Exhibit 10.1
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Plan") is made this
30th day of March, 1999, among Chandelier Business Services, Inc., a Nevada
corporation ("Chandelier"); Internet Marketing, Inc., a Texas corporation
("Internet Marketing"); the initial Internet Marketing stockholders (the
"Internet Marketing Stockholders"); and the Internet Marketing subscribers (the
"Internet Marketing Subscribers") of common stock of Internet Marketing; all of
whom are listed on Exhibit A hereto and who execute and deliver a copy of the
Plan (sometimes, collectively, the "Internet Marketing Stockholders").
W I T N E S S E T H:
RECITALS
--------
WHEREAS, the respective Boards of Directors of Chandelier and Internet
Marketing and the Internet Marketing Stockholders have adopted resolutions
pursuant to which Chandelier shall acquire and Internet Marketing Stockholders
shall exchange 100% of the outstanding common stock and subscriptions to
purchase common stock of Internet Marketing; and
WHEREAS, the sole consideration for 100% interest in Internet
Marketing shall be the exchange of $0.001 par value common stock of Chandelier
(which shares are all "restricted securities" as defined in Rule 144 of the
Securities and Exchange Commission) as outlined in Exhibit A; and
WHEREAS, the Internet Marketing Stockholders shall acquire in exchange
the "restricted securities" of Chandelier in a reorganization within the meaning
of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended;
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, it is agreed:
Section 1
Exchange of Stock
-----------------
1.1 Number of Shares. The Internet Marketing Stockholders and the
----------------
Internet Marketing Subscribers respectively agree to transfer to Chandelier at
the closing (the "Closing") 100% of the outstanding securities and subscriptions
to purchase securities of Internet Marketing, listed in Exhibit A, which is
attached hereto and incorporated herein by reference (the "Internet Marketing
Shares"), in exchange, respectively, for 6,072,000 shares of common stock of
Chandelier (for the outstanding securities of Internet Marketing), and 428,000
shares of common stock of Chandelier (for the outstanding subscriptions).
Taking into account (i) these shares (collectively, 6,500,000 shares); (ii) the
current outstanding shares of Chandelier (2,546,000 shares) and the shares to be
canceled as outlined in Section 1.5 below (546,000 shares); (iii) and the shares
to be issued to a financial consultant or its designees as outlined in Section
1.6 below (1,000,000 shares); there will be 9,500,000 outstanding shares of the
reorganized Chandelier on the Closing. The exchange shall be on a basis of one
share of Chandelier for each of the Internet Marketing Shares, provided,
however, Xxxx X. Xxxxxx, the President and a director of Internet Marketing,
shall receive 28,000 less shares due to an over subscription in the
subscriptions of Internet Marketing, by agreement with Xx. Xxxxxx.
1.2 Delivery of Certificates by Internet Marketing Stockholders.
-------------------------------------------------------------
The transfer of the Internet Marketing Shares by the Internet Marketing
Stockholders shall be effected by the delivery to Chandelier at the Closing of
stock certificate or certificates representing the transferred shares duly
endorsed in blank or accompanied by stock powers executed in blank with all
signatures witnessed or guaranteed to the satisfaction of Chandelier and with
all necessary transfer taxes and other revenue stamps affixed and acquired at
the Internet Marketing Stockholders' expense. Since Internet Marketing Shares
have not been issued to the Internet Marketing Subscribers, who subscribed with
the understanding that the Plan would be completed and each would receive the
number of shares subscribed for in the reorganized Chandelier, the signed
Counterpart Signature Page to the Plan of the Internet Marketing Subscribers,
together with Chandelier's acceptance thereof at the Closing, shall be
sufficient to transfer the equity interest in Internet Marketing of the Internet
Marketing Subscribers to Chandelier.
1.3 Further Assurances. At the Closing and from time to time
-------------------
thereafter, the Internet Marketing Stockholders and the Internet Marketing
Subscribers shall execute such additional instruments and take such other action
as Chandelier may request in order to exchange and transfer clear title and
ownership in the Internet Marketing Shares to Chandelier.
