EXHIBIT 2.2
STOCK EXCHANGE AGREEMENT
BETWEEN AND AMONG
XXXXXXXXX TECHNOLOGIES CORPORATION,
FUTURE COM SOUTH FLORIDA, INC.
AND
THE SHAREHOLDERS OF FUTURE COM SOUTH FLORIDA, INC.
November 4, 1999
STOCK EXCHANGE AGREEMENT
TABLE OF CONTENTS
1. Definitions............................................................1
1.1 Closing.........................................................1
1.2 Code............................................................1
1.3 Constituent Corporations........................................1
1.4 Delaware Law....................................................1
1.5 Effective Date..................................................2
1.6 Exchange........................................................2
1.7 Execution Date..................................................2
1.8 Florida Law.....................................................2
1.9 Future Com......................................................2
1.10 Future Com Common Stock.........................................2
1.11 Future Com Shareholders.........................................2
1.12 Future Com's Business...........................................2
1.13 Xxxxxxxxx.......................................................2
1.14 Xxxxxxxxx Common Stock..........................................2
1.15 Xxxxxxxxx'x Business............................................2
1.16 Material Adverse Change.........................................2
1.17 1933 Act........................................................2
1.18 1934 Act........................................................2
1.19 SEC.............................................................2
1.20 Subsidiary......................................................3
1.21 Transfer Agent..................................................3
2. The Exchange...........................................................3
2.1 Exchange........................................................3
2.2 Effective Date..................................................3
2.3 Concurrent Agreements...........................................3
2.3.1 Xxxxxxxxx Employment Agreements...........................3
2.3.2 Future Com Employee.......................................3
2.3.3 Insurance Agreements......................................3
2.3.4 Expenses; Indebtedness....................................4
2.3.5 Purchase Of SMR Licenses..................................4
2.3.6 Purchase Of Satellite License.............................5
2.3.7 Purchase Of Additional SMR Licenses.......................5
2.3.8 Registration Rights Agreement.............................5
2.3.9 Option Agreements.........................................5
2.4 Covenant Not To Compete.........................................6
3. Directors..............................................................6
4. Exchange of Shares.....................................................6
4.1 Exchange Of Shares..............................................6
4.2 Mechanics Of Exchange...........................................7
5. Representations And Warranties Of Xxxxxxxxx............................7
5.1 Organization And Standing.......................................7
5.2 Capitalization..................................................8
5.3 Authority; Non-Contravention....................................8
5.4 Governmental Consents...........................................8
5.5 Disclosure......................................................8
5.6 Reorganization..................................................9
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6. Representations And Warranties Of Future Com...........................9
6.1 Organization And Standing.......................................9
6.2 No Subsidiaries.................................................9
6.3 Capitalization..................................................9
6.4 Authority; Non-Contravention...................................10
6.5 Contracts And Commitments......................................10
6.6 Compliance With Other Instruments..............................10
6.7 Litigation And Claims..........................................11
6.8 Insurance......................................................11
6.9 Governmental Consents..........................................11
6.10 Disclosure.....................................................11
6.11 Actions........................................................11
6.12 Taxes..........................................................12
6.13 No Employees; No Retirement Obligations........................12
6.14 Books And Records..............................................12
6.15 Copies Of Documents............................................12
6.16 Employees, Officers, Directors, And Consultants................13
6.17 Documents Delivered............................................13
6.18 No Material Changes............................................13
6.19 Financial Statements; Undisclosed Liabilities..................14
6.20 Encumbrances...................................................15
6.21 No Encumbrances On Future Com Common Stock.....................15
6.22 Reorganization.................................................15
6.23 Restricted Stock...............................................15
7. Certain Agreements....................................................15
7.1 Access And Information.........................................15
7.2 Shareholder Authorization......................................16
7.3 Operation Of Business..........................................16
7.4 Preservation Of Business.......................................16
7.5 Tax Cooperation................................................16
7.6 Interim Operations.............................................18
7.7 Reorganization.................................................19
7.8 Accuracy of Representations....................................19
7.9 Consents, Waivers And Approvals................................19
7.10 Notice Of Breach Of Warranty...................................19
7.11 Additional Documents; Further Assurances.......................19
7.12 Notice Of Inaccurate Information...............................19
7.13 Publicity......................................................19
8. Conditions To Performance By All Parties..............................20
9. Conditions Precedent To Performance By Future Com.....................20
10. Conditions Precedent To Performance By Xxxxxxxxx......................21
11. Indemnification By Xxxxxxxxx..........................................22
12. Indemnification By The Future Com Shareholders........................23
13. Notice of Claim.......................................................24
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14. Closing...............................................................24
15. Termination And Abandonment Of The Exchange...........................25
15.1. Termination....................................................25
15.2. Effect Of Termination..........................................25
16. Amendment Or Waiver...................................................26
17. Entire Agreement......................................................26
18. Notice................................................................26
19. Severability..........................................................27
20. Headings..............................................................27
21. Counterparts..........................................................27
22. Expenses..............................................................27
23. Nature And Survival Of Representations................................27
24. Benefits And Assignment...............................................27
25. Specific Performance..................................................27
26. Brokers...............................................................28
27. Costs.................................................................28
28. Termination On Default................................................28
29. Choice Of Law.........................................................28
30. Arbitration...........................................................28
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SCHEDULES AND EXHIBITS
----------------------
Schedule No. And Description
----------------------------
2.3.3.2 Medical Insurance Policies
2.3.5. SMR Licenses
2.3.6. Satellite License
6.5. Material Contracts, Indebtedness, Liabilities And Obligations
6.6. Violations Of Articles Of Incorporation, Bylaws, Contracts, Etc.
6.7. Litigation And Claims
6.8. Insurance
6.16. Employee, Officer, Director And Consultant Annual Compensation
6.18. Material Changes
6.19. Future Com Assets And Liabilities
6.20 Encumbrances
Exhibits
--------
Exhibit A Form Of Employment And Nonsolicitation Agreement
Exhibit B Employment Agreements Regarding Xxxxxxx Xxxxx And Xxxxxxxxxxx
Xxxxxxx
Exhibit C Form Of Stock Option Agreement
Exhibit D Agreement Regarding Repayment Of Debt Owed By Future Com
Exhibit E Form SMR License Purchase Agreement
Exhibit F Form Of Satellite License Purchase Agreement
Exhibit G Registration Rights Agreement
Exhibit H Form of Noncompetition Agreement
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STOCK EXCHANGE AGREEMENT
BETWEEN
XXXXXXXXX TECHNOLOGIES CORPORATION,
FUTURE COM SOUTH FLORIDA, INC.
AND
THE SHAREHOLDERS OF FUTURE COM SOUTH FLORIDA, INC.
THIS STOCK EXCHANGE AGREEMENT (the "Agreement") is made and entered into to
be effective as of November 4, 1999 (the "Effective Date"), between and among
Xxxxxxxxx Technologies Corporation, a Delaware corporation ("Xxxxxxxxx"), Future
Com South Florida, Inc., a Florida corporation ("Future Com"), and Xxxxxxx Xxxx
and Xxxxxx Xxxxxx (the "Future Com Shareholders"). Each of Xxxxxxxxx, Future Com
and the Future Com Shareholders may be referred to individually as a "Party",
and all of Xxxxxxxxx, Future Com and the Future Com Shareholders may be referred
to collectively as the "Parties".
RECITALS
A. The Parties to this Agreement desire to effect an exchange (the
"Exchange") pursuant to which Xxxxxxxxx will deliver to the Future Com
Shareholders 4,000,000 shares of restricted common stock of Xxxxxxxxx in
exchange for all the issued and outstanding shares of common stock of Future
Com. As a result of the Exchange, Xxxxxxxxx will own all the issued and
outstanding securities of Future Com, and Future Com will become a wholly-owned
subsidiary of Xxxxxxxxx. Future Com has no outstanding securities except for the
shares of its common stock to be delivered to Xxxxxxxxx pursuant to the terms of
this Agreement.
B. The Board Of Directors of Xxxxxxxxx and the Future Com Shareholders have
reviewed and approved this Agreement and have determined that the Exchange
should be consummated pursuant to the terms and conditions hereinafter set forth
in this Agreement.
C. The Parties desire to effectuate the Exchange as a reorganization under
Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code").
AGREEMENT
In consideration of the premises and the mutual representations,
warranties, covenants and agreements herein contained, the Parties agree as
follows:
1. Definitions. As used in this Agreement the following terms have the
meanings indicated:
1.1. "Closing" refers to the consummation of the transactions
contemplated by this Agreement.
1.2. "Code" refers to the Internal Revenue Code of 1986, as amended.
1.3. "Constituent Corporations" refers to Xxxxxxxxx and Future Com,
collectively.
1.4. "Delaware Law" refers to the Delaware General Corporation Law.
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1.5. "Effective Date" refers to 12:01 a.m. on November 4, 1999, at
which time all rights and obligations of the parties shall accrue pursuant to
the terms of this Agreement.
1.6. "Exchange" refers to the exchange of 4,000,000 shares of
Xxxxxxxxx Common Stock for all the issued and outstanding Future Com Common
Stock pursuant to the terms and conditions of this Agreement.
1.7. "Execution Date" refers to the date on which this Agreement is
signed by the last to sign of all the signatories to this Agreement.
1.8. "Florida Law" refers to the Florida General Corporation Act.
1.9. "Future Com " refers to Future Com South Florida, Inc., a Florida
corporation.
1.10. "Future Com Common Stock" refers to the $1.00 par value common
stock of Future Com.
1.11. "Future Com Shareholders" means Xxxxxxx Xxxx and Xxxxxx Xxxxxx,
who at the Effective Date and the Closing will together own all the outstanding
Future Com Common Stock.
1.12. "Future Com's Business" refers to the operation of Specialized
Mobil Radio systems as carried on throughout the United States by Future Com
prior to the Closing and any other business in which Future Com is engaged or in
which Future Com plans to engage following the Closing.
1.13. "Xxxxxxxxx" refers to Xxxxxxxxx Technologies Corporation, a
Delaware corporation.
1.14. "Xxxxxxxxx Common Stock" refers to the $.001 par value common
stock of Xxxxxxxxx.
1.15. "Xxxxxxxxx'x Business" refers to the development and marketing
of computer data security devices as carried on throughout the United States by
Xxxxxxxxx prior to the Closing and any other business in which Xxxxxxxxx is
engaged or in which Xxxxxxxxx plans to engage following the Closing.
1.16. "Material Adverse Change" or "Material Adverse Effect" means,
when used with respect to Xxxxxxxxx or Future Com, as the case may be, any
change or effect that is or, so far as can reasonably be determined, is likely
to be materially adverse to the assets, properties, condition (financial or
otherwise), business or results of operations of Xxxxxxxxx or Future Com, as the
case may be.
1.17. "1933 Act" refers to the Securities Act of 1933, as amended.
1.18. "1934 Act" refers to the Securities Exchange Act of 1934, as
amended.
1.19. "SEC" refers to the United States Securities And Exchange
Commission.
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1.20. "Subsidiary" means any corporation, partnership, joint venture
or other legal entity of which Xxxxxxxxx or Future Com, as the case may be
(either alone or through or together with any other Subsidiary), owns, directly
or indirectly, 50 percent or more of the stock or other equity interests the
holders of which are generally entitled to vote for the election of the board of
directors or other governing body of such corporation or other legal entity.
