EXHIBIT 2.1
SHARE EXCHANGE AGREEMENT BETWEEN THE COMPANY AND
POINT BREAK PRODUCTIONS, INC. DATED AS OF MAY 23, 2005
SHARE EXCHANGE AGREEMENT
by and between
BRAVO RESOURCES LTD., A NEVADA CORPORATION
and
POINT BREAK PRODUCTIONS, INC., A NEVADA CORPORATION
Dated as of May 23, 2005
TABLE OF CONTENTS
PAGE
THE SHARE EXCHANGE.............................................................1
1.1 The Share Exchange................................................1
1.2 Number of Shares Of BRAVO Common Stock............................1
1.3 Conversion Of POINT BREAK Common Stock............................1
1.4 Effective Time....................................................2
1.5 Fractional Shares.................................................2
1.6 Reservation of Shares.............................................2
1.7 Adjustments to Exchange Ratio.....................................2
1.8 Dissenting Shares.................................................2
1.9 Exchange of Certificates..........................................2
1.10 No Further Ownership Rights In POINT BREAK Common Stock...........3
1.11 Lost, Stolen or Destroyed Certificates............................3
1.12 Exemption From Registration.......................................3
1.13 Reporting of Share Exchange.......................................3
1.14 Escrow Of BRAVO And POINT BREAK Common Stock......................3
1.15 Board of Directors and Officers Of BRAVO..........................4
1.16 Taking of Necessary Action; Further Action........................4
THE CLOSING....................................................................4
2.1 Time and Place of Closing.........................................4
2.2 Obligations of POINT BREAK And The POINT BREAK
Shareholders At or Prior to the Closing...........................4
2.3 Obligations of BRAVO At or Prior to the Closing...................5
REPRESENTATIONS AND WARRANTIES OF POINT BREAK..................................5
3.1 Organization and Qualification....................................5
3.2 Capitalization....................................................5
3.3 Subsidiaries and Affiliates.......................................6
3.4 Options or Other Rights...........................................6
3.5 Ownership of Shares...............................................6
3.6 Validity and Execution of Agreement...............................6
3.7 No Conflict.......................................................6
3.8 Consents and Approvals............................................7
3.9 Violation of Laws, Permits, Etc...................................7
3.10 Books and Records.................................................7
3.11 POINT BREAK Financial Statements..................................7
3.12 Undisclosed Liabilities...........................................7
3.13 Title to Property; Encumbrances...................................8
3.14 Taxes.............................................................8
3.15 Litigation........................................................9
3.16 Contracts and Other Agreements....................................9
3.17 Compensation Arrangements; Officers and Directors.................9
3.18 Erisa.............................................................9
3.19 Operations........................................................9
3.20 Licenses and Permits.............................................11
3.21 Brokers..........................................................11
3.22 Disclosure.......................................................11
REPRESENTATIONS AND WARRANTIES OF BRAVO.......................................12
4.1 Organization and Qualification...................................12
4.2 Capitalization...................................................12
4.3 Subsidiaries and Affiliates......................................12
4.4 Options or Other Rights..........................................12
4.5 Validity and Execution of Agreement..............................12
4.6 No Conflict......................................................12
4.7 Consents and Approvals...........................................13
4.8 Violation of Laws, Permits, Etc..................................13
4.9 Books and Records................................................13
4.10 BRAVO Financial Statements.......................................13
4.11 Undisclosed Liabilities..........................................13
4.12 Title to Property; Encumbrances..................................14
4.13 Taxes............................................................14
4.14 Litigation.......................................................14
4.15 Contracts and Other Agreements...................................14
4.16 Compensation Arrangements; Officers and Directors................15
4.17 ERISA............................................................15
4.18 Operations.......................................................15
4.19 Brokers..........................................................17
4.20 Approval of Share Exchange.......................................17
4.21 Investment Company...............................................17
4.22 Trading Status...................................................17
4.23 SEC Reporting Status.............................................17
4.24 Disclosure.......................................................17
ACTIONS PRIOR TO CLOSING......................................................17
5.1 Corporate Examinations and Investigations........................17
5.2 Conduct and Preservation of Business of BRAVO....................18
5.3 Conduct and Preservation of Business Of POINT BREAK..............18
5.4 Advice of Changes................................................18
5.5 OTC Bulletin Board...............................................19
5.6 SEC Reports......................................................19
5.7 Shareholder Approvals............................................19
5.8 Other Agreements.................................................19
CONDITIONS PRECEDENT TO CLOSING...............................................19
6.1 Conditions Precedent to the Obligations Of BRAVO to
Complete the Closing.............................................19
6.2 Conditions Precedent to the Obligations of POINT BREAK
to Complete the Closing..........................................21
POST-CLOSING COVENANTS........................................................22
7.1 Further Information..............................................22
7.2 Record Retention.................................................22
7.3 Post-closing Assistance..........................................22
7.4 Issuance of Shares During Escrow Period..........................23
SURVIVAL; INDEMNIFICATION.....................................................23
8.1 Survival of Agreements, Representations and Warranties...........23
TERMINATION OF AGREEMENT......................................................23
9.1 Termination......................................................23
9.2 Survival After Termination.......................................24
MISCELLANEOUS.................................................................24
10.1 Expenses.........................................................24
10.2 Further Assurances...............................................24
10.3 Notices..........................................................24
10.4 Mediation........................................................25
10.5 Arbitration......................................................26
10.6 Publicity........................................................26
10.7 Entire Agreement.................................................26
10.8 Waivers and Amendments...........................................26
10.9 Governing Law....................................................27
10.10 Binding Effect, No Assignment...................................27
10.11 Counterparts....................................................27
10.12 Exhibits and Schedules..........................................27
10.13 Effect of Disclosure On Schedules...............................27
10.14 Headings........................................................27
10.15 Severability of Provisions......................................27
SCHEDULE A - POINT BREAK SHAREHOLDERS
SCHEDULE B - COMPLETION OF EPISODES
SCHEDULE C - BUDGET FOR PRODUCTION
SCHEDULE D - ESCROW AGREEMENT
THIS SHARE EXCHANGE AGREEMENT is entered into as of May 23, 2005, by and between
BRAVO RESOURCES LTD., a Nevada corporation ("BRAVO"), and POINT BREAK
PRODUCTIONS, INC., a Nevada corporation ("POINT BREAK").
RECITALS
A. The Boards of Directors of each of BRAVO and POINT BREAK have
determined that it is in the best interests of BRAVO and POINT BREAK
(as applicable) and their respective shareholders that BRAVO acquire
POINT BREAK through a statutory share exchange under the laws of Nevada
(the "SHARE EXCHANGE") and, in furtherance thereof, have approved the
Share Exchange, this Agreement and the transactions contemplated
hereby.
B. Pursuant to the Share Exchange, among other things, and subject to the
terms and conditions of this Agreement, all of the shares of capital
stock of POINT BREAK which are issued and outstanding immediately prior
to the Effective Time (as defined below) shall be converted into the
right to receive shares of common stock, $0.001 par value per share, of
BRAVO ("BRAVO COMMON STOCK") on the terms and subject to the conditions
set forth herein.
X. XXXXX and POINT BREAK desire to make certain representations,
warranties, covenants and agreements in connection with the Share
Exchange.