1.4 Resignations of Present Directors and Executive Officers and
--------------------------------------------------------------
Designation of New Directors and Executive Officers. On Closing, the sole
--------------------------------------------------------
present director and executive officer of Chandelier, York X. Xxxxxxxx, shall
designate the directors and executive officers nominated by Internet Marketing
to serve in his place and stead, until the next respective annual meetings of
the stockholders and the Board of Directors of Chandelier, and until their
respective successors shall be elected and qualified or until their respective
prior resignations or terminations, who shall be: Xxxx X. Xxxxxx, President,
CEO and Director; Xxxxxx X. Xxxxxx, Director; Xxxxxxx X. Xxxxxxx, Comptroller
and CFO; Wajed (Xxxxx) Salam, Director; Xxxxxxx X. Xxxxxxxx, Director; Xxxxxx X.
Xxxxxxxx, Director; and Xxxxx X. Xxxxxx, Xx., Secretary/Treasurer; and then, Xx.
Xxxxxxxx shall resign.
1.5 Cancellation of Certain Pre-Plan Shares. In consideration of
----------------------------------------
the Plan, York X. Xxxxxxxx, President and a director of Chandelier, shall convey
to Chandelier simultaneous with the Closing, 546,000 shares of common stock of
Chandelier which are owned by him, for cancellation.
1.6 Financial Consultant's Compensation. In consideration of
-------------------------------------
services rendered in connection with the negotiation and Closing of the Plan,
simultaneous with the Closing, Chandelier shall issue 1,000,000 shares of its
"restricted securities" (common stock) to Eurotrade Financial, Inc. or its
designees.
-2-
1.7 Change of Name. Simultaneous with the Closing of this Plan,
---------------
the Board of Directors of Chandelier, with the written consent of York X.
Xxxxxxxx, its majority stockholder, shall adopt the resolutions necessary to
amend Chandelier's Articles of Incorporation to change its name to "Internet
Marketing, Inc."
1.8 Assets and Liabilities of Chandelier at Closing. Chandelier
-------------------------------------------------
shall have no material assets and no liabilities at Closing, and all costs
incurred by Chandelier incident to the Plan shall have been paid or satisfied.
1.9 Limitation on Reverse Splits. Without the prior written
-------------------------------
consent of the current members of the Board of Directors of Chandelier, no
reverse split of the outstanding voting securities of Chandelier shall be
effected following the Closing, for a period of not less than 12 months.
1.10 Closing. The Plan will be deemed to be completed on receipt
-------
of the signatures of Internet Marketing Stockholders or Internet Marketing
Subscribers collectively owning or having rights to acquire not less that 80% of
the Internet Marketing Shares.
Section 2
Closing
-------
The Closing contemplated by Section 1 shall be held at the offices of
Xxxxxxx X. Xxxxxxxxxx, Esq., Suite 205 Hermes Building, 000 Xxxx 000 Xxxxx, Xxxx
Xxxx Xxxx, Xxxx 00000, on or before ten days following the execution and
delivery of this Plan, unless another place or time is agreed upon in writing by
the parties. The Closing may be accomplished by wire, express mail or other
courier service, conference telephone communications or as otherwise agreed by
the respective parties or their duly authorized representatives.
Section 3
Representations and Warranties of Chandelier
--------------------------------------------
Chandelier represents and warrants to, and covenants with, the
Internet Marketing Stockholders, the Internet Marketing Subscribers and Internet
Marketing as follows:
3.1 Corporate Status. Chandelier is a corporation duly organized,
----------------
validly existing and in good standing under the laws of the State of Nevada and
is licensed or qualified as a foreign corporation in all states in which the
nature of its business or the character or ownership of its properties makes
such licensing or qualification necessary (Nevada only.) Chandelier is a
publicly held company, having previously and lawfully offered and sold a portion
of its securities in accordance with applicable federal and state securities
laws, rules and regulations. Chandelier's common stock is quoted on the OTC
Bulletin Board of the National Association of Securities Dealers, Inc. (the
"NASD") under the symbol "CHBD."