1.21. "Transfer Agent" refers to the American Stock Transfer And Trust
Co., located at 00 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
2. The Exchange; Additional Agreements.
2.1. Exchange. Subject to the terms and conditions hereof, at the
Closing, Xxxxxxxxx shall deliver to the Future Com Shareholders 4,000,000 shares
of Xxxxxxxxx Common Stock in exchange for all the issued and outstanding Future
Com Common Stock, with Xxxxxxxxx then being the sole shareholder of Future Com.
2.2. Effective Date. Subject to compliance by the Parties with the
covenants and agreements of, and satisfaction of the conditions contained in,
this Agreement, the Parties shall take all actions as are required by law to
make the Exchange effective. Upon the Closing of this Agreement, the Exchange
shall become effective as of the Effective Date.
2.3 Concurrent Agreements.
2.3.1. Xxxxxxxxx Employment Agreements. At the Closing, Xxxxxxxxx
and each of Xxxxxxx Xxxx ("Xxxx") and Xxxxxx Xxxxxx ("Xxxxxx") shall enter into
an Employment And Nonsolicitation Agreement substantially in the form attached
to and made a part of this Agreement as Exhibit A (the "Employment And
Nonsolicitation Agreement"). All material provisions of the Employment And
Nonsolicitation Agreements executed by Xxxxxxxxx, Xxxx and Xxxxxx, except for
provisions related to specific business activities of Xx. Xxxx and/or Xx.
Xxxxxx, shall be substantially similar to the employment agreements previously
executed by Xxxxxxxxx and each of Messrs. Xxxxxxx Xxxxx and Xxxxxxxxxxx Xxxxxxx,
which agreements are attached to this Agreement as Exhibit B and which provide,
among other things, that (i) payment to Messrs. Xxxx and Xxxxxx by Xxxxxxxxx
shall be deferred until such time as funds become available to Xxxxxxxxx which,
in Xxxxxxxxx'x sole discretion, are sufficient to provide for payment to
Xxxxxxxxx'x employees without jeopardizing Xxxxxxxxx'x ongoing operations, and
(ii) Messrs. Xxxx and Xxxxxx shall agree not to compete in the Specialized
Mobile Radio ("SMR") industry in the United States without Xxxxxxxxx'x prior
approval.
2.3.2. [Intentionally left blank.]
2.3.3. Insurance Agreements.
2.3.3.1.D & O And Key Man Insurance. Promptly after the
Closing, Xxxxxxxxx shall use its reasonable best efforts to obtain and
thereafter maintain a directors' and officers' insurance policy covering errors
or omissions of Xxxxxxxxx'x directors and officers acting in such capacities, in
the highest coverage amount available for a premium not to exceed $30,000 per
year.
2.3.3.2.Medical Policies. Future Com shall maintain in
effect the medical insurance policies set forth on Schedule 2.3.3.2 for the
employees identified on that Schedule; provided however, that Xxxxxxxxx or
Future Com may substitute other medical policies with substantially the same
coverages and benefits as the policies set forth on Schedule 2.3.3.2.
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2.3.4. Expenses; Indebtedness. Each of Gale, Blanck, Xxxxxxxxx
and Future Com agree as follows:
2.3.4.1.Xxxx and Xxxxxx will jointly and severally pay, or
reimburse Xxxxxxxxx and Future Com for, all costs incurred by Xxxxxxxxx and
Future Com for maintenance of all SMR systems owned or operated by Future Com
for the one-year period beginning on the Closing date;
2.3.4.2.Future Com shall be responsible for all lease
payments in connection with Future Com's offices, office furniture, equipment
and telephones, up to a maximum of $10,000 per month, for the one-year period
beginning on the Closing date;
2.3.4.3.Future Com shall be responsible for all expenses
paid towards insurance premiums paid in connection with the liability insurance
maintained on Future Com's properties for the one-year period beginning on the
Closing date;
2.3.4.4.Future Com shall be responsible for all expenses
associated with telephone communications, including cellular telephones and long
distance costs, incurred by Xxxxxxxxx and/or Future Com in connection with
Future Com's properties for the one-year period beginning on the Closing date;
2.3.4.5.Future Com agrees to reimburse Xxxx and Xxxxxx, up
to a maximum of $850 per month for each of Xxxx and Xxxxxx, for expenses
incurred by Xxxx and Xxxxxx in connection with the lease by Xxxx and Xxxxxx of
one automobile each for use by them in furtherance of Xxxxxxxxx'x Business and
Future Com's Business; and
2.3.4.6.Future Com and each of Uni-Call Communications, Inc.
and Communications Concepts, Inc. (the "Debt Holders") shall enter into an
agreement substantially in the form attached to this Agreement as Exhibit D and
pursuant to which Future Com shall agree to repay $150,000 owed by Future Com to
each of the Debt Holders.
2.3.5. Purchase Of SMR Licenses. At the Closing, Xxxx and Xxxxxx
will enable Xxxxxxxxx and Future Com to enter into one or more agreements (the
"SMR License Purchase Agreements") for the purchase of the four SMR frequency
licenses described on Schedule 2.3.5. attached to and made a part of this
Agreement (the "SMR Licenses") at a purchase price of $175,000 per SMR License
payable in the form of restricted Xxxxxxxxx Common Stock at a rate equal to the
last closing bid price of the Xxxxxxxxx Common Stock quoted on the OTC Bulletin
Board on the Closing date, but in no event less than $.50 per share, as well as
warrants to purchase an equal number of shares of restricted Xxxxxxxxx Common
Stock at an exercise price equal to the rate per share described in the
preceding clause, with all the warrants to expire at 5:00 p.m. Austin, Texas
time on the first anniversary of the Closing date. The shares and options shall
be delivered to the respective sellers of the SMR Licenses upon the receipt by
Future Com of the approval of the FCC to the transfer of the respective SMR
Licenses to Future Com. The SMR License Purchase Agreement shall be in the form
of Exhibit E attached to and made a part of this Agreement.
2.3.6. Purchase Of Satellite License. Also at the Closing, Xxxx
and Xxxxxx will enable Xxxxxxxxx and Future Com to enter into an additional
agreement (the "Satellite License Purchase Agreement") pursuant to which
Xxxxxxxxx shall purchase the dedicated satellite license described on Schedule
2.3.6. attached to and made a part of this Agreement (the "Satellite License")
at a purchase price of 75,000 restricted shares of Xxxxxxxxx Common Stock and
options to purchase 75,000 restricted shares of Xxxxxxxxx Common Stock at an
exercise price of $.50 per share, all of which options shall expire at 5:00
4
p.m., Austin, Texas time on the third anniversary of the Closing date. The
shares and options shall be delivered to the seller of the Satellite License
upon the receipt by Future Com of the approval of the FCC to the transfer of the
Satellite License to Future Com. In addition, in order to obtain the release of
all security interests and other interests in the Satellite License, Future Com
shall pay 1,300,000 restricted shares of Xxxxxxxxx Common Stock and warrants to
purchase an equal number of shares of restricted Xxxxxxxxx Common Stock at an
exercise price of $.50 per share, with all the warrants to expire at 5:00 p.m.
Austin, Texas time on the first anniversary of the Closing date. The shares and
options shall be delivered upon the receipt by Future Com of the approval of the
FCC to the transfer of the Satellite License to Future Com The Satellite License
Purchase Agreement and release agreement shall be in the forms attached to and
made a part of this Agreement as Exhibit F.
2.3.7. Purchase Of Additional SMR Licenses. Effective as of the
date of the Closing, Xxxx and Xxxxxx shall grant to Future Com the right to
purchase additional SMR frequency licenses (the "Additional Licenses") that are
owned by or presented to Xxxx or Xxxxxx or owned by or presented to an entity in
which Xxxx or Xxxxxx has a direct or indirect five percent or greater interest
or for which Xxxx or Xxxxxx serves as an officer, director, manager or partner
(the "Additional License Owner"). With the approval of Xxxxxxxxx, Future Com
shall have the right to purchase the Additional Licenses at a price equal to the
cost of the Additional License to the Additional License Owner payable in the
form of restricted Xxxxxxxxx Common Stock at a rate equal to the last closing
bid price of the Xxxxxxxxx Common Stock quoted on the OTC Bulletin Board on the
date of acquisition of the Additional License by Future Com but in no event less
than $.50 per share, as well as warrants to purchase an equal number of shares
of restricted Xxxxxxxxx Common Stock at an exercise price equal to the rate per
share described in the preceding clause, with all the warrants to expire at 5:00
p.m. Austin, Texas on the first anniversary of the date of the acquisition of
the Additional License by Future Com.
2.3.8. Registration Rights Agreement. At the Closing, each of
Gale, Blanck, Xxxxxxx Xxxx, Xxxxxxx Xxxxx and Xxxxxxxxxxx X. Xxxxxxx shall enter
into an agreement with Xxxxxxxxx in the form of Exhibit G attached to and made a
part of this Agreement concerning the registration and disposition of their
respective shares of Xxxxxxxxx Common Stock.
2.3.9. Option Agreements. At the Closing, Xxxxxxxxx shall grant
to the individuals set forth below options to purchase the number of shares of
restricted Xxxxxxxxx Common Stock set forth opposite their respective names,
which options shall provide for an exercise priced $.80 per share and all of
which options shall expire at 5:00 p.m., Austin, Texas time on the first
anniversary of Closing date, and which options shall be evidenced by a stock
option agreement in the form of Exhibit C attached to and made a part of this
Agreement:
Option Recipient Option Shares
---------------- -------------
Xxxxxxx Xxxxxxx 100,000
Xxxxx Xxxx 100,000
Xxxxx Xxxxx 50,000
Xx Xxxxxxx 50,000
Xxx Xxxxxxx 50,000
Xxxxxxx Xxxxxxxx 50,000
Total: 600,000
=======
2.4. Covenant Not To Compete.
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2.4.1. Each of Xxxx and Xxxxxx agrees that, until the later to
occur of two (2) years after the Effective Date and one (1) year following the
termination of his respective employment with or engagement as a consultant to
Xxxxxxxxx or Future Com, that, without the prior written consent of Xxxxxxxxx,
he will not directly or indirectly engage in (whether as a principal,
consultant, proprietor, sales representative, shareholder, partner, director or
otherwise), or have any ownership interest in, or participate in the financing,
operation, management or control of, any person, firm, corporation or business
that engages in a "Restricted Business" in a "Restricted Territory" (as defined
below). It is agreed that ownership of no more than one percent (1%) of the
outstanding voting stock of a publicly traded corporation shall not constitute a
violation of this provision.
2.4.2. As used herein, the terms:
2.4.2.1."Restricted Business" shall mean any business
selling any products or services in competition with the business of Xxxxxxxxx
or Future Com or with the Xxxxxxxxx Business or the Future Com Business or with
the business of any entity controlled by or under common control with Xxxxxxxxx
or Future Com, as of the Effective Date and/or as of any date during the period
set forth in Section 2.4.1.
2.4.2.2."Restricted Territory" shall mean the United States
or anywhere in the world outside the United States where Xxxxxxxxx or Future Com
or any entity controlled by or under common control with Xxxxxxxxx or Future Com
conducts business.