AGREEMENT
NOW, THEREFORE, for and in consideration of the premises and the mutual
agreements hereinafter set forth, in accordance with the provisions of
applicable law, the parties hereby agree as follows:
ARTICLE I
THE SHARE EXCHANGE
1.1 THE SHARE EXCHANGE. At the Effective Time and upon the terms and
subject to the conditions of this Agreement and the applicable
provisions of the Nevada Revised Statutes (the "NEVADA LAW"), by virtue
of the Share Exchange and without any action on the part of BRAVO or
the holder of any shares of POINT BREAK Common Stock, the following
shall occur:
1.2 NUMBER OF SHARES OF BRAVO COMMON STOCK. The stockholders of POINT BREAK
named on SCHEDULE A attached to this Agreement (the "POINT BREAK
SHAREHOLDERS") shall receive an aggregate of 24,000,000 shares of BRAVO
Common Stock on a pro rata basis based on their percentage
shareholdings in POINT BREAK at the Effective Date, and POINT BREAK
shall become a wholly-owned subsidiary of BRAVO.
1.3 CONVERSION OF POINT BREAK COMMON STOCK. Each share of POINT BREAK
Common Stock issued and outstanding immediately prior to the Effective
Time (other than any Dissenting Shares, as such term is defined in
SECTION 1.8) will be automatically converted
Share Exchange Agreement - Page 1
into the right to receive 61,538.46 shares of BRAVO Common Stock (the
"EXCHANGE RATIO").
1.4 EFFECTIVE TIME. The Share Exchange will become effective upon the
execution by the parties of this Share Exchange Agreement and the
attached Escrow Agreement (SCHEDULE D), and the receipt by the Escrow
Agent of the Items of Escrow identified therein (the "EFFECTIVE TIME").
1.5 FRACTIONAL SHARES. No fraction of a share of BRAVO Common Stock will be
issued upon such exchange of shares of POINT BREAK Common Stock.
Instead amounts of shares will be rounded to the nearest whole number.
1.6 RESERVATION OF SHARES. BRAVO will reserve sufficient shares of BRAVO
Common Stock for issuance pursuant to SECTION 1.3.
1.7 ADJUSTMENTS TO EXCHANGE RATIO. The Exchange Ratio shall be equitably
adjusted to reflect fully the effect of any stock split, reverse split,
stock combination, stock dividend (including any dividend or
distribution of securities convertible into BRAVO Common Stock or POINT
BREAK Common Stock), reorganization, reclassification, recapitalization
or other like change with respect to BRAVO Common Stock or POINT BREAK
Common Stock, the effective date of which occurs after the date hereof
and prior to the Effective Time.
1.8 DISSENTING SHARES.
(a) Notwithstanding any provision of this Agreement to the
contrary, any shares of POINT BREAK Common Stock held by a
holder who has demanded and perfected appraisal rights for
such shares in accordance with the Nevada Law and who, as of
the Effective Time, has not effectively withdrawn or lost such
appraisal or dissenters' rights ("DISSENTING Shares") shall
not be converted into or represent a right to receive BRAVO
Common Stock pursuant to SECTIONS 1.2 and 1.3, but the holder
thereof shall only be entitled to such rights as are granted
by the Nevada Law.
(b) Notwithstanding the provisions of SECTION 1.8(A), if any
holder of shares of POINT BREAK Common Stock who demands
appraisal of such shares under the Nevada Law shall
effectively withdraw or lose (through failure to perfect or
otherwise) the right to appraisal, then, as of the later of
(i) the Effective Time or (ii) the occurrence of such event,
such holder's shares shall automatically be converted into and
represent only the right to receive BRAVO Common Stock as
provided in SECTIONS 1.2 and 1.3, without interest thereon, in
accordance with SECTIONS 1.2 and 1.3.
(c) POINT BREAK shall give BRAVO (i) prompt notice of its receipt
of any written demands for appraisal of any shares of BRAVO
Common Stock, withdrawals of such demands, and any other
instruments relating to the Share Exchange received by POINT
BREAK and (ii) the opportunity to participate in all
negotiations and proceedings with respect to demands for
appraisal under the Nevada Law.
1.9 EXCHANGE OF CERTIFICATES. BRAVO shall cause its transfer agent to issue
certificates representing the whole number of shares of BRAVO Common
Stock into which such
Share Exchange Agreement - Page 2
POINT BREAK Shareholder's shares of POINT BREAK Common Stock shall have
been exchanged as set forth in SCHEDULE A attached hereto.
1.10 NO FURTHER OWNERSHIP RIGHTS IN POINT BREAK COMMON STOCK. All shares of
BRAVO Common Stock issued upon the surrender for exchange of shares of
POINT BREAK Common Stock in accordance with the terms hereof shall be
deemed to have been issued in full satisfaction of all rights
pertaining to such shares of POINT BREAK Common Stock, and there shall
be no further registration of transfers on the records of POINT BREAK
of shares of POINT BREAK Common Stock which were outstanding
immediately prior to the Effective Time. If, after the Effective Time,
certificates are presented to the BRAVO for any reason, they shall be
canceled and exchanged as provided in this Article 1.
1.11 LOST, STOLEN OR DESTROYED CERTIFICATES. In the event any certificates
evidencing shares of POINT BREAK Common Stock shall have been lost,
stolen or destroyed, the transfer agent for BRAVO shall issue
certificates representing such shares of BRAVO Common Stock in exchange
for such lost, stolen or destroyed certificates, upon the making of an
affidavit of that fact by the holder thereof.
1.12 EXEMPTION FROM REGISTRATION. The shares of BRAVO Common Stock to be
issued pursuant to SECTIONS 1.2 and 1.3 in connection with the Share
Exchange will be issued in a transaction exempt from registration under
the Securities Act of 1933, as amended (including the rules and
regulations promulgated thereunder, the "SECURITIES ACT").
1.13 REPORTING OF SHARE EXCHANGE. For federal, state, and local income tax
return reporting purposes, all parties agree to treat the Share
Exchange as a nontaxable exchange under Section 368 of the Internal
Revenue Code.
1.14 ESCROW OF BRAVO AND POINT BREAK COMMON STOCK.
(a) Immediately after Closing, BRAVO will engage in a private
placement of its shares of Common Stock for net proceeds of
sufficient amount, as set forth in the attached SCHEDULE C, to
fund the production of 13 episodes of "The Strip Poker
Invitational." At Closing, the shares certificates of BRAVO
Common Stock and the share certificates of POINT BREAK Common
Stock (with executed stock powers), to be issued pursuant to
SECTIONS 1.2 and 1.3 shall be placed into and held in escrow
until (a) the financing has been obtained and all 13 episodes
have been completed as described in SCHEDULES B AND C attached
hereto, or (b) November 30, 2005, whichever shall first occur
(the "ESCROW PERIOD").
(b) If the financing shall have been obtained and all 13 episodes
shall have been completed prior to November 30, 2005, then the
shares certificates of POINT BREAK Common Stock shall be
transferred to BRAVO and the shares certificates of BRAVO
Common Stock shall be delivered to the POINT BREAK
Shareholders.
(c) If all the financing shall not have been obtained or if all 13
episodes shall not have been completed prior to November 30,
2005, this Share Exchange Agreement may be rescinded by either
BRAVO or the POINT BREAK Shareholders (who are the third party
beneficiaries of this Share Exchange Agreement), whereupon the
shares of
Share Exchange Agreement - Page 3
BRAVO Common Stock shall be returned to BRAVO for cancellation
and the shares of POINT BREAK Common Stock and accompanying
stock powers shall be returned to the POINT BREAK Shareholders
for reinstatement of ownership of those shares.
1.15 BOARD OF DIRECTORS AND OFFICERS OF BRAVO. Immediately after the Closing
and until the termination of the Escrow Period, the officers and
directors of BRAVO shall continue to serve in their current positions.
1.16 TAKING OF NECESSARY ACTION; FURTHER ACTION. If, at any time after the
Effective Time, any such further action is necessary or desirable to
carry out the purposes of this Agreement, the officers and directors of
BRAVO are fully authorized to take, and will use their reasonable
efforts to take, all such lawful and necessary action.