-3-
3.2 Capitalization. The current pre-Plan authorized capital stock
--------------
of Chandelier consists of 25,000,000 shares of $0.001 par value common voting
stock, of which 2,546,000 shares are issued and outstanding, all fully paid and
non-assessable. Except as otherwise provided herein, there are no outstanding
options, warrants or calls pursuant to which any person has the right to
purchase any authorized and unissued common stock of Chandelier.
3.3 Financial Statements. The financial statements of Chandelier
---------------------
furnished to the Internet Marketing Stockholders and Internet Marketing,
consisting of audited financial statements for the years ended January 31, 1999
and 1998, attached hereto as Exhibit B and incorporated herein by reference, are
correct and fairly present the financial condition of Chandelier at such dates
and for the periods involved; such statements were prepared in accordance with
generally accepted accounting principles consistently applied, and no material
change has occurred in the matters disclosed therein, except as indicated in
Exhibit C, which is attached hereto and incorporated herein by reference. Such
financial statements do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements made, in
light of the circumstances under which they were made, not misleading.
3.4 Undisclosed Liabilities. Chandelier has no liabilities of any
-----------------------
nature except to the extent reflected or reserved against in its balance sheets,
whether accrued, absolute, contingent or otherwise, including, without
limitation, tax liabilities and interest due or to become due, except as set
forth in Exhibit C.
3.5 Interim Changes. Since the date of its balance sheets, except
---------------
as set forth in Exhibit C, there have been no (1) changes in financial
condition, assets, liabilities or business of Chandelier which, in the
aggregate, have been materially adverse; (2) damages, destruction or losses of
or to property of Chandelier, payments of any dividend or other distribution in
respect of any class of stock of Chandelier, or any direct or indirect
redemption, purchase or other acquisition of any class of any such stock; or (3)
increases paid or agreed to in the compensation, retirement benefits or other
commitments to its employees.
3.6 Title to Property. Chandelier has good and marketable title
-------------------
to all properties and assets, real and personal, reflected in Chandelier's
balance sheets, and the properties and assets of Chandelier are subject to no
mortgage, pledge, lien or encumbrance, except for liens shown therein or in
Exhibit C, with respect to which no default exists.
3.7 Litigation. There is no litigation or proceeding pending, or
----------
to the knowledge of Chandelier, threatened, against or relating to Chandelier,
its properties or business, except as set forth in Exhibit C. Further, no
officer, director or person who may be deemed to be an affiliate of Chandelier
is party to any material legal proceeding which could have an adverse effect on
Chandelier (financial or otherwise), and none is party to any action or
proceeding wherein any has an interest adverse to Chandelier.
-4-
3.8 Books and Records. From the date of this Plan to the Closing,
-----------------
Chandelier will (1) give to the Internet Marketing Stockholders and Internet
Marketing or their respective representatives full access during normal business
hours to all of Chandelier's offices, books, records, contracts and other
corporate documents and properties so that the Internet Marketing Stockholders
and Internet Marketing or their respective representatives may inspect and audit
them; and (2) furnish such information concerning the properties and affairs of
Chandelier as the Internet Marketing Stockholders and Internet Marketing or
their respective representatives may reasonably request.
3.9 Tax Returns. Chandelier has filed all federal and state
------------
income or franchise tax returns required to be filed or has received currently
effective extensions of the required filing dates.
3.10 Confidentiality. Until the Closing (and thereafter if there
---------------
is no Closing), Chandelier and its representatives will keep confidential any
information which they obtain from the Internet Marketing Stockholders or from
Internet Marketing concerning the properties, assets and business of Internet
Marketing. If the transactions contemplated by this Plan are not consummated by
April 9, 1999, Chandelier will return to Internet Marketing all written matter
with respect to Internet Marketing obtained by Chandelier in connection with the
negotiation or consummation of this Plan.
3.11 Corporate Authority. Chandelier has full corporate power and
-------------------
authority to enter into this Plan and to carry out its obligations hereunder and
will deliver to the Internet Marketing Stockholders and Internet Marketing or
their respective representatives at the Closing a certified copy of resolutions
of its Board of Directors authorizing execution of this Plan by Chandelier's
officers and performance thereunder, and that the sole director adopting and
delivering such resolutions is the duly elected and incumbent director of
Chandelier.