2.4.3. If any restriction set forth in this Section 2.4 is found
by any court of competent jurisdiction to be unenforceable because it extends
for too long a period of time or over too great a range of activities or in too
broad a geographic area, it shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable.
2.4.4. At the Closing, Xxxxxxxxx shall cause each of Xxxxxxx
Xxxx, Xxxxxxx Xxxxx and Xxxxxxxxxxx X. Xxxxxxx to enter into agreements
providing for the same restrictions imposed on Xxxx and Xxxxxx pursuant to this
Section 2.4., which agreements shall be in the form of Exhibit H attached to and
made a part of this Agreement.
3. Directors. At the Effective Date, the officers and directors of Future
Com shall resign and Xxxxxxxxx, as the then-owner of all the outstanding Future
Com Common Stock, shall cause the following to be elected as the directors of
Future Com beginning as of the Effective Date: Xxxxxxx Xxxx, Xxxxxx Xxxxxx,
Xxxxxxx Xxxx, Xxxxxxx Xxxxx and Xxxxxxxxxxx X. Xxxxxxx (the "New Board"). The
New Board shall elect the following to serve in the offices indicated beginning
as of the Effective Date: Xxxxxxx Xxxx - President and Chief Executive Officer;
Xxxxxx Xxxxxx - Secretary and Treasurer; and Xxxxx Xxxx - Chief Financial
Officer.
4. Exchange Of Shares.
4.1. Exchange Of Shares. At the Closing the following shall occur:
4.1.1. Xxxxxxxxx shall deliver to each Future Com Shareholder
2,000,000 shares of restricted Xxxxxxxxx Common Stock in exchange for each
outstanding share of Future Com Common Stock owned by that Future Com
Shareholder, and each Future Com Shareholder shall deliver to Xxxxxxxxx a Future
Com stock certificate representing all shares of Future Com Common Stock owned
by that shareholder together with a duly executed stock power and assignment
transferring those shares to Xxxxxxxxx.
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4.1.2. No fractional shares of Xxxxxxxxx Common Stock will be
issued. Each shareholder of Future Com shall receive the number of shares of
Xxxxxxxxx Common Stock set forth below:
Shares of Future Com Shares of Xxxxxxxxx
Future Com Shareholder Common Stock Held Common Stock to be Issued
---------------------- ----------------- -------------------------
Xxxxxxx Xxxx 2,500 2,000,000
Xxxxxx Xxxxxx 2,500 2,000,000
----- ---------
Totals: 5,000 4,000,000
===== =========
4.2. Mechanics Of Exchange. At the Closing, each Future Com
Shareholder who is the holder of a certificate that immediately prior to the
Effective Date represented outstanding shares of Future Com Common Stock shall
surrender that certificate, together with any other reasonably required
documents, to Xxxxxxxxx, and that Future Com Shareholder shall be entitled, upon
surrender, to receive in exchange therefor certificates representing shares of
Xxxxxxxxx Common Stock in accordance with the terms of this Agreement. If any
certificate for Xxxxxxxxx Common Stock is to be issued in a name other than that
in which the certificate for shares of Future Com Common Stock surrendered in
exchange therefor is registered, it shall be a condition of that exchange that
the person requesting the exchange shall pay any transfer or other taxes or fees
required by reason of the issuance of certificates for Xxxxxxxxx Common Stock in
a name other than that of the registered holder of the Future Com certificate
surrendered. If any Future Com certificates representing shares of Future Com
Common Stock shall have been lost or destroyed, the Future Com Shareholder who
is the registered owner of those shares may obtain the certificate representing
the Xxxxxxxxx Common Stock to which that Future Com Shareholder is entitled by
reason of the consummation of the Exchange, provided that such Future Com
Shareholder delivers to Xxxxxxxxx and the Transfer Agent a statement certifying
to the loss or destruction and providing for indemnity or in certain cases a
bond satisfactory to Xxxxxxxxx and the Transfer Agent indemnifying Xxxxxxxxx and
the Transfer Agent against any loss or expense either of them may incur if the
lost or destroyed certificates are thereafter presented to Xxxxxxxxx or the
Transfer Agent for exchange.
5. Representations And Warranties Of Xxxxxxxxx. Xxxxxxxxx represents and
warrants to Future Com and the Future Com Shareholders as follows:
5.1. Organization And Standing. Xxxxxxxxx is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. Xxxxxxxxx has the requisite corporate power to own and operate its
properties and assets, and to carry on its business as currently conducted and
as proposed to be conducted. Xxxxxxxxx is licensed or qualified as a foreign
corporation and is in good standing in every state, or other jurisdiction,
wherein the character of its property or the nature of its activities makes such
licensing or qualification necessary and wherein the failure to be so licensed
or qualified would have a Material Adverse Effect on the business and operations
of Xxxxxxxxx taken as a whole. Xxxxxxxxx has furnished Future Com or Future
Com's counsel with copies of its Certificate Of Incorporation and Bylaws. These
copies are true, correct and complete in the form in which they now exist and
contain all amendments through the date of this Agreement.
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5.2. Capitalization. Xxxxxxxxx'x entire authorized capital stock
consists of 100,000,000 shares of Xxxxxxxxx Common Stock, par value $.001 per
share. At August 1, 1999 there were 68,248,601 shares of Xxxxxxxxx Common Stock
issued and outstanding. There are no shares of Xxxxxxxxx'x preferred stock
outstanding.
5.3. Authority; Non-Contravention. Xxxxxxxxx has the requisite power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement, the
performance by Xxxxxxxxx of its obligations hereunder, and the consummation of
the transactions contemplated hereby have been duly authorized by its Board Of
Directors, and, except for the corporate filings required by state law, no other
corporate proceedings on the part of Xxxxxxxxx are necessary to authorize this
Agreement and the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Xxxxxxxxx and (assuming the due
authorization, execution and delivery hereof by Future Com) constitutes a valid
and binding obligation of Xxxxxxxxx enforceable against Xxxxxxxxx in accordance
with its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other
similar laws of general applicability relating to or affecting the enforcement
of creditors' rights and by the effect of general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law). The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby and compliance with the
provisions hereof will not, conflict with, or result in any violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancellation or acceleration of any obligation or to
the loss of a material benefit under, or result in the creation of any lien,
security interest, charge or encumbrance upon any of the properties or assets of
Xxxxxxxxx under any provision of (i) the Certificate Of Incorporation or Bylaws
(true and complete copies of which as of the date hereof have been delivered to
Future Com) of Xxxxxxxxx, (ii) any loan or credit agreement, note, bond,
mortgage, indenture, lease, other agreement, instrument, permit, concession,
franchise or license applicable to Xxxxxxxxx, or (iii) any judgment, order,
decree, statute, law, ordinance, rule or regulation applicable to Xxxxxxxxx or
to any of its properties or assets, other than, in the case of clauses (ii) or
(iii), any such conflicts, violations, defaults, right, liens, security
interests, charges or encumbrances that, individually or in the aggregate, would
not have a Material Adverse Effect on Xxxxxxxxx, materially impair the ability
of Xxxxxxxxx to perform its obligations hereunder, or prevent the consummation
of any of the transactions contemplated hereby.
5.4. Governmental Consents. Except for actions that have been or will
be taken prior to the Closing, no consent, approval, order or authorization of,
or registration, qualification, designation, declaration or filing with, any
governmental or regulatory authority on the part of Xxxxxxxxx is required in
connection with the consummation of the transactions contemplated by this
Agreement. As of the Closing, there will be no consent of any third party that
has not been obtained and that is required in order to consummate the
transactions being consummated at the Closing.
5.5. Disclosure. Neither this Agreement nor any Schedule, Exhibit or
certificate delivered in accordance with the terms hereof or any document or
statement in writing which has been supplied by or on behalf of Xxxxxxxxx, or by
any of the directors or officers of Xxxxxxxxx, in connection with the
transactions contemplated hereby, contains any untrue statement (attributable to
Xxxxxxxxx) of a material fact. There is no fact known to Xxxxxxxxx which would
cause a Material Adverse Effect on the business, prospects or financial
condition of Xxxxxxxxx or any of Xxxxxxxxx'x properties or assets taken as a
whole, which has not been set forth in this Agreement or in the Schedules or
Exhibits or certificates, SEC filings by Xxxxxxxxx, if any, or statements in
writing furnished in connection with the transactions contemplated by this
Agreement. Xxxxxxxxx has fully provided Future Com with all the written
8
information that Future Com has requested for the purpose of deciding whether to
consummate the Exchange. Xxxxxxxxx agrees that, during the period between
execution of this Agreement and the date of the Closing, Xxxxxxxxx will provide
all additional information that Future Com reasonably requests.
5.6. Reorganization. To Xxxxxxxxx'x knowledge, it has not taken any
action or failed to take any action which action or failure to take action would
jeopardize the qualification of the Exchange as a reorganization within the
meaning of Section 368(a) of the Code. Without limiting the foregoing (i)
Xxxxxxxxx has no plan or intention: to cause Future Com to issue any shares of
stock following the Exchange; to reacquire any of the Xxxxxxxxx Common Stock
issued in the Exchange; to liquidate Future Com; to merge Future Com with or
into another corporation; to sell or otherwise dispose of any stock of Future
Com; or to cause Future Com to sell or otherwise dispose of (except in the
ordinary course of business) any of its assets, (ii) following the Exchange,
Future Com will continue at least one significant historic business line of
Future Com, or use at least a significant portion of Future Com's historic
business assets in a business, in each case within the meaning of Treas. Reg.
ss. 1.368-1(d), and (iii) Xxxxxxxxx does not own, nor has Xxxxxxxxx owned during
the past five years, any capital stock of Future Com.
6. Representations And Warranties Of Future Com. Future Com agrees,
represents and warrants to Xxxxxxxxx as follows:
6.1. Organization And Standing. Future Com is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Florida. Future Com has the requisite corporate power to own and operate its
properties and assets, and to carry on its business as currently conducted and
as proposed to be conducted. Future Com is licensed or qualified as a foreign
corporation and is in good standing in every state, or other jurisdiction,
wherein the character of its property or the nature of its activities makes such
licensing or qualification necessary and wherein the failure to be so licensed
or qualified would have a Material Adverse Effect on the business and operations
of Future Com taken as a whole.
6.2. No Subsidiaries. Future Com has no partially or wholly owned,
direct or indirect, Subsidiaries.
6.3. Capitalization. Future Com's entire authorized capital stock
consists solely of 5,000 shares of Future Com Common Stock. As of the date of
this Agreement and the date of Closing, there are and will be 5,000 shares of
Future Com Common Stock issued and outstanding, all of which are and will be
held by the Future Com Shareholders in the amounts set forth in Section 1.12 of
this Agreement. There are no shareholders of Future Com or owners of any equity
interests in Future Com other than the Future Com Shareholders.
Future Com has granted no warrant, call, option, convertible security or
other agreement or right (contingent or otherwise) to purchase or acquire any
Future Com Common Stock or any other capital stock of Future Com, and Future Com
has no other commitments to issue such warrant, call, option, convertible
security or other right. Future Com has no obligation, contingent or otherwise,
to purchase, redeem, or otherwise acquire any shares of Future Com's capital
stock or any interest therein or to pay any dividend or to make any other
distribution in respect thereof, except as permitted by this Agreement.