ARTICLE II
THE CLOSING
2.1 TIME AND PLACE OF CLOSING. The closing of the Share Exchange (the
"CLOSING") shall, unless otherwise agreed to in writing by the parties,
take place at such time and place, not later than May 31, 2005, as the
parties shall mutually agree.
2.2 OBLIGATIONS OF POINT BREAK AND THE POINT BREAK SHAREHOLDERS AT OR PRIOR
TO THE CLOSING. At or prior to Closing, and subject to the satisfaction
by BRAVO of its obligations hereunder, POINT BREAK and the POINT BREAK
Shareholders shall deliver to BRAVO the following:
(a) A copy of the Articles of Incorporation of POINT BREAK
certified as of a date within ten days of the Closing by the
Secretary of State of the State of Nevada and certified by the
corporate secretary of POINT BREAK as to the absence of any
amendments between the date of certification by the Secretary
of State and the Closing;
(b) A certificate from the Secretary of State of the State of
Nevada as to the existence and good standing of POINT BREAK as
of a date within ten days of the Closing;
(c) A certificate of the corporate secretary of POINT BREAK
attaching thereto true and correct copies of the bylaws of
POINT BREAK;
(d) The certificate of POINT BREAK referred to in SECTION 6.1
hereof;
(e) Such other documents as are required pursuant to this
Agreement or as may reasonably be requested from POINT BREAK
by BRAVO or its counsel; and
(f) The certificates evidencing the shares of POINT BREAK Common
Stock owned by the POINT BREAK Shareholders, duly endorsed for
transfer to BRAVO.
Share Exchange Agreement - Page 4
2.3 OBLIGATIONS OF BRAVO AT OR PRIOR TO THE CLOSING. At or prior to
Closing, and subject to the satisfaction by POINT BREAK of its
obligations hereunder, BRAVO shall deliver to POINT BREAK and the POINT
BREAK Shareholders the following:
(a) A copy of the Articles of Incorporation of BRAVO certified as
of a date within ten days of the Closing by the Secretary of
State of the State of Nevada and certified by the corporate
secretary of BRAVO as to the absence of any amendments between
the date of certification by the Secretary of State and the
Closing;
(b) A certificate from the Secretary of State of the State of
Nevada as to the existence and good standing of BRAVO as of a
date within ten days of the Closing;
(c) A certificate of the corporate secretary of BRAVO attaching
thereto true and correct copies of the bylaws of BRAVO and the
corporate resolutions duly adopted by the board of directors
of BRAVO authorizing the consummation of the transactions
contemplated hereby;
(d) The certificate of BRAVO referred to in SECTION 6.2 hereof;
(e) Such other documents as are required pursuant to this
Agreement or as may reasonably be requested from BRAVO by
POINT BREAK or its counsel; and
(f) Certificates evidencing the BRAVO Common Stock to be issued to
the POINT BREAK Shareholders pursuant to ARTICLE I hereof.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF POINT BREAK
Except as expressly set forth and specifically identified by the section number
of this Agreement in the schedule delivered by POINT BREAK to BRAVO
contemporaneously with the execution of this Agreement (the "POINT BREAK
DISCLOSURE SCHEDULE"), POINT BREAK represents, warrants, and covenants to BRAVO
as follows:
3.1 ORGANIZATION AND QUALIFICATION. POINT BREAK is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Nevada and has all requisite corporate power and authority to
(a) own, lease and operate its properties and assets as they are now
owned, leased and operated and (b) carry on its business as currently
conducted and as proposed to be conducted. POINT BREAK is duly
qualified or licensed to do business in each jurisdiction in which the
failure to be so qualified or licensed could have a material adverse
effect in the business, operations, properties, assets, liabilities,
prospects, or condition (financial or otherwise) of POINT BREAK
(hereinafter a "MATERIAL EFFECT").
3.2 CAPITALIZATION. The issued and outstanding capital stock of POINT BREAK
consists of 390 shares of common stock. All of the issued and
outstanding shares of capital stock of POINT
Share Exchange Agreement - Page 5
BREAK are validly issued, fully paid, and nonassessable, and none of
such shares has been issued in violation of the preemptive rights of
any person.
3.3 SUBSIDIARIES AND AFFILIATES. Except as set forth in SECTION 3.3 of the
POINT BREAK Disclosure Schedule, POINT BREAK does not own or hold,
directly or indirectly, any equity, debt, or other interest in any
entity or business or any option to acquire any such interest.
3.4 OPTIONS OR OTHER RIGHTS. Except as set forth in SECTION 3.4 of the
POINT BREAK Disclosure Schedule, no options, warrants, calls,
commitments or other rights to acquire, sell or issue shares of capital
stock or other equity interests of POINT BREAK, whether upon conversion
of other securities or otherwise, are issued or outstanding, and there
is no agreement or understanding with respect to the voting of such
capital stock or other equity interests.
3.5 OWNERSHIP OF SHARES. The shares of POINT BREAK Common Stock are owned
of record and beneficially by the POINT BREAK Shareholders as set forth
on Schedule A. To the knowledge of POINT BREAK, the POINT BREAK
Shareholders possess full authority and legal right to sell, transfer,
and assign the entire legal and beneficial ownership of the shares of
POINT BREAK common stock, free from all liens, claims, and encumbrances
of any kind.
3.6 VALIDITY AND EXECUTION OF AGREEMENT. POINT BREAK has the full legal
right, capacity and power required to enter into, execute and deliver
this Agreement and to carry out the transactions contemplated, subject
to approval of the shareholders of POINT BREAK and the terms set forth
in this Agreement. This Agreement has been duly executed and delivered
by POINT BREAK and constitutes the valid and binding obligation of
POINT BREAK, enforceable in accordance with its terms, subject to the
qualification that enforcement of the rights and remedies created
hereby is subject to (a) bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the rights
and remedies of creditors and (b) general principles of equity
(regardless of whether such enforcement is considered in a proceeding
in equity or at law).
3.7 NO CONFLICT. Except as set forth in SECTION 3.7 of the POINT BREAK
Disclosure Schedule and to the knowledge of POINT BREAK, none of the
execution, delivery, or performance of this Agreement does or will: (a)
result in any violation or be in conflict with or constitute a default
under any term or provision of the Articles of Incorporation or bylaws
of POINT BREAK or any term or provision of any judgment, decree, order,
statute, injunction, rule, or regulation applicable to POINT BREAK that
would cause a Material Effect, or of any material note, bond, mortgage,
indenture, lease, license, franchise, agreement, or other instrument or
obligation to which POINT BREAK or is bound that would cause a Material
Effect; (b) result in the creation of any material option, pledge,
security interest, lien, charge, encumbrance, or restriction, whether
imposed by agreement, understanding, law or otherwise, except those
arising under applicable federal or state securities laws (hereinafter
an "ENCUMBRANCE") upon any of the properties or assets of POINT BREAK
pursuant to any such term or provision that would cause a Material
Effect; or (c) constitute a default under,
Share Exchange Agreement - Page 6
terminate, accelerate, amend or modify, or give any party the right to
terminate, accelerate, amend, modify, abandon, or refuse to perform or
comply with, any material contract, agreement, arrangement, commitment,
or plan to which POINT BREAK is a party, or by which POINT BREAK or any
of its properties or assets may be subject or bound that would cause a
Material Effect.
3.8 CONSENTS AND APPROVALS. No federal, state, or other regulatory
approvals are required to be obtained, nor any regulatory requirements
complied with, by POINT BREAK in connection with the Share Exchange.