3.12 Due Authorization. Execution of this Plan and performance by
-----------------
Chandelier hereunder have been duly authorized by all requisite corporate action
on the part of Chandelier, and this Plan constitutes a valid and binding
obligation of Chandelier and performance hereunder will not violate any
provision of the Articles of Incorporation, Bylaws, agreements, mortgages or
other commitments of Chandelier.
3.13 Environmental Matters. Chandelier has no knowledge of any
----------------------
assertion by any governmental agency or other regulatory authority of any
environmental lien, action or proceeding, or of any cause for any such lien,
action or proceeding related to the business operations of Chandelier or
Chandelier' predecessors. In addition, to the best knowledge of Chandelier,
there are no substances or conditions which may support a claim or cause of
action against Chandelier or any of Chandelier' current or former officers,
directors, agents or employees, whether by a governmental agency or body,
private party or individual, under any Hazardous Materials Regulations.
"Hazardous Materials" means any oil or petrochemical products, PCB's, asbestos,
urea formaldehyde, flammable explosives, radioactive materials, solid or
hazardous wastes, chemicals, toxic substances or related materials, including,
-5-
without limitation, any substances defined as or included in the definition of
"hazardous substances," "hazardous wastes," "hazardous materials," or "toxic
substances" under any applicable federal or state laws or regulations.
"Hazardous Materials Regulations" means any regulations governing the use,
generation, handling, storage, treatment, disposal or release of hazardous
materials, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act, the Resource Conservation and Recovery
Act and the Federal Water Pollution Control Act.
3.14 Access to Information Regarding Internet Marketing.
-------------------------------------------------------
Chandelier acknowledges that it has been delivered copies of what has been
represented to be documentation containing all material information respecting
Internet Marketing and Internet Marketing's present and contemplated business
operations, potential acquisitions, management and other factors; that it has
had a reasonable opportunity to review such documentation and discuss it, to the
extent desired, with its legal counsel, directors and executive officers; that
it has had, to the extent desired, the opportunity to ask questions of and
receive responses from the directors and executive officers of Internet
Marketing, and with the legal and accounting firms of Internet Marketing, with
respect to such documentation; and that to the extent requested, all questions
raised have been answered to Chandelier's complete satisfaction.
Section 4
Representations, Warranties and Covenants of Internet Marketing
---------------------------------------------------------------
and the Internet Marketing Stockholders
---------------------------------------
Internet Marketing and the Internet Marketing Stockholders (Sections
4.1, 4.11, 4.12 and 4.15 are the only representations of the Internet Marketing
Subscribers) represent and warrant to, and covenant with, Chandelier as follows:
4.1 Ownership. Internet Marketing Stockholders own the Internet
---------
Marketing Shares, free and clear of any liens or encumbrances of any type or
nature whatsoever, and each has full right, power and authority to convey the
Internet Marketing Shares owned without qualification.
4.2 Corporate Status. Internet Marketing is a corporation duly
-----------------
organized, validly existing and in good standing under the laws of the State of
Texas and is licensed or qualified as a foreign corporation in all states or
foreign countries and provinces in which the nature of Internet Marketing's
business or the character or ownership of Internet Marketing properties makes
such licensing or qualification necessary.
4.3 Capitalization. The authorized capital stock of Internet
--------------
Marketing consists of 100,000,000 shares of common stock, par value $0.001 per
share, of which 6,100,000 shares are issued and outstanding, all fully paid and
non-assessable; and 10,000,000 shares of preferred stock, par value $0.001 per
share, of which no shares are issued and outstanding. Except for the
subscriptions of the Internet Marketing Subscribers referred to elsewhere
herein, there are no outstanding options, warrants or calls pursuant to which
any person has the right to purchase any other securities of Internet Marketing.
-6-
Internet Marketing has received subscriptions in the total amount of $214,000,
representing the agreement to purchase 428,000 post-Plan shares of common stock
of Chandelier. The amount of pre-Plan subscriptions was contemplated to be for
400,000 shares, and because of the over subscription, Xxxx X. Xxxxxx has agreed
to deduct the additional 28,000 shares which were over subscribed from the
shares of common stock he is to receive under the Plan.