9
6.4. Authority; Non-Contravention. Future Com has the requisite power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement, the
performance by Future Com of its obligations hereunder and the consummation of
the transactions contemplated hereby have been duly authorized by its Board Of
Directors and by the Future Com Shareholders, and except for the corporate
filings required by state law, no other corporate proceedings on the part of
Future Com are necessary to authorize this Agreement and the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by Future Com and (assuming the due authorization, execution and
delivery hereof by Xxxxxxxxx) constitutes a valid and binding obligation of
Future Com enforceable against Future Com in accordance with its terms, except
to the extent enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or other similar laws of general
applicability relating to or affecting the enforcement of creditors' rights and
by the effect of general principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law). The execution
and delivery of this Agreement do not, and the consummation of the transactions
contemplated hereby and compliance with the provisions hereof will not, conflict
with, or result in any violation of, or default (with or without notice or lapse
of time, or both) under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to the loss of a material benefit under, or
result in the creation of any lien, security interest, charge or encumbrance
upon any of the properties or assets of Future Com under, any provision of (i)
the Articles Of Incorporation or Bylaws (true and complete copies of which as of
the date hereof have been delivered to Xxxxxxxxx) of Future Com, (ii) any loan
or credit agreement, note, bond, mortgage, indenture, lease or other agreement
instrument, permit, concession, franchise or license applicable to Future Com,
or (iii) any judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to Future Com or any of its properties or assets, other
than, in the case of clauses (ii) or (iii), any such conflicts, violations,
defaults, right, liens, security interests, charges or encumbrances that,
individually or in the aggregate, would not have a Material Adverse Effect on
Future Com, materially impair the ability of Future Com to perform its
obligations hereunder or prevent the consummation of any of the transactions
contemplated hereby.
6.5. Contracts And Commitments. Other than this Agreement and the
agreements and documents contemplated herein, attached hereto as Schedule 6.5 is
a list of all agreements, contracts, indebtedness, liabilities and other
obligations known to Future Com to which Future Com is a party or by which
Future Com is bound or subject, which are material to the conduct and operations
of its business. True and complete copies of such agreements and obligations, if
extant, have been made available for inspection by Xxxxxxxxx at the offices of
Future Com. Except as set forth on Schedule 6.5, all of the contracts and other
agreements listed on Schedule 6.5 are valid and binding upon Future Com in
accordance with their terms, and neither Future Com nor, to the knowledge of
Future Com, any other party is in default, nor has Future Com received or sent
notice of default or of any unresolved claim, under any such contracts or other
agreements. Except as separately identified on Schedule 6.5, no approval or
consent of any person is needed in order that the contracts and other agreements
set forth on Schedule 6.5 or on any other Schedule continue in full force and
effect following the consummation of the transactions contemplated by this
Agreement.
6.6. Compliance With Other Instruments. Future Com is not in violation
of any term of its Articles Of Incorporation or Bylaws, or in any respect
material to the business and operations of Future Com taken as a whole of any
contract, agreement, instrument, judgment, decree, or order, except as set forth
on Schedule 6.6 hereto. Except as set forth on Schedule 6.6, to the best of
Future Com's knowledge Future Com is not in violation of any material federal,
state, or local law, ordinance, statute, rule or regulation or any other
material requirement of any governmental or regulatory body, court or arbitrator
10
applicable to the business of that entity. Future Com holds, or believes that in
the ordinary course of business it will be able to obtain, all licenses,
permits, orders and approvals of any foreign, federal, state or local
governmental or regulatory bodies that are material to or necessary for the
conduct of the business of Future Com (collectively, "Permits"). All Permits are
in full force and effect; and no proceeding is pending or, to the knowledge of
Future Com, threatened to revoke or limit any Permit.
6.7. Litigation And Claims. Except as shown on Schedule 6.7 hereto,
there is no action, suit, claim or legal, administrative or arbitral proceeding
or investigation (whether or not the defense thereof or liabilities in respect
thereof are covered by insurance) pending and known to Future Com or known and
currently threatened against Future Com or any properties or assets of any of
them, nor to the knowledge of Future Com is there a basis therefor which
questions the validity of this Agreement or the right of Future Com to enter
into it, or to consummate the transactions contemplated hereby, or which might
result, either individually or in the aggregate, in any Material Adverse Change
in the assets, condition, affairs or prospects of Future Com, financially or
otherwise, nor does Future Com know of any meritorious basis for the foregoing.
Neither Future Com nor any properties or assets of Future Com is a party or
subject to the provisions of any order, writ, injunction, judgment, award or
decree of any court or government or regulatory agency or instrumentality or
arbitration tribunal of a material nature that has not been disclosed in
Schedule 6.7. All notices required to have been given to any insurance company
listed as insuring against any action, suit or claim set forth on Schedule 6.7
have been timely and duly given and no insurance company has asserted, orally or
in writing, that such claim is not covered by the applicable policy relating to
such claim.
6.8. Insurance. Future Com maintains the insurance coverage or
policies described on Schedule 6.8.
6.9. Governmental Consents. Except for actions that have been or will
be taken prior to the Closing, no consent, approval, order or authorization of,
or registration, qualification, designation, declaration or filing with, any
governmental or regulatory authority on the part of Future Com is required in
connection with the consummation of the transactions contemplated by this
Agreement. As of the Closing, there will be no consent of any third party that
has not been obtained and that is required in order to consummate the
transactions being consummated at the Closing.
6.10. Disclosure. Neither this Agreement nor any Schedule, Exhibit or
certificate delivered in accordance with the terms hereof or any document or
statement in writing which has been supplied by or on behalf of Future Com, or
by any of the directors or officers of Future Com in connection with the
transactions contemplated hereby, contains any untrue statement (attributable to
Future Com) of a material fact. There is no fact known to Future Com which would
cause a Material Adverse Effect on the business, prospects or financial
condition of Future Com or any of its respective properties or assets taken as a
whole, which has not been set forth in this Agreement or in the Schedules or
Exhibits or certificates or statements in writing furnished in connection with
the transactions contemplated by this Agreement. Future Com has fully provided
Xxxxxxxxx with all the written information that Xxxxxxxxx has requested for the
purpose of deciding whether to consummate the Exchange. Future Com agrees that,
during the period between execution of this Agreement and the date of the
Closing, Future Com will provide all additional information that Xxxxxxxxx
reasonably requests.
6.11. Actions. Except as otherwise set forth in this Agreement or the
Schedules hereto, during the period from the Execution Date to and including the
date of Closing, Future Com will not have (a) declared or paid any dividends, or
11
authorized or made any distribution upon or with respect to any class or series
of its capital stock or redeemed, purchased or otherwise acquired any shares of
its capital stock or any option, warrant or other right to purchase or acquire
any such shares, (b) incurred or increased the amount of any indebtedness for
money borrowed or incurred any other liabilities or obligations, (c) made any
loans or advances to any officer, director or shareholder, (d) sold,
transferred, exchanged or otherwise disposed of any of its assets or rights, (e)
permitted any of its assets to be subjected to any mortgage, pledge, lien,
security interest, encumbrance, restriction or charge of any kind, (f) made any
capital expenditure or commitment therefor, (g) made any bonus or profit sharing
distribution or payment of any kind, (h) written-off as uncollectable any notes
or accounts receivable, (i) granted any increase in the rate of wages, salaries,
bonuses or other remuneration of any officer, director, employee or consultant,
(j) cancelled or waived any claims or rights, (k) made any change in any method
of accounting or auditing practice, (l) otherwise conducted its business or
entered into any transaction, other than in the usual and ordinary manner and in
the ordinary course of its business, or (m) agreed, whether or not in writing,
to do any of the foregoing.
6.12. Taxes. All income, excise, occupation, franchise, and other
taxes, duties or charges levied, assessed or imposed upon Future Com by the
United States or by any government, state, municipality or governmental
subdivision have been duly paid or adequately provided for or are being timely
and properly contested, and all income, excise, franchise and other tax reports
or other reports required by law or regulation have been duly filed or
extensions have been duly obtained. All federal, state or other tax returns of
Future Com have been filed by Future Com as required with the appropriate
governmental agency and all assessments with respect to such periods have been
paid or adequately provided for or are being timely and properly contested.
Since its inception on August 9, 1999, (a) no audit of any federal, state, local
or other tax returns of Future Com has been conducted, is in progress or, to
Future Com's knowledge, has been threatened, (b) Future Com has not waived any
statute of limitations with respect to any of its tax liabilities, including,
without limitation, liability for federal income or any other taxes for any
period prior to the date hereof, and (c) no consents have been filed pursuant to
Section 341(f) of the Code by Future Com or any transferor corporation to Future
Com.
6.13. Employees; No Retirement Obligations. The names of all the
employees of Future Com are set forth in Schedule 6.16. Future Com has no
obligation under any pension, retirement or similar plan or obligation, whether
of a legally binding nature or in the nature of informal understandings. Future
Com has no employment contracts, collective bargaining agreements, health,
medical, long-term disability, dental, overriding royalty plans, or pension,
bonus, profit-sharing, stock option, or 401(k) plans, or other agreements
providing for employee remuneration or benefits, or any consulting, commission
or fee agreements with independent contractors, except for relationships with
accounting and law firms that may be terminated by Future Com at any time
without payment of any penalty or other amounts other than fees and expenses
previously incurred.
6.14. Books And Records. With respect to matters occurring since the
inception of Future Com, the minute books of Future Com contain complete and
accurate records of all meetings and other corporate actions of Future Com's
shareholders, Board Of Directors and all committees, if any, appointed by the
Board Of Directors.
6.15. Copies Of Documents. Future Com has caused to be made available,
to the extent reasonably requested by Xxxxxxxxx, for inspection and copying by
Xxxxxxxxx and its advisors, true, complete and correct copies of all documents
referred to in any Schedule furnished by Future Com to Xxxxxxxxx.
12
6.16. Employees, Officers, Directors, And Consultants. Schedule 6.16
sets forth the name and total annual compensation, from Future Com, of employee,
each officer and director and of each other consultant, agent or other
representative of Future Com other than day laborers and contract employees.
Future Com has no commitment or agreement to continue to employ or retain, or to
compensate in any manner, any such person after the Effective Date and, as of
the Effective Date, Future Com is not indebted to any such person and, also as
of the Effective Date, Future Com has no other liability to any such person.
None of such persons has made a written threat to Future Com or to any of Future
Com's officers or directors concerning such person's relationship with Future
Com.
6.17. Documents Delivered. Future Com has furnished to Xxxxxxxxx for
its examination true and complete copies of the following: (a) the Articles Of
Incorporation, as amended, and the Bylaws, as amended, of Future Com; (b) the
minute book of Future Com, containing all records required to be set forth
concerning all proceedings, consents, actions and meetings of the shareholders
and the Board of Directors of Future Com; and (c) all material permits, orders,
and consents (issued by a governmental or quasi-governmental authority) received
by Future Com, or with respect to any security of Future Com, and all
applications for such permits, orders and consents, except for permits, orders
and consents, or applications therefor, issued to or received by Future Com in
the ordinary course of Future Com's business. No amendments will be made to the
Articles Of Incorporation or Bylaws of Future Com prior to the Closing without
Xxxxxxxxx'x consent.