3.9 VIOLATION OF LAWS, PERMITS, ETC.
(a) POINT BREAK is not in violation of any term or provision of
its Articles of Incorporation or bylaws, or of any material
term or provision of any judgment, decree, order, statute,
law, injunction, rule, ordinance, or governmental regulation
that is applicable to it and where the failure to comply with
which would have a Material Effect.
(b) POINT BREAK has maintained in full force and effect all
certificates, licenses, and permits material to the conduct of
its business, and has not received any notification that any
revocation or limitation thereof is threatened or pending.
3.10 BOOKS AND RECORDS. The books and records of POINT BREAK (including,
without limitation, the books of account, minute books, and stock
record books) are complete and correct in all material respects and
have been maintained in accordance with sound business practices. The
minute books of POINT BREAK are complete and current in all material
respects and, as applicable, accurately reflect all actions taken by
the shareholders and the board of directors of POINT BREAK since the
date of inception of POINT BREAK, and all signatures contained therein
are the true signatures of the persons whose signatures they purport to
be.
3.11 POINT BREAK FINANCIAL STATEMENTS. The unaudited balance sheet of POINT
BREAK as of May 10, 2005, and the related unaudited statement of income
and statement of cash flows for the period commencing as of date of
inception through May 10, 2005 (the "POINT BREAK FINANCIAL
STATEMENTS"), true and complete copies of which have been delivered to
BRAVO, present fairly, in all material respects, the financial position
of POINT BREAK as at such dates and the results of operations of POINT
BREAK for the periods then ended, in accordance with generally accepted
accounting principles ("GAAP") consistently applied for the periods
covered thereby.
3.12 UNDISCLOSED LIABILITIES. To the knowledge of POINT BREAK, POINT BREAK
does not have any material direct or indirect indebtedness, liability,
claim, loss, damage, deficiency, obligation or responsibility, fixed or
unfixed, xxxxxx or inchoate, liquidated or unliquidated, secured or
unsecured, accrued, absolute, contingent or otherwise (all of the
foregoing being collectively referred to as "LIABILITIES" and
individually as a "LIABILITY"), of a kind required by GAAP to be set
forth on a financial statement that is not fully and adequately
reflected or
Share Exchange Agreement - Page 7
reserved against on the POINT BREAK Financial Statements. POINT BREAK
does not have any Liabilities, whether or not of a kind required by
GAAP to be set forth on a financial statement, other than (a)
Liabilities incurred in the ordinary course of business since the date
of the latest balance sheet included in the POINT BREAK Financial
Statements that are consistent with past practice and are included in
the latest POINT BREAK Financial Statements, (b) Liabilities that are
fully reflected on or reserved against on the latest balance sheet
included in the POINT BREAK Financial Statements, or (c) as
specifically disclosed in the POINT BREAK Financial Statements.
3.13 TITLE TO PROPERTY; ENCUMBRANCES. POINT BREAK has good and indefeasible
title to and other legal right to use all properties and assets, real,
personal and mixed, tangible and intangible, reflected as owned on the
latest balance sheet included in the POINT BREAK Financial Statements
or acquired after the date of such balance sheet, except for properties
and assets disposed of in accordance with customary practice in the
business or disposed of for full and fair value since the date of such
balance sheet in the ordinary course of business consistent with past
practice and except for matters that would not have a Material Effect.
3.14 TAXES. All returns, reports, information returns, or other documents
(including any related or supporting information) filed or required to
be filed with any federal, state, local, or foreign governmental entity
or others authority in connection with the determination, assessment or
collection of any Tax (whether or not such Tax is imposed on POINT
BREAK) or the administration of any laws, regulations or administrative
requirements relating to any Tax (hereinafter "TAX Returns"), reports
and declarations of estimated tax or estimated tax deposit forms
required to be filed by POINT BREAK have been duly and timely filed;
POINT BREAK has paid all taxes, charges, fees, levies or other
assessments imposed by any federal, state, local or foreign taxing
authority, whether disputed or not, including, without limitation,
income, capital, estimated, excise, property, sales, transfer,
withholding, employment, payroll, and franchise taxes and such terms
shall include any interest, penalties or additions attributable to or
imposed on or with respect to such assessments and any expenses
incurred in connection with the settlement of any tax liability
(hereinafter "TAXES") which have become due whether pursuant to such
returns or any assessment received by it or otherwise, and has paid all
installments of estimated Taxes due; and all Taxes which POINT BREAK is
required by law to withhold or to collect have been duly withheld and
collected, and have been paid over to the proper court, tribunal,
arbitrator or any government or political subdivision thereof, whether
federal, state, county, local or foreign, or any agency, authority,
official or instrumentality of any such government or political
subdivision (hereinafter "GOVERNMENTAL OR REGULATORY BODY"). There are
no tax liens upon any of the assets or properties of POINT BREAK except
for any lien, pledge, hypothecation, mortgage, security interest,
claim, lease, charge, option, right of first refusal, easement,
servitude, transfer restriction under any member or similar agreement,
encumbrance or any other restriction or limitation whatsoever, other
than (i) materialmen's, mechanics', repairmen's or other like liens
arising in the ordinary course of business for amounts either not yet
due or being contested in good faith and by appropriate proceedings so
long as such proceedings shall not involve any material danger of sale,
forfeiture or loss of any part of the assets and shall have been
disclosed to BRAVO hereunder, or (ii) any lien arising as a result of
any act or omission of BRAVO (hereinafter "LIENS") for Taxes not yet
Share Exchange Agreement - Page 8
due. POINT BREAK is not a party to any express tax settlement
agreement, arrangement, policy or guideline, formal or informal (a
"SETTLEMENT AGREEMENT"), and POINT BREAK does not have any obligation
to make payments under any Settlement Agreement.
3.15 LITIGATION.
(a) There is no action, proceeding, investigation, or inquiry
pending or, to the best of POINT BREAK's knowledge, threatened
(i) against or affecting any of POINT BREAK's assets or
business that, if determined adversely to POINT BREAK, would
result in a Material Effect or (ii) that questions this
Agreement or any action contemplated by this Agreement or in
connection with the Share Exchange.
(b) POINT BREAK has no knowledge of any state of facts or of the
occurrence or nonoccurrence of any event or group of related
events, that should reasonably cause POINT BREAK to determine
that there exists any basis for any material claim against
POINT BREAK for any of the matters described in paragraph (a)
above.
3.16 CONTRACTS AND OTHER AGREEMENTS. POINT BREAK has made available to BRAVO
complete and correct copies of all material written agreements,
contracts, and commitments, together with all amendments thereto, and
accurate (in all material respects) descriptions of all material oral
agreements. Such agreements, contracts, and commitments are in full
force and effect, and, to the best of POINT BREAK's knowledge, all
other parties to such agreements, contracts, and commitments have
performed all obligations required to be performed by them to date
thereunder in all material respects and are not in default thereunder
in any material respect.
3.17 COMPENSATION ARRANGEMENTS; OFFICERS AND DIRECTORS. SECTION 3.17 to the
POINT BREAK Disclosure Schedule sets forth: (a) the names of all
present officers and directors of POINT BREAK and current annual
salary, including any promised, expected or customary bonus or such
other amount, and (b) the names and titles of all directors and
officers of POINT BREAK. POINT BREAK has not made a commitment or
agreement (verbally or in writing) to increase the compensation or to
modify the conditions or terms of employment of any person listed in
SECTION 3.17 to the POINT BREAK Disclosure Schedule. To the knowledge
of POINT BREAK, none of such persons has made a threat to POINT BREAK
to terminate such person's relationship with POINT BREAK.