4.4 Financial Statements. The financial statements of Internet
---------------------
Marketing furnished to Chandelier, consisting of unaudited financial statements
from July 27, 1998 (date of inception) through December 31, 1998, attached
hereto as Exhibit D and incorporated herein by reference, are correct and fairly
present the financial condition of Internet Marketing as of these dates and for
the periods involved, and such statements were prepared in accordance with
generally accepted accounting principles consistently applied, and no material
change has occurred in the matters disclosed therein, except as indicated in
Exhibit E, which is attached hereto and incorporated herein by reference. These
financial statements do not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements made, in
light of the circumstances under which they were made, not misleading.
4.5 Undisclosed Liabilities. Internet Marketing has no material
------------------------
liabilities of any nature except to the extent reflected or reserved against in
the balance sheet, whether accrued, absolute, contingent or otherwise,
including, without limitation, tax liabilities and interest due or to become
due, except as set forth in Exhibit E attached hereto and incorporated herein by
reference.
4.6 Interim Changes. Since the date of the balance sheet, except
----------------
as set forth in Exhibit E, there have been no (1) changes in the financial
condition, assets, liabilities or business of Internet Marketing, in the
aggregate, have been materially adverse; (2) damages, destruction or loss of or
to the property of Internet Marketing, payment of any dividend or other
distribution in respect of the capital stock of Internet Marketing, or any
direct or indirect redemption, purchase or other acquisition of any such stock;
or (3) increases paid or agreed to in the compensation, retirement benefits or
other commitments to their employees.
4.7 Title to Property. Internet Marketing has good and marketable
-----------------
title to all properties and assets, real and personal, proprietary or otherwise,
reflected in the balance sheet, and the properties and assets of Internet
Marketing are subject to no mortgage, pledge, lien or encumbrance, except as
reflected in the balance sheet or in Exhibit E, with respect to which no default
exists.
4.8 Litigation. There is no litigation or proceeding pending, or
----------
to the knowledge of Internet Marketing, threatened, against or relating to
Internet Marketing or its properties or business, except as set forth in Exhibit
E. Further, no officer, director or person who may be deemed to be an affiliate
of Internet Marketing is party to any material legal proceeding which could have
an adverse effect on Internet Marketing (financial or otherwise), and none is
party to any action or proceeding wherein any has an interest adverse to
Internet Marketing.
4.9 Books and Records. From the date of this Plan to the Closing,
-----------------
the Internet Marketing Stockholders will cause Internet Marketing to (1) give to
Chandelier and its representatives full access during normal business hours to
all of its offices, books, records, contracts and other corporate documents and
-7-
properties so that Chandelier may inspect and audit them; and (2) furnish such
information concerning the properties and affairs of Internet Marketing as
Chandelier may reasonably request.
4.10 Tax Returns. Internet Marketing has filed all federal and
------------
state income or franchise tax returns required to be filed or has received
currently effective extensions of the required filing dates.
4.11 Confidentiality. Until the Closing (and continuously if
---------------
there is no Closing), Internet Marketing, the Internet Marketing Stockholders
and their representatives will keep confidential any information which they
obtain from Chandelier concerning its properties, assets and business. If the
transactions contemplated by this Plan are not consummated by April 9, 1999,
Internet Marketing and the Internet Marketing Stockholders will return to
Chandelier all written matter with respect to Chandelier obtained by them in
connection with the negotiation or consummation of this Plan.
4.12 Investment Intent. The Internet Marketing Stockholders are
------------------
acquiring the shares to be exchanged and delivered to them under this Plan for
investment and not with a view to the sale or distribution thereof, and the
Internet Marketing Stockholders have no commitment or present intention to
liquidate the Company or to sell or otherwise dispose of the Chandelier shares.