6.18. No Material Changes. Except as set forth in Schedule 6.18, from
the Execution Date through the date of the Closing, none of the following has
occurred:
6.18.1. Any material transaction by Future Com;
6.18.2. Any capital expenditure in excess of $5,000 by Future
Com;
6.18.3. Any changes in the condition (financial or otherwise),
liabilities, assets, or business of Future Com that, when considered
individually or in the aggregate, have a Material Adverse Effect except for
general political, economic or industry changes that Future Com reasonably
believes Xxxxxxxxx already has knowledge of from sources other than Future Com;
6.18.4. The destruction of, damage to, or loss of any asset of
Future Com (regardless of whether covered by insurance) as a direct or indirect
result of the action or inaction of Future Com that, when considered
individually or in the aggregate, has a Material Adverse Effect upon the
condition (financial or otherwise) or business of Future Com;
6.18.5. Any labor matters or other events or conditions of any
character that, when considered individually or in the aggregate, have a
Material Adverse Effect upon the condition (financial or otherwise) of Future
Com except for general political, economic or industry changes that Future Com
reasonably believes Xxxxxxxxx already has knowledge of from sources other than
Future Com;
6.18.6. Any change in accounting methods or practices (including,
without limitation, any change in depreciation or amortization policies or
rates) by Future Com;
6.18.7. Any issuance or sale or authorization for issuance or
sale of additional shares of any class of capital stock, or subscriptions,
options (including employee stock options), warrants, rights or convertible
securities or other agreements obligating Future Com to issue shares of its
capital stock;
13
6.18.8. The declaration, setting aside, or payment of a dividend
or other distribution with respect to the capital stock of Future Com, or any
direct or indirect redemption, purchase or other acquisition by Future Com of
any of its shares of capital stock, except as otherwise permitted in this
Agreement;
6.18.9. Any increase in the salary or other compensation payable
or to become payable by Future Com to any of its officers or directors, or the
declaration, payment, or commitment or obligation of any kind for the payment by
Future Com of a bonus or other additional salary or compensation to any such
person;
6.18.10. The amendment or termination of any contract, agreement,
or license to which Future Com is directly a party, except for amendment or
termination of customer contracts in the ordinary course of Future Com's
business.
6.18.11. Any loan by Future Com to any person or entity, or the
guaranteeing by Future Com of any loan;
6.18.12. Any mortgage, pledge or other encumbrance of any asset
of Future Com by Future Com or as a direct or indirect result of the action or
inaction of Future Com;
6.18.13. The waiver or release of any right or claim of Future
Com by Future Com;
6.18.14. Any other events or conditions of any character within
the knowledge of Future Com that, when considered individually or in the
aggregate, have or might reasonably be expected to have a Material Adverse
Effect on the condition (financial or otherwise), business or assets of Future
Com except for general political, economic or industry events or conditions that
Future Com reasonably believes Xxxxxxxxx already has knowledge of from sources
other than Future Com;
6.18.15. The issuance or sale by Future Com of any shares of its
capital stock of any class, or of any other of its securities;
6.18.16. The granting, by Future Com, exercise or expiration of
options or other rights to purchase securities of Future Com; or
6.18.17. Any agreement by Future Com to do any of the things
described in this Section 6.18.
6.19. Assets; Undisclosed Liabilities. Schedule 6.19 to this Agreement
sets forth all the assets and liabilities of Future Com. Notwithstanding any
other provision of this Agreement, at the Effective Date, except as provided for
in Schedule 6.19, Future Com does not have any debt, liability or obligation of
any nature, whether accrued, absolute, contingent, or otherwise, and whether due
or to become due, including any debt, liability or obligation relating to or
arising out of any act, transaction, circumstance or state of facts that
occurred or existed on or before the Execution Date or the date of Closing.
14
6.20 No Encumbrances. All of Future Com's interests in tangible and
intangible property are free and clear of restrictions on or conditions to
transfer or assignment, and free and clear of liens, pledges, charges,
encumbrances, equities, claims, conditions, or restrictions, except for (a)
those restrictions, conditions or liens disclosed in Schedule 6.20 to this
Agreement; (b) the lien of current taxes not yet due and payable; and (c)
matters that, in the aggregate, are not substantial and do not materially
detract from or interfere with the present or intended use of these assets, or
do not materially impair the business operations of Future Com. Future Com does
not own any real property. Future Com does not occupy any real property in
violation of any law, regulation or decree.
6.21. No Encumbrances On Future Com Common Stock. The Future Com
Common Stock being exchanged by the Future Com Shareholders is owned by the
Future Com Shareholders free and clear of any liens, claims, encumbrances or
restrictions of any kind, and none of those shares is subject to options,
rights, warrants, or other agreements or commitments by which the Future Com
Shareholders are or may become obligated to transfer those shares of Future Com
Common Stock other than pursuant to this Agreement.
6.22. Reorganization. To the knowledge of Future Com, Future Com has
not taken any action or failed to take any action, which action or failure to
take action would jeopardize the qualification of the Exchange as a
reorganization within the meaning of Section 368(a) of the Code. Without
limiting the foregoing: (i) to the knowledge of the executive officers of Future
Com, there is no plan or intention on the part of the holders of Future Com
Common Stock to sell, exchange, or otherwise dispose of a number of shares of
Xxxxxxxxx Common Stock that would cause paragraph 2 of Section 7.03 of Rev.
Proc. 77-37 (as amplified) not to be true as applied to the Exchange, and of the
outstanding Future Com Common Stock, (ii) as of the Effective Date, Xxxxxxxxx
will hold "substantially all" of Future Com's properties within the meaning of
Section 368(a)(2)(D) of the Code and Rev. Proc. 77-37 (as amplified), and (iii)
there is no intercorporate indebtedness between Future Com and Xxxxxxxxx.
6.23. Restricted Stock. Each of the Future Com Shareholders
understands and agrees that the issuance of the shares of Xxxxxxxxx Common Stock
has not been registered under federal or state securities laws and the shares of
Xxxxxxxxx Common Stock are "restricted" securities as defined in Rule 144 under
the 1933 Act. Each of the Future Com Shareholders understands and agrees that no
holder of Future Com Common Stock may sell, offer for sale, transfer, pledge or
hypothecate the shares of Xxxxxxxxx Common Stock received pursuant to this
Agreement in the absence of an effective registration statement covering that
transaction, under all applicable federal and state securities laws, unless that
transaction is exempt from registration under all applicable federal and state
securities laws, including an exemption under Rule 144 promulgated under the
0000 Xxx.
7. Certain Agreements.
7.1. Access And Information. Future Com shall give to Xxxxxxxxx and
its representatives, and Xxxxxxxxx shall give to Future Com and its
representatives, during normal business hours from the Execution Date until the
Effective Date, full access to all properties, books, contracts and records
(including tax returns and insurance policies) of or relating to Future Com or
Xxxxxxxxx, respectively, with all information reasonably requested by the other
Party. Except as agreed to by Future Com and Xxxxxxxxx, all information obtained
hereunder which is not otherwise public shall be held confidential and, in the
event of termination of this Agreement, all documents (including copies thereof)
obtained hereunder containing such information shall be destroyed or returned to
the Party from which they were obtained. At the Closing, Future Com shall
deliver to Xxxxxxxxx all books, contracts, and records (including tax returns
and insurance policies) of or relating to Future Com.
15
7.2. Shareholder Authorization. Future Com shall provide Xxxxxxxxx
with evidence of the approval of this Agreement and the transactions
contemplated by this Agreement by Future Com's shareholders in accordance with
all applicable laws and the governing documents of Future Com.
7.3. Operation Of Business. Each of Future Com and Xxxxxxxxx agrees
with the other that from the Execution Date to the Effective Date, except as
otherwise consented to or approved by the other in writing, each will operate
its business as presently operated in the ordinary course, and, consistent with
those operations, each of Future Com and Xxxxxxxxx will substantially comply
with all applicable legal and contractual obligations, except where
noncompliance will not cause a Material Adverse Effect on their respective
operations, and will use its best efforts consistent with past practices to
preserve the goodwill of its suppliers, customers and others with whom it has
business relationships; and neither Future Com nor Xxxxxxxxx, without the
written consent of the other Party, (a) shall institute nor use any methods of
purchase, sale, lease, management, accounting or operation that are inconsistent
with practices normally followed or that vary substantially from those methods
used by that Party as of the date of this Agreement, (b) will take any action
(or omit to take any action) which action or omission would cause any
representation to be untrue at any time prior to the Effective Date as if that
representation or warranty were made at and as of the Effective Date, or make
any change in any method of reporting income or expenses for federal income tax
purposes.
7.4. Preservation Of Business. Unless it has the written consent of
the other Party to this Agreement, Future Com and Xxxxxxxxx will each use its
best efforts to preserve its business organization intact and to preserve its
present relationships with suppliers, customers and others having business
relationships with it.
7.5. Tax Cooperation.
7.5.1. After the Effective Date, each of Xxxxxxxxx, Future Com
and the Future Com Shareholders shall cooperate, and cause their respective
directors, employees, officers and representatives to cooperate, with each other
and with each other's respective agents, including accounting firms and legal
counsel, in connection with the preparation or audit of any tax return or
report, amended return or report, claim for refund in any tax claim or
litigation in respect of Xxxxxxxxx or Future Com, or Future Com's or Xxxxxxxxx'x
activities, which cooperation shall include, but not be limited to, making
available to the other all information, records, and documents in their
possession relating to the liabilities for taxes associated with Xxxxxxxxx or
Future Com, except as may be limited by this Agreement. Xxxxxxxxx and Future Com
also shall make available to the other, as reasonably requested and available,
the personnel responsible for preparing, maintaining and interpreting
information, records and documents in connection with taxes as well as related
litigation. Any information provided or obtained pursuant to this Section 7.5.1
shall be kept confidential, except as may be otherwise necessary in connection
with the filing of returns or reports, refund claims, audits, tax claims and
litigation. The Future Com Shareholders, with the assistance of Future Com and
Xxxxxxxxx as requested and furnished pursuant to this Section 7.5.1, shall
prepare and file a federal and state tax return on behalf of Future Com for the
year ended December 31, 1998, which tax return shall be filed by the applicable
due date including applicable extensions. Copies of the tax return filed
pursuant to this Section 7.5.1 shall be promptly provided to each Party. The
Future Com Shareholders shall cause the tax return to be prepared in sufficient
detail to determine the tax basis of the investments as of the Effective Date.
16
7.5.2. Future Com and Xxxxxxxxx shall provide written notice to
the other on or before 15 days after learning of any pending or threatened tax
audit, tax assessment or tax proceeding related to Future Com or Xxxxxxxxx for
whole or partial periods for which a claim for payment or reimbursement may be
made by the Future Com Shareholders or Xxxxxxxxx against the other. The notice
required by the previous sentence shall contain factual information (to the
extent known) describing the asserted tax liability in reasonable detail and
shall include copies of any notice or other document received from any tax
authority in respect of any such matters. If a Party (the "Claiming Party") has
knowledge of an asserted tax liability with respect to a matter for which that
Claiming Party may make a claim against the other Party (the "Defending Party")
and the Claiming Party fails to give the Defending Party prompt notice of that
asserted tax liability as required by this Section 7.5.2 and (i) if the
Defending Party is precluded by the failure to receive prompt notice from
contesting the asserted tax liability in both the administrative and judicial
forums, then the Defending Party shall have no responsibility for any taxes or
penalties arising out of that asserted tax liability, and (ii) if the Defending
Party is not so precluded from contesting, but such failure to receive prompt
notice results in a detriment to the Defending Party, then any amount that the
Defending Party is otherwise required to pay to the Claiming Party pursuant to
this Agreement shall be reduced by the amount of such detriment, provided that
the Claiming Party shall nevertheless be entitled to full payment as provided
pursuant to this Agreement to the extent, and only to the extent, that the
Claiming Party can establish that the Defending Party was not prejudiced by such
failure.