3.18 ERISA. Except as set forth in SECTION 3.18 to the POINT BREAK
Disclosure Schedule, there are no employee benefit plans as defined in
ERISA ("PLANS") maintained for the benefit of, or covering, any
employee, former employee, independent contractor or former independent
contractor of POINT BREAK, or their dependents or their beneficiaries,
or otherwise, now or heretofore contributed to by POINT BREAK, and no
such Plan is or has ever been subject to ERISA.
3.19 OPERATIONS. Except as expressly authorized by this Agreement, and
except as set forth in SECTION 3.19 to the POINT BREAK Disclosure
Schedule, since the date of the latest POINT BREAK Financial
Statements, POINT BREAK has not:
Share Exchange Agreement - Page 9
(a) amended its Articles of Incorporation or By-Laws or merged
with or into or consolidated with any other entity, or changed
or agreed to rearrange in any manner the character of the
business of POINT BREAK;
(b) issued, sold or purchased options or rights to subscribe to,
or entered into any contracts or commitments to issue, sell or
purchase, any shares of its capital stock or other equity
interests except in the ordinary course of business and
consistent with past practices;
(c) issued any note, bond or other debt security, created,
incurred or assumed any indebtedness for borrowed money other
than in the ordinary course of business in connection with
trade payables, or guaranteed any indebtedness for borrowed
money or any capitalized lease obligation;
(d) declared, set aside or paid any dividends or declared or made
any other distributions of any kind to the shareholders, or
made any direct or indirect redemption, retirement, purchase
or other acquisition of any shares of its capital stock or
other equity interests;
(e) knowingly waived any right of material value to the business
of POINT BREAK;
(f) made any change in its accounting methods or practices or made
any changes in depreciation or amortization policies or rates
adopted by it or made any material write-down of inventory or
material write-off as uncorrectable of accounts receivable;
(g) made any wage or salary increase or other compensation payable
or to become payable or bonus, or increase in any other direct
or indirect compensation, for or to any of its officers,
directors, employees, consultants, agents or other
representatives, or any accrual for or commitment or agreement
to make or pay the same, other than increases made in the
ordinary course consistent with past practice;
(h) entered into any transactions with any of its affiliates,
shareholders, officers, directors, employees, consultants,
agents or other representatives (other than employment
arrangements made in the ordinary course of business
consistent with past practice), or any affiliate of any
shareholder, officer, director, consultant, employee, agent or
other representative;
(i) made any payment or commitment to pay any severance or
termination pay to any person or any of its officers,
directors, employees, consultants, agents or other
representatives, other than payments or commitments to pay
such persons or their officers, directors, employees in the
ordinary course of business;
Share Exchange Agreement - Page 10
(j) except in the ordinary course of business, incurred or assumed
any debt, obligation or liability (whether absolute or
contingent and whether or not currently due and payable);
(k) except in the ordinary course of business, made any
acquisition of all or any part of the assets, properties,
capital stock or business of any other person;
(l) except in the ordinary course of business, paid, directly or
indirectly, any of its Liabilities before the same became due
in accordance with their terms or otherwise than in the
ordinary course of business, except to obtain the benefit of
discounts available for early payment;
(m) except in the ordinary course of business, created, incurred
or assumed any indebtedness for borrowed money, or guaranteed
any indebtedness for borrowed money or any capitalized lease
obligation, in each case in excess of $50,000 individually or
in the aggregate;
(n) except in the ordinary course of business, made any capital
expenditures or commitments for capital expenditures in
aggregate amount exceeding $50,000; or
(o) except in the ordinary course of business, terminated, failed
to renew, amended or entered into any contract or other
agreement of a type required to be disclosed pursuant to
SECTION 3.16.
3.20 LICENSES AND PERMITS. All of the licenses, concessions and permits
issued to POINT BREAK are set forth in SECTION 3.20 of the POINT BREAK
Disclosure Schedule. POINT BREAK has not received any notice of any
claim of revocation of any such licenses, concessions, and permits and
has no knowledge of any event, which would be likely to give rise to
such a claim.
3.21 BROKERS. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried out by POINT BREAK
directly with BRAVO without the intervention of any other person on
behalf of POINT BREAK in such manner as to give rise to any valid claim
by any person against POINT BREAK or BRAVO for a finder's fee,
brokerage commission or similar payment.
3.22 DISCLOSURE. To the knowledge of POINT BREAK, neither this Agreement,
nor any Schedule or Exhibit to this Agreement, contains an untrue
statement of a material fact or omits a material fact necessary to make
the statements contained herein or therein not misleading.
Share Exchange Agreement - Page 11
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BRAVO
Except as expressly set forth and specifically identified by the section number
of this Agreement in the schedule delivered by BRAVO to POINT BREAK
contemporaneously with the execution of this Agreement (the "BRAVO DISCLOSURE
SCHEDULE"), BRAVO represents, warrants, and covenants to POINT BREAK as follows:
4.1 ORGANIZATION AND QUALIFICATION. BRAVO is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Nevada and has all requisite corporate power and authority to (a) own,
lease and operate its properties and assets as they are now owned,
leased and operated and (b) carry on its business as currently
conducted and as proposed to be conducted. BRAVO is duly qualified or
licensed to do business in each jurisdiction in which the failure to be
so qualified or licensed could have a Material Effect.
4.2 CAPITALIZATION. The issued and outstanding capital stock of BRAVO
consists of 6,362,744 shares of common stock, $0.001 par value per
share. All of the issued and outstanding shares of capital stock of
BRAVO are validly issued, fully paid, and nonassessable, and none of
such shares has been issued in violation of the preemptive rights of
any person. The BRAVO Common Stock shall be validly issued, fully paid,
and nonassessable.
4.3 SUBSIDIARIES AND AFFILIATES. Except as set forth in SECTION 4.3 of the
BRAVO Disclosure Schedule, BRAVO does not own or hold, directly or
indirectly, any equity, debt, or other interest in any entity or
business or any option to acquire any such interest.
4.4 OPTIONS OR OTHER RIGHTS. Except as set forth in SECTION 4.4 of the
BRAVO Disclosure Schedule, no options, warrants, calls, commitments or
other rights to acquire, sell or issue shares of capital stock or other
equity interests of BRAVO whether upon conversion of other securities
or otherwise, are issued or outstanding except as set forth in the
BRAVO Disclosure Schedule, and there is no agreement or understanding
with respect to the voting of such capital stock or other equity
interests.
4.5 VALIDITY AND EXECUTION OF AGREEMENT. BRAVO has the full legal right,
capacity, and power required to enter into, execute, and deliver this
Agreement and to carry out the transactions contemplated, subject to
approval of the shareholders of BRAVO and the terms set forth in this
Agreement. This Agreement has been duly and validly executed on behalf
of BRAVO and is a valid and binding obligation of BRAVO, enforceable in
accordance with its terms, subject to the qualification that
enforcement of the rights and remedies created hereby is subject to (a)
bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting the rights and remedies of creditors and
(b) general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law).
4.6 NO CONFLICT. Except as set forth in SECTION 4.6 of the BRAVO Disclosure
Schedule and to the knowledge of BRAVO, none of the execution,
delivery, or performance of this Agreement does or will: (a) result in
any violation or be in conflict with or constitute a
Share Exchange Agreement - Page 12
default under any term or provision of the Articles of Incorporation or
bylaws of BRAVO or any term or provision of any judgment, decree,
order, statute, injunction, rule, or regulation applicable to BRAVO
that would cause a Material Effect, or of any material note, bond,
mortgage, indenture, lease, license, franchise, agreement, or other
instrument or obligation to which BRAVO is bound that would cause a
Material Effect; (b) result in the creation of any Encumbrance upon any
of the properties or assets of BRAVO pursuant to any such term or
provision that would cause a Material Effect; or (c) constitute a
default under, terminate, accelerate, amend or modify, or give any
party the right to terminate, accelerate, amend, modify, abandon, or
refuse to perform or comply with, any material contract, agreement,
arrangement, commitment, or plan to which BRAVO is a party, or by which
BRAVO or any of its properties or assets may be subject or bound that
would cause a Material Effect.
