986,
as amended (the "CODE");
WHEREAS, the parties desire to make certain representations,
warranties, and agreements in connection with the Merger and desire to prescribe
certain conditions precedent to such Merger; and
NOW THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and agreements herein contained, the
result and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. THE MERGER. Subject to the terms and conditions hereinbelow set
forth, on the Effective Date (as hereinafter defined in Section 6 hereof), in
accordance with the FGCL and the TBCA, Acquisition Corp. shall be merged with
and into Excalibur (the "MERGER") and, in connection therewith:
(a) except to the extent provided or permitted by the TBCA,
Acquisition Corp. shall merge with and into Excalibur, the separate existence of
Acquisition Corp. shall cease and terminate, and Excalibur shall continue as the
surviving corporation and as a wholly-owned subsidiary of GRMG (Excalibur as the
surviving corporation after the Merger is hereinafter sometimes referred to as
the "SURVIVING CORPORATION");
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(b) all of the rights, privileges, immunities, powers,
franchises and authority (both public and private) of Excalibur and Acquisition
Corp. shall vest in the Surviving Corporation;
(c) all of the assets and property of Excalibur and
Acquisition Corp. of every kind, nature and description (real, personal and
mixed and both tangible and intangible) and every interest therein, wheresoever
located, including, without limitation, all debts or other obligations belonging
or due to Excalibur or Acquisition Corp., all claims and all causes of action,
shall be, and be deemed to be, vested, absolutely and unconditionally, in the
Surviving Corporation; and
(d) all debts and obligations of Excalibur or Acquisition
Corp., all rights of creditors of Excalibur or Acquisition Corp. and all liens
or security interests encumbering any of the property of Excalibur or
Acquisition Corp. shall be vested in the Surviving Corporation and shall remain
in full force and effect without modification or impairment and shall be, and be
deemed to be, enforceable against the Surviving Corporation and its assets and
properties with the same full force and effect as if such debts, obligations,
liens or security interests had been originally incurred or created by the
Surviving Corporation in its own name and for its own behalf. Without limiting
the generality of the foregoing, Surviving Corporation specifically assumes all
continuing obligations which Excalibur or Acquisition Corp. would otherwise have
to indemnify its officers and directors, to the fullest extent currently
provided in the Surviving Corporation's Articles of Incorporation, By-Laws and
pursuant to the TBCA, with respect to any and all claims arising out of actions
taken or omitted by such officers and directors prior to the Effective Date.
2. INSTRUMENTS OF CONVEYANCE. Without limiting the generality of the
provisions of Section 1 hereof and/or the succession provisions of applicable
law, the officers and directors of Acquisition Corp. last in office shall (to
the extent they, or any of them, possess and/or may exercise the power to do so)
execute, deliver and/or record such deeds and/or other instruments of transfer
and/or conveyance, and take or cause to be taken, such other and further
actions, as the case may be, as shall be reasonably requested by Excalibur or
its legal counsel, to vest, perfect, confirm, implement the transfer of, or
establish in the name, on behalf or for the account or the benefit of Excalibur,
title to, and/or possession of, any or all of the assets, property, property
interests, rights, privileges, immunities, powers and franchises owned and/or
exercisable by Acquisition Corp. (or in which Acquisition Corp. had an interest
and/or the power to exercise immediately prior to the Effective Date) and which
was vested, or intended to be vested, in Excalibur pursuant to the provisions of
this Agreement and the Merger.
3. CONSTITUTIONAL DOCUMENTS, DIRECTORS, AND OFFICERS. On and as of the
Effective Date:
(a) the Articles of Incorporation of Excalibur on such date in
full force and effect shall be the Articles of Incorporation of the Surviving
Corporation, until the same shall be altered, amended, modified, terminated or
rescinded in the manner provided by the TBCA, which rights of alteration,
amendment, modification, termination and/or rescission are hereby expressly
reserved by Excalibur.
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(b) the By-Laws of Excalibur on such date in full force and
effect shall be the By-Laws of the Surviving Corporation, until the same shall
be altered, amended, modified, terminated or rescinded in the manner provided in
the Articles of Incorporation of Excalibur and/or the TBCA, which rights of
alteration, amendment, modification, termination and/or rescission are hereby
expressly reserved by Excalibur; and
(c) the members of the Board of Directors of the Surviving
Corporation shall be the directors of Excalibur immediately prior to the
Effective Date, who shall hold such office as provided in the By-Laws of
Excalibur and/or the TBCA. The officers of the Surviving Corporation shall be
the former officers of Excalibur, who shall hold office as provided in the
By-Laws of Excalibur.
4. CONVERSION. On and as of the Effective Date, by virtue of the Merger
and without any action on the part of the holder of any shares of capital stock
of Excalibur or capital stock of Acquisition Corp.:
(a) subject to Section 5, the outstanding shares of Excalibur
Common Stock shall be converted and exchanged into shares of the common stock,
$.001 par value, of GRMG ("GRMG COMMON STOCK") in the following manner: Each
issued and outstanding share of the Excalibur Common Stock shall, by virtue of
the Merger and without any action on the part of the holder thereof, be
converted and exchanged into one (1) duly authorized, validly issued, fully
paid, and non-assessable share (the "COMMON EXCHANGE RATIO") of GRMG Common
Stock.
(b) subject to Section 5, the outstanding shares of
Excalibur's Series A Convertible Preferred Stock, $.001 par value ("EXCALIBUR
SERIES A PREFERRED STOCK") shall be converted and exchanged into shares of
Series A Preferred Stock of GRMG (to be authorized pursuant to Section 13(h)
("GRMG SERIES A PREFERRED STOCK") in the following manner: Each issued and
outstanding share of the Excalibur Series A Preferred Stock shall, by virtue of
the Merger and without any action on the part of the holder thereof, be
converted and exchanged into one (1) duly authorized, validly issued, fully
paid, and nonassessable share (the "SERIES A PREFERRED EXCHANGE RATIO") share of
GRMG Series A Preferred Stock.
(c) each issued and outstanding share of the capital stock of
Acquisition Corp. shall be converted into and become one fully paid and
nonassessable share of Common Stock of the Surviving Corporation.
(d) The shares of the GRMG Common Stock and GRMG Series A
Preferred Stock to be issued to the Excalibur shareholders shall be deemed to be
"restricted securities" as defined by Rule 144(a)(3) under the Securities Act of
1933, as amended (the "SECURITIES ACT"). The certificates evidencing such shares
shall bear the following restrictive legend:
"The shares evidenced by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), and may not be sold or otherwise
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transferred unless registered under the Securities Act or
there is an opinion from counsel to the company that such sale
or other transfer may be made pursuant to an exemption from
the registration requirement of the Securities Act."
5. CERTIFICATE EXCHANGE. Subsequent to the Effective Date, the issuance
and distribution of New Certificates (as hereinafter defined) in exchange for
Old Certificates (as hereinafter defined) shall be implemented as follows:
(a) On the Effective Date, GRMG shall deposit with a bank,
trust company, or transfer agent designated by GRMG and Excalibur (the
"REPRESENTATIVE"), for the benefit of the former holders of shares of Excalibur
Common Stock and Excalibur Series A Preferred Stock, for exchange in accordance
with this Section 5, through the Representative, stock certificates representing
the shares of the GRMG Common Stock and GRMG Series A Preferred Stock (the "NEW
CERTIFICATES") issuable pursuant to Section 4 in exchange for the holder's stock
certificate representing the Excalibur Common Stock and Excalibur Series A
Preferred Stock (the "OLD CERTIFICATES").
(b) As promptly after the Effective Date as shall be
reasonably possible, the Representative shall be directed to, and shall, send
written notification (the "STOCK NOTIFICATION") each holder of the Excalibur
Common Stock and Excalibur Series A Preferred Stock of the consummation of the
Merger, the availability of the New Certificates and provide (i) a description
of the procedure to be followed in connection with the surrender of the Old
Certificates and the issuance of the New Certificates, and (ii) a letter of
transmittal (which shall be in customary form and have such provisions as GRMG
and Excalibur may reasonably specify). Upon compliance by a holder thereof with
the requirements for the certificate surrender and issuance specified in the
Stock Notification, the Representative shall be directed to, and shall, issue
and transmit to such holder New Certificates representing that number of shares
of the GRMG Common Stock and GRMG Series A Preferred Stock, as the case may be,
to which such holder shall be entitled as herein provided.
(c) From and after the Effective Date, the sole rights of the
holders of Old Certificates (except as otherwise provided by applicable law or
Section 4(a) hereof) shall be those to which they are entitled as owners of the
GRMG Common Stock or GRMG Series A Preferred Stock, as the case may be.
6. THE EFFECTIVE DATE.
(a) Subject to the provisions of this Agreement, articles of
merger ("ARTICLES OF MERGER") in such form as is required by the TBCA shall be
duly prepared, executed, and acknowledged by Excalibur and Acquisition Corp. and
thereafter delivered to the Secretary of State of the State of Texas for filing,
as provided in the TBCA, as early as practicable on the Closing Date (as defined
in Section 6(b)). The Merger shall become effective as at the close of business
on the date specified in the Articles of Merger or, if none, on the date of
filing (the "EFFECTIVE DATE").
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(b) The closing of the Merger (the "CLOSING") shall take place
on such date, at such place and at such time (the "CLOSING DATE") within two (2)
business days after the satisfaction or waiver of the last of the conditions set
forth in Sections 14 and 15 hereof as shall be determined by the mutual consent
of GRMG and Excalibur at the offices of Xxxxxxxxxxx Xxxxx & Xxxxxxxx LLP,
Newport Beach, California.
