EXHIBIT 10
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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
IMOJO, INC.,
SKYGIVERS, INC.
AND
IMA ACQUISITION, INC.
DATED: MARCH 15, 2001
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement"), dated as of March
15, 2001, is made and entered into by and among IMOJO, INC., a Delaware
corporation ("IMOJO"), SKYGIVERS, INC., a Nevada corporation ("SkyGivers"), and
IMA ACQUISITION, INC., a Delaware corporation and wholly-owned subsidiary of
SkyGivers ("IMA").
BACKGROUND
WHEREAS, IMOJO identifies deficiencies in multiple marketplaces
including, but not limited to, pharmaceutical/medical, advertising,
communications, media and financial, and develops technology solutions for these
deficiencies (the "Business"); and
WHEREAS, the respective Boards of Directors of IMOJO, SkyGivers and
IMA, have approved the merger of IMA with and into IMOJO (the "Merger") with
IMOJO being the surviving corporation, upon the terms and subject to the
conditions more fully set forth herein.
NOW, THEREFORE, and in consideration of the mutual promises and
covenants set forth herein, and intending to be legally bound hereby, the
parties hereto agree as follows:
ARTICLE 1
THE MERGER AND RELATED MATTERS
SECTION 1.1 THE MERGER. Subject to the terms and conditions of this
Agreement, Articles of Merger duly executed and acknowledged shall be filed in
the office of the Secretaries of State of the States of Delaware and Nevada, as
necessary, on the Closing Date (as defined in Article 4) or as soon as
practicable thereafter. The Merger shall become effective upon such filing (the
"Effective Time"). At the Effective Time, IMA shall be merged with and into
IMOJO, and IMOJO shall continue as the surviving corporation under the laws of
the State of Delaware (such continuing corporation sometimes hereinafter
referred to as the "Surviving Corporation"). For federal income tax purposes,
the Merger is intended to constitute a reorganization within the meaning of
Section 368 of the Code. The parties to this Agreement hereby adopt this
Agreement as a "plan of reorganization" within the meaning of Sections
1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations.
SECTION 1.2 EFFECT OF MERGER. At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of the laws of the
State of Delaware. Except as herein specifically set forth, the identity,
existence, purposes, powers, objects, franchises, privileges, rights and
immunities of IMOJO shall continue unaffected and unimpaired by the Merger and
the corporate franchises, existence and rights of IMA shall be merged with and
into IMOJO, and IMOJO, as the Surviving Corporation, shall be fully vested
therewith. At the Effective Time, the separate existence of IMA shall cease and,
in accordance with the terms of this Agreement, the Surviving Corporation shall
possess all the rights, privileges, immunities and franchises, of a public, as
well as of a private, nature, and all property, real, personal and mixed, and
all debts due on whatever account, including subscriptions to shares, and all
taxes, including those due
and owing and those accrued, and all other choses in action, and all and every
other interest of or belonging to or due to IMOJO and IMA shall be taken and
deemed to be transferred to, and vested in, the Surviving Corporation without
further act or deed; and all property, rights and privileges, powers and
franchises and all and every other interest shall be thereafter effectually the
property of the Surviving Corporation as they were of IMOJO and IMA. Except as
otherwise provided herein, the Surviving Corporation shall thenceforth be
responsible and liable for all the liabilities and obligations of IMOJO and IMA
and any claim existing, or action or proceeding pending, by or against IMOJO or
IMA may be prosecuted as if the Merger had not taken place, or the Surviving
Corporation may be substituted in their place. Except as set forth herein,
neither the rights of creditors nor any liens upon the property of IMOJO or IMA
shall be impaired by the Merger, and all debts, liabilities and duties of IMOJO
and IMA shall attach to the Surviving Corporation, and may be enforced against
the Surviving Corporation to the same extent as if said debts, liabilities and
duties had been incurred or contracted by such Surviving Corporation.
SECTION 1.3 ARTICLES OF INCORPORATION OF THE SURVIVING CORPORATION. The
Articles of Incorporation of IMOJO, as in effect immediately prior to the
Closing, shall be the Articles of Incorporation of the Surviving Corporation.
SECTION 1.4 BY-LAWS OF THE SURVIVING CORPORATION. The By-Laws of IMOJO,
as in effect immediately prior to the Closing, shall be the By-Laws of the
Surviving Corporation until thereafter amended as provided by law.
SECTION 1.5 DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. At the
Effective Time, Xxxxx Xxxxxxxx and Xxxxxx Xxxxxx shall be the directors of the
Surviving Corporation, to hold office, subject to the applicable provisions of
the Articles of Incorporation and By-Laws of the Surviving Corporation, until
the next annual stockholders' meeting of the Surviving Corporation and until
their successors shall be duly elected or appointed and qualified. At the
Effective Time, the officers of IMOJO, subject to the applicable provisions of
the Articles of Incorporation and By-Laws of the Surviving Corporation, shall be
as designated by the Board of Directors of the Surviving Corporation until their
respective successors shall be duly elected or appointed and qualified.
SECTION 1.6 MANNER OF CONVERSION. As of the Effective Time:
(a) all of the shares of common stock, $.01 par value, of
IMOJO which are issued and outstanding immediately prior to the Effective Time
(the "IMOJO Shares"), by virtue of the Merger and without any action on the part
of the holder thereof, automatically shall be deemed to represent the right to
receive the Merger Consideration, as provided in Section 1.7 hereof;
(b) all IMOJO Shares which are held by IMOJO as treasury stock
shall be canceled and retired and no consideration shall be delivered or paid in
exchange therefor; and
(c) each share of the capital stock of IMA shall be cancelled
and in exchange therefore, 1,000 shares of IMOJO shall be issued to SkyGivers.