4.7 CONSENTS AND APPROVALS. No federal, state, or other regulatory
approvals are required to be obtained, nor any regulatory requirements
complied with, by BRAVO in connection with the Share Exchange.
4.8 VIOLATION OF LAWS, PERMITS, ETC.
(a) BRAVO is not in violation of any term or provision of its
Articles of Incorporation or bylaws, or of any material term
or provision of any judgment, decree, order, statute, law,
injunction, rule, ordinance, or governmental regulation that
is applicable to it and where the failure to comply with which
would have a Material Effect.
(b) BRAVO has maintained in full force and effect all
certificates, licenses, and permits material to the conduct of
its business, and has not received any notification that any
revocation or limitation thereof is threatened or pending.
4.9 BOOKS AND RECORDS. The books and records of BRAVO (including, without
limitation, the books of account, minute books, and stock record books)
are complete and correct in all material respects and have been
maintained in accordance with sound business practices. The minute
books of BRAVO are complete and current in all material respects and,
as applicable, accurately reflect all actions taken by the shareholders
and the board of directors of BRAVO since the date of inception of
BRAVO, and all signatures contained therein are the true signatures of
the persons whose signatures they purport to be.
4.10 BRAVO FINANCIAL STATEMENTS. The unaudited balance sheet of BRAVO as of
March 31, 2005, and the related unaudited statement of income and
statement of cash flows for the year then ended (the "BRAVO FINANCIAL
STATEMENTS"), true and complete copies of which have been delivered to
POINT BREAK, present fairly, in all material respects, the financial
position of BRAVO as at such dates and the results of operations of
POINT BREAK for the periods then ended, in accordance with GAAP
consistently applied for the periods covered thereby.
4.11 UNDISCLOSED LIABILITIES. To the knowledge of BRAVO, BRAVO does not have
any Liability of a kind required by GAAP to be set forth on a financial
statement that is not fully and adequately reflected or reserved
against on the BRAVO Financial Statements. BRAVO
Share Exchange Agreement - Page 13
does not have any Liabilities, whether or not of a kind required by
GAAP to be set forth on a financial statement, other than (a)
Liabilities incurred in the ordinary course of business since the date
of the latest balance sheet included in the BRAVO Financial Statements
that are consistent with past practice and are included in the latest
BRAVO Financial Statements, (b) Liabilities that are fully reflected on
or reserved against on the latest balance sheet included in the BRAVO
Financial Statements, or (c) as specifically disclosed in the BRAVO
Financial Statements.
4.12 TITLE TO PROPERTY; ENCUMBRANCES. BRAVO has good and indefeasible title
to and other legal right to use all properties and assets, real,
personal and mixed, tangible and intangible, reflected as owned on the
latest balance sheet included in the BRAVO Financial Statements or
acquired after the date of such balance sheet, except for properties
and assets disposed of in accordance with customary practice in the
business or disposed of for full and fair value since the date of such
balance sheet in the ordinary course of business consistent with past
practice and except for matters that would not have a Material Effect.
4.13 TAXES. All Tax Returns, reports and declarations of estimated tax or
estimated tax deposit forms required to be filed by BRAVO have been
duly and timely filed; BRAVO has paid all Taxes which have become due
whether pursuant to such returns or any assessment received by it or
otherwise, and has paid all installments of estimated Taxes due; and
all Taxes which BRAVO is required by law to withhold or to collect have
been duly withheld and collected, and have been paid over to the proper
Governmental or Regulatory Body. There are no tax liens upon any of the
assets or properties of BRAVO except for Liens for Taxes not yet due.
BRAVO is not a party to any Settlement Agreement, and BRAVO does not
have any obligation to make payments under any Settlement Agreement.
4.14 LITIGATION.
(a) There is no action, proceeding, investigation, or inquiry
pending or, to the best of BRAVO's knowledge, threatened (i)
against or affecting any of BRAVO's assets or business that,
if determined adversely to BRAVO, would result in a Material
Effect or (ii) that questions this Agreement or any action
contemplated by this Agreement or in connection with the Share
Exchange.
(b) BRAVO has no knowledge of any state of facts or of the
occurrence or nonoccurrence of any event or group of related
events, that should reasonably cause BRAVO to determine that
there exists any basis for any material claim against BRAVO
for any of the matters described in paragraph (a) above.
4.15 CONTRACTS AND OTHER AGREEMENTS. BRAVO has made available to POINT BREAK
complete and correct copies of all material written agreements,
contracts, and commitments, together with all amendments thereto, and
accurate (in all material respects) descriptions of all material oral
agreements. Such agreements, contracts, and commitments are in full
force and effect, and, to the best of BRAVO's knowledge, all other
parties to such agreements, contracts, and commitments have performed
all obligations required to be performed by
Share Exchange Agreement - Page 14
them to date thereunder in all material respects and are not in default
thereunder in any material respect.
4.16 COMPENSATION ARRANGEMENTS; OFFICERS AND DIRECTORS. SECTION 4.16 to the
BRAVO Disclosure Schedule sets forth: (a) the names of all present
officers and directors of BRAVO and current annual salary, including
any promised, expected or customary bonus or such other amount, and (b)
the names and titles of all directors and officers of BRAVO. BRAVO has
not made a commitment or agreement (verbally or in writing) to increase
the compensation or to modify the conditions or terms of employment of
any person listed in SECTION 4.16 to the BRAVO Disclosure Schedule. To
the knowledge of BRAVO, none of such persons has made a threat to BRAVO
to terminate such person's relationship with BRAVO.
4.17 ERISA. Except as set forth in SECTION 4.17 to the BRAVO Disclosure
Schedule, there are no employee benefit plans as defined in ERISA
("PLANS") maintained for the benefit of, or covering, any employee,
former employee, independent contractor or former independent
contractor of BRAVO, or their dependents or their beneficiaries, or
otherwise, now or heretofore contributed to by BRAVO, and no such Plan
is or has ever been subject to ERISA.