The Internet Marketing Stockholders shall execute and deliver to Chandelier on
the Closing an Investment Letter attached hereto as Exhibit F and incorporated
herein by reference, acknowledging the "unregistered" and "restricted" nature of
the shares of Chandelier being received under the Plan in exchange for the
Internet Marketing Shares; receipt of certain material information regarding
Chandelier; and compromising and/or waiving any claims any has or may have
against Internet Marketing by reason of the purchase of any securities of
Internet Marketing by each or any of them prior to the Closing of the Plan
4.13 Corporate Authority. Internet Marketing has full corporate
--------------------
power and authority to enter into this Plan and to carry out its obligations
hereunder and will deliver to Chandelier or its representative at the Closing a
certified copy of resolutions of its Board of Directors authorizing execution of
this Plan by its officers and performance thereunder.
4.14 Due Authorization. Execution of this Plan and performance by
-----------------
Internet Marketing hereunder have been duly authorized by all requisite
corporate action on the part of Internet Marketing, and this Plan constitutes a
valid and binding obligation of Internet Marketing and performance hereunder
will not violate any provision of the Articles of Incorporation, Bylaws,
agreements, mortgages or other commitments of Internet Marketing.
4.15 Environmental Matters. Internet Marketing and the Internet
----------------------
Marketing Stockholders have no knowledge of any assertion by any governmental
agency or other regulatory authority of any environmental lien, action or
proceeding, or of any cause for any such lien, action or proceeding related to
the business operations of Internet Marketing or its predecessors. In addition,
to the best knowledge of Internet Marketing, there are no substances or
conditions which may support a claim or cause of action against Internet
-8-
Marketing or any of its current or former officers, directors, agents, employees
or predecessors, whether by a governmental agency or body, private party or
individual, under any Hazardous Materials Regulations. "Hazardous Materials"
means any oil or petrochemical products, PCB's, asbestos, urea formaldehyde,
flammable explosives, radioactive materials, solid or hazardous wastes,
chemicals, toxic substances or related materials, including, without limitation,
any substances defined as or included in the definition of "hazardous
substances," "hazardous wastes," "hazardous materials," or "toxic substances"
under any applicable federal or state laws or regulations. "Hazardous Materials
Regulations" means any regulations governing the use, generation, handling,
storage, treatment, disposal or release of hazardous materials, including,
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act, the Resource Conservation and Recovery Act and the Federal Water
Pollution Control Act.
4.15 Access to Information Regarding Chandelier. Internet
----------------------------------------------
Marketing and the Internet Marketing Stockholders acknowledge that they have
been delivered copies of what has been represented to be documentation
containing all material information respecting Chandelier and its present and
contemplated business operations, potential acquisitions, management and other
factors; that they have had a reasonable opportunity to review such
documentation and discuss it, to the extent desired, with their legal counsel,
directors and executive officers; that they have had, to the extent desired, the
opportunity to ask questions of and receive responses from the directors and
executive officers of Chandelier, and with the legal and accounting firms of
Chandelier, with respect to such documentation; and that to the extent
requested, all questions raised have been answered to their complete
satisfaction.
Section 5
Conditions Precedent to Obligations of Internet Marketing
---------------------------------------------------------
and the Internet Marketing Stockholders
---------------------------------------
All obligations of Internet Marketing and the Internet Marketing
Stockholders under this Plan are subject, at their option, to the fulfillment,
before or at the Closing, of each of the following conditions:
5.1 Representations and Warranties True at Closing. The
---------------------------------------------------
representations and warranties of Chandelier contained in this Plan shall be
deemed to have been made again at and as of the Closing and shall then be true
in all material respects and shall survive the Closing.
5.2 Due Performance. Chandelier shall have performed and complied
---------------
with all of the terms and conditions required by this Plan to be performed or
complied with by it before the Closing.
5.3 Officers' Certificate. Internet Marketing and the Internet
----------------------
Marketing Stockholders shall have been furnished with a certificate signed by
the President of Chandelier, in such capacity, attached hereto as Exhibit G and
incorporated herein by reference, dated as of the Closing, certifying (1) that
all representations and warranties of Chandelier contained herein are true and
-9-
correct; and (2) that since the date of the financial statements (Exhibit B
hereto), there has been no material adverse change in the financial condition,
business or properties of Chandelier, taken as a whole.