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SECTION 1.7 MERGER CONSIDERATION. At the Effective Time, IMOJO Shares,
other than IMOJO Shares held in treasury (which shall be cancelled pursuant to
Section 1.6(b) above), by virtue of the Merger and without any action on the
part of the stockholders of IMOJO (the "IMOJO Stockholders"), automatically
shall be canceled and extinguished and converted into the right to receive an
aggregate of 600,000,000 Shares (as herein defined) (comprised of approximately
50,000,000 shares of common stock of SkyGivers (the "Common Shares") and
approximately 550,000 shares of Preferred Stock having such name as shall be
designated by SkyGivers Board of Directors (the "Preferred Shares") and warrants
to purchase an additional 500,000,000 Shares at an exercise price of $.03 per
share (the "Warrants"). The Warrants shall be exercisable for a period of five
years from the Closing Date. Each share of Preferred Stock shall have the rights
and privileges equal in all respects to 1,000 shares of Common Stock. The Merger
Consideration may be allocated and distributed to the IMOJO Stockholders, in
accordance with their relative interests therein, in such combinations of
Warrants and Shares (Common Shares and/or Preferred Shares) as IMOJO may
determine in its sole discretion. As used herein, a "Share" shall mean a Common
Share or common share equivalent. Any reference herein to a quantity of Shares
shall refer to that number of Common Shares or a number of Preferred Shares
and/or Common Shares (in any combination) having the rights of an equivalent
number of Common Shares.
SECTION 1.8 ADJUSTMENTS TO MERGER CONSIDERATION.
(a) Notwithstanding anything to the contrary contained herein,
in the event the liabilities of SkyGivers as of the Effective Time, whether or
not disclosed in the financial statements of SkyGivers dated as of September 30,
2000 (the "Financial Statements"), are determined to exceed One Hundred Thousand
Dollars ($100,000), the IMOJO Stockholders shall receive an additional
10,000,000 Shares for each additional $100,000 in liabilities and a
proportionate amount for any fraction thereof.
(b) Notwithstanding anything to the contrary contained herein,
in the event of a breach by SkyGivers of any of the representations and
warranties contained in Article 3 hereof, the IMOJO Stockholders shall be
entitled (i) at their sole discretion, to terminate the Agreement in accordance
with Article 10, or (ii) for a period of time not to exceed two years from the
Closing Date, receive such additional Shares in settlement of any such breach in
an amount equal to the fair value of such claim divided by the fair market value
of the Common Stock as of the date on which the fair value of the claim is
determined by IMOJO's accountants.
(c) If, prior to the Effective Time, the outstanding shares of
SkyGivers common stock shall be changed into a greater number of shares or a
different class of stock by reason of any reclassification, recapitalization,
exchange of shares, stock split, or otherwise, the number of Shares to be
received by the IMOJO Stockholders hereunder shall be likewise adjusted to
reflect the changed number or classification of SkyGivers Common Stock.
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ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF IMOJO
IMOJO hereby makes the following representations and warranties to IMA
and SkyGivers:
SECTION 2.1 ORGANIZATION. IMOJO is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and is duly authorized to carry on the Business. As of the date hereof, IMOJO
has ______ shares of common stock issued and outstanding, which are owned by the
stockholders set forth in the corporate documents being provided to SkyGivers in
accordance with Section 2.5 hereof, and no shares of preferred stock issued and
outstanding. All of the issued and outstanding shares of common stock of IMOJO
as identified in such corporate documents (the "IMOJO Shares") are free and
clear of all liens and encumbrances of any kind. The IMOJO Shares represent all
of the issued and outstanding shares, of all types or classes, of IMOJO and
there are no outstanding options, warrants, convertible or exchangeable
securities or other rights to purchase shares of capital stock of IMOJO.
SECTION 2.2 PENDING CLAIMS.
(a) There is no litigation, suit, action, claim, arbitration,
administrative or legal or other proceeding, or governmental investigation
pending or, to IMOJO's knowledge threatened, against IMOJO relating to the
Business and there are no unasserted claims possible of assertion involving the
Business of which IMOJO has notice or knowledge;
(b) There are no audits by a governmental authority, claims
for unpaid taxes of any kind, or other similar actions, proceedings or disputes
pending or, to IMOJO's knowledge, threatened against or affecting the Business;
(c) There are no unpaid judgments of any kind against IMOJO
relating to the Business; and
(d) IMOJO has not been charged with or, to its knowledge
threatened, with a charge or violation or, to its knowledge, is it under
investigation with respect to any alleged violation of any provision of any
federal, state, local or foreign law or administrative ruling or regulation
relating to any aspect of the Business.
SECTION 2.3 TITLE TO ASSETS. IMOJO is the sole and exclusive owner of,
and has good and marketable title to, all of its assets (the "Assets"), rights,
properties, claims, contracts and businesses of every kind, nature, character
and description, tangible and intangible, personal, real or mixed, wherever
located, free and clear of all liens, mortgages, pledges, claims, encumbrances,
security interests, covenants, easements, rights of way, equities, options,
rights of first refusal, assessments, defects in title, encroachments, charges
or any other burden of restriction of any kind or nature (collectively,
"Liens"); and (b) no other person, firm or corporation has or will have on the
Closing Date any interest whatsoever in the Assets.
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SECTION 2.4 NO BREACH OR VIOLATION. The execution, delivery and
performance of this Agreement and any other agreements contemplated hereby
between the parties hereto by IMOJO and the consummation of the transactions
contemplated by this Agreement or any other agreements contemplated hereby will
not (a) result in or constitute a breach or an event that, with or without
notice or the passing of time or both, would be a default, breach or other
violation of the articles of incorporation or bylaws of IMOJO; (b) violate (with
or without the giving of notice or the passing of time or both), or require any
consent, approval, filing or notice under, any provision of any law, rule or
regulation, court or administrative order, writ, judgment or decree applicable
to IMOJO, the Business or any of the Assets, and (c) with or without the giving
of notice or the passing of time or both (i) violate or conflict with, or result
in the breach, suspension or termination of any provision of, or constitute a
default under, or result in the acceleration of the performance of the
obligations of IMOJO under, or (ii) result in the creation of any Liens upon all
or any portion of the properties, assets (including the Assets) or the Business
pursuant to, the articles of incorporation or bylaws of IMOJO, or any indenture,
mortgage, deed of trust, lease, agreement, contract or instrument to which IMOJO
is a party or by which IMOJO, the Assets or Business is bound.