(c) On the Effective Date, GRMG shall fix the number of
members of the Board of Directors at seven (7), effective with the Effective
Date. The Board of Directors shall consist of the following individuals: Xxxxxxx
X.X. Xxxxxx, Xxxxxxx X. Xxxxxxxx, Xxxxxx Xxxxx, W. Xxxxxx Xxxx, Xxxxx Xxxxxxx,
and Xxxxxx Xxxx Xxxxx, with one vacancy, each to serve until the next Annual
Meeting of Stockholders of GRMG or until his or her successor is duly elected
and qualifies.
(d) On the Effective Date, the officers of GRMG shall be
Xxxxxxx X.X. Xxxxxx, Chief Executive Officer and Chairman of the Board, Xxxxxx
Xxxxx, President and Chief Operating Officer, Xxxxxxx X. Xxxxxxxx, Chief
Financial Officer (Treasurer), Executive Vice President and Secretary, Xxxx
Xxxxx, Vice President of Operations, and Xxxxx Xxxxx, Vice President of
Marketing, each to serve until the first meeting of the Board of Directors
immediately following the next Annual Meeting of Stockholders of GRMG or until
the Board otherwise directs.
7. ASSUMPTION AND PAYMENT OF LIABILITIES
(a) Upon the signing of this Agreement, Excalibur shall
deliver to GRMG by wire transfer or certified check, a non-refundable payment of
$50,000 (the "NON-REFUNDABLE PAYMENT") that shall be used to pay down a portion
of the outstanding liabilities of GRMG, all of which are listed on SCHEDULE
9(k).
(b) Upon the Effective Date, Excalibur shall deliver to GRMG
by wire transfer or certified check an additional payment of $50,000 (the
"ADDITIONAL PAYMENT") that shall be used to pay down any and all remaining
liabilities of GRMG, all of which are listed on SCHEDULE 9(k), and other
payments in connection with the Merger.
8. EXCALIBUR REPRESENTATIONS AND WARRANTIES. In order to induce GRMG
and Acquisition Corp. to execute this Agreement and perform their obligations
under this Agreement, Excalibur does hereby represent, warrant, covenant and
agree (which representations, warranties, covenants and agreements shall be, and
be deemed to be, continuing and survive the execution and delivery of this
Agreement and the Effective Date) as follows:
(a) Excalibur is a Texas corporation duly organized and
validly existing under the laws of the State of Texas and has all requisite
power and authority to own, lease, and operate its properties and assets and to
conduct the business as now conducted and as proposed to be conducted. A true,
complete and correct copy of each of the Articles of Incorporation, By-laws, and
other governing documents of Excalibur as in effect on the date of this
Agreement, including all amendments thereto, have heretofore been delivered to
GRMG.
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(b) Excalibur is duly qualified to do business as a foreign
corporation, and is in good standing, in all jurisdictions, if any, wherein such
qualification is necessary and where failure so to qualify would have a material
adverse effect on the business, properties, liabilities, assets, operations,
results of operations, condition (financial or otherwise) or affairs of
Excalibur.
(c) SCHEDULE 8(c) sets forth all of the subsidiaries of
Excalibur. Except as set forth in SCHEDULE 8(c), Excalibur has never had, nor
does it have, any subsidiaries, nor has it ever owned, nor does it currently
own, any capital stock or other proprietary interest, directly or indirectly, in
any corporation, association, trust, partnership, joint venture or other entity.
(d) Subject only to obtaining the consent of its shareholders
as required by the TBCA and its Articles of Incorporation: (i) Excalibur has the
full power and authority, corporate and otherwise, to execute, deliver and
perform this Agreement and to consummate the transactions contemplated hereby;
(ii) the execution, delivery and performance of this Agreement, the consummation
by Excalibur of the transactions herein contemplated and the compliance by
Excalibur with the terms of this Agreement have been duly authorized by all
necessary corporate action; (iii) this Agreement is the valid and binding
obligation of Excalibur enforceable in accordance with its terms, subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the rights of creditors generally and the
discretion of courts in granting equitable remedies; (iv) the execution,
delivery and performance of this Agreement by Excalibur and the consummation by
Excalibur of the transactions herein contemplated do not, and will not, with or
without the giving of notice or the lapse of time, or both, (A) result in any
violation of the Articles of Incorporation or By-Laws of Excalibur or (B) result
in a breach of, or a conflict with, any of the terms or provisions of, or
constitute a default under, or result in the modification or termination of, or
result in the creation or imposition of any lien, security interest, charge or
encumbrance upon any of the properties or assets of Excalibur pursuant to, any
indenture, mortgage, note, contract, commitment or other agreement or instrument
to which Excalibur is a party or by which it is, or any of its respective
properties or assets are, or may be, bound or affected. No consent, approval,
authorization or order of, or any filing with, any court, governmental agency,
authority or body (other than the filing of Articles of Merger under the TBCA)
and/or any party to any agreement to which Excalibur is a party and/or by which
it is bound is required in connection with the execution, delivery and
performance of this Agreement and/or the consummation by Excalibur of the
transactions contemplated by this Agreement.
(e) Excalibur is not in violation of, or in default under, (i)
any term or provision of its Articles of Incorporation or By-Laws; (ii) any
material term or provision of any financial covenant of any indenture, mortgage,
contract, commitment or other agreement or instrument to which it is a party or
by which it is, or any or its properties or assets are, or may be, bound or
affected; or (iii) any existing applicable law, rule, regulation, judgment,
order or decree of any governmental agency or court, domestic or foreign, having
jurisdiction over it or any of its properties or business. Excalibur owns,
possesses or has obtained all governmental and other licenses, permits,
certifications, registration, approvals or consents and other authorizations
necessary to own or lease, as the case may be, and to operate its properties and
to conduct its business or operations as presently conducted and all such
governmental and other licenses, permits, certifications, registrations,
approvals, consents and other authorizations are outstanding and in good
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standing and there are no proceedings pending or, to the best of its knowledge,
threatened or any basis therefor existing, seeking to cancel, terminate or limit
such licenses, permits, certifications, registrations, approvals or consents or
authorizations.
(f) Except as set forth on SCHEDULE 8(f) hereto, there are no
claims, actions, suits, proceedings, arbitrations, investigations or inquiries
before any court or governmental agency, court or tribunal, domestic or foreign,
or before any private arbitration tribunal, pending or, to the best of the
knowledge of Excalibur, threatened against Excalibur or involving its assets
which, if determined adversely to Excalibur, would, individually or in the
aggregate, result in a material adverse change in the financial position,
shareholders' equity, results of operations, properties, business, management or
affairs of Excalibur, or which question the validity of this Agreement or of any
action taken, or to be taken, by Excalibur pursuant to, or in connection with,
this Agreement; nor, to the best of the knowledge of Excalibur, is there any
basis for any such claim, action, suit, proceeding, arbitration, investigation
or inquiry to be made by any person and/or entity. There are no outstanding
orders, judgments or decrees of any court, governmental agency or other tribunal
specifically naming Excalibur and/or enjoining Excalibur from taking, or
requiring Excalibur to take, any action, and/or by which Excalibur is, and/or
its assets are, bound or subject.
(g) Excalibur owns all trademarks, service marks, tradenames,
copyrights, similar rights and their registrations, trade secrets, methods,
practices, systems, ideas, know how and confidential materials used or proposed
to be used in the conduct of its business as conducted as of the date hereof
(collectively the "EXCALIBUR INTANGIBLES") free and clear of all liens, security
interests, claims and encumbrances and rights and options of third parties
(including, without limitation, former or current officers, directors,
shareholders, employees and agents).
(h) Excalibur is currently having an accounting firm conduct
an audit of its financial statements, including its Subsidiaries, for the year
ended 2000 and the year ended 2001 (the "EXCALIBUR AUDITED FINANCIAL
STATEMENTS") and shall be completed in sufficient time to have the Excalibur
Audited Financial Statements filed as an exhibit to an Amendment to GRMG's
Current Report on Form 8-K with respect to the Merger. Excalibur has provided a
copy of unaudited financial statements for Excalibur and its Subsidiaries for
the year ended December 31, 2001 (the "EXCALIBUR UNAUDITED FINANCIAL
STATEMENTS"). The Excalibur Unaudited Financial Statements are, and the
Excalibur Audited Financial Statements will be, true and accurate, in accordance
with the books and records of Excalibur, and the Excalibur Unaudited Financial
Statements are, and the Excalibur Audited Financial Statements will, present
fairly in all material respects the financial position and results of operations
of Excalibur as of the times and for the periods referred to therein, in each
case in accordance with generally accepted accounting principles under current
United States accounting rules and regulations, consistently applied ("GAAP").
All of the financial books and records of Excalibur have been made available to
GRMG, and such books and records completely and fairly record in all material
respects Excalibur's financial affairs, which would normally be recorded in
financial books and records.
Except as set forth on the Excalibur Unaudited Financial
Statements and SCHEDULE 8(j), Excalibur has no debt, liability or obligations of
any nature, whether accrued, absolute, contingent or otherwise, whether due or
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to become due and whether or not the amount hereof is readily ascertainable,
that will not be reflected as a liability in the Excalibur Unaudited Financial
Statements or except for liabilities incurred by Excalibur in the ordinary
course of business, consistent with past practices which are not otherwise
prohibited by, or in violation of, or which will not result in a breach of, the
representations, warranties and covenants of Excalibur contained in this
Agreement. There will be no material loss contingencies (as such term is used in
Statement of Financial Accounting Standards No. 5 ("FAS No. 5") issued by the
Financial Accounting Standards Board (the "FASB") which will not be adequately
provided for in the Excalibur Financial Statements as required by FAS No. 5.