5.4 Opinion of Counsel of Chandelier. Internet Marketing and the
---------------------------------
Internet Marketing Stockholders shall have received an opinion of counsel for
Chandelier, dated as of the Closing, to the effect that (1) the representations
of Sections 3.1, 3.2 and 3.11 are correct; (2) except as specified in the
opinion, counsel knows of no inaccuracy in the representations in 3.5, 3.6 or
3.7; and (3) the shares of Chandelier to be issued to the Internet Marketing
Stockholders under this Plan will, when so issued, be validly issued, fully paid
and non-assessable.
5.5 Assets and Liabilities of Chandelier. Unless otherwise
----------------------------------------
agreed, Chandelier shall have no assets and no liabilities at Closing, and all
costs, expenses and fees incident to the Plan shall have been paid.
5.6 Resignation of Directors and Executive Officers and
---------------------------------------------------------
Designation of New Directors and Executive Officers. The present sole director
-------------------------------------------
and executive officer of Chandelier shall resign, and shall have designated
nominees of Internet Marketing as outlined in Section 1.4 hereof as directors
and executive officers of Chandelier to serve in his place and stead, until the
next respective annual meetings of the stockholders and Board of Directors of
Chandelier, and until their respective successors shall be elected and qualified
or until their respective prior resignations or terminations.
5.7 Name Change of Chandelier, Cancellation of Pre-Plan
---------------------------------------------------------
Outstanding Shares and Issuance of Compensation Shares. Simultaneous with the
---------------------------------------------
Closing of this Plan, (i) Chandelier and its majority stockholder shall have
adopted such resolutions as are necessary for the purpose of amending its
Articles of Incorporation to change the name of Chandelier to "Internet
Marketing, Inc."; (ii) to cause the shares of common stock as outlined in
Section 1.5 hereof to be canceled; and (iii) to cause the shares of common stock
outlined in Section 1.6 hereof to be issued as fully paid and non-assessable
shares.
Section 6
Conditions Precedent to Obligations of Chandelier
-------------------------------------------------
All obligations of Chandelier under this Plan are subject, at
Chandelier's option, to the fulfillment, before or at the Closing, of each of
the following conditions:
6.1 Representations and Warranties True at Closing. The
---------------------------------------------------
representations and warranties of Internet Marketing and the Internet Marketing
Stockholders contained in this Plan shall be deemed to have been made again at
and as of the Closing and shall then be true in all material respects and shall
survive the Closing.
-10-
6.2 Due Performance. Internet Marketing and the Internet
----------------
Marketing Stockholders shall have performed and complied with all of the terms
and conditions required by this Plan to be performed or complied with by them
before the Closing.
6.3 Officers' Certificate. Chandelier shall have been furnished
----------------------
with a certificate signed by the President of Internet Marketing, in such
capacity, attached hereto as Exhibit H and incorporated herein by reference,
dated as of the Closing, certifying (1) that all representations and warranties
of Internet Marketing and the Internet Marketing Stockholders contained herein
are true and correct; and (2) that since the date of the financial statements
(Exhibit D), there has been no material adverse change in the financial
condition, business or properties of Internet Marketing, taken as a whole.
6.4 Books and Records. The Internet Marketing Stockholders or the
-----------------
Board of Directors of Internet Marketing shall have caused Internet Marketing to
make available all books and records of Internet Marketing, including minute
books and stock transfer records; provided, however, only to the extent
requested in writing by Chandelier at Closing.
Section 7
Termination
-----------
Prior to Closing, this Plan may be terminated (1) by mutual consent in
writing; (2) by either the sole director of Chandelier or Internet Marketing and
the Internet Marketing Stockholders if there has been a material
misrepresentation or material breach of any warranty or covenant by the other
party; or (3) by either the sole director of Chandelier or Internet Marketing
and the Internet Marketing Stockholders if the Closing shall not have taken
place, unless adjourned to a later date by mutual consent in writing, by the
date fixed in Section 2.