SECTION 2.5 CORPORATE DOCUMENTS. IMOJO has furnished to SkyGivers for
its examination true and correct copies of the articles of incorporation, bylaws
and minute books of IMOJO.
SECTION 2.6 CONDUCT OF BUSINESS. From the date of this Agreement until
the Closing, IMOJO shall operate the Business in the ordinary course and in a
commercially reasonable manner and will make all reasonably necessary efforts to
preserve intact the Business, its relationships with third parties, all
memberships, if any, that it presently holds, the goodwill it has accrued and
the services, to the extent practicable, of its existing officers, employees,
and directors.
SECTION 2.7 AUTHORIZATION. IMOJO has taken all necessary corporate
action on its part as may be required under the laws of the jurisdiction of
organization and under its charter documents to authorize the execution,
delivery and carrying out of this Agreement and other documents and instruments,
and has executed the same in connection herewith on behalf of IMOJO.
SECTION 2.8 AUTHORITY AND ENFORCEABILITY. IMOJO has the full right,
power, legal capacity and authority to enter into and perform its obligations
under this Agreement. The execution, delivery and performance by IMOJO of this
Agreement and any other agreements contemplated hereby and the consummation by
it of the transactions contemplated hereby and thereby have been duly authorized
by the Board of Directors of IMOJO. No other corporate or stockholder action is
necessary for the authorization, execution, delivery and performance by IMOJO of
this Agreement and any other agreements between the parties contemplated hereby
and the consummation by IMOJO of the transactions contemplated hereby or
thereby. This Agreement has been duly executed and delivered by IMOJO and
constitutes a valid and legally binding obligation of IMOJO, enforceable against
it in accordance with the terms hereof.
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SECTION 2.9 LIABILITIES. To the best knowledge of IMOJO, there are no
liabilities or potential liabilities of IMOJO which in the aggregate exceed One
Million ($1,000,000) Dollars.
SECTION 2.10 NO MATERIAL MISSTATEMENT OR OMISSION OF MATERIAL FACT.
IMOJO will provide SkyGivers with written materials relating to IMOJO that
SkyGivers reasonably requests in connection with this Agreement. This Agreement
together with any documents executed concurrently herewith do not contain any
untrue statement of a material fact nor omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
ARTICLE 3
SKYGIVERS' AND IMA'S REPRESENTATIONS AND WARRANTIES
SkyGivers and IMA each represent and warrant to IMOJO, its respective
successors and assigns that:
SECTION 3.1 ORGANIZATION. SkyGivers is a corporation duly organized,
existing and in good standing under the laws of the State of Nevada, and is not
presently and has not since its incorporation been the subject of any
governmental or quasi-governmental inquiry or review which would materially
adversely affect its business or operations, nor to the knowledge of SkyGivers,
is any such inquiry or review pending or threatened. IMA is a corporation duly
organized, existing and in good standing under the laws of the State of
Delaware.
SECTION 3.2 PENDING CLAIMS.
(a) There is no litigation, suit, action, claim, arbitration,
administrative or legal or other proceeding, or governmental investigation
pending or, to SkyGivers' or IMA's knowledge threatened, against SkyGivers or
IMA, respectively, relating to the business of either of them and there are no
unasserted claims possible of assertion involving such business of which
SkyGivers or IMA has notice or knowledge;
(b) There are no audits by a governmental authority, claims
for unpaid taxes of any kind, or other similar actions, proceedings or disputes
pending or, to SkyGivers' or IMA's knowledge, threatened against or affecting
either of them or their respective businesses;
(c) There are no unpaid judgments of any kind against
SkyGivers or IMA relating to either of them or their respective businesses; and
(d) Neither SkyGivers nor IMA has been charged with or, to the
knowledge of either of them threatened, with a charge or violation or, to the
knowledge of either of them, is either under investigation with respect to any
alleged violation of any provision of any federal, state, local or foreign law
or administrative ruling or regulation relating to any aspect of either of them
or their respective businesses.
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SECTION 3.3 TITLE TO ASSETS. Each of SkyGivers and IMA is the sole and
exclusive owner of, and has good and marketable title to, all of its respective
assets, rights, properties, claims, contracts and business of every kind,
nature, character and description, tangible and intangible, personal, real or
mixed, wherever located, free and clear of all liens, mortgages, pledges,
claims, encumbrances, security interests, covenants, easements, rights of way,
equities, options, rights of first refusal, assessments, defects in title,
encroachments, charges or any other burden or restriction of any kind or nature;
and (b) no other person, firm or corporation has or will have on the Closing
Date any interest whatsoever in any of such assets.
SECTION 3.4 AUTHORIZATION. Each of SkyGivers and IMA has taken all
necessary corporate action on its part as may be required under the laws of the
jurisdiction of organization and under its charter documents to authorize the
execution, delivery and carrying out of this Agreement and other documents and
instruments, and has executed the same in connection herewith on behalf of
SkyGivers and IMA, respectively.
SECTION 3.5 AUTHORITY AND ENFORCEABILITY. SkyGivers and IMA each have
the full right, power, legal capacity and authority to enter into and perform
their respective obligations under this Agreement. The execution, delivery and
performance by SkyGivers and IMA of this Agreement and any other agreements
contemplated hereby and the consummation by them of the transactions
contemplated hereby and thereby have been duly authorized by SkyGivers as the
sole shareholder of IMA and by the Board of Directors of SkyGivers. No other
corporate or stockholder action is necessary for the authorization, execution,
delivery and performance by SkyGivers and IMA of this Agreement and any other
agreements between the parties contemplated hereby and the consummation by
SkyGivers and IMA of the transactions contemplated hereby or thereby. This
Agreement has been duly executed and delivered by SkyGivers and IMA and
constitutes a valid and legally binding obligation of SkyGivers and IMA,
enforceable against each of them in accordance with the terms hereof.