(i) Except as set forth in SCHEDULE 8(i), Excalibur does not
currently own, nor has it ever owned, any real property. SCHEDULE 8(i) hereto
also contains a list and a brief description of (i) all real property leased by
Excalibur, and (ii) with respect to each lease, the name of the lessor, any
requirement of consent of the lessor to assignment (including assignment by way
of merger or change in control) and the termination date of the lease. Excalibur
owns or has good and marketable title to its assets, properties, and interests
in properties which will be reflected in the latest balance sheet included in
the Excalibur Unaudited Financial Statements and/or are utilized in connection
with the operation of the business of Excalibur, in all cases free and clear of
all liens, security interests, claims, and encumbrances of every kind, nature
and description and rights and options of others except as will be expressly set
forth in such balance sheet.
(j) Since the date of the latest balance sheet included in the
Excalibur Unaudited Financial Statements, Excalibur has not, except as set forth
on SCHEDULE 8(j) hereto, (i) incurred any obligation or liability (absolute or
contingent, secured or unsecured); (ii) cancelled, without payment in full, any
notes, loans or other obligations receivable or other debts or claims held by
it; (iii) sold, assigned, transferred, abandoned, mortgaged, pledged, or
subjected to lien or security interest any of its material properties, tangible
or intangible, or rights under any contract, permit, license, franchise, or
other agreement other than sales or other dispositions of goods or services in
the ordinary course of business at customary prices; (iv) declared, made or
paid, or set aside for payment, any cash or non-cash dividends or other
distribution on any shares of its capital stock.
(k) Excalibur is not in default, in any respect, under the
terms of any outstanding agreement which is material to the business,
operations, properties, assets or financial condition of Excalibur and there
exists no event of default or event which, with notice and/or the passage of
time, or both, would constitute any such default.
(l) Excalibur has filed all federal, state, municipal and
local tax returns (whether relating to income, sales, franchise, withholding,
real, or personal property or otherwise) required to be filed under the laws of
the United States and all applicable states and has paid in full all taxes which
are due pursuant to such returns or claimed to be due by any taxing authority or
otherwise due and owing. No penalties or other charges are, or will become, due
with respect to the late filing of any such return. To the best of the knowledge
of Excalibur, after due investigation, each such tax return heretofore filed by
Excalibur correctly and accurately reflects the amount of its tax liability
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thereunder. Excalibur has withheld, collected, and paid all other levies,
assessments, license fees and taxes to the extent required and, with respect to
payments, to the extent that the same have become due and payable.
(m) The authorized and outstanding capitalization of Excalibur
is as set forth on SCHEDULE 8(m) hereto. As of the date hereof and the Effective
Date, except as set forth on SCHEDULE 8(m) hereto, there shall not be authorized
and/or issued and outstanding any shares of capital stock of Excalibur and there
shall not be outstanding any rights to purchase shares of capital stock of
Excalibur. The issued and outstanding shares of the Excalibur Common Stock and
Excalibur Series A Preferred Stock have been duly authorized and validly issued.
All outstanding shares of the Excalibur Common Stock and Excalibur Series A
Preferred Stock are fully paid and nonassessable. Except as set forth on
SCHEDULE 8(m), there are no outstanding warrants, options, or similar rights to
purchase or convert into the Excalibur Common Stock or Excalibur Series A
Preferred Stock. Except as set forth on SCHEDULE 8(m), there are no preemptive
rights with respect to the Excalibur Common Stock or Excalibur Series A
Preferred Stock. Excalibur has no reason to believe that any holder of such
outstanding shares of the Excalibur Common Stock or Excalibur Series A Preferred
Stock is subject to personal liability solely by reason of being such a holder.
The offers and sales of such outstanding shares of the Excalibur Common Stock or
Excalibur Series A Preferred Stock were, at all relevant times, exempt from the
registration or prospectus delivery requirements of the Securities Act and any
applicable state securities laws pursuant to an exemption for which Excalibur
and/or such offering or sale fully qualified. No dividends, redemptions or other
distributions of the assets of Excalibur have been, or will be, declared and/or
paid prior to the Effective Date on or with respect to the Excalibur Common
Stock or Excalibur Series A Preferred Stock.
(n) Except as set forth in SCHEDULES 8(j), 8(m), and 8(n)
hereto and as contemplated by this Agreement, since the date of the latest
balance sheet included in the Excalibur Unaudited Financial Statements, there
has not been with respect to Excalibur:
(i) Any loan to any person or entity and/or the
issuance of any guaranty for, or with respect to, its or another's obligations;
(ii) Any waiver or release of any material right or
claim;
(iii) Any incurrence of any material obligation or
liability, absolute or contingent;
(iv) Any payment of any material obligation or
liability, absolute or contingent, except for current liabilities reflected in,
or shown on, the most recent balance sheet of Excalibur and/or incurred
subsequent to the date thereof in the ordinary course of business and/or in
connection with the transactions contemplated by this Agreement; and
(v) Any material adverse change in the business,
assets, properties, liabilities, operations, results of operations, condition
(financial or otherwise) or affairs of Excalibur;
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(vi) Any damage, destruction or loss, whether or not
covered by insurance, having or which could reasonably be expected to have a
material adverse effect on Excalibur; (vii) (A) any liability created, assumed,
guaranteed or incurred, or (B) any transaction, contract or commitment entered
into, by Excalibur, in the case of either clause (A) or (B) other than in the
ordinary course of business;
(viii) Any payment, discharge or satisfaction of any
material encumbrance by Excalibur or any cancellation by Excalibur of any
material debts or claims or any amendment, termination or waiver of any rights
of material value to Excalibur;
(ix) Any direct or indirect redemption, purchase or
other acquisition of any such shares of the capital stock of Excalibur;
(x) Any stock split, reverse stock split,
combination, reclassification or recapitalization of the Excalibur Common Stock
or Excalibur Series A Preferred Stock, or any issuance of any other security in
respect of, or in exchange for, any shares of the Excalibur Common Stock or
Excalibur Series A Preferred Stock;
(xi) Any issuance by Excalibur of any shares of its
capital stock or any debt security or any subscription or similar right to
acquire any shares of the Excalibur capital stock;
(xii) Any license, sale, transfer, pledge, mortgage
or other disposition of any material tangible or intangible asset (including any
Excalibur Intangibles) of Excalibur;
(xiii) Any termination of, or written indication of
an intention to terminate or not renew, any material contract, license,
commitment or other agreement between Excalibur and any other person;
(xiv) Any material write-down or write-up of the
value of any asset of Excalibur, or any material write-off of any accounts
receivable or notes receivable of Excalibur or any portion thereof;
(xv) Any increase in, or modification of,
compensation payable, or to become payable, to any director, officer, employee,
consultant or agent of Excalibur, or the entering into of any employment
contract with any officer or employee;
(xvi) Any increase in, or modification or
acceleration of, any benefits payable, or to become payable, under any bonus,
pension, severance, insurance or other benefit plan, payment or arrangement
(including, but not limited to, the granting of stock options, restricted stock
awards or stock appreciation rights) made to, for or with any director, officer,
employee, consultant or agent of Excalibur other than as described in SCHEDULE
8(m) hereto;
(xvii) The making of any loan, advance or capital
contribution to, or investment in, any person or the engagement in any
transaction with any employee, officer, director or security holder of
10
Excalibur, other than advances to employees in the ordinary course of business
for travel and similar business expenses;
(xviii) Any change in the accounting methods or
practices followed by Excalibur or any change in depreciation or amortization
policies or rates theretofore adopted;
(xix) Any forward sales commitments at a price less
than Excalibur's cost of sales for such commitments;
(xx) Any termination of employment of any officer or
key employee of Excalibur or any expression of intention by any officer or key
employee of Excalibur to resign from such office or employment with Excalibur;
(xxi) Any amendments or changes in Excalibur's
Articles of Incorporation or By-Laws;
(xxii) Any agreement, understanding, authorization or
proposal, whether in writing or otherwise, for Excalibur to take any of the
actions described in this Section 8(n).
9. GRMG REPRESENTATIONS AND WARRANTIES. In order to induce Excalibur to
execute this Agreement and perform its obligations under this Agreement, GRMG
does hereby represent, warrant, covenant and agree (which representations,
warranties, covenants and agreements shall be, and be deemed to be, continuing
and survive the execution and delivery of this Agreement and the Effective Date)
as follows:
(a) GRMG is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Florida, with full power and
authority, corporate and otherwise, and with all licenses, permits,
certifications, registrations, approvals, consents and franchises necessary to
own or lease and operate its properties and to conduct its business as currently
being conducted. A true, complete and correct copy of each of the Articles of
Incorporation, By-laws and other governing documents of GRMG as in effect on the
date of this Agreement, including all amendments thereto, have heretofore been
delivered to Excalibur.
(b) GRMG is duly qualified to do business as a foreign
corporation, and is in good standing, in all jurisdictions, if any, wherein such
qualification is necessary and where failure so to qualify would have a material
adverse effect on the business, properties, liabilities, assets, operations,
results of operations, condition (financial or otherwise) or affairs of GRMG.
(c) Other than Acquisition Corp., which is a wholly-owned
subsidiary of GRMG, GRMG does not have any subsidiaries, nor does it currently
own, any capital stock or other proprietary interest, directly or indirectly, in
any corporation, association, trust, partnership, joint venture or other entity.