7.5.3. In the event of an audit or dispute with a taxing
authority over taxes for which a Party is primarily liable pursuant to this
Agreement, that Party will be entitled to control the proceedings related to
those taxes (including action taken to pay, compromise, or settle those taxes),
provided that Xxxxxxxxx, Future Com and the Future Com Shareholders shall
jointly control, in good faith with each other, any proceeding related to a
taxable period that begins before and ends after the Effective Date and which
Xxxxxxxxx, Future Com, and/or the Future Com Shareholders have liability for
pursuant to this Agreement, provided further, however, that Xxxxxxxxx will in
any event be entitled to solely control any proceeding that relates to or
impacts a consolidated, combined or unitary return filed in any jurisdiction by
Future Com and Xxxxxxxxx. Reasonable out-of-pocket expenses with respect to such
contest shall be borne by the Parties in proportion to their responsibility for
those taxes as set forth in this Agreement. The Party that is not entitled to
control any such proceedings shall be afforded a reasonable opportunity to
participate in such proceedings at its own expense.
7.5.4. Xxxxxxxxx, Future Com and the Future Com Shareholders
shall have possession of their own and their subsidiaries', if applicable, tax
records after the Closing. Xxxxxxxxx, Future Com and the Future Com Shareholders
shall make available to each other for inspection and copying during normal
business hours, in connection with the preparation of tax returns, audits and
litigation, all tax records in their possession relating to Xxxxxxxxx, Future
Com or the Future Com Shareholders or their respective activities for a period
prior to the Effective Date, taxable periods for which Xxxxxxxxx, Future Com and
the Future Com Shareholders may share tax liabilities, and tax records that are
relevant to periods following the Effective Date. Xxxxxxxxx, Future Com and the
Future Com Shareholders shall preserve and keep all such tax records in their
possession until the expiration of any applicable statutes of limitation or
extensions thereof and as otherwise required by law, but in any event for a
period not less than seven years after the Tax Closing Date. Notwithstanding the
17
foregoing, any of the Parties may dispose of those records provided 90 days
advance written notice of the intent to dispose is given to other Party. Such
notice shall be delivered in accordance with the provisions of Section 19 of
this Agreement and shall include a list of the records to be disposed of which
shall describe in reasonable detail each file, book or other record accumulation
to be disposed. The notified Party shall have the opportunity, at its cost and
expense, to copy or remove, within that 90 day period, all or any part of those
tax records. For purposes of this Section 7.5.4 tax records include, without
limitation, journal vouchers, cash vouchers, general ledgers, material
contracts, and other related records.
7.6. Interim Operations. From the Execution Date to the Effective
Date, Future Com will not, unless Xxxxxxxxx gives its prior written approval:
(a) amend or otherwise change its Articles Of Incorporation or Bylaws; (b) issue
or sell or authorize for issuance or sale additional shares of any class of
capital stock, or subscriptions, options (including employee stock options),
warrants, rights or convertible securities or other agreements obligating Future
Com to issue shares of its capital stock; (c) declare, set aside, make or pay
any dividend or other distribution with respect to its capital stock; (d)
redeem, purchase or otherwise acquire, directly or indirectly, any of its
capital stock; (e) issue any instrument that permits participation in the
revenues or profits of Future Com; (f) incur any indebtedness except for
accounts payable in the ordinary course of its business; (g) permit the sale or
encumbrance of any of the assets of Future Com; (h) enter into any employment or
severance agreements or similar agreements with any person; or (i) agree to,
make, engage in or allow to occur or continue any of the following:
7.6.1. Any material transaction;
7.6.2. Any capital expenditure in excess of $5,000;
7.6.3. Any changes in its condition (financial or otherwise),
liabilities, assets, or business that, when considered individually or in the
aggregate, have a Material Adverse Effect;
7.6.4. The destruction of, damage to, or loss of any asset of
Future Com (regardless of whether covered by insurance) as a direct or indirect
result of the action or inaction of Future Com, that, when considered
individually or in the aggregate, has a Material Adverse Effect upon the
condition (financial or otherwise) or business of Future Com;
7.6.5. Any labor troubles or other events or conditions of any
character that, when considered individually or in the aggregate, have a
Material Adverse Effect upon the condition (financial or otherwise) or business
of Future Com;
7.6.6. Any change in accounting methods or practices (including,
without limitation, any change in depreciation or amortization policies or
rates);
7.6.7. Any increase in the salary or other compensation payable
or to become payable to any of its officers or directors, or the declaration,
payment, or commitment or obligation of any kind for the payment of a bonus or
other additional salary or compensation to any such person;
7.6.8. The material amendment or termination of any material
contract, agreement, or license to which it is a party, except with respect to
the amendment or termination of Future Com's customer contracts in the ordinary
course of Future Com's business;
7.6.9. Any loan to any person or entity, or the guaranteeing of
any loan;
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7.6.10. Any mortgage, pledge or other encumbrance of any asset of
Future Com by Future Com or as a direct or indirect result of the action or
inaction of Future Com; or
7.6.11. The waiver or release of any right or claim of Future Com
by Future Com.
7.7. Reorganization. During the period from the Execution Date through
the Effective Date, unless the other Parties shall otherwise agree in writing,
neither of Future Com or Xxxxxxxxx shall knowingly take or fail to take any
action which action or failure to act would jeopardize qualification of the
Exchange as a reorganization within the meaning of Section 368(a) of the Code.
7.8. Accuracy Of Representations. Each Party will take all reasonable
action necessary to render accurate, as of the Closing, its representations and
warranties contained in this Agreement, and it will refrain from taking any
action that would render any such representation or warranty inaccurate as of
that time. Each Party will use its best efforts to perform or cause to be
satisfied each covenant or condition to be performed or satisfied by it pursuant
to the terms of this Agreement.
7.9. Consents, Waivers And Approvals. Each of Future Com and Xxxxxxxxx
hereby undertake to use its best efforts to obtain in writing, as soon as
practicable after the Execution Date, all such consents, waivers, approvals and
authorizations required prior to the consummation of the Exchange.
7.10. Notice Of Breach Of Warranty. Future Com will immediately give
notice to Xxxxxxxxx of the occurrence of any event or the failure of any event
to occur that has resulted in a breach of Future Com's representations or
warranties or a failure by Future Com to comply with any covenant, condition or
agreement contained in this Agreement. Xxxxxxxxx will immediately give notice to
Future Com of the occurrence of any event or the failure of any event to occur
that has resulted in a breach of Xxxxxxxxx'x representations or warranties or a
failure by Xxxxxxxxx to comply with any covenant, condition or agreement
contained in this Agreement.
7.11. Additional Documents; Further Assurances. In addition to the
schedules and other items specifically required to be furnished hereunder,
Future Com and Xxxxxxxxx hereby agree that each will promptly furnish to the
other such further schedules, certificates and other instruments and take such
other action as may reasonably be requested in order to effectuate the purposes
of this Agreement.
7.12. Notice Of Inaccurate Information. Future Com and Xxxxxxxxx each
will notify the other in writing as soon as possible of any events or
occurrences that have happened or that may happen and that have caused or that
may cause any of the information contained in this Agreement or in the Schedules
to this Agreement to become inaccurate or incomplete.
7.13. Publicity. All notices to third parties and all other publicity
concerning the transactions contemplated by this Agreement shall be directed by
Xxxxxxxxx. Notwithstanding anything to the contrary in this Section, any Party
to this Agreement shall be permitted unilaterally to make such notices and to
engage in such publicity as it reasonably deems necessary to comply with
applicable laws and regulations, including their respective reporting
obligations, if any, under the 0000 Xxx. The provisions of this Section shall
remain in effect only until the earlier to occur of the Closing or the
termination of this Agreement.
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8. Conditions To Performance By All Parties. The obligations of all Parties
to effect the Exchange shall be subject to the fulfillment at or prior to the
Effective Date of the following conditions:
8.1. The Exchange shall have been approved by the Board Of Directors
and shareholders of Future Com in accordance with Florida Law and any other laws
applicable to this transaction and Agreement to which Future Com is subject.
8.2. The Exchange shall have been approved by the board of directors
of Xxxxxxxxx in accordance with Delaware Law.
8.3. At the Effective Date, there shall not be in effect any court
order restraining or prohibiting consummation of the Exchange, or any pending
proceeding brought by, or before, any governmental commission, board, agency,
court or body with a view to seeking, or in which it is sought, to restrain or
prohibit consummation of the Exchange or in which it is sought to obtain
divestiture of a material amount of assets of either Future Com or Xxxxxxxxx and
their respective Subsidiaries taken as a whole.
9. Conditions Precedent To Performance By Future Com. The obligations of
Future Com to effect the Exchange shall be, at Future Com's option, subject to
the fulfillment at or prior to the Effective Date of the following conditions
(unless any or all of them is waived by Future Com):
9.1. The representations and warranties of Xxxxxxxxx set forth in this
Agreement, including the attached Schedules, shall be true and correct in all
material respects at and as of the date hereof and shall be true and correct in
all material respects at and as of the Effective Date as though made at and as
of the Effective Date, except for changes which do not have a Material Adverse
Effect on Xxxxxxxxx and except to the extent such representations and warranties
are not true and correct by reason of actions permitted or authorized by this
Agreement or consented to in writing by Future Com. Future Com shall have
received a certificate of Xxxxxxxxx, dated the Effective Date and duly executed
by its President and Secretary, as to the accuracy of their respective
representations and warranties as of the Effective Date.
9.2. Future Com shall have received an opinion of counsel from legal
counsel to Xxxxxxxxx, dated the Effective Date, substantially to the effect
that:
9.2.1. The incorporation, existence, good standing and
capitalization of Xxxxxxxxx are as stated in this Agreement and the shares of
Xxxxxxxxx Common Stock to be issued to and received by the Future Com
Shareholders pursuant to this Agreement will be duly and validly authorized and
issued, fully paid and non-assessable.
9.2.2. Xxxxxxxxx has full corporate power and authority to
execute, deliver and perform this Agreement and this Agreement has been duly
authorized, executed and delivered by Xxxxxxxxx, and (assuming the due and valid
authorization, execution and delivery by Future Com) constitutes the legal,
valid and binding agreement of Xxxxxxxxx.
9.2.3. To the knowledge of such counsel, there are no actions,
suits or proceedings, pending or threatened against Xxxxxxxxx or its
Subsidiaries by any Governmental Entity which seek to restrain, prohibit or
invalidate the transactions contemplated by this Agreement.