SECTION 3.6 NO BREACH OR VIOLATION. The execution, delivery and
performance of this Agreement and any other agreements contemplated hereby
between the parties hereto by SkyGivers and IMA and the consummation of the
transactions contemplated by this Agreement or any other agreements contemplated
hereby will not (a) result in or constitute a breach or an event that, with or
without notice or the passing of time or both, would be a default, breach or
other violation of the articles of incorporation or bylaws of SkyGivers or IMA;
(b) violate (with or without the giving of notice or the passing of time or
both) or require any consent, approval, filing or notice under, any provision of
any law, rule or regulation, court or administrative order, writ, judgment or
decree applicable to SkyGivers or IMA; and (c) with or without the giving of
notice or the passing of time or both, violate or conflict with, or result in
the breach, suspension or termination of any provision of, or constitute a
default under, or result in the acceleration of the performance of any
obligations of SkyGivers or IMA. SkyGivers is not subject to the provisions of
Section 78:378 of the Nevada General Corporation Law.
SECTION 3.7 CORPORATE DOCUMENTS. SkyGivers and IMA have furnished to
IMOJO for its examination true and correct copies of their articles of
incorporation, bylaws and minute books.
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SECTION 3.8 CAPITALIZATION. As of the date hereof, the authorized
capital stock of SkyGivers consists of (a) 750,000,000 shares of common stock,
par value $.0001 per share (the "Common Stock"), of which approximately
422,000,000 shares of Common Stock are validly issued and outstanding, fully
paid and non-assessable and (b) 25,000,000 shares of Preferred Stock (the
"Preferred Stock") of which no shares are issued and outstanding. SkyGivers has
received commitments from eight (8) of its existing stockholders to redeem (the
"Redemption") an aggregate of 143,000,000 shares of Common Stock for a
redemption price (the "Redemption Price") of $.000001 per share. Except for (i)
the Redemption, (ii) warrants issued by SkyGivers prior to October 2000 for
which notice of redemption has been provided (and for which the redemption price
not exceeding $100 has not yet been paid), (iii) warrants held by two
stockholders to purchase a total of 3,500,000 shares of SkyGivers' common stock,
exercisable until February 1, 2003 at an exercise price of $.05 per share, and
(iv) agreements to issue to two persons an aggregate of 2,500,000 shares of
SkyGivers Common Stock, SkyGivers has no options, warrants, equity securities,
calls, rights (including preemptive rights), commitments or agreements of any
character to which SkyGivers is a party or by which it is bound, obligating it
to issue, deliver or sell, or cause to be issued, delivered or sold, or to
repurchase, redeem or otherwise acquire, or to cause the repurchase, redemption
or acquisition, of any shares of capital stock of SkyGivers or obligating it to
grant, extend, accelerate the vesting of or enter into any such option, warrant,
equity security, call, right, commitment or agreement, or any other obligation
to make any other distribution in respect thereof. Except for this Agreement and
certain registration rights granted to a stockholder with respect to 14,000,000
shares of SkyGivers Common Stock, there are no voting trusts or agreements,
shareholder agreements, buy-sell agreements, rights of first refusal, preemptive
rights or proxies relating to any securities of SkyGivers (whether or not
SkyGivers is a party thereto). SkyGivers holds no shares of capital stock in its
treasury. The Preferred Stock is so-called "blank check" preferred stock which
may have such rights and preferences as the Board of Directors of SkyGivers may
authorize from time to time.
SECTION 3.9 LIABILITIES. To the best knowledge of SkyGivers, there are
no liabilities or potential liabilities of SkyGivers (other than the obligation
to pay certain attorneys' fees described in Section 11.1 hereof), whether or not
disclosed in the Financial Statements which in the aggregate exceed Fifty
Thousand ($50,000) Dollars.
SECTION 3.10 CONDUCT OF BUSINESS. From the date of this Agreement until
the Closing, SkyGivers shall operate its business in the ordinary course and in
a commercially reasonable manner and will make all reasonably necessary efforts
to preserve intact the business and its relationships with third parties.
SECTION 3.11 NO MATERIAL ADVERSE EFFECT. Since the date of the
Financial Statements, there has not occurred any change, event or effect (a
"Material Adverse Effect") that is materially adverse to the business, assets
(including, without limitation, intangible assets), liabilities, financial
condition or results of operations of SkyGivers or any of its subsidiaries,
taken as a whole; provided that the demands for payment of certain liabilities
(each of which will be identified to IMOJO prior to the Closing Date) of
SkyGivers by vendors or other parties does not constitute a "Material Adverse
Effect" hereunder.
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SECTION 3.12 NO MATERIAL MISSTATEMENT OR OMISSION OF MATERIAL FACT. All
filings required to be made under the Securities Act of 1933, as amended (the
"Act") and the Rules and Regulations promulgated thereunder have been made.
Neither this Agreement, nor any schedules provided in connection herewith, any
documents executed concurrently herewith, at the time of execution, nor any of
the documents filed by SkyGivers with the SEC (including all financial
statements included therein and exhibits thereto) (the "SEC Filings") at the
time of filing thereof, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein and necessary to
make the statements therein in light of the circumstances under which they were
made, not misleading. At the time of any SEC Filings, such SEC Filings conformed
with the requirements of the Act and the Rules and Regulations promulgated
thereunder,
ARTICLE 4
THE CLOSING
The closing ("Closing") of the Merger and any other transactions
contemplated by this Agreement shall take place at the law offices of Xxxxxxxxx
Ball Xxxxxx & Xxxxxx, LLP, 000 Xxx Xxxxxxx Xxxx, Xxxxx 000, Xxxxxx Xxxx, Xxx
Xxxx 00000 within 10 days after satisfaction of the conditions set forth in
Article 5 hereof, but no later than April 30, 2001, or at such other place and
time and on such other date, as the parties may agree upon in writing ("Closing
Date").