(d) Subject only to obtaining the consent of its stockholders,
if required by the FGCL: (i) GRMG has the full power and authority, corporate
and otherwise, to execute, deliver and perform this Agreement and to consummate
11
the transactions contemplated hereby; (ii) the execution, delivery, and
performance of this Agreement, the consummation by GRMG of the transactions
herein contemplated and the compliance by GRMG with the terms of this Agreement
have been duly authorized by all necessary corporate action; (iii) this
Agreement is the valid and binding obligation of GRMG enforceable in accordance
with its terms, subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, reorganization, moratorium and other laws affecting the
rights of creditors generally and the discretion of courts in granting equitable
remedies; (iv) the execution, delivery and performance of this Agreement by GRMG
and the consummation by GRMG of the transactions herein contemplated do not, and
will not, with or without the giving of notice or the lapse of time, or both,
(A) result in any violation of the Articles of Incorporation or By-Laws of GRMG,
(B) result in a breach of, or a conflict with, any of the terms or provisions
of, or constitute a default under, or result in the modification or termination
of, or result in the creation or imposition of any lien, security interest,
charge or encumbrance upon any of the properties or assets of GRMG pursuant to,
any indenture, mortgage, note, contract, commitment or other agreement or
instrument to which GRMG is a party or by which it is, or any of its respective
properties or assets are, or may be, bound or affected. No consent, approval,
authorization or order of, or filing with, any court, governmental agency,
authority or body (other than as required pursuant to the Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT"), and the rules and regulations
promulgated thereunder, or as otherwise provided in this Agreement, including
the filing of the Articles of Merger with the appropriate government
authorities) and/or any party to an agreement to which GRMG is a party and/or by
which it is bound is required in connection with the execution, delivery and
performance of this Agreement and/or the consummation by GRMG of the
transactions contemplated by this Agreement.
(e) GRMG is not in violation of, or in default under, (i) any
term or provision of its Articles of Incorporation or By-Laws; (ii) any material
term or provision of any financial covenant of any indenture, mortgage,
contract, commitment or other agreement or instrument to which it is a party or
by which it is, or any or its properties or assets are, or may be, bound or
affected; or (iii) any existing applicable law, rule, regulation, judgment,
order or decree of any governmental agency or court, domestic or foreign, having
jurisdiction over it or any of its properties or business, including, without
limitation, all reporting obligations pursuant to the Exchange Act and the rules
and regulations promulgated thereunder. GRMG owns, possesses or has obtained all
governmental and other licenses, permits, certifications, registration,
approvals or consents and other authorizations necessary to own or lease, as the
case may be, and to operate its properties and to conduct its business or
operations as presently conducted and all such governmental and other licenses,
permits, certifications, registrations, approvals, consents and other
authorizations are outstanding and in good standing and there are no proceedings
pending or, to the best of its knowledge, threatened or any basis therefor
existing, seeking to cancel, terminate or limit such licenses, permits,
certifications, registrations, approvals or consents or authorizations.
(f) There are no claims, actions, suits, proceedings,
arbitrations, investigations or inquiries before any court or governmental
agency, court or tribunal, domestic or foreign, or before any private
arbitration tribunal, pending or, to the best of the knowledge of GRMG,
threatened against GRMG or involving its assets which, if determined adversely
12
to GRMG, would, individually or in the aggregate, result in a material adverse
change in the financial position, stockholders' equity, results of operations,
properties, business, management or affairs of GRMG, or which question the
validity of this Agreement or of any action taken, or to be taken, by GRMG
pursuant to, or in connection with, this Agreement; nor, to the best of the
knowledge of GRMG, is there any basis for any such claim, action, suit,
proceeding, arbitration, investigation or inquiry to be made by any person
and/or entity. There are no outstanding orders, judgments or decrees of any
court, governmental agency or other tribunal specifically naming GRMG and/or
enjoining GRMG from taking, or requiring GRMG to take, any action and/or by
which GRMG is, and/or its assets are, bound or subject.
(g) GRMG owns no trademarks, service marks, tradenames,
copyrights, similar rights and their registrations, trade secrets, methods,
practices, systems, ideas, know how and confidential materials (collectively the
"GRMG INTANGIBLES") used or proposed to be used in the conduct of its business
as intended to be conducted as of the date hereof.
(h) GRMG has delivered or made available to Excalibur accurate
and complete copies (excluding copies of exhibits) of each report, registration
statement and definitive proxy statement filed by GRMG with the Securities and
Exchange Commission ("SEC") since January 1, 1999 (collectively, with all
information incorporated by reference therein or deemed to be incorporated by
reference therein, the "GRMG SEC DOCUMENTS"). All statements, reports,
schedules, forms and other documents required to have been filed by GRMG with
the SEC have been so filed on a timely basis, except for the 10-QSB for the
quarter ended September 30, 2001. As of the time it was filed with the SEC (or,
if amended or superseded by a filing prior to the date of this Agreement, then
on the date of such filing): (i) each of the GRMG SEC Documents complied in all
material respects with the applicable requirements of the Securities Act or the
Exchange Act; and (ii) none of the GRMG SEC Documents contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. Except as
disclosed in the GRMG SEC Documents filed prior to the date hereof and except as
set forth in SCHEDULE 9(h), if any, GRMG has not incurred any liabilities that
are of a nature that would be required to be disclosed on a balance sheet of
GRMG or the footnotes thereto prepared in conformity with GAAP other than (A)
liabilities incurred in the ordinary course of business and (B) liabilities that
in the aggregate would not reasonably be expected to have a material adverse
effect on GRMG.
(i) The financial statements contained in the GRMG SEC
Documents: (i) complied as to form in all material respects with the published
rules and regulations of the SEC applicable thereto; (ii) were prepared in
accordance with GAAP applied on a consistent basis throughout the periods
covered (except as may be indicated in the notes to such financial statements
and, in the case of unaudited statements, as permitted by Form 10-QSB of the
SEC, and except that unaudited financial statements may not contain footnotes
and are subject to normal and recurring year-end audit adjustments which will
not, individually or in the aggregate, be material in amount); and (iii) fairly
present, in all material respects, the financial position of GRMG as of the
respective dates thereof and the results of operations of GRMG for the periods
covered thereby. All adjustments considered necessary for a fair presentation of
the financial statements have been included.
13
(j) GRMG does not currently own, nor has it ever owned, any
real property. SCHEDULE 9(j) hereto contains a list and a brief description of
(i) all real property leased by GRMG, and (ii) with respect to each lease, the
name of the lessor, any requirement of consent of the lessor to assignment
(including assignment by way of merger or change in control) and the termination
date of the lease. GRMG has made available to Excalibur true and complete copies
of all leases. All leases to which GRMG is a party shall be terminated prior to
or as of the Effective Date. GRMG owns and has good and marketable title to its
assets, properties and interests in properties which are reflected in the latest
balance sheet included in the GRMG SEC Documents (including the financial
statements contained therein), in all cases free and clear of all liens,
security interests, claims and encumbrances of every kind, nature and
description and rights and options of others except as expressly set forth in
such balance sheet.
(k) GRMG has not, except as set forth on SCHEDULE 9(k) hereto,
(i) incurred any obligation or liability (absolute or contingent, secured or
unsecured); (ii) cancelled, without payment in full, any notes, loans or other
obligations receivable or other debts or claims held by it; (iii) sold,
assigned, transferred, abandoned, mortgaged, pledged, or subjected to lien or
security interest any of its material properties, tangible or intangible, or
rights under any contract, permit, license, franchise, or other agreement; (iv)
entered into any line of business other than that previously conducted by it
prior to the date hereof or entered into any transaction not in the ordinary
course of its business; or (v) declared, made or paid, or set aside for payment,
any cash or non-cash dividends or other distribution on any shares of its
capital stock.
(l) GRMG is not in default, in any respect, under the terms of
any outstanding agreement which is material to the properties, assets, or
financial condition of GRMG and there exists no event of default or event which,
with notice and/or the passage of time, or both, would constitute any such
default.
(m) GRMG has filed all federal, state, municipal and local tax
returns (whether relating to income, sales, franchise, withholding, real, or
personal property or otherwise) required to be filed under the laws of the
United States and all applicable states and has paid in full all taxes which are
due pursuant to such returns or claimed to be due by any taxing authority or
otherwise due and owing. No penalties or other charges are, or will become, due
with respect to the late filing of any such return. To the best of the knowledge
of GRMG, after due investigation, each such tax return heretofore filed by GRMG
correctly and accurately reflects the amount of its tax liability thereunder.
GRMG has withheld, collected, and paid all other levies, assessments, license
fees and taxes to the extent required and, with respect to payments, to the
extent that the same have become due and payable.
(n) The authorized and outstanding capitalization of GRMG is
as set forth on SCHEDULE 9(n) hereto. As of the date hereof and the Effective
Date, except as set forth on SCHEDULE 9(n), there shall not be authorized and/or
issued and outstanding any shares of capital stock of GRMG and there shall not
be outstanding any rights to purchase shares of capital stock of GRMG. The
issued and outstanding shares of the GRMG Common Stock have been duly authorized
and validly issued. All of the outstanding shares of the GRMG Common Stock are
fully paid and nonassessable. Except as set forth on SCHEDULE 9(n), there are no
outstanding warrants, options, or similar rights to purchase or convert into the
14
GRMG Common Stock or the GRMG Series A Preferred Stock. There are no preemptive
rights with respect to the GRMG Common Stock or the GRMG Series A Preferred
Stock. GRMG has no reason to believe that any holder of such outstanding shares
of the GRMG Common Stock is subject to personal liability solely by reason of
being such a holder. The offers and sales of such outstanding shares of the GRMG
Common Stock were, at all relevant times, exempt from the registration or
prospectus delivery requirements of the Securities Act and any applicable state
securities laws pursuant to an exemption for which GRMG and/or such offering or
sale fully qualified. No dividends, redemptions or other distributions of the
assets of GRMG have been, or will be, declared prior to the Effective Date on or
with respect to the GRMG Common Stock or the GRMG Series A Preferred Stock. The
shares of the GRMG Common Stock have been registered under Section 12(g) of the
Exchange Act. The list of GRMG stockholders heretofore delivered by GRMG to
Excalibur is true, complete, and correct in all respects as of the date so
delivered.
