EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (hereinafter referred to as this
"Agreement") dated as of July 3, 2003, is made and entered into by and between
InkSure Technologies Inc., a Nevada corporation (the "Parent") and InkSure
Technologies (Delaware) Inc., a Delaware corporation (the "Subsidiary").
RECITALS:
A. The Parent is a corporation organized and existing under the laws of the
State of Nevada.
B. The Subsidiary is a corporation organized and existing under the laws of the
State of Delaware and is a wholly owned subsidiary of the Parent.
C. The Parent and the Subsidiary and their respective Boards of Directors deem
it advisable and to the advantage, welfare, and best interests of the
corporations and their respective stockholders to merge Parent with and into
Subsidiary pursuant to the provisions of Nevada Revised Statutes (the "NRS") and
the Delaware General Corporation Law (the "DGCL") upon the terms and conditions
hereinafter set forth.
NOW THEREFORE, in consideration of the premises, the mutual covenants
herein contained and other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree that the
Parent shall be merged into the Subsidiary (the "Merger") upon the terms and
conditions hereinafter set forth.
ARTICLE I
PRINCIPAL TERMS OF THE MERGER
1.1. Merger. On the Effective Date (as defined in Section 4.1 hereof),
the Parent shall be merged into the Subsidiary, the separate existence of the
Parent shall cease and the Subsidiary (following the Merger referred to as the
"Surviving Corporation") shall operate under the name "InkSure Technologies
Inc." by virtue of, and shall be governed by, the laws of the State of Delaware.
The address of the registered office of the Surviving Corporation in the State
of Delaware will be 00 Xxxx Xxxxx Xxxxxx, Xxxx xx Xxxxx, Xxxxxx of Kent, and the
registered agent in charge thereof shall be United Corporate Services, Inc.
1.2. Certificate of Incorporation of the Surviving Corporation. The
Certificate of Incorporation of the Surviving Corporation shall be the
Certificate of Incorporation of the Subsidiary as in effect on the date hereof
without change unless and until amended in accordance with applicable law.
1.3. Bylaws of the Surviving Corporation. The Bylaws of the Surviving
Corporation shall be the Bylaws of the Subsidiary as in effect on the date
hereof without change unless and until amended or repealed in accordance with
applicable law.
1.4. Directors and Officers. At the Effective Date of the Merger, the
directors and officers of the Parent in office at the Effective Date of the
Merger shall become the directors and officers, respectively, of the Surviving
Corporation, each of such directors and officers to hold office, subject to the
applicable provisions of the Certificate of Incorporation and Bylaws of the
Surviving Corporation and the DGCL, until his or her successor is duly elected
or appointed and qualified.
ARTICLE II
CONVERSION, CERTIFICATES AND PLANS
2.1. Conversion of Shares. At the Effective Date of the Merger, each of
the following transactions shall be deemed to occur simultaneously:
(a) Common Stock. Each share of the Parent's common stock, $0.01
par value per share (the "Parent's Common Stock"), issued and outstanding
immediately prior to the Effective Date of the Merger shall, by virtue of the
Merger and without any action on the part of the holder thereof, be converted
into and become one validly issued, fully paid and nonassessable share of the
Surviving Corporation's common stock, $0.01 par value per share (the "Surviving
Corporation's Common Stock"), except for those shares of the Parent's Common
Stock with respect to which the holders thereof duly exercise their dissenters'
rights under the NRS.
(b) Options. Each option to acquire shares of the Parent's Common
Stock outstanding immediately prior to the Effective Date of the Merger shall,
by virtue of the Merger and without any action on the part of the holder
thereof, be converted into and become an equivalent option to acquire, upon the
same terms and conditions, the number of shares of the Surviving Corporation's
Common Stock, which is equal to the number of shares of the Parent's Common
Stock that the optionee would have received had the optionee exercised such
option in full immediately prior to the Effective Date of the Merger (whether or
not such option was then exercisable) and the exercise price per share under
each of said options shall be equal to the exercise price per share thereunder
immediately prior to the Effective Date of the Merger, unless otherwise provided
in the instrument granting such option.
(c) Warrants. Each warrant to acquire shares of the Parent's
Common Stock outstanding immediately prior to the Effective Date of the Merger
shall, by virtue of the Merger and without any action on the part of the holder
thereof, be converted into and become a warrant to acquire, upon the same terms
and conditions, the number of shares of the Surviving Corporation's Common Stock
which is equal to the number of shares of the Parent's Common Stock that the
warrant holder would have received had the warrant holder exercised such warrant
in full immediately prior to the Effective Date of the Merger (whether or not
such warrant was then exercisable) and the exercise price per share under each
of said warrants shall be equal to the exercise price per share thereunder
immediately prior to the Effective Date of the Merger, unless otherwise provided
in the instrument granting such warrant.
(d) Other Rights. Any other right, by contract or otherwise, to
acquire shares of the Parent's Common Stock outstanding immediately prior to the
Effective Date of the Merger shall, by virtue of the Merger and without any
action on the part of the holder thereof, be converted into and become a right
to acquire, upon the same terms and conditions, the number of shares of the
Surviving Corporation's Common Stock which is equal to the number of shares of
the Parent's Common Stock that the right holder would have received had the
right holder exercised such right in full immediately prior to the Effective
Date of the Merger (whether or not such right was then exercisable) and the
exercise price per share under each of said rights shall be equal to the
exercise price per share thereunder immediately prior to the Effective Date of
the Merger, unless otherwise provided in the agreement granting such right.
(e) Each share of the Subsidiary's Common Stock issued and
outstanding immediately prior to the Effective Date of the Merger and held by
the Parent shall be canceled without any consideration being issued or paid
therefor.