ARTICLE 5
CONDITIONS TO CLOSING
The obligations of each party to engage in the transactions
contemplated by this Agreement are subject to the fulfillment, prior to or at
the Closing Date, of the following conditions:
(a) The directors of SkyGivers shall have authorized and
caused to be executed and filed with the Secretary of State of the State of
Nevada a Certificate of Designation describing the relative rights and
preferences of the Series A Preferred Stock in the form annexed hereto as
Exhibit A.
(b) The receipt of all requisite approvals by government
agencies and authorities and all consents and approvals of third parties as may
be required for the consummation of the Merger;
(c) Approval by the Boards of Directors of each of the parties
hereto, the IMOJO Stockholders and SkyGivers as the sole stockholder of IMA;
(d) Completion of satisfactory due diligence;
(e) Consummation of the Redemption and execution by eight (8)
stockholders of SkyGivers whose stock is being redeemed pursuant to the
Redemption of a general release waiving any and all right to assert claims,
whether known or unknown, with respect to the
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purchase price paid for shares of SkyGivers Common Stock in connection with the
Redemption; and
(f) Execution of a release dated no earlier than the Closing
Date, in form and substance satisfactory to IMOJO's counsel, by Xxxxxxxx Xxxxx
with respect to any and all claims or potential claims against SkyGivers
including, but not limited to, any claim related to any grant of options to
purchase SkyGivers Common Stock.
(g) Nothing shall have occurred or be continuing that would of
itself, or with the passing of time or giving of notice or both, have a material
adverse effect on the business or assets of SkyGivers, IMOJO or IMA.
ARTICLE 6
CONDUCT AND TRANSACTIONS OF SKYGIVERS, IMA,
AND SKYGIVERS' STOCKHOLDERS PRIOR TO EFFECTIVE TIME
(a) During the period from the date of this Agreement and
continuing until the earlier of the termination of this Agreement or the
Effective Time, SkyGivers shall carry on its business in the usual, regular and
ordinary course and use all commercially reasonable efforts to preserve intact
its present business organization and preserve its relationships with third
parties and others having business dealings with it, with the objective that its
goodwill and ongoing business shall be unimpaired at the Effective Time.
SkyGivers shall continue to make all required government filings including, but
not limited to, all filings with the Securities and Exchange Commission in
accordance with the Act, as amended, and the Securities Exchange Act of 1934, as
amended. SkyGivers shall promptly notify IMOJO of any event or occurrence not in
the ordinary course of business of SkyGivers which comes to SkyGivers' attention
and which has, or could reasonably be expected to have, a Material Adverse
Effect on the business of SkyGivers.
(b) Except as expressly contemplated by this Agreement,
SkyGivers shall not, without the prior written consent of IMOJO:
(i) Declare or pay any dividends on or make any other
distributions (whether in cash, stock or property) in respect of any of its
capital stock, or split, combine or reclassify any of its capital stock or issue
or authorize the issuance of any other securities in respect of, in lieu of or
in substitution for shares of its capital stock, or repurchase or otherwise
acquire, directly or indirectly, any shares of its capital stock except from
former employees, directors and consultants in accordance with written
agreements providing for the repurchase of shares in connection with any
termination of service to SkyGivers, except that SkyGivers may, with full
disclosure of this transaction and any other material information, conclude the
Redemption provided that SkyGivers does not expend more than $2,500 in payment
of the Redemption Price;
(ii) Issue, deliver or sell, authorize or propose the
issuance, delivery or sale of, or purchase or propose the purchase of, any
shares of its capital stock or securities
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convertible into, or subscriptions, rights, warrants or options to acquire, or
other agreements or commitments of any character obligating it to issue any such
shares or other convertible securities or authorize or propose any change in its
equity capitalization;
(iii) Solicit approval for or effect any amendments
to SkyGivers Articles of Incorporation or Bylaws;
(iv) Acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial portion of the assets of, or
by any other manner, any business or any corporation, partnership, association
or other business organization or division thereof, or otherwise acquire or
agree to acquire any assets which are material, individually or in the
aggregate, to SkyGivers;
(v) Sell, lease, license, pledge or otherwise dispose
of or encumber any of its properties or assets except in the ordinary course of
business consistent with past practice (including without limitation any
indebtedness owed to it or any claims held by it);
(vi) Incur any indebtedness for borrowed money or
guarantee any such indebtedness or issue or sell any debt securities or
guarantee, endorse or otherwise become responsible for the obligations of
others, or make loans or advances, other than in the ordinary course of business
consistent with past practice;
(vii) Pay, discharge or satisfy any claim, liability
or obligation (absolute, accrued, asserted or unasserted, contingent or
otherwise), other than the payment, discharge or satisfaction in the ordinary
course of business consistent with past practice of liabilities reflected or
reserved against in the Financial Statements;
(viii) Enter into or amend any employment, severance,
termination contract or other agreement or arrangement with, or pay any bonus or
remuneration, including without limitation, any severance or termination pay to,
any director, employee or consultant, or increase the salaries, wage rates, or
other payments or benefits of its directors, officers, employees, or
consultants;
(ix) Transfer, assign or otherwise grant or convey to
any person or entity any rights in, to or under its intellectual property;
(x) Engage in any activities or transactions that are
outside the ordinary course of its business; or
(xi) Take, or agree (in writing or otherwise) to
take, any of the actions described in this Article, or any action which would
make any of the representations or warranties of SkyGivers contained in this
Agreement untrue or inaccurate or result in any of the conditions to the Merger
set forth herein not being satisfied.