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9.2.4. The execution and performance by Xxxxxxxxx of this
Agreement will not violate the Certificate Of Incorporation or Bylaws of
Xxxxxxxxx.
9.2.5. To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental agency or body which has not
been obtained is required on behalf of Xxxxxxxxx or any of its Subsidiaries for
consummation of the transactions contemplated by this Agreement.
In rendering its opinion, counsel may rely as to factual matters on
certificates of public officials and officers or employees of Xxxxxxxxx,
provided that copies of such opinions and certificates shall be delivered with
such opinion, and provided further that in the case of any such reliance,
counsel shall state that it believes that it is justified in relying on such
opinions and certificates for such matters.
9.3. Xxxxxxxxx shall have performed all obligations required to be
performed by them and shall have furnished all documents, schedules and
instruments required to be furnished by them under this Agreement at or prior to
the Effective Date. Future Com shall have received a certificate of Xxxxxxxxx,
dated the Effective Date and duly executed by its President to this effect.
10. Conditions Precedent To Performance By Xxxxxxxxx. The obligations of
Xxxxxxxxx to effect the Exchange shall be, at Xxxxxxxxx'x option, subject to the
fulfillment at or prior to the Effective Date of the following conditions:
10.1. The representations and warranties of Future Com set forth in
this Agreement, including the attached Schedules, shall be true and correct in
all material respects at and as of the date hereof and shall be true and correct
in all material respects at and as of the Effective Date as though made at and
as of the Effective Date, except to the extent such representations and
warranties are not true and correct by reason of actions permitted or authorized
by this Agreement or consented to in writing by Xxxxxxxxx. Xxxxxxxxx shall have
received a certificate of Future Com, dated the Effective Date and duly executed
by its President and Secretary, as to the accuracy of its representations and
warranties.
10.2. Xxxxxxxxx shall have received an opinion of counsel from legal
counsel to Future Com, dated the Effective Date, substantially to the effect
that:
10.2.1. The incorporation, existence, good standing and
capitalization of Future Com are as stated in this Agreement; all outstanding
shares of Future Com Common Stock are duly and validly authorized and issued,
fully paid and non-assessable and have not been issued in violation of any
preemptive right of shareholders; and, to the knowledge of such counsel, there
is no existing option, warrant, right, call, subscription or other agreement or
commitment obligating Future Com to issue or sell, or to purchase or redeem any
shares of its capital stock other than as stated in this Agreement.
10.2.2. Future Com has full corporate power and authority to
execute, deliver and perform this Agreement and this Agreement has been duly
authorized, executed and delivered by Future Com, and (assuming the due and
valid authorization, execution and delivery by Xxxxxxxxx) constitutes the legal,
valid and binding agreement of Future Com.
10.2.3. To the knowledge of such counsel, there are no actions,
suits or proceedings, pending or threatened against Future Com or its
Subsidiaries by any Governmental Entity which seek to restrain, prohibit or
invalidate the transactions contemplated by this Agreement.
21
10.2.4. The execution and performance by Future Com of this
Agreement will not violate the Articles Of Incorporation or Bylaws of Future
Com.
10.2.5. To the knowledge of such counsel, no consent, approval,
authorization or order of any court or governmental agency or body which has not
been obtained is required on behalf of Future Com or any of its Subsidiaries for
consummation of the transactions contemplated by this Agreement.
In rendering its opinion, counsel may rely as to factual matters on
certificates of public officials and officers or employees of Future Com,
provided that copies of such opinions and certificates shall be delivered with
such opinion, and provided further that in the case of any such reliance,
counsel shall state that it believes that it is justified in relying on such
opinions and certificates for such matters.
10.3. Future Com shall have performed all obligations required to be
performed by it and shall have furnished all documents, schedules and
instruments required to be furnished by it under this Agreement at or prior to
the Effective Date. Xxxxxxxxx shall have received a certificate of Future Com,
dated the Effective Date and duly executed by its President to this effect.
10.4. No holders of the shares of Future Com Common Stock outstanding
prior to the Exchange shall have exercised their appraisal rights in connection
with the Exchange.
10.5. On or before the date of Closing, all necessary approvals and
consents of any Parties as set forth in Schedule 6.5 shall have been obtained by
Future Com and delivered to Xxxxxxxxx.
10.6. At or before the Closing, Xxxxxxxxx shall have been furnished
with all documents that they reasonably may require for the purpose of enabling
them to pass upon the valid exchange of the Xxxxxxxxx Common Stock for Future
Com Common Stock and in order to evidence the accuracy of any of the
representations or warranties and the fulfillment of any of the conditions
contained in this Agreement. All proceedings taken by Future Com in connection
with the consummation of transactions contemplated by this Agreement shall be
satisfactory in form and substance to Xxxxxxxxx.
11. Indemnification By Xxxxxxxxx. Xxxxxxxxx hereby agrees to indemnify and
hold harmless Future Com, Future Com's officers, directors, shareholders,
employees and agents against any and all losses, claims, damages, liabilities,
costs and expenses (including but not limited to attorneys' fees and other
expenses of investigation and defense of any claims or actions) to which they or
any of them may become subject due to, or which results from, any of the
following:
11.1. Any breach of Xxxxxxxxx'x covenants, agreements, warranties or
representations contained in this Agreement.
11.2. Any misstatement of a material fact contained in this Agreement
or in any of the documents executed in connection with transactions contemplated
by this Agreement, but only if the misstatement relates to information
concerning Xxxxxxxxx or its operations.
11.3. The omission to state any fact necessary to make the statements
contained in this Agreement or in any of the documents executed in connection
with the transactions contemplated by this Agreement not misleading, but only if
the omission relates to information concerning Xxxxxxxxx or their operations.
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11.4. The operations of Xxxxxxxxx, or the acts of their employees,
acting in their capacities as such, prior to the Closing, except that Xxxxxxxxx
shall not indemnify Future Com or its officers, directors, employees and agents
for liabilities incurred by Future Com in the ordinary course of business prior
to the Closing.
11.5. Actions or inactions of Xxxxxxxxx, or the agents of Xxxxxxxxx
acting in their capacity as agents, prior to the Closing, except any such costs
or losses incurred through reasonable and good faith acts in the ordinary course
of the business of Xxxxxxxxx.
12. Indemnification By Future Com And The Future Com Shareholders
12.1. Future Com and each of the Future Com Shareholders hereby agrees
to jointly and severally indemnify and hold harmless Xxxxxxxxx and Xxxxxxxxx'x
officers, directors, employees and agents against any and all losses, damages,
liabilities, costs and expenses (including but not limited to attorneys' fees
and other expenses of investigation and defense of any claims or actions) to
which they or any of them may become subject due to, or which result from, any
of the following:
12.1.1. Any breach of Future Com's covenants, agreements,
warranties or representations contained in this Agreement.
12.1.2. Any misstatement of a material fact contained in this
Agreement or in any of the documents executed in connection with transactions
contemplated by this Agreement, but only if the misstatement related to
information concerning Future Com and its operations.
12.1.3. The omission to state any fact necessary to make the
statements contained in this Agreement or in any of the documents executed in
connection with the transactions contemplated by this Agreement not misleading,
including Future Com's representations contained in Section 6.19 regarding
undisclosed liabilities, but only if the omission relates to information
concerning Future Com and its operations.
12.1.4. The operations of Future Com or the acts of their
employees, acting in their capacities as such, prior to the Closing, except that
the Future Com Shareholders shall not indemnify Xxxxxxxxx or Xxxxxxxxx'x
officers, directors, employees and agents for liabilities incurred by Xxxxxxxxx
through reasonable and good faith acts in the ordinary course of business of
Future Com prior to the Closing.
12.1.5. Actions or inactions of Future Com, or the agents of
Future Com (excluding sales agents) acting in their capacity as agents, prior to
the Closing, except any such costs or losses incurred through reasonable and
good faith acts in the ordinary course of the business of Future Com.
12.2. Each of the Future Com Shareholders represents and warrants to
Xxxxxxxxx as follows:
12.2.1. Benefits Of Agreement. All the outstanding capital stock
of Future Com is owned by the Future Com Shareholders in the amounts described
in Section 1.12. Each of the Future Com Shareholders acknowledges and agrees
23
that Future Com Shareholder will be receiving benefit from the transactions
entered into pursuant to this Agreement and other transactions entered into
between and among the Future Com Shareholders, Future Com and/or Xxxxxxxxx in
connection with the transactions contemplated by this Agreement.
12.2.2. Reliance On Representations And Warranties. Each of the
Future Com Shareholders understands that Xxxxxxxxx, in entering into this
Agreement, is relying upon the agreements, representations, and warranties made
by Future Com and upon the agreement of the Future Com Shareholders herein made
in this Section 12.
13. Notice Of Claim. Should any Party (the "Indemnified Party") suffer any
loss, damage or expense for which the other Party (the "Indemnifying Party") is
obligated to indemnify and hold such Indemnified Party harmless pursuant to
Section 11 or 12 of this Agreement, the following shall apply: Promptly upon
receipt by the Indemnified Party of notice of any demand, assertion, claim,
action or proceeding, judicial or otherwise, with respect to any matter as to
which the Indemnifying Party is obligated to indemnify the Indemnified Party
under the provisions of this Agreement, the Indemnified Party shall give prompt
notice thereof to the Indemnifying Party, together with a statement of such
information respecting such matter as the Indemnified Party shall then have and
a statement advising that the Indemnifying Party must notify it within 10 days
whether the Indemnifying Party will undertake the defense of such matter. The
Indemnifying Party shall not be obligated to indemnify the Indemnified Party
with respect to any matter hereunder if the Indemnified Party has failed to use
its best efforts to notify the Indemnifying Party thereof in accordance with the
provisions of the Agreement in sufficient time to permit the Indemnifying Party
and its counsel to defend against such matter and to make a timely response
thereto, including without limitation, the preparation and assertion of an
answer or other responsive motion to a complaint, petition, notice or other
legal, equitable or administrative process relating to any such claim. Notice of
the intention of the Indemnifying Party to contest any such claim, and the
identity of counsel that the Indemnifying Party intends to employ to contest any
such claim, shall be given by the Indemnifying Party to the Indemnified Party
within 10 days from the date of receipt by the Indemnifying Party of notice by
the Indemnified Party of the assertion of any such claim. The Indemnified Party
shall have the right to approve the counsel named in the Notice provided
pursuant to the preceding sentence, provided that such approval shall not be
unreasonably withheld. The Indemnified Party shall have the right to participate
in such proceedings and to be represented by attorneys of its own choosing;
however, such representation shall be at the Indemnified Party's own expense if
the Indemnifying Party selects different counsel of its own choosing. If the
Indemnifying Party does not elect to contest any such claim, the Indemnifying
Party shall be bound by the results obtained with respect thereto by the
Indemnified Party, including any settlement of such claim. If the Indemnifying
Party elects to contest any claim, the Indemnified Party shall be bound by the
results obtained with respect thereto by the Indemnifying Party, including any
settlement of such claim.