2.2. Stock Certificates. After the Effective Date of the Merger, each
certificate theretofore representing issued and outstanding shares of the
Parent's Common Stock will thereafter be deemed to represent one share of the
same class and series of capital stock of the Subsidiary. The holders of
outstanding certificates theretofore representing the Parent's Common Stock will
not be required to surrender such certificate to the Parent.
2.3. Employee Benefit and Compensation Plans. At the Effective Date of
the Merger, each employee benefit plan, incentive compensation plan and other
similar plans to which the Parent is then a party shall be assumed by, and
continue to be the plan of, the Surviving Corporation. To the extent any
employee benefit plan, incentive compensation plan or other similar plan of the
Parent provides for the issuance or purchase of, or otherwise relates to, the
Parent's Common Stock, after the Effective Date of the Merger such plan shall be
deemed to provide for the issuance or purchase of, or otherwise relate to, the
Surviving Corporation's Common Stock.
ARTICLE III
TRANSFER AND CONVEYANCE OF ASSETS AND ASSUMPTION OF LIABILITIES
3.1. Effects of the Merger. At the Effective Date of the Merger, the
Merger shall have the effects specified in the NRS, the DGCL and this Agreement.
Without limiting the generality of the foregoing, and subject thereto, at the
Effective Date of the Merger, the Surviving Corporation shall possess all the
rights, privileges, powers and franchises, of a public as well as a private
nature, and shall be subject to all the restrictions, disabilities and duties of
each of the parties to this Agreement; the rights, privileges, powers and
franchises of the Parent and the Subsidiary, and all property, real, personal
and mixed, and all debts due to each of them on whatever account, shall be
vested in the Surviving Corporation; and all property, rights, privileges,
powers and franchises, and all and every other interest shall be thereafter the
property of the Surviving Corporation, as they were of the respective
constituent entities, and the title to any real estate whether by deed or
otherwise vested in the Parent and the Subsidiary or either of them, shall not
revert to be in any way impaired by reason of the Merger; but all rights of
creditors and all liens upon any property of the parties hereto, shall be
preserved unimpaired, and all debts, liabilities and duties of the respective
constituent entities shall thenceforth attach to the Surviving Corporation, and
may be enforced against it to the same extent as if said debts, liabilities and
duties had been incurred or contracted by it.
3.2. Additional Actions. If, at any time after the Effective Date of
the Merger, the Surviving Corporation shall consider or be advised that any
further assignments or assurances in law or any other acts are necessary or
desirable (a) to vest, perfect or confirm, of record or otherwise, in the
Surviving Corporation, title to and possession of any property or right of the
Parent acquired or to be acquired by reason of, or as a result of, the Merger,
or (b) otherwise to carry out the purposes of this Agreement, the Parent and its
proper officers and directors shall be deemed to have granted to the Surviving
Corporation an irrevocable power of attorney to execute and deliver all such
proper deeds, assignments and assurances in law and to do all acts necessary or
proper to vest, perfect or confirm title to and possession of such property or
rights in the Surviving Corporation and otherwise to carry out the purposes of
this Agreement. The proper officers and directors of the Surviving Corporation
are fully authorized in the name of the Parent or otherwise to take any and all
such action.
ARTICLE IV
APPROVAL BY SHAREHOLDERS; AMENDMENT; EFFECTIVE DATE
4.1. Approval. This Agreement and the Merger contemplated hereby are
subject to approval by the requisite vote of shareholders in accordance with the
NRS and the DGCL. As promptly as practicable after approval of this Agreement by
shareholders in accordance with applicable law, duly authorized officers of the
respective parties shall make and execute Articles of Merger and a Certificate
of Merger and shall cause such documents to be filed with the Secretary of State
of Nevada and the Secretary of State of Delaware, respectively, in accordance
with the laws of the States of Nevada and Delaware. The effective date (the
"Effective Date") of the Merger shall be the date on which the Merger becomes
effective under the laws of Nevada or the date on which the Merger becomes
effective under the laws of Delaware, whichever occurs later.
4.2. Amendments. The Board of Directors of the Parent may amend this
Agreement at any time prior to the Effective Date, provided that an amendment
made subsequent to the approval of the Merger by the shareholders of the Parent
shall not (a) alter or change the amount or kind of shares to be received in
exchange for or on conversion of all or any of the shares of the Parent's Common
Stock, (b) alter or change any term of the Certificate of Incorporation of the
Subsidiary, or (c) alter or change any of the terms and conditions of this
Agreement if such alteration or change would adversely affect the holders of the
Parent's Common Stock.
ARTICLE V
MISCELLANEOUS
5.1. Termination. This Agreement may be terminated and the Merger
abandoned at any time prior to the filing of this Agreement with the Secretary
of State of Nevada and the Secretary of State of Delaware, whether before or
after shareholder approval of this Agreement, by the consent of the Board of
Directors of the Parent and the Subsidiary.
5.2. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be considered to be an original instrument.
5.3. Descriptive Headings. The descriptive headings are for convenience
of reference only and shall not control or affect the meaning or construction of
any provision of this Agreement.
5.4. Governing Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware, except to the extent the laws of the
State of Nevada shall apply to the Merger where mandated by the NRS.
* * *
IN WITNESS WHEREOF, the undersigned officers of each of the parties to
this Agreement, pursuant to authority duly given by their respective boards of
directors, have caused this Agreement to be duly executed on the date set forth
above.
INKSURE TECHNOLOGIES INC.
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: Chief Executive Officer
INKSURE TECHNOLOGIES (DELAWARE) INC.
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Vice President, Secretary and Treasurer