(c) Each of SkyGivers and IMA shall afford to IMOJO and its
accountants, counsel and other representatives, reasonable access during normal
business hours and upon
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reasonable prior notice during the period from the date of this Agreement until
the earlier of the Effective Time or the termination of this Agreement to (i)
all of its respective properties, books, contracts, commitments and records, and
(ii) all other information concerning its business, properties and personnel as
IMOJO may reasonably request. No information or knowledge obtained in any
investigation pursuant to this Section shall affect or be deemed to modify any
representation or warranty contained herein or the conditions to the obligations
of the parties to consummate the Merger.
(d) Each holder (a "Controlling Stockholder") of the Common
Stock who beneficially owns greater than a five (5%) percent interest shall not,
until the Closing Date, without the prior written consent of IMOJO, sell or
authorize the sale of any of its shares of capital stock of SkyGivers or
securities convertible into such shares.
(e) Prior to the Closing, SkyGivers directors shall authorize
and cause to be executed and filed with the Secretary of State of the State of
Nevada a Certificate of Designation for the Series A Preferred Stock in the form
annexed hereto as Exhibit A.
(f) Upon execution of this Agreement, SkyGivers and IMOJO in
conjunction with counsel for each will promptly prepare and file with the SEC
within 15 days after the execution of this Agreement, a Report on Form 8-K with
respect to the Merger.
ARTICLE 7
POST CLOSING COVENANTS OF SKYGIVERS
(a) Immediately following the Closing or as soon thereafter as
is reasonably practicable, SkyGivers shall take all steps necessary to ensure
that its Board of Directors is comprised of Xxxxx Xxxxxxxx and Xxxxxx Xxxxxx,
who shall hold office, subject to the applicable provisions of the Articles of
Incorporation and By-Laws of SkyGivers until the next annual stockholders'
meeting of SkyGivers and until their successors shall be duly elected or
appointed and qualified.
(b) SkyGivers will continue, for a period of one year
following the Closing Date, at least one of the business enterprises of IMOJO.
(c) Following the Closing, SkyGivers shall take such steps as
may be reasonably necessary and proper to authorize (1) the change of its name
to Imojo, Inc. or such other name as Imojo may designate, (2) the transfer of
the existing SkyGivers business model, including the intangible assets listed on
Schedule A hereto related thereto, to Xxxxx Xxxxxxxxxx, and (3) cause the
trading symbol of SkyGivers to be changed.
(d) Within thirty (30) days after the change of the SkyGivers
trading symbol, SkyGivers shall pay its outstanding liabilities (not to exceed
$50,000) to third parties in accordance with the schedule of liabilities
delivered to IMOJO.
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ARTICLE 8
OBLIGATIONS OF IMOJO AT CLOSING
At the Closing, IMOJO or the IMOJO Stockholders (as the case may be)
shall deliver or cause to be delivered to SkyGivers the following in a form and
substance reasonably satisfactory to SkyGivers:
(a) Stock certificates for all of the IMOJO Shares duly
endorsed for transfer or accompanied by duly executed stock powers executed in
blank;
(b) Executed Certificate of Merger for IMA with and into IMOJO
for filing in the State of Delaware;
(c) A Certificate of Good Standing from the Secretary of State
of Delaware for IMOJO, together with a copy of the resolutions of the Board of
Directors of IMOJO and the IMOJO Stockholders, authorizing the execution,
delivery and consummation of this Agreement and the execution, delivery and
consummation of all other agreements and documents executed in connection
herewith.
ARTICLE 9
OBLIGATIONS OF IMA AND SKYGIVERS AT CLOSING
At Closing, IMA or SkyGivers (as the case may be) shall deliver or
cause to be delivered to IMOJO the following in form and substance reasonably
satisfactory to IMOJO and the IMOJO Stockholders, as the case may be:
(a) Certificates representing the Shares and Warrants to the
IMOJO Stockholders;
(b) Executed Certificate of Merger of IMA with and into IMOJO
for filing in the State of Delaware;
(c) A Certificate of Good Standing from the Secretaries of
State of Delaware and Nevada for IMA and SkyGivers, respectively;
(d) The resignation of all of SkyGivers' officers and
directors;
(e) A Certificate signed by the Chief Executive Officer of
each of SkyGivers and IMA to the effect that (i) the representations and
warranties of SkyGivers and IMA set forth in this Agreement are true and correct
in all material respects on and as of the Closing Date; (ii) there shall have
been no Material Adverse Effect with respect to SkyGivers or IMA from the date
of this Agreement through the Closing Date; and (iii) all covenants requiring
pre-Closing performance have been performed;
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(f) A Certificate signed by the Secretary of each of SkyGivers
and IMA certifying (i) the resolutions adopted by the respective Boards of
Directors authorizing (A) the execution and delivery of this Agreement, (B) the
consummation of the transactions contemplated hereby and (C) the execution,
delivery and filing of the Certificate of Designation with respect to the Series
A Preferred Stock, (ii) a true copy of each corporation's Certificate of
Incorporation, as amended to date, including, but not limited to, a certified
copy of the filed Certificate of Designation with respect to the Series A
Preferred Stock, and (iii) a true copy of each corporation's Bylaws, as amended
to date.