(o) Except as set forth in SCHEDULES 9(k), 9(n), and 9(o)
hereto and as contemplated by this Agreement, since December 31, 2001, there has
not been with respect to GRMG:
(i) Any loan to any person or entity and/or the
issuance of any guaranty for, or with respect to, its or another's obligations;
(ii) Any waiver or release of any material right or
claim;
(iii) Any incurrence of any material obligation or
liability, absolute or contingent;
(iv) Any payment of any material obligation or
liability, absolute or contingent, except for current liabilities reflected in,
or shown on, the most recent balance sheet of GRMG and/or incurred subsequent to
the date thereof in the ordinary course of business and/or in connection with
the transactions contemplated by this Agreement; and
(v) Any material adverse change in the business,
assets, properties, liabilities, operations, results of operations, condition
(financial or otherwise) or affairs of GRMG;
(vi) Any damage, destruction or loss, whether or not
covered by insurance, having or which could reasonably be expected to have a
material adverse effect on GRMG;
(vii) (A) Any liability created, assumed, guaranteed
or incurred, or (B) any transaction, contract or commitment entered into, by
GRMG, in the case of either clause (A) or (B) other than in the ordinary course
of business;
(viii) Any payment, discharge or satisfaction of any
material encumbrance by GRMG or any cancellation by GRMG of any material debts
or claims or any amendment, termination or waiver of any rights of material
value to GRMG;
15
(ix) Any direct or indirect redemption, purchase or
other acquisition of any such shares of the capital stock of GRMG;
(x) except for the Reverse Split (as defined in
Section 13(g)), any stock split, reverse stock split, combination,
reclassification or recapitalization of the GRMG Common Stock, or any issuance
of any other security in respect of, or in exchange for, any shares of the GRMG
Common Stock;
(xi) Any issuance by GRMG of any shares of its
capital stock or any debt security or any subscription or similar right to
acquire any shares of the GRMG capital stock;
(xii) Any license, sale, transfer, pledge, mortgage
or other disposition of any material tangible or intangible asset (including any
GRMG Intangibles) of GRMG;
(xiii) Any termination of, or written indication of
an intention to terminate or not renew, any material contract, license,
commitment or other agreement between GRMG and any other person;
(xiv) Any material write-down or write-up of the
value of any asset of GRMG, or any material write-off of any accounts receivable
or notes receivable of GRMG or any portion thereof;
(xv) Any increase in, or modification of,
compensation payable, or to become payable to, any director, officer, employee,
consultant or agent of GRMG, or the entering into of any employment contract
with any officer or employee;
(xvi) Any increase in, or modification or
acceleration of, any benefits payable or to become payable under any bonus,
pension, severance, insurance or other benefit plan, payment or arrangement
(including, but not limited to, the granting of stock options, restricted stock
awards or stock appreciation rights) made to, for or with any director, officer,
employee, consultant or agent of GRMG other than as described in Schedule 9(n)
hereto;
(xvii) The making of any loan, advance or capital
contribution to, or investment in, any person or the engagement in any
transaction with any employee, officer, director or security holder of GRMG,
other than advances to employees in the ordinary course of business for travel
and similar business expenses;
(xviii) Any change in the accounting methods or
practices followed by GRMG or any change in depreciation or amortization
policies or rates theretofore adopted;
(xix) Any termination of employment of any officer or
key employee of GRMG or any expression of intention by any officer or key
employee of GRMG to resign from such office or employment with GRMG;
16
(xx) Any amendments or changes in GRMG's Articles of
Incorporation or By-Laws;
(xxi) Any agreement, understanding, authorization or
proposal, whether in writing or otherwise, for GRMG to take any of the actions
described in this Section 9(o).
(p) At the Effective Date, all of the shares of the GRMG
Common Stock to be issued by GRMG pursuant to this Agreement shall be, and be
deemed to be, duly and validly authorized and, when issued to the Excalibur
shareholders in exchange for their shares of the Excalibur Common Stock, duly
and validly issued, fully paid and nonassessable and free and clear of all
federal and state issuance, stock and/or company taxes, liens, security
interests, claims, encumbrances and charges.
(q) At the Effective Date, all of the shares of the GRMG
Series A Preferred Stock to be issued by GRMG pursuant to this Agreement shall
be, and be deemed to be, duly and validly authorized and, when issued to the
Excalibur shareholders in exchange for their shares of the Excalibur Series A
Preferred Stock, duly and validly issued, fully paid and nonassessable and free
and clear of all federal and state issuance, stock and/or company taxes, liens,
security interests, claims, encumbrances and charges.
(r) Upon the Effective Date, GRMG shall have no assets (other
than the share of common stock of Excalibur as described in Section 4(c)) or
liabilities (other than liabilities associated with the Investment Banking
Agreement (as defined in Section 14(j)) either reflected on GRMG's balance sheet
or under any contract, benefit plan or otherwise. Upon the Effective Date, GRMG
will have no debt, liability or obligations of any nature, whether accrued,
absolute, contingent or otherwise, whether due or to become due and whether or
not the amount hereof is readily ascertainable.
10. ACQUISITION CORP. REPRESENTATIONS AND WARRANTIES. In order to
induce Excalibur to execute this Agreement and perform its obligations under,
this Agreement, Acquisition Corp. does hereby represent, warrant, covenant and
agree (which representations, warranties, covenants and agreements shall be, and
be deemed to be, continuing and survive the execution and delivery of this
Agreement and the Effective Date) as follows:
(a) Acquisition Corp. is a corporation duly organized, validly
existing and in good standing under the laws of the State of Texas. Neither
prior to the date hereof has Acquisition Corp. engaged, nor prior to the
Effective Date will Acquisition Corp. engage, in any business activity of any
kind, nature or description except in connection with the implementation of the
transactions herein described. Acquisition Corp. has no subsidiaries, nor, at
the present time is it, or on the Effective Date will it be, a partner or joint
venturer with any other person or entity. Acquisition Corp. is a wholly-owned
subsidiary of GRMG.
(b) (i) Acquisition Corp. has the full power and authority,
corporate and otherwise, to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby; (ii) the execution, delivery,
and performance of this Agreement, the consummation by Acquisition Corp. of the
17
transactions herein contemplated and the compliance by Acquisition Corp. with
the terms of this Agreement have been duly authorized by Acquisition Corp.;
(iii) this Agreement is the valid and binding obligation of Acquisition Corp.,
enforceable in accordance with its terms, subject, as to enforcement of
remedies, to applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the rights of creditors generally and the discretion of
courts in granting equitable remedies; (iv) the execution, delivery and
performance of this Agreement by Acquisition Corp. and the consummation by
Acquisition Corp. of the transactions herein contemplated do not, and will not,
with or without the giving of notice or the lapse of time, or both, (A) result
in any violation of the Articles of Incorporation or By-Laws of Acquisition
Corp., (B) result in a breach of, or a conflict with, any of the terms or
provisions of, or constitute a default under, or result in the modification or
termination of, or result in the creation or imposition of any lien, security
interest, charge or encumbrance upon any of the properties or assets of
Acquisition Corp. pursuant to, any indenture, mortgage, note, contract,
commitment or other agreement or instrument to which Acquisition Corp. is a
party or by which it is, or any of its properties or assets are, or may be,
bound or affected; or (C) to the best knowledge of Acquisition Corp., after due
investigation, violate any existing applicable law, rule, regulation, judgment,
order or decree of any governmental agency or court, domestic or foreign, having
jurisdiction over Acquisition Corp. or its assets. Except as otherwise required
by the TBCA, no consent, approval, authorization or order of any court,
governmental agency, authority or body, is required in connection with the
execution, delivery and performance of this Agreement, and/or the consummation
by Acquisition Corp. of the transactions contemplated by this Agreement.
(c) Acquisition Corp. is not in violation of, or in default
under, (i) any term or provision of its Articles of Incorporation or By-Laws;
(ii) any material term or provision of any financial covenant of any indenture,
mortgage, contract, commitment or other agreement or instrument to which it is a
party or by which it or any or its properties is, or may be, bound or affected;
or (iii) any existing applicable law, rule, regulation, judgment, order or
decree of any governmental agency or court, domestic or foreign, having
jurisdiction over it or any of its assets.
(d) Acquisition Corp. was incorporated on March 19, 2002, has
no assets and has incurred no liabilities, debt, liability or obligations of any
nature, whether accrued, absolute, contingent or otherwise, whether due or to
become due and whether or not the amount hereof is readily ascertainable, other
than its incorporation costs. Prior to the date hereof, Acquisition Corp. has
conducted no business operations and, prior to the Effective Date, its sole
activities will be in connection with the transactions contemplated by this
Agreement.
