Exhibit 1
SHARE EXCHANGE AGREEMENT
AND
PLAN OF REORGANIZATION
DATED: July 25, 2000
BETWEEN: Nova Communications, Ltd., a Nevada corporation
0000 Xxx Xxx Xxxxxxxxx
Xxxxxxxx, XX 00000 "Nova"
AND: Communications 2000, Inc. a California corporation
0000 Xxx Xxx Xxxxxxxxx
Xxxxxxxx XX 00000 "Comm 2000"
AND: Xxxxxxx X. Xxxx
00-000 Xxxxxxx Xxxx
Xxxxxxxx Xxxxx, XX 00000 "Xxxx"
RECITALS
A. Nova desires to acquire Ninety Percent (90%) of the issued and
outstanding common stock of Comm 2000 as described in this Agreement.
X. Xxxx is willing to exchange his shares of Comm 2000 for shares of Nova
pursuant to the terms and conditions of this Agreement and with the
understanding and intention that the exchange of shares will qualify as a tax-
free reorganization under Section 368(a)(1)(B) of the Internal Revenue Code of
1986, as amended.
NOW, THEREFORE, the parties hereto agree as follows:
1. The Exchange.
------------
(a) Common Share Exchange. Xxxx will exchange Nine Hundred (900)
---------------------
shares of the issued and outstanding common stock of Comm 2000 ("Comm 2000
Shares") for Three Million (3,000,000) shares of common stock of Nova ("Nova
Shares").
Page 1 - SHARE EXCHANGE AGREEMENT
(b) Procedure. Xxxx, by executing this Agreement, agrees to surrender
---------
the Comm 2000 Shares for exchange pursuant to this Agreement.
2. Representations and Warranties of Xxxx.
--------------------------------------
(a) By executing this Agreement, Xxxx represents and warrants that he
owns the Comm 2000 Shares free and clear of any lien, encumbrance or claim of
others and may freely transfer, assign and exchange the same.
(b) Xxxx represents and warrants that he is exchanging the Comm 2000
Shares for the Nova Shares for investment purposes only, and not with a view to
distribute and acknowledges that the Nova Shares will not be registered and only
may be sold or transferred pursuant to a registration statement or an exemption
from registration under the Securities Act of 1933. Xxxx acknowledges that the
certificate representing the Nova Shares may be issued to him with a legend
substantially as follows:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THE SHARES HAVE BEEN ACQUIRED WITHOUT A VIEW TO
DISTRIBUTION AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE
ACT AND UNDER ANY APPLICABLE SECURITIES LAWS, OR AN OPINION OF COUNSEL
ACCEPTABLE TO THE CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED AS TO SUCH
SALE OR OFFER."
3. Representations and Warranties of Nova.
--------------------------------------
(a) Nova is a corporation duly organized under the laws of the State
of Nevada, validly existing, and authorized to exercise all its corporate
powers, rights and privileges.
(b) Nova has the corporate power and authority to own and operate its
properties and to carry on its businesses now conducted.
(c) Nova has all requisite legal and corporate power to execute and
deliver this Agreement.
Page 2 - SHARE EXCHANGE AGREEMENT
(d) Nova will have at Closing, all required legal and corporate power
to issue the Nova Shares called for by this Agreement.
(e) All corporate actions on the part of Nova necessary for the
authorization, execution, delivery and performance of all obligations under this
Agreement and for the issuance and delivery of the Nova Securities has been
taken, and this Agreement constitutes a valid obligation of Nova.
(f) Nova is a reporting public corporation within the meaning of the
Securities Exchange Act of 1934 and has filed all the reports, required to be
filed thereunder, during the previous 12 months.
(g) The Nova Shares, when sold and delivered in accordance with the
terms of this Agreement and for the consideration expressed herein, shall be
duly and validly issued, fully paid and non-assessable.
(h) There is no action, proceeding, or investigation pending or
threatening, or any basis therefore known to Nova to question the validity of
this Agreement or the accuracy of the representations and warranties contained
herein
(i) The authorized capital stock of Nova consists of 500,000,000
shares of common stock, par value $0.001 per share, of which 17,484,096 shares
are issued and outstanding and 10,000,000 shares of preferred stock, par value
$0.001 per shares, none of which are outstanding. Except as contemplated in
this Agreement, there are no other securities, options, warrants, or other
rights to purchase any securities of Nova outstanding. All outstanding
securities of Nova are duly and validly issued, fully paid and non-assessable.
4. Representations and Warranties of Communications 2000, Inc.
-----------------------------------------------------------
(a) Comm 2000 is a corporation duly organized under the laws of the
State of California, validly existing and authorized to exercise all its
corporate powers, rights and privileges.
(b) Comm 2000 has the corporate power and authority to own and operate
its properties and to carry on its business as now conducted.
(c) Comm 2000 has all requisite legal and corporate power to execute
and deliver this Agreement.
Page 3 - SHARE EXCHANGE AGREEMENT
(d) All corporate actions on the part of Comm 2000 necessary for the
authorization, execution, delivery and performance of all obligations under this
Agreement have been taken and this Agreement constitutes a valid obligation of
Comm 2000.
(e) Comm 2000 is not a reporting corporation within the meaning of The
Securities Exchange Act of 1934.
(f) There is no action, proceeding or investigation pending or
threatening or any basis thereof known to Comm 2000 to question the validity of
this Agreement or the accuracy of the representations and warranties contained
herein.
5. Closing.
-------
Closing shall take place on or about October 1, 2000. Upon receipt of
the Agreement executed by all parties or in counterparts and when in possession
of the Comm 2000 Shares, Nova may complete the transaction by transferring the
Nova Shares to Xxxx.
6. Miscellaneous.
-------------
(a) This Agreement may be signed in any number of counterparts, each
of which will be considered an original.
(b) The representations and warranties herein contained will survive
Closing.
(c) This Agreement constitutes the entire agreement between the
parties and supersedes any previous agreement between the parties concerning its
subject matter.
(d) This Agreement will be governed by the laws of the State of
Nevada.
(e) Any controversy or claim arising out of, or related to this
Agreement, or the breach thereof, shall be settled by arbitration in accordance
with the rules of the America Arbitration Association and judgment upon the
award rendered by the arbitrator(s) may be entered in any court have
jurisdiction thereof. Comm 2000 hereby submits to the jurisdiction of any local,
state or federal court in the United States for purposes of enforcing any
judgment described in this section.
Page 4 - SHARE EXCHANGE AGREEMENT
(f) In any arbitration proceeding initiated under this Agreement, the
prevailing party shall be entitled to an award of its reasonable attorneys fees
and costs.
THIS AGREEMENT IS EFFECTIVE AS OF THE DATE FIRST ABOVE WRITTEN.
NOVA COMMUNICATIONS LTD. COMMUNICATIONS 2000, INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxx
By: /s/ Xxxxxxx X. Xxxx
Page 5 - SHARE EXCHANGE AGREEMENT