4.18 OPERATIONS. Except as expressly authorized by this Agreement, and
except as set forth in SECTION 4.18 to the BRAVO Disclosure Schedule,
since the date of the latest BRAVO Financial Statements, BRAVO has not:
(a) amended its Articles of Incorporation or By-Laws or merged
with or into or consolidated with any other entity, or changed
or agreed to rearrange in any manner the character of the
business of BRAVO;
(b) issued, sold or purchased options or rights to subscribe to,
or entered into any contracts or commitments to issue, sell or
purchase, any shares of its capital stock or other equity
interests except in the ordinary course of business and
consistent with past practices;
(c) issued any note, bond or other debt security, created,
incurred or assumed any indebtedness for borrowed money other
than in the ordinary course of business in connection with
trade payables, or guaranteed any indebtedness for borrowed
money or any capitalized lease obligation;
(d) declared, set aside or paid any dividends or declared or made
any other distributions of any kind to the shareholders, or
made any direct or indirect redemption, retirement, purchase
or other acquisition of any shares of its capital stock or
other equity interests;
(e) knowingly waived any right of material value to the business
of BRAVO;
Share Exchange Agreement - Page 15
(f) made any change in its accounting methods or practices or made
any changes in depreciation or amortization policies or rates
adopted by it or made any material write-down of inventory or
material write-off as uncorrectable of accounts receivable;
(g) made any wage or salary increase or other compensation payable
or to become payable or bonus, or increase in any other direct
or indirect compensation, for or to any of its officers,
directors, employees, consultants, agents or other
representatives, or any accrual for or commitment or agreement
to make or pay the same, other than increases made in the
ordinary course consistent with past practice;
(h) entered into any transactions with any of its affiliates,
shareholders, officers, directors, employees, consultants,
agents or other representatives (other than employment
arrangements made in the ordinary course of business
consistent with past practice), or any affiliate of any
shareholder, officer, director, consultant, employee, agent or
other representative;
(i) made any payment or commitment to pay any severance or
termination pay to any person or any of its officers,
directors, employees, consultants, agents or other
representatives, other than payments or commitments to pay
such persons or their officers, directors, employees in the
ordinary course of business;
(j) except in the ordinary course of business, incurred or assumed
any debt, obligation or liability (whether absolute or
contingent and whether or not currently due and payable);
(k) except in the ordinary course of business, made any
acquisition of all or any part of the assets, properties,
capital stock or business of any other person;
(l) except in the ordinary course of business, paid, directly or
indirectly, any of its Liabilities before the same became due
in accordance with their terms or otherwise than in the
ordinary course of business, except to obtain the benefit of
discounts available for early payment;
(m) except in the ordinary course of business, created, incurred
or assumed any indebtedness for borrowed money, or guaranteed
any indebtedness for borrowed money or any capitalized lease
obligation, in each case in excess of $50,000 individually or
in the aggregate;
(n) except in the ordinary course of business, made any capital
expenditures or commitments for capital expenditures in
aggregate amount exceeding $50,000; or
(o) except in the ordinary course of business, terminated, failed
to renew, amended or entered into any contract or other
agreement of a type required to be disclosed pursuant to
SECTION 3.16.
Share Exchange Agreement - Page 16
4.19 BROKERS. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried out by POINT BREAK
directly with BRAVO without the intervention of any other person on
behalf of BRAVO in such manner as to give rise to any valid claim by
any person against POINT BREAK or BRAVO for a finder's fee, brokerage
commission or similar payment.
4.20 APPROVAL OF SHARE EXCHANGE. The board of directors of BRAVO has
approved the Share Exchange without reservation or qualification.
4.21 INVESTMENT COMPANY. BRAVO is not an investment company within the
meaning of Section 3 of the Investment Company Act.
4.22 TRADING STATUS. The BRAVO Common Stock is quoted on the OTC Bulletin
Board under the symbol "BVOL."
4.23 SEC REPORTING STATUS. BRAVO filed a registration statement under the
Securities Act of 1933, which was declared effective on February 11,
2004. Accordingly, since that date, BRAVO has filed all reports
required to be filed pursuant to Section 15(d) of the Securities
Exchange Act of 1934.
4.24 DISCLOSURE. To the knowledge of BRAVO, neither this Agreement, nor any
Schedule or Exhibit to this Agreement, contains an untrue statement of
a material fact or omits a material fact necessary to make the
statements contained herein or therein not misleading.
ARTICLE V
ACTIONS PRIOR TO CLOSING
5.1 CORPORATE EXAMINATIONS AND INVESTIGATIONS. At or prior to the Closing
Date, each of BRAVO and POINT BREAK shall be entitled to make such
investigation of the assets, properties, business and operations of the
other and such examination of the books, records, Tax Returns,
financial condition and operations of the other as each may wish. Any
such investigation and examination shall be conducted at reasonable
times and under reasonable circumstances and BRAVO and POINT BREAK
shall cooperate fully therein. In order that each of BRAVO and POINT
BREAK may have full opportunity to make such a business, accounting and
legal review, examination or investigation as it may wish of the
business and affairs of the other, BRAVO or POINT BREAK, as the case
may be, shall furnish to the other during such period all such
information and copies of such documents concerning its affairs as
BRAVO or POINT BREAK may reasonably request and cause its officers,
employees, consultants, agents, accountants and attorneys to cooperate
fully and provide all material facts affecting its financial condition
and business operations. Until the Closing and if the Closing shall not
occur, thereafter, BRAVO, POINT BREAK, and its respective affiliates
shall keep confidential and shall not use in any manner inconsistent
with the transactions contemplated by this Agreement and after
termination of this Agreement, BRAVO, POINT BREAK, and its respective
affiliates shall not disclose, nor use for their own benefit, any
information or documents obtained from the other concerning its assets,
Share Exchange Agreement - Page 17
properties, business and operations, unless (a) readily ascertainable
from public or published information, or trade sources, (b) received
from a third party not under an obligation to BRAVO or POINT BREAK, as
the case may be, to keep such information confidential or (c) required
by any Law or Order. If this transaction does not close for any reason,
BRAVO, POINT BREAK, and its respective affiliates shall return or
destroy all such confidential information and compilations thereof as
is practicable, and shall certify such destruction or return to BRAVO
or POINT BREAK, as the case may be.
5.2 CONDUCT AND PRESERVATION OF BUSINESS OF BRAVO. From the date hereof
through the Closing Date, BRAVO shall cause its corporate existence to
be continued in the ordinary course in the same manner as it has been
conducted since it inception. BRAVO covenants that, except with the
prior written consent of POINT BREAK, which consent shall not be
unreasonably withheld, BRAVO will not:
(a) Do any of the restricted acts set forth in SECTION 4.18
hereof, or enter into any agreement of a nature set forth in
SECTION 4.15 hereof; or
(b) Enter into any transaction other than in the ordinary course
of business.
5.3 CONDUCT AND PRESERVATION OF BUSINESS OF POINT BREAK. From the date
hereof through the Closing Date, POINT BREAK shall cause its business
to be conducted in the ordinary course and in the same manner as it has
been conducted since its inception. POINT BREAK covenants that, except
with the prior written consent of BRAVO, which consent shall not be
unreasonably withheld, POINT BREAK will not:
(a) Do any of the restricted acts set forth in SECTION 3.19
hereof, or enter into any agreement of a nature set forth in
SECTION 3.16 hereof, except for any agreements necessary for
the production of the episodes of "The Strip Poker
Invitational"; or
(b) Enter into any transaction other than in the ordinary course
of business.
Further, POINT BREAK shall use commercially reasonable efforts to (i)
preserve intact its business, assets, properties and organizations,
(ii) keep available the services of its present officers, employees,
consultants and agents; and (iii) maintain its present suppliers and
customers and preserve its goodwill.
5.4 ADVICE OF CHANGES. POINT BREAK will promptly advise BRAVO in writing
from time to time prior to the Closing with respect to any matter
hereafter arising and known to them that, if existing or occurring at
the date of this Agreement, would have been required to be set forth or
described in the POINT BREAK Disclosure Schedule or would have resulted
in any representation of POINT BREAK in this Agreement being untrue.
BRAVO will promptly advise POINT BREAK in writing from time to time
prior to the Closing with respect to any matter hereafter arising and
known to it that, if existing or occurring at the date of this
Agreement, would have been required to be set forth or described in the
BRAVO Disclosure Schedule or would have resulted in any representation
of BRAVO in this Agreement being untrue in any material respect.
Share Exchange Agreement - Page 18
5.5 OTC BULLETIN BOARD. BRAVO will use its best efforts to maintain the
listing on the OTC Bulletin Board of the BRAVO Common Stock. BRAVO
shall take the necessary action to notify NASD Regulation of the Share
Exchange in a timely manner.