(e) There are no claims, actions, suits, proceedings,
arbitrations, investigations or inquiries before any court or governmental
agency, court or tribunal, domestic, or foreign, or before any private
arbitration tribunal, pending or, to the best of the knowledge of Acquisition
Corp., threatened against Acquisition Corp. or involving its assets which, if
determined adversely to Acquisition Corp., would, individually or in the
aggregate, result in a material adverse change in the financial position,
shareholders' equity, results of operations, properties, business, management or
affairs of Acquisition Corp., or which question the validity of this Agreement
or of any action taken or to be taken by Acquisition Corp. pursuant to, or in
connection with, this Agreement; nor, to the best of the knowledge of
Acquisition Corp., is there any basis for any such claim, action, suit,
proceeding, arbitration, investigation or inquiry to be made by any person
18
and/or entity. There are no outstanding orders, judgments or decrees of any
court, governmental agency or other tribunal specifically naming Acquisition
Corp. and/or enjoining Acquisition Corp. from taking, or requiring Acquisition
Corp. to take, any action, and/or by which Acquisition Corp. is, and/or its
assets are, bound or subject.
11. STOCK OPTIONS/WARRANTS.
(a) Excalibur has provided GRMG with a true and complete list
as of the date hereof of all holders of outstanding options under Excalibur's
2001 Stock Option Plan (the "EXCALIBUR STOCK OPTION PLAN"), including the number
of shares of Excalibur Common Stock subject to each such option, the exercise or
vesting schedule, the exercise price and term of each such option. On the
Effective Date, each outstanding option to purchase shares of Excalibur Common
Stock (an "EXCALIBUR STOCK OPTION") under the Excalibur Stock Option Plan,
whether vested or unvested, shall be assumed and shall constitute an option to
aqcuire, on the same terms and conditions as were applicable under such
Excalibur Stock Option, the same number of shares of GRMG Common Stock as the
holder of such Excalibur Stock Option would have been entitled to receive
pursuant to the Merger had such holder exercised such option (including any
unvested portion thereof) in full (disregarding any limitation on exercisability
thereof) immediately before the Effective Date (rounded downward to the nearest
whole number), at a price per share (rounded upward to the nearest whole cent)
equal to (y) the aggregate exercise price for the shares of Excalibur Common
Stock purchasable pursuant to such Excalibur Stock Option immediately before the
Effective Date divided by (z) the number of full shares of GRMG Common Stock
deemed purchasable pursuant to such Excalibur Stock Option in accordance with
the foregoing.
(b) Except as otherwise provided in the Excalibur Stock Option
Plan, the documents governing the Excalibur Stock Options, and offer letters and
other agreements affecting such Excalibur Stock Options, the Merger shall not
result in the termination or acceleration of any outstanding Excalibur Stock
Options under the Excalibur Stock Option Plan that are so assumed by GRMG. It is
the intention of the parties that the Excalibur Stock Options so assumed by GRMG
qualify following the Effective Date as incentive stock options as defined in
Section 422 of the Internal Revenue Code to the extent such Excalibur Stock
Options qualified as incentive stock options before the Effective Date. As
promptly as reasonably practicable and in any event within thirty (30) business
days after receipt of all option documentation it requires relating to the
outstanding Excalibur Stock Options, GRMG will issue to each person who,
immediately prior to the Effective Date, is a holder of an outstanding Excalibur
Stock Option under the Excalibur Stock Option Plan that is to be assumed by GRMG
hereunder, a document evidencing the foregoing assumption of such Excalibur
Stock Option by GRMG.
(c) GRMG shall take all corporate action necessary to reserve
for issuance a sufficient number of shares of GRMG Common Stock for delivery
under Excalibur Stock Options assumed in accordance with this Section 11. The
Board of Directors of Excalibur shall, prior to or as of the Effective Date,
take all necessary actions, pursuant to and in accordance with the Excalibur
Stock Option Plan and the instruments evidencing the Excalibur Stock Options, to
provide for the assumption of Excalibur Stock Options by GRMG in accordance with
19
this Section 11, and to provide that no consent of the holders of the Excalibur
Stock Options is required in connection with such assumption.
(d) On the Effective Date, each outstanding warrant to
purchase shares of Excalibur Common Stock or Excalibur Series A Preferred Stock
(an "EXCALIBUR WARRANT") shall be assumed and shall constitute an option to
aqcuire, on the same terms and conditions as were applicable under such
Excalibur Warrant, the same number of shares of GRMG Common Stock or GRMG Series
A Preferred Stock, as the case may be, as the holder of such Excalibur Warrant
would have been entitled to receive pursuant to the Merger had such holder
exercised such option (including any unvested portion thereof) in full
(disregarding any limitation on exercisability thereof) immediately before the
Effective Date (rounded downward to the nearest whole number), at a price per
share (rounded upward to the nearest whole cent) equal to (y) the aggregate
exercise price for the shares of Excalibur Common Stock or Excalibur Series A
Preferred Stock, as the case may be, purchasable pursuant to such Excalibur
Warrant immediately before the Effective Date divided by (z) the number of full
shares of GRMG Common Stock or GRMG Series A Preferred Stock deemed purchasable
pursuant to such Excalibur Warrant in accordance with the foregoing.
(e) Except as otherwise provided in the Excalibur Warrants and
other agreements affecting such Excalibur Warrants, the Merger shall not result
in the termination or acceleration of any outstanding Excalibur Warrants that
are so assumed by GRMG. As promptly as reasonably practicable and in any event
within thirty (30) business days after receipt of all documentation it requires
relating to the outstanding Excalibur Warrants, GRMG will issue to each person
who, immediately prior to the Effective Date, is a holder of an outstanding
Excalibur Warrant under that is to be assumed by GRMG hereunder, a document
evidencing the foregoing assumption of such Excalibur Warrant by GRMG.
(f) GRMG shall take all corporate action necessary to reserve
for issuance a sufficient number of shares of GRMG Common Stock and GRMG Series
A Preferred Stock for delivery under Excalibur Warrants assumed in accordance
with this Section 11. The Board of Directors of Excalibur shall, prior to or as
of the Effective Date, take all necessary actions, pursuant to the Excalibur
Warrants, to provide for the assumption of Excalibur Warrants by GRMG in
accordance with this Section 11, and to provide that no consent of the holders
of the Excalibur Warrants is required in connection with such assumption.
12. EXCALIBUR COVENANTS. Excalibur shall, during the period commencing
on the date hereof and terminating immediately following the close of business
on the Effective Date (or earlier, upon the failure or refusal of the Excalibur
shareholders or the GRMG stockholders to approve this Agreement and/or the
termination of this Agreement as hereinafter provided):
(a) Take and perform any and all actions necessary to render
accurate, and/or maintain the accuracy of, all of the representations and
warranties of Excalibur herein contained and/or satisfy each covenant or
condition required to be performed or satisfied by Excalibur at or prior to the
Effective Date and/or to cause or permit the implementation of the Merger;
20
(b) Not take or perform any action which would or might cause
any representation or warranty made by Excalibur herein to be rendered
inaccurate, in whole or in part, and/or which would prevent, inhibit or preclude
the satisfaction, in whole or in part, of any covenant required to be performed
or satisfied by Excalibur at or prior to the Effective Date and/or the
implementation of the Merger;
(c) Carry on and maintain its business in substantially the
same form, style, and manner as heretofore operated by it; perform, in all
material respects, all of its respective obligations under all material
agreements, leases and documents relating to or affecting its respective assets,
properties and businesses; and use its best efforts to preserve intact its
business organization and the good will and relationships with its suppliers,
customers and others having business relations with it;
(d) Use commercially reasonable efforts to obtain, pursuant to
the TBCA, the required shareholder consent to approve the merger of Acquisition
Corp. into Excalibur and give notice to the non-consenting shareholders in
accordance with the TBCA;
(e) Use commercially reasonable efforts to obtain investment
representation certificates ("INVESTOR REPRESENTATION CERTIFICATES") signed by
each shareholder of Excalibur; and
(f) Immediately advise GRMG of any event, condition or
occurrence which constitutes, or may, with the passage of time and/or giving of
notice, constitute, a breach of any representation or warranty of Excalibur
herein contained and/or which prevents, inhibits or limits or may prevent,
inhibit or limit Excalibur from satisfying, in full and on a timely basis, any
covenant, term or condition herein contained and/or implementing this Agreement.
Notwithstanding anything to the contrary contained in this Agreement,
it is hereby expressly agreed that Excalibur, in its sole discretion, may
authorize and issue Excalibur capital stock as follows: (i) up to 1,200,000
shares of Series B Convertible Preferred Stock, (ii) warrants to purchase up to
480,000 shares of Common Stock in connection with the issuance of the Series B
Preferred Stock described in subsection (i), (iii) additional Excalibur Stock
Options pursuant to the Excalibur Stock Option Plan.
13. GRMG COVENANTS. GRMG shall, during the period commencing on the
date hereof and terminating immediately following the close of business on the
Effective Date (or earlier, upon the failure or refusal of the Excalibur
shareholders or the GRMG stockholders to approve this Agreement and/or the
termination of this Agreement as hereinafter provided):
(a) Take and perform any and all actions necessary to render
accurate, and/or maintain the accuracy of, all of the representations and
warranties of GRMG herein contained and/or satisfy each covenant or condition
required to be performed or satisfied by GRMG at or prior to the Effective Date
and/or to cause or permit the implementation of the Merger;
(b) Not take or perform any action which would or might cause
any representation or warranty made by GRMG herein to be rendered inaccurate, in
whole or in part, and/or which would prevent, inhibit or preclude the
21
satisfaction, in whole or in part, of any covenant required to be performed or
satisfied by GRMG at or prior to the Effective Date and/or the implementation of
the Merger;
(c) Carry on and maintain its business in substantially the
same form, style and manner as heretofore operated by it; perform, in all
material respects, all of its respective obligations under all material
agreements, leases and documents relating to or affecting its respective assets,
properties and businesses; and use its best efforts to preserve intact its
business organization and the good will and relationships with its suppliers,
customers and others having business relations with it;
(d) Not make any announcement to the public in general and/or
within its industry and/or otherwise with respect to this Agreement, the Merger
and the current or future business or operations of any party hereto without the
prior written consent of Excalibur or, in the case of an announcement required
by applicable securities laws, prior consultation with Excalibur;
(e) Immediately advise Excalibur of any event, condition or
occurrence which constitutes, or may, with the passage of time and/or giving of
notice, constitute, a breach of any representation or warranty of GRMG herein
contained and/or which prevents, inhibits or limits or may prevent, inhibit or
limit GRMG from satisfying, in full and on a timely basis, any covenant, term or
condition herein contained and/or implementing this Agreement;
(f) Pay the specified liabilities in SCHEDULE 9(k) hereto with
the Non-Refundable Payment and the Additional Payment and provide Excalibur with
satisfactory evidence of such payment;
(g) Effect a 1 for 14.758 reverse split (the "REVERSE SPLIT")
of the GRMG Common Stock;
(h) Authorize the GRMG Series A Preferred Stock, which shall
have rights, preferences and privileges which are substantially similar to those
of the Excalibur Series A Preferred Stock;
(i) Establish a stock option plan ("STOCK OPTION PLAN") in the
form attached hereto as EXHIBIT B.