Section 8
General Provisions
------------------
8.1 Further Assurances. At any time, and from time to time, after
------------------
the Closing, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or perfect
title to any property transferred hereunder or otherwise to carry out the intent
and purposes of this Plan.
8.2 Waiver. Any failure on the part of any party hereto to comply
------
with any of Chandelier obligations, agreements or conditions hereunder may be
waived in writing by the party to whom such compliance is owed.
8.3 Brokers. Each party represents to the other parties hereunder
-------
that no broker or finder has acted for it in connection with this Plan, and
agrees to indemnify and hold harmless the other parties against any fee, loss or
expense arising out of claims by brokers or finders employed or alleged to have
been employed by he/she/it.
-11-
8.4 Notices. All notices and other communications hereunder shall
-------
be in writing and shall be deemed to have been given if delivered in person or
sent by prepaid first-class registered or certified mail, return receipt
requested, as follows:
If to Chandelier: 000 Xxxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
If to Internet Marketing: 000 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
With a copy to: Xxxxxxx X. Xxxxxxxxxx, Esq.
455 East 000 Xxxxx, #000
Xxxx Xxxx Xxxx, Xxxx 00000
If to the Internet Marketing
Stockholders: To the addresses listed on Exhibit A
8.5 Entire Agreement. This Plan constitutes the entire agreement
-----------------
between the parties and supersedes and cancels any other agreement,
representation or communication, whether oral or written, between the parties
hereto relating to the transactions contemplated herein or the subject matter
hereof.
8.6 Headings. The section and subsection headings in this Plan
--------
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Plan.
8.7 Governing Law. This Plan shall be governed by and construed
--------------
and enforced in accordance with the laws of the State of Nevada, except to the
extent pre-empted by federal law, in which event (and to that extent only),
federal law shall govern.
8.8 Assignment. This Plan shall inure to the benefit of, and be
----------
binding upon, the parties hereto and their successors and assigns.
8.9 Counterparts. This Plan may be executed simultaneously in two
------------
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
8.10 Default. In the event of any default hereunder, the
-------
prevailing party in any action to enforce the terms and provisions hereof shall
be entitled to recover reasonable attorney's fees and related costs.
-12-
IN WITNESS WHEREOF, the parties have executed this Agreement
and Plan of Reorganization effective the day and year first above written.
CHANDELIER BUSINESS SERVICES, INC.
Date: 3-30-99 By /s/ York Xxxxxxxx
York X. Xxxxxxxx, President
INTERNET MARKETING, INC.
Date: 3-30-99 By /s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx, President
INTERNET MARKETING, INC.
STOCKHOLDERS
Date: 3-30-99 /s/ Xxxx X. Xxxxxx
Xxxx X. Xxxxxx
Dated: 3-29-99 /s/ Xxxxxx Xxxxxx
Xxxxxx Xxxxxx
Dated: 3-29-99 /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Dated: 3-29-99 /s/ L & J FAMILY LIMITED PARTNERSHIP
By /s/ W. Salem
W. Salem
Dated: March 29, 1999 /s/ Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxxxxx
Dated: 03/29/99 AMENS FAMILY LIMITED PARTNERSHIP
By: /s/ X. X. Xxxxxxx, G.P.
R. A. Xxxxxxx, X.X.
Dated: 3-29-99 /s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx
-13-
Form of:
AGREEMENT AND PLAN OF REORGANIZATION
COUNTERPART SIGNATURE PAGE
This Counterpart Signature Page for that certain AGREEMENT AND PLAN OF
Reorganization (the "Agreement") dated as of the ____ day of March, 1999, among
Chandelier Business Services, Inc., a Nevada corporation ("Chandelier");
Internet Marketing, Inc., a Texas corporation ("Internet Marketing"); the
initial Internet Marketing stockholders (the "Internet Marketing Stockholders");
and the Internet Marketing subscribers (the "Internet Marketing Subscribers") of
common stock of Internet Marketing, who are signatories thereto, is executed by
the undersigned, an Internet Marketing Subscriber as of the date first written
above. The undersigned, through execution and delivery of this Counterpart
Signature page, intends to be legally bound by the terms of the Agreement.
_______________________________________
Name (Please Print)
-14-