14. Closing. Subject to the terms and conditions contained in this
Agreement, the Closing shall take place on or before November 4, 1999, or on
such other date or at such other time as shall be agreed to by the Parties, by
exchange of documents by overnight courier or facsimile. At the Closing, the
following shall occur:
14.1. Future Com shall deliver to Xxxxxxxxx (a) a certificate executed
by the President and Secretary of Future Com dated as of the Closing certifying
that the representations and warranties of Future Com in this Agreement are true
and correct in all material respects at and as of the Effective Date as though
each representation and warranty had been made on that date; (b) the stock book,
stock ledger, minute book and corporate seal of Future Com, and (c) such other
documents as are required to be delivered to Xxxxxxxxx under the terms of this
Agreement, including the opinion of counsel described in Section 10.2.
24
14.2. The Future Com Shareholders shall deliver to Xxxxxxxxx stock
certificates representing the shares of Future Com Common Stock that are being
exchanged for Xxxxxxxxx Common Stock pursuant to Section 4 of this Agreement
together with duly executed stock powers and assignments transferring those
shares to Xxxxxxxxx.
14.3. Xxxxxxxxx shall deliver to each of the Future Com Shareholders,
upon receipt from the Future Com Shareholders by Xxxxxxxxx of the stock
certificates described in Section 14.2, stock certificates representing the
shares of Xxxxxxxxx Common Stock to be issued pursuant to this Agreement in
exchange for Future Com Common Stock and the opinion of counsel described in
Section 9.2.
14.4. Xxxxxxxxx shall deliver to Future Com (a) a certificate executed
by the President and Secretary of Xxxxxxxxx dated as of the Closing, certifying
that the representations and warranties of Xxxxxxxxx in this Agreement are true
and correct in all material respects at and as of the Effective Date, as though
each representation and warranty had been made on that date; and (b) such other
documents are required to be delivered to Future Com under the terms of this
Agreement.
14.5. Xxxxxxxxx and each of Xxxx and Xxxxxx shall execute the
Employment And Nonsolicitation Agreements pursuant to Section 2.3.1 of this
Agreement.
14.6. Each of the persons named in Section 2.4.4 shall execute and
deliver to Xxxxxxxxx a noncompetition agreement in the form of Exhibit H
attached to and made a part of this Agreement.
14.7. Xxxxxxxxx and the Debt Holders named in Section 2.3.4.6 shall
sign, and Xxxxxxxxx shall deliver to the Debt Holders, the promissory notes
required to be delivered pursuant to Section 2.3.4.6.
14.8. Xxxxxxxxx and the recipients of options named in Section 2.3.9
shall sign, and Xxxxxxxxx shall deliver to the recipients of options, the option
agreements required to be delivered pursuant to Section 2.3.9.
14.9. Each of Parties agrees that it will at any time and from time to
time after the Closing, upon the request of any other Party, perform, execute,
acknowledge and deliver all such further acts, deeds, assignments, transfers,
powers of attorney and assurances as may be required for the purpose of
effectuating the consummation of the transactions contemplated by this
Agreement.
15. Termination And Abandonment Of The Exchange.
15.1. Termination. Anything herein or elsewhere to the contrary
notwithstanding, this Agreement may be terminated and abandoned at any time
before the consummation of the Exchange by the mutual consent of the Boards of
Directors of Xxxxxxxxx and Future Com.
15.2. Effect Of Termination. In the event of termination and
abandonment under Section15.1, this Agreement shall forthwith become void and
there shall be no liability on the part of any Party or their respective
officers and directors, except that the provisions of the second sentence of
Section 7.1 hereof and the provisions of Section 22 hereof shall continue in
effect.
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16. Amendment Or Waiver. This Agreement may be amended, modified or
superseded, and any of the terms, covenants, representations, warranties or
condition hereof may be waived, but only by a written instrument executed by
Future Com and Xxxxxxxxx; provided, however, the terms of the Exchange
concerning the ratio of the conversion of shares of Future Com Common Stock may
be amended, modified or superseded only with the approval of Xxxxxxxxx and
Future Com and the Future Com Shareholders. Except as expressly otherwise
required by the previous sentence or applicable law, no shareholders approval
shall be required for any amendment, modification or waiver. No waiver of any
nature, in any one or more instances, shall be deemed to be or construed as a
further or continued waiver of any condition or any breach of any other term,
representation or warranty in this Agreement.
17. Entire Agreement. This Agreement, together with the Schedules hereto,
and the documents referred to herein, constitutes the entire agreement among the
Parties with respect to the Exchange, and supersedes all prior arrangements or
understandings with respect thereto.
18. Notice. All notices, requests, demands, directions and other
communications ("Notices") provided for in this Agreement shall be in writing
and shall be mailed or delivered personally or sent by telecopier or facsimile
to the applicable Party at the address of such Party set forth below in this
Section 18. When mailed, each such Notice shall be sent by first class,
certified mail, return receipt requested, enclosed in a postage prepaid wrapper,
and shall be effective on the third business day after it has been deposited in
the mail. When delivered personally, each such Notice shall be effective when
delivered to the address for the respective Party set forth in this Section 18.
When sent by telecopier or facsimile, each such Notice shall be effective on the
first business day on which or after which it is sent. Each such Notice shall be
addressed to the Party to be notified as shown below:
XXXXXXXXX:
Xxxxxxxxx Technologies Corporation
ATTN: Xxxxxxx Xxxx
0000 Xxxxxxx xx Xxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Facsimile: (000) 000-0000
FUTURE COM:
Future Com South Florida, Inc.
ATTN: Xxxxxxx Xxxx
0000 X.X. 00xx Xxxxxx, Xxxxx 000Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
FUTURE COM SHAREHOLDERS:
Xxxxxxx Xxxx
0000 X.X. 00xx Xxxxxx, Xxxxx 000Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
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Xxxxxx Xxxxxx
0000 X.X. 00xx Xxxxxx, Xxxxx 000Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Any Party may change his or its respective address for purposes of this
Section 18 by giving the other Party Notice of the new address in the manner set
forth above.
19. Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such a manner as to be effective and valid under applicable
law, and if any provision of this Agreement shall be or become prohibited or
invalid in whole or in part for any reason whatsoever, that provision shall be
ineffective only to the extent of such prohibition or invalidity without
invalidating the remaining portion of that provision or the remaining provisions
of this Agreement.
20. Headings. The headings to this Agreement are for convenience only; they
form no part of this Agreement and shall not affect its interpretation.
21. Counterparts. This Agreement may be executed in any number of
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
22. Expenses. Regardless of whether the transactions provided for herein
are consummated, each Party to this Agreement will pay its respective costs and
expenses.
23. Nature And Survival Of Representations. All statements contained in
this Agreement and in the Schedules to this Agreement shall be deemed
representations and warranties by the applicable Party under this Agreement. All
representations and warranties made by the Parties in this Agreement or pursuant
to this Agreement shall be true and accurate as of the Closing in all material
respects. The obligation that the representations and warranties be accurate as
of the Closing in all material respects shall survive the Closing and continue
in full force and effect. In addition, all obligations relating to
indemnification under this Agreement shall survive the Closing and continue in
full force and effect.
24. Benefits And Assignment. The provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the Parties
hereto and their respective successors and assigns. The Parties agree that this
Agreement is made solely for the benefit of the Parties and their respective
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. The terms "successor" or the term
"successors and assigns" as used in this Agreement shall not include any holders
of the Future Com Common Stock, or recipients of the Xxxxxxxxx Common Stock
pursuant to this Agreement.
25. Specific Performance. 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. Notwithstanding any breach or default by any of the Parties of any
of their respective representations, warranties, covenants or agreements under
this Agreement, if Closing occurs as contemplated, each of the Parties waives
any rights that it or they may have to rescind this Agreement or the
transactions consummated pursuant to it; provided, however, this wavier shall
not affect any other rights or remedies available to the Parties under this
Agreement or under the law.
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26. Brokers. Each of Xxxxxxxxx and Future Com represents and warrants to
the other that all of its negotiations relative to this Agreement and the
transactions contemplated hereby have been carried on directly, without the
intervention of any other person, so as not to give rise to any valid claim
against any Party hereto for a finder's fee, brokerage commission or other like
payment.
27. Costs. If any legal action or other proceeding is brought by one of the
Parties to this Agreement against another Party to this Agreement for the
enforcement of this Agreement, or because of an alleged dispute, breach, default
or misrepresentation in connection with any of the provisions of this Agreement,
the successful or prevailing Party shall be entitled to recover reasonable
attorneys' fees and other costs incurred in that action or proceeding, in
addition to any other relief to which it or they may be entitled.
28. Termination On Default. If Xxxxxxxxx or Future Com materially defaults
in the due and timely performance of any of its or their warranties, covenants
or agreements under this Agreement, then the nondefaulting Party may at the time
set for the Closing give notice of termination of this Agreement, in the manner
provided in Section 18. A notice shall specify with particularity the default or
defaults on which the notice is based. The defaulting Party, however, shall have
the right to cure such default or defaults within 30 days after the date set for
Closing. The termination shall be effective 30 days after the date set for
Closing, unless the specific default or defaults have been cured on or before
this effective date for termination.
29. Choice Of Law. This Agreement shall be governed by, construed,
interpreted and the rights of the Parties determined in accordance with the laws
of the State of Delaware without regard to principles of conflicts of laws.
30. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the breach thereof, shall be settled in the United States by
arbitration (except as provided below), in accordance with the rules then
obtaining, of the American Arbitration Association (the "Association") and shall
proceed pursuant to the Association's Commercial Dispute Resolution Procedure
Rules (the "Rules"). If the subject of the arbitration involves an intellectual
property, corporate, or bankruptcy matter, as determined by the Association,
then the arbitrator(s) shall have had experience in that subject. The
Association is authorized to make arrangement for this arbitration, to be held
in Austin, Texas under the Rules. Three arbitrators shall decide all issues;
Xxxxxxxxx is entitled to appoint one arbitrator of its choice and all other
parties to the dispute are entitled to appoint one arbitrator of their own
choice and those two arbitrators shall mutually choose the third arbitrator who
shall be the chairperson of the arbitration panel. If no agreement concerning
the choice of the third arbitrator can be reached by those two appointed
arbitrators within 15 calendar days from the date of the appointment of the last
party-appointed arbitrator, the third arbitrator shall be chosen pursuant to the
Rules. In addition, in the event of a dispute for which the aggrieved party
seeks immediate equitable relief, including without limitation an injunction,
the appropriate action may be brought only in the federal district, state
district or county courts located in or that have jurisdiction in the County of
Xxxxxx, Texas, provided that any such equitable relief shall be subject to
modification by the court after completion of arbitration of the dispute. This
Agreement shall be enforceable and judgment upon any award rendered by all or a
majority of the arbitrators may be entered in any court of any county having
jurisdiction.
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IN WITNESS WHEREOF, the Parties to this Agreement have caused this
Agreement to be executed by their duly authorized representatives on the date
first above written.
XXXXXXXXX:
XXXXXXXXX TECHNOLOGIES CORPORATION
Date: ______________________ By: ______________________
______________________
Printed Name and Title
ATTEST:
______________________
______________________ , Secretary
FUTURE COM:
FUTURE COM SOUTH FLORIDA, INC.
Date: ______________________ By: ______________________
______________________
Printed Name and Title
ATTEST:
______________________
______________________ , Secretary
FUTURE COM SHAREHOLDERS:
Date: ______________________ By: ______________________
Xxxxxx Xxxxxx, Individually
Date: ______________________ By: ______________________
Xxxxxxx Xxxx, Individually
29