ARTICLE 10
TERMINATION
This Agreement may be terminated and the merger and the other
transactions contemplated by this Agreement may be abandoned at any time prior
to the Effective Time, notwithstanding any requisite approval and adoption of
this Agreement and the transactions contemplated by this Agreement, as follows:
(a) by the parties following mutual written consent duly
authorized by the Boards of Directors of each of the parties hereto;
(b) by IMOJO, if satisfactory due diligence, performed in good
faith, cannot be completed by 5:00 p.m. on March 20, 2001;
(c) by any of the parties if the Effective Time shall not have
occurred as soon as reasonably practicable but no later than April 30, 2001;
provided, however, that the right to terminate this Agreement under this Section
10(c) shall not be available if the reason the Effective Time has not occurred
is the intentional failure by the party seeking termination to fulfill any
obligation under this Agreement; or
(d) by IMOJO or SkyGivers in the event IMOJO or IMA fails to
obtain stockholder approval required by the Agreement;
(e) by IMOJO, following discovery of: (i) information that, in
the reasonable discretion of IMOJO, may be material and adverse to either
SkyGivers or IMOJO or their respective businesses, or constitutes a material
adverse change to the business of SkyGivers or IMOJO on a going forward basis;
or (ii) a breach of any representation or warranty made by SkyGivers or IMA
contained in Article 3 hereof; and
(f) by IMOJO, in the event that SkyGivers, by the Effective
Time, fails to (i) consummate the Redemption or otherwise recapitalize and
reduce the number of its outstanding shares of common stock to no more than
285,000,000 shares, and (ii) obtain executed waivers and releases as provided in
Section 5(e) hereof.
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In the event of termination of this Agreement pursuant to this Article
10, the Agreement shall forthwith become void, there shall be no liability under
this Agreement on the part of any party, or any of their respective officers or
directors except as set forth in Section 11.1; PROVIDED, HOWEVER, that nothing
herein shall relieve any party from liability for the willful breach of any of
its representations, warranties, covenants or agreements set forth in this
Agreement
ARTICLE 11
MISCELLANEOUS
SECTION 11.1 EXPENSES. Except as provided in the remainder of this
Section 11.1, each party shall bear its own expenses in connection with this
Agreement and the transactions contemplated hereby. Notwithstanding the
preceding sentence, the Surviving Corporation in the Merger shall be responsible
for the payment of all legal and accounting fees incurred by SkyGivers through
the closing of the Merger. In this regard, all outstanding legal fees and
disbursements payable to SkyGivers' special counsel, Xxxxxxxxx Ball Xxxxxx &
Xxxxxx, LLP, as of the date of an IMOJO Offering (as hereinafter defined), shall
be payable in full in cash on the date of the closing of the IMOJO Offering. In
the event that this Agreement is terminated for any reason prior to Closing,
IMOJO will pay to SkyGivers' special counsel, upon the closing of an IMOJO
Offering, an amount equal to fifty (50%) percent of the outstanding legal fees
and disbursements of SkyGivers' special counsel. In addition, IMOJO agrees that,
as a condition to the Closing of the Merger, IMOJO will make payments to certain
third party service providers engaged by SkyGivers' special counsel in the
aggregate amount of approximately $10,000, to be identified as soon as possible
after the execution of this Agreement and in no event later than the date of the
Closing. As used in this Agreement, the term IMOJO Offering shall mean a public
or private placement or placements of securities by SkyGivers or IMOJO (either
before or after the Merger) yielding gross proceeds to the issuer of a minimum
of $250,000 in the aggregate. Written notice of the consummation of an IMOJO
Offering will be provided to SkyGivers' special counsel at the address set forth
in Article 4 hereof on the closing date of an IMOJO Offering. IMOJO agrees to
use its reasonable best efforts to promptly consummate an IMOJO Offering. All
legal fees and disbursements owed to SkyGivers' special counsel shall be payable
without offset on September 1, 2001 if an IMOJO Offering shall not have occurred
prior to such date. IMOJO and SkyGivers acknowledge that SkyGivers' special
counsel is an intended third party beneficiary of this Section 11.1. This
Section 11.1 will survive any termination of this Agreement.
SECTION 11.2 LIABILITIES; REMEDIES. No SkyGivers stockholder, director,
officer, employee or agent shall have any personal liability to IMOJO or any
IMOJO Stockholder in connection with any breach by SkyGivers of any of the
representations and warranties contained in Article 3 hereof, PROVIDED such
person had no actual notice or knowledge, as of the date of the Closing Date, of
the facts which constitute any such breach; and provided, further, that even if
such person had actual notice or knowledge as of the date of the Closing Date of
the facts which constitute any such breach, such person shall not have the
personal liability if an officer or director of IMOJO had actual notice or
knowledge of such breach on the Closing Date. Notwithstanding any other remedies
which may be available to IMOJO for any breach of a representation or warranty
contained in Article 3, IMOJO may, in its discretion and as a result of a
material breach, rescind this Agreement and unwind the transactions contemplated
hereunder.
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No breach of any representation or warranty by SkyGivers will permit the
exercise of the rescission right described in the preceding sentence if an
officer or director of IMOJO has actual notice or knowledge of such breach on
the Closing Date. The right to rescind this Agreement shall survive the Closing.
SECTION 11.3 HEADINGS. The subject headings of the sections, paragraphs
and subparagraphs of this Agreement are included for purposes of convenience
only, and shall not affect the construction or interpretation of any of its
provisions.
SECTION 11.4 CONFIDENTIALITY. The parties to this Agreement shall hold,
and shall cause their representatives to hold, all negotiations, information and
documents delivered pursuant to this Agreement confidential and shall not
disclose for any reason, except as provided below, any such information without
the prior written consent of the party to whom such information relates. If the
transactions contemplated by this Agreement are not consummated for any reason,
shall destroy or return to the other party all such information and documents
and any copies as soon as practicable and not disclose any such information
(that has not previously been disclosed by a party other than the relevant
party) to any third party unless required to do so pursuant to a requirement or
order under applicable laws and regulations or pursuant to a subpoena or other
legal process.
SECTION 11.5 ENTIRE AGREEMENT, MODIFICATION AND WAIVER. This Agreement,
together with the agreements referenced herein or contemplated hereby,
constitute the entire agreement between the parties pertaining to its subject
matter and supersede all prior and contemporaneous agreements, representations
and understandings of the parties. No supplement, modification or amendment of
this Agreement shall be binding unless executed in writing by all the parties.