(j) Lawfully terminate all leases and other agreements to
which GRMG is a party.
(k) Not take or perform any action identified in Section 9(o)
unless specifically authorized by this Agreement.
14. GRMG AND ACQUISITION CORP. CONDITIONS PRECEDENT. The obligations of
GRMG and Acquisition Corp. to implement this Agreement and consummate the Merger
are, at their respective elections, subject to, and conditioned upon, the GRMG
satisfaction (and/or waiver except as to Sections 14(a) and (e)) of each of the
following conditions:
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(a) Prior to the Effective Date, the holders of more than 66
2/3% of the outstanding shares of the Excalibur Common Stock and Excalibur
Series A Preferred Stock (voting on an as-if converted basis) voting together,
and 66 2/3% of the outstanding shares of the Excalibur Series A Preferred Stock,
voting as a class, shall have consented to this Agreement and the Merger in
accordance with the TBCA.
(b) The representations and warranties of Excalibur contained
in this Agreement shall be true and correct in all material respects as of the
Effective Date with the same effect as if made on and as of the Effective Date
(except for changes specifically authorized by this Agreement, including, but
not limited to, the issuance of Excalibur capital stock as described in Section
12), and Excalibur shall have performed in all material respects all of its
covenants and obligations contemplated hereunder to be performed on or prior to
the Effective Date. On the Effective Date, GRMG shall have received a
certificate, executed by the Chief Executive Officer and the Secretary of
Excalibur (effective as of the Effective Date) and in form reasonably acceptable
to GRMG, certifying as of both the date of this Agreement and the Effective
Date, the truth and accuracy of (and the remaking of) the representations and
warranties of Excalibur herein contained, including, without limitation, those
set forth in Section 8 hereof.
(c) Prior to the Effective Date, all corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be in form
and content reasonably satisfactory to GRMG and its counsel and GRMG and its
counsel shall have received all counterpart originals or certified or other
copies of such documents and instruments as they may reasonably request.
(d) No action or proceeding shall have been instituted and be
pending by any private party and/or governmental agency or authority challenging
the legality of this Agreement or the Merger and/or seeking to prevent or delay
consummation of the transactions herein contemplated, which action or proceeding
shall have resulted in an order granting preliminary or permanent injunctive
relief prohibiting consummation of this Agreement and/or the Merger and which
order shall not have been vacated as of the Effective Date.
(e) All statutory requirements for the valid consummation by
Excalibur of the transactions herein described shall have been fully and timely
satisfied; all authorizations, consents and approvals of all federal, state and
local governmental agencies and authorities required to be obtained in order to
permit consummation by Excalibur of the transactions herein described and/or to
permit the businesses currently carried on by Excalibur to continue unimpaired
in all material respects immediately following the Effective Date shall have
been obtained and shall be in full force and effect; and no action or proceeding
to suspend, revoke, cancel, terminate, modify or alter any of such
authorizations, consents or approvals shall be pending or threatened.
(f) GRMG's due diligence inquiry, including receipt of the
Excalibur Audited Financial Statements, shall be complete and satisfactory.
(g) Each Excalibur shareholder shall have completed, executed
and delivered an Investment Representation Certificate.
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(j) GRMG shall have executed an investment banking agreement
(the "INVESTMENT BANKING AGREEMENT") with Atlas Capital Services, LLC ("ATLAS
CAPITAL"), in form and substance substantially similar to the agreement set
forth in EXHIBIT A attached hereto.
(k) Excalibur shall have received the consent of the holders
of its Series A Preferred Stock to grant to Atlas Capital the registration
rights set forth in Section 5 of the Investment Banking Agreement.
(l) Excalibur has performed and complied with all agreements,
covenants, obligations and conditions required by the Agreement to be performed
or complied with by Excalibur on or prior to the Effective Date.
15. EXCALIBUR CONDITIONS PRECEDENT. The obligation of Excalibur to
implement this Agreement and to consummate the Merger is, at its election,
subject to, and conditioned upon, the satisfaction (and/or waiver except as to
Sections 15(a) and (e)) of each of the following conditions:
(a) Prior to the Effective Date, the holders of more than 66
2/3% of the outstanding shares of the Excalibur Common Stock and Excalibur
Series A Preferred Stock (voting on an as-if converted basis) voting together,
and 66 2/3% of the outstanding shares of the Excalibur Series A Preferred Stock,
voting as a class, shall have consented to this Agreement and the Merger in
accordance with the TBCA.
(b) The representations and warranties of GRMG and Acquisition
Corp. contained in this Agreement shall be true and correct in all material
respects as of the Effective Date with the same effect as if made on and as of
the Effective Date. At the Effective Date, Excalibur shall have received a
certificate, executed by the President and the Secretary of GRMG and Acquisition
Corp. (effective as of the Effective Date) and in form and content reasonably
acceptable to Excalibur, certifying, as to both the date of this Agreement and
the Effective Date the truth and accuracy of (and the remaking of) the
representations and warranties of GRMG and Acquisition Corp. herein contained,
including, without limitation, those set forth in Sections 8 and 9 hereof, and
that GRMG has performed and complied with all agreements, covenants, obligations
and conditions required by the Agreement to be performed or complied with by
GRMG on or prior to the Effective Date.
(c) Prior to the Effective Date, all corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be in form
and content reasonably satisfactory to Excalibur and its counsel and Excalibur
and its counsel shall have received all counterpart originals or certified or
other copies of such documents and instruments as they may reasonably request.
(d) No action or proceeding shall have been instituted and be
pending by any private party and/or governmental agency or authority challenging
the legality of this Agreement or the Merger and/or seeking to prevent or delay
24
consummation of the transactions herein contemplated, which action or proceeding
shall have resulted in an order granting preliminary or permanent injunctive
relief prohibiting consummation of this Agreement and/or the Merger and which
order shall not have been vacated as of the Effective Date.
(e) All statutory requirements for the valid consummation by
GRMG of the transactions herein described shall have been fully and timely
satisfied; all authorizations, consents and approvals of all federal, state and
local governmental agencies and authorities required to be obtained in order to
permit consummation by GRMG of the transactions herein described shall have been
obtained and shall be in full force and effect; and no action or proceeding to
suspend, revoke, cancel, terminate, modify or alter any of such authorizations,
consents or approvals shall be pending or threatened.
(f) Excalibur's due diligence inquiry of GRMG shall be
complete and satisfactory.
(g) Each Excalibur shareholder shall have completed, executed,
and delivered an Investment Representation Certificate.
(h) GRMG has performed and complied with all agreements,
covenants, obligations and conditions required by the Agreement to be performed
or complied with by GRMG on or prior to the Effective Date.
(i) Excalibur shall have received lock-up agreements ("Lock-Up
Agreements") from the Principal Stockholder and Xxxxxx Xxxxxxx in the form and
substance similar to the Lock-Up Agreements set forth in EXHIBIT C hereto.
16. TERMINATION; BREAK UP FEE.
(a) This Agreement may be terminated and the Merger abandoned
at any time prior to the Effective Date, whether before or after submission to,
or approval by, the Excalibur shareholders or the GRMG stockholders as herein
provided either: (a) by mutual agreement of the Boards of Directors of Excalibur
and GRMG; or (b) by the Board of Directors of either Excalibur or GRMG if either
(i) the Effective Date shall not have taken place on or prior to April 30, 2001
(other than by reason of the default hereunder by the terminating party) or (ii)
there is any statute, rule or regulation which makes consummation of the Merger
illegal or otherwise prohibited or any order, decree, injunction or judgment
enjoining GRMG, Excalibur or Acquisition Corp. from consummating the Merger is
issued by a court of competent jurisdiction and such order, decree, injunction
or judgment has become final and non-appealable.
(b) If Excalibur terminates this Agreement, Excalibur will be
obligated to reimburse GRMG for all of its expenses, including legal,
accounting, advisory or otherwise incurred as a result of the Merger
contemplated hereby and shall forfeit the Non-Refundable Payment; provided
however, if Excalibur terminates the Agreement due to a breach of a GRMG
representation or warranty set forth in Section 9 (GRMG Representations and
Warranties), due to a breach of an Acquisition Corp. representation or warranty
set forth in Section 10 (Acquisition Corp. Representations and Warranties), due
to the failure of GRMG to fulfill its covenants set forth in Section 13 (GRMG
25
Covenants), or due to the failure of any of the conditions set forth in Section
15 (Excalibur Conditions Precedent), then Excalibur's obligations with respect
to the expenses set forth in 16 (b) herein shall terminate and Excalibur shall
be entitled to a refund of its Non-Refundable Payment.