No waiver of any of the provisions of this Agreement shall be deemed, or shall
constitute, a waiver of any other provision, whether or not similar, nor shall
any waiver constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver.
SECTION 11.6 FURTHER ACTION. Each of the parties hereto shall use its
reasonable best efforts to (i) take, or cause to be taken, all appropriate
action and do, or cause to be done, all things necessary, proper or advisable
under applicable law or otherwise to consummate and make effective the
transactions contemplated by the Agreement, and (ii) make all necessary filings,
and thereafter make any other required submissions, with respect to the
Agreement and the transactions contemplated hereby. The parties hereto shall
cooperate with each other in connection with the timely making of all such
filings, including by providing copies of all such documents to the other party
and its advisors prior to filing and, if requested, by accepting all reasonable
additions, deletions or changes suggested in connection therewith.
SECTION 11.7 PUBLICITY. No party to this Agreement shall issue any
press release or other public statement relating to this Agreement or the
transactions contemplated hereby without the prior written approval of the other
parties.
SECTION 11.8 COUNTERPARTS. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
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SECTION 11.9 RIGHTS OF PARTIES. Except as provided in Section 11.1,
nothing in this Agreement, whether expressed or implied, is intended to confer
any rights or remedies under or by reason of this Agreement on any persons other
than the parties to it and their respective successors and assigns, nor is
anything in this Agreement intended to relieve or discharge the obligation or
liability of any third persons to any party to this Agreement, nor shall any
provision give any third persons any right of subrogation or action over or
against any party to this Agreement.
SECTION 11.10 ASSIGNMENT. Neither IMA nor SkyGivers shall assign this
Agreement to any person or entity without the prior written consent of IMOJO.
IMOJO shall not assign this Agreement to any person or entity without the prior
written consent of SkyGivers. Subject to the previous sentence, this Agreement
shall be binding on, and shall inure to the benefit of, the parties to it and
their respective heirs, legal representatives, successors and permitted assigns.
Any assignment or attempted assignment in violation of the provisions of this
Section shall be void.
SECTION 11.11 REMEDIES. Each party's obligation under this Agreement is
unique. If any party should default in its obligations under this Agreement, the
parties each acknowledge that it would be extremely impracticable to measure the
resulting damages; accordingly, the nondefaulting party, in addition to any
other available rights or remedies, may xxx in equity for specific performance,
and the parties each expressly waive the defense that a remedy in damages will
be adequate.
SECTION 11.12 EFFECT OF CERTAIN ACTIONS. No action taken pursuant to or
related to this Agreement, including without limitation any investigation by or
on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representation, warranty, condition or
agreement contained herein.
SECTION 11.13 NOTICES. All notices, requests and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party (including
without limitation service by overnight courier service) to whom notice is to be
given, or on the third day after mailing if mailed to the party to whom notice
is to be given, by first class mail, registered or certified, postage prepaid,
at the address set forth below, or on the date of service if delivered by
facsimile to the facsimile number set forth below which facsimile is confirmed
within three days by deposit of a copy of such notice in first class mail,
registered or certified, postage prepaid at the address set forth below. Any
party may change its address for purposes of this paragraph by giving the other
parties written notice of the new address in the manner set forth above.
If to IMOJO: 00 Xxxx Xxxxx
Xxxx 0
Xxxxxxx, XX 00000
Attn: Mr. Xxxxx Xxxxxxxx
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With a copy to: Ruskin, Moscou, Xxxxx & Faltischek, P.C.
000 Xxx Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx, Esq.
If to SkyGivers or to IMA: 000 Xxxx Xxxxxx
Xxxx Xxx, XX 00000
Attn: Ms. Xxxxx Xxxxxxxxxx
With a copy to: Xxxxxxxxx Ball Xxxxxx & Xxxxxx, LLP
000 Xxx Xxxxxxx Xxxx
Xxxxx 000
Xxxxxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxx, Esq.
SECTION 11.14 SEVERABILITY. If any provision of this Agreement shall be
declared by any court of competent jurisdiction to be illegal, void or
unenforceable, all other provisions of this Agreement shall not be affected and
shall remain in full force and effect.
SECTION 11.15 GOVERNING LAW; VENUE. This Agreement shall be construed
in accordance with, and governed by, the law of the State of New York without
regard to any principles of conflicts of law. The parties hereby agree that any
action, suit, arbitration or other proceeding arising out of or related to this
Agreement shall be brought, maintained and conducted only in New York, and each
party hereby irrevocably consents and submits to the personal jurisdiction of
and venue in the United States District Court for the Eastern District of New
York and the New York State Courts in any such proceeding.
SECTION 11.16 LEGAL FEES. In the event any legal action or proceeding
is instituted to enforce or interpret any of the provisions of this Agreement,
the prevailing party shall be entitled to reasonable attorneys' fees.
SECTION 11.17 SCHEDULES AND EXHIBITS. The Schedules and Exhibits
attached to this Agreement are a part hereof as if fully set forth herein.
SECTION 11.18 TIME OF ESSENCE. Time is of the essence for each and
every provision of this Agreement where time is a factor.
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IN WITNESS WHEREOF, the parties to this Agreement have duly executed it
as of the day and year first set forth above.
IMOJO, INC.
By: /s/ XXXXX XXXXXXXX
----------------------------------
Name: Xxxxx Xxxxxxxx
----------------------------------
Title: President
----------------------------------
SKYGIVERS, INC.
By: /s/ XXXXX XXXXXXXXXX
----------------------------------
Name: Xxxxx Xxxxxxxxxx
----------------------------------
Title: President
----------------------------------
IMA ACQUISITION, INC.
By: /s/ XXXXX XXXXXXXXXX
----------------------------------
Name: Xxxxx Xxxxxxxxxx
----------------------------------
Title: President
----------------------------------
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