(c) In the event of the termination of this Agreement as provided in subsection
(a) of this Section 16, all of the obligations and liabilities of the parties
under this Agreement shall terminate; provided, however, that nothing in this
Section 16 shall relieve any party from any liability for any breach of this
Agreement.
17. INDEMNIFICATION. (a) INDEMNITY BY GRMG AND THE PRINCIPAL
SHAREHOLDER. GRMG and the Principal Shareholder, jointly and severally, agree to
indemnify and hold harmless Excalibur and its successors and assigns (the
"EXCALIBUR INDEMNITEES") against and in respect of any and all claims, suits,
actions, proceedings (formal and informal), investigations, judgments,
deficiencies, damages, settlements, liabilities, losses, costs and legal and
other expenses arising out of or based upon any breach of any representation or
warranty, covenant or agreement of GRMG contained in this Agreement or in any
other agreement executed and delivered hereunder or in connection herewith
(referred to as "EXCALIBUR LOSSES").
(b) INDEMNITY BY EXCALIBUR. Excalibur agrees to indemnify and
hold harmless GRMG its respective successors and assigns, shareholders,
employees, (the "GRMG INDEMNITEES") against and in respect of any and all
claims, suits, actions, proceedings (formal and informal), investigations,
judgments, deficiencies, damages, settlements, liabilities, losses, costs and
legal and other expenses arising out of or based upon any breach of any
representation, warranty, covenant or agreement of Excalibur contained in this
Agreement, or in any other agreement executed and delivered by Excalibur
(referred to as the "GRMG LOSSES").
(c) DEFENSE OF CLAIMS. Any Excalibur Indemnitee or GRMG
Indemnitee (the "INDEMNIFIED PARTY") seeking indemnification under this
Agreement shall give to the party obligated to provide indemnification to such
Indemnified Party (the "INDEMNITOR") a notice (a "CLAIM NOTICE") describing in
reasonable detail the facts giving rise to any claim for indemnification
hereunder promptly upon learning of the existence of such claim. Upon receipt by
the Indemnitor of a Claim Notice from an Indemnified Party with respect to any
claim of a third party, such Indemnitor may assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party and, in such event,
shall agree to pay and otherwise discharge with the Indemnitor's own assets all
judgments, deficiencies, damages, settlements, liabilities, losses, costs and
legal and other expenses related thereto; and the Indemnified Party shall
cooperate in the defense or prosecution thereof and shall furnish such records,
information and testimony and attend all such conferences, discovery
proceedings, hearings, trials and appeals as may be reasonably requested in
connection therewith. If the Indemnitor does not assume the defense thereof
within ten days of its receipt of the Claim Notice, the Indemnitor shall
similarly cooperate with the Indemnified Party in such defense or prosecution.
The Indemnified Party shall have the right to participate in the defense or
prosecution of any lawsuit with respect to which the Indemnitor has assumed the
defense and to employ its own counsel therein, but the fees and expenses of such
counsel shall be at the expense of the Indemnified Party unless (i) the
26
Indemnitor shall not have promptly employed counsel reasonably satisfactory to
such Indemnified Party to take charge of the defense of such action, (ii) such
Indemnified Party shall have reasonably concluded that there exists a
significant conflict of interest with respect to the conduct of such Indemnified
Party's defense by the Indemnitor, or (iii) the Indemnitor fails to provide
reasonable insurance to the Indemnified Party of its financial capacity to
defend such action and provide indemnification with respect to such action, in
any of which events such reasonable fees and expenses shall be borne by the
Indemnitor and the Indemnitor shall not have the right to direct the defense of
any such action on behalf of the Indemnified Party. The Indemnitor shall have
the right, in its sole discretion, to settle any claim (a) which is solely for
monetary damages for which indemnification has been sought and is available
hereunder, and (b) where there is no finding or admission of any violation of
any legal requirements or any violation of the rights of any Person and no
effect on any other claims that may be made against the indemnified party,
provided that the Indemnitor shall not agree to the settlement of any claim
which constitutes the subject of a Claim Notice which settlement in the
reasonable opinion of the Indemnified Party would have a material adverse
continuing effect on the business of the Indemnified Party without the prior
written consent of the Indemnified Party. The Indemnified Party shall give
written notice to the Indemnitor of any proposed settlement of any suit, which
settlement the Indemnitor may, if it shall have assumed the defense of the suit,
reject in its reasonable judgment within 10 days of receipt of such notice.
Notwithstanding the foregoing the Indemnified Party shall have the right to pay
or settle any suit for which indemnification has been sought and is available
hereunder, provided that, if the defense of such claim shall have been assumed
by the Indemnitor, the Indemnified Party shall automatically be deemed to have
waived any right to indemnification hereunder.
18. BROKERS AND FINDERS. Except pursuant to the Investment Banking
Agreement with Atlas Capital, the parties have not employed any broker,
financial advisor or finder or incurred any liability for any broker, financial
advisory or finders' fees in connection with this Agreement and Merger.
Notwithstanding the foregoing, the parties acknowledge that Xxxxx Securities has
acted as a finder for Excalibur with respect to the Excalibur Series A Preferred
Stock and will make a market in the GRMG Common Stock after the Effective Date.
19. COSTS AND EXPENSES. Each party shall pay their own costs and
expenses relating to the transactions contemplated by this Agreement, including,
without limitation, the costs and expenses relating to the preparation of this
Agreement, such as attorneys' fees, accounting fees, printing expenses and
consent solicitation expenses.
20. NOTICES. Any and all notices, requests or instructions desired to
be given by any party hereto to any other party hereto shall be in writing and
shall be either be hand delivered, delivered by express courier or mailed to the
recipient first class, postage prepaid, certified, return receipt requested at
the following respective addresses:
To: Excalibur:
Excalibur Holdings, Inc.
00000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxxxxx X.X. Xxxxxx
27
With a copy to:
Xxxxxxxxxxx Xxxxx & Xxxxxxxx LLP
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
To: GRMG or Acquisition Corp.
0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
With a copy to:
Xxxxxx & Jaclin, LLP
0000 Xxxxx 0 Xxxxx, 0xx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxx X. Xxxxxx, Esq.
or to such other address as any party hereto shall designate in a writing
complying with the provisions of this Section 20.
21. WAIVER. Each of the parties hereto may, by written instrument, (a)
extend the time for the performance of any of the obligations or other acts of
any other party hereto; (b) waive any inaccuracies of such other party in the
representations and warranties contained herein or in any document delivered
pursuant to this Agreement; (c) waive compliance with any of the covenants of
such other party contained in this Agreement; (d) waive such other party's
performance of any of such other party's obligations set out in this Agreement;
and (e) waive any condition to such other party's obligation to effect the
Merger.
22. AMENDMENTS. This Agreement may be amended at any time prior to the
Effective Date (whether before or after the consent of shareholders of Excalibur
as herein provided) by a writing executed by an authorized officer of GRMG,
Excalibur and Acquisition Corp. (upon due authorization by their respective
Boards of Directors).
23. GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York applicable to contracts
executed and to be fully performed therein and without regard to any principles
of conflicts of laws. Any action or proceeding seeking to enforce any provision
of, or based on any right arising out of, this Agreement shall only be brought
against any of the parties in the state or federal courts of the State and
County of New York and each of the parties hereby consents to the exclusive
jurisdiction of such courts (and of the appropriate appellate courts) in any
such action or proceeding and waives any objection to venue laid therein. The
parties hereto each waive any claim that such jurisdiction is not a convenient
28
forum for any such action; provided, however, that each party reserves the right
to seek to remove the action or proceeding from the state court to the federal
court in such jurisdiction or VICE VERSA. Each party waives the right to a jury
trial.
24. EFFECTIVENESS. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and any controlling person of any party hereof
as provided in Section 16 of the Securities Act and their respective successors,
transferees, heirs, assigns and beneficiaries.
25. COUNTERPARTS. This Agreement may be executed in multiple copies,
each of which shall constitute an original, but all of which shall constitute
one and the same agreement.
26. PARTIAL INVALIDITY. If any term, covenant or condition in this
Agreement, or the application thereof to any person or circumstance, shall be
invalid or unenforceable, the remainder of this Agreement or the application of
such term, covenant or condition to persons or circumstances, other than those
as to which it is held invalid, shall be unaffected thereby and each term,
covenant or condition of this Agreement shall be enforced to fullest extent
permitted by law.
27. INTEGRATION. This Agreement (including the Schedules hereto, the
documents and instruments delivered by the parties hereto and any other
documents executed and delivered and/or to be executed and delivered pursuant to
the provisions of this Agreement as herein provided) sets forth the entire
agreement among the parties hereto with respect to the subject matter herein
contained. There are no covenants, promises, agreements, conditions or
understandings, either oral or written, between or among the parties hereto with
respect to the subject matter hereof except as herein and in such ancillary
documents provided.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement and
Plan of Merger as of the date first above written.
GLOBAL REALTY MANAGEMENT GROUP, INC.
By:
-----------------------------------------------
Xxxxxxx X. Xxxxxx, Executive Vice-President
GRMG ACQUISITION CORPORATION
By:
-----------------------------------------------
Xxxxxxx X. Xxxxxx, President
EXCALIBUR HOLDINGS, INC.
By:
-----------------------------------------------
Xxxxxxx X.X. Xxxxxx, President
XXXXXXX X. XXXXXX
-----------------------------------------------
Xxxxxxx X. Xxxxxx
30