5.6 SEC REPORTS. BRAVO shall file with the SEC all reports and other
documents that are required by the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder to be filed in
connection with the transactions contemplated by this Agreement.
5.7 SHAREHOLDER APPROVAL. POINT BREAK shall, as expeditiously as possible,
take all actions necessary to obtain the approval of its shareholders
of the transactions contemplated by this Agreement as required by the
laws of Nevada.
5.8 OTHER AGREEMENTS. POINT BREAK and BRAVO agree to take, or cause to be
taken, all actions and to do, or cause to be done, all things
reasonably necessary, proper or advisable to consummate and make
effective as promptly as practicable the transactions contemplated by
this Agreement, including, without limitation, the obtaining of all
necessary waivers, consents and approvals and the effecting of all
necessary registrations and filings, including, but not limited to,
submissions of information requested by Governmental or Regulatory
Bodies and any other persons required to be obtained by them for the
consummation of the closing and the continuance in full force and
effect of the permits, contracts and other agreements set forth on the
Schedules to this Agreement.
ARTICLE VI
CONDITIONS PRECEDENT TO CLOSING
6.1 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BRAVO TO COMPLETE THE
CLOSING. The obligations of BRAVO to enter into and complete the
Closing are subject to the fulfillment of the following conditions, any
one or more of which may be waived by BRAVO:
(a) (i) All of the terms, covenants, and conditions of this
Agreement to be complied with or performed by POINT BREAK at
or before the Closing shall have been duly complied with and
performed in all material respects, (ii) the representations
and warranties of POINT BREAK set forth in Article III shall
be true in all material respects on and as of the Closing Date
with the same force and effect as if such representations and
warranties had been made on and as of the Closing, and (iii)
BRAVO shall have received a certificate to such effect from
POINT BREAK, specifically referencing SECTIONS 3.7 AND 3.8.
(b) All consents, waivers, approvals, licenses, authorizations of,
or filings or declarations with third parties or Governmental
or Regulatory Bodies required to be obtained by POINT BREAK in
order to permit the transactions contemplated by this
Agreement to be consummated in accordance with agreements and
court orders applicable to POINT BREAK and applicable
governmental laws, rules, regulations and agreements shall
have been obtained and any waiting period thereunder shall
have
Share Exchange Agreement - Page 19
expired or been terminated, and BRAVO shall have received a
certificate from POINT BREAK to such effect.
(c) All actions, proceedings, instruments, and documents in
connection with the consummation of the transactions
contemplated by this Agreement, including the forms of all
documents, legal matters, opinions, and procedures in
connection therewith, shall have been approved in form and
substance by counsel for BRAVO, which approval shall not be
unreasonably withheld.
(d) POINT BREAK shall have furnished such certificates to evidence
compliance with the conditions set forth in this Article, as
may be reasonably requested by BRAVO or its counsel.
(e) POINT BREAK shall not have suffered any Material Effect.
(f) No material information or data provided or made available to
BRAVO by or on behalf of POINT BREAK shall be incorrect in any
material respect.
(g) No investigation and no suit, action, or proceeding before any
court or any governmental or regulatory authority shall be
pending or threatened by any state or federal governmental or
regulatory authority, against POINT BREAK or any of its
affiliates, associates, officers, or directors seeking to
restrain, prevent, or change in any material respect the
transactions contemplated hereby or seeking damages in
connection with such transactions that are material to POINT
BREAK.
(h) All of the POINT BREAK Shareholders approving the Share
Exchange shall have acknowledged that the shares of BRAVO
Common Stock are restricted securities under the Securities
Act and represent that such POINT BREAK Shareholder (i) is
acquiring the BRAVO Common Stock for his own account without a
view to distribution within the meaning of the Securities Act;
(ii) has received from BRAVO its filings with the Securities
and Exchange Commission and all other information that he has
deemed necessary to make an informed investment decision with
respect to an investment in BRAVO in general and the BRAVO
Common Stock in particular; (iii) is financially able to bear
the economic risks of an investment in BRAVO; and (iv) has
such knowledge and experience in financial and business
matters in general and with respect to investments of a nature
similar to the BRAVO Common Stock so as to be capable, by
reason of such knowledge and experience, of evaluating the
merits and risks of, and making an informed business decision
with regard to, the acquisition of the BRAVO Common Stock.
Such acknowledgment shall also indicate that each POINT BREAK
Shareholder understands and agrees that the certificates
evidencing the BRAVO Common Stock shall bear the usual
restrictive legend pertaining to Rule 144 under the Securities
Act and that the BRAVO Common Stock will not be transferable
except under an effective registration statement under the
Securities Act or in accordance with available exemptions from
registration under the Securities Act. Such acknowledgment
shall be substantially in the form attached hereto as EXHIBIT
A.
Share Exchange Agreement - Page 20
(i) POINT BREAK shall have received the necessary approvals from
at least 90% of its shareholders to proceed with the
transactions contemplated herein.
(j) POINT BREAK shall have demonstrated, to the satisfaction of
BRAVO, that it owns all of the rights to the following:
o 13-episode video production titled "The Strip Poker
Invitational," including the rights to the pilot of the
show;
o all revenue sources held under Aces and Eights
Entertainment LLC; and
o the contracts of Xxxxxx Xxxxxxx, Xxxxxxx Xxxx, Lodge
Net, In Demand, and Kingworld, with respect to "The
Strip Poker Invitational" video production.
6.2 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF POINT BREAK TO COMPLETE THE
CLOSING. The obligations of POINT BREAK to enter into and complete the
Closing are subject to the fulfillment on or prior to the Closing Date,
of the following conditions, any one or more of which may be waived by
POINT BREAK:
(a) (i) All of the terms, covenants, and conditions of this
Agreement to be complied with or performed by BRAVO at or
before the Closing shall have been duly complied with and
performed in all material respects, (ii) the representations
and warranties of BRAVO set forth in Article IV shall be true
in all material respects on and as of the Closing Date with
the same force and effect as if such representations and
warranties had been made on and as of the Closing, and (iii)
POINT BREAK shall have received a certificate to such effect
from BRAVO, specifically referencing SECTIONS 4.6 AND 4.7.
BRAVO shall provide a certificate from its transfer agent as
to the representations contained in SECTION 4.2.
(b) All consents, waivers, approvals, licenses, authorizations of,
or filings or declarations with third parties or Governmental
or Regulatory Bodies required to be obtained by BRAVO in order
to permit the transactions contemplated by this Agreement to
be consummated in accordance with agreements and court orders
applicable to BRAVO and applicable governmental laws, rules,
regulations and agreements shall have been obtained and any
waiting period thereunder shall have expired or been
terminated, and POINT BREAK shall have received a certificate
from BRAVO to such effect.
(c) All actions, proceedings, instruments, and documents in
connection with the consummation of the transactions
contemplated by this Agreement, including the forms of all
documents, legal matters, opinions, and procedures in
connection therewith, shall have been approved in form and
substance by counsel for POINT BREAK, which approval shall not
be unreasonably withheld.
(d) BRAVO shall have furnished such certificates to evidence
compliance with the conditions set forth in this Article, as
may be reasonably requested by POINT BREAK or its counsel.
Share Exchange Agreement - Page 21
(e) BRAVO shall not have suffered any Material Effect.
(f) No material information or data provided or made available to
POINT BREAK by or on behalf of BRAVO shall be incorrect in any
material respect.
(g) No investigation and no suit, action, or proceeding before any
court or any governmental or regulatory authority shall be
pending or threatened by any state or federal governmental or
regulatory authority, against BRAVO or any of its affiliates,
associates, officers, or directors seeking to restrain,
prevent, or change in any material respect the transactions
contemplated hereby or seeking damages in connection with such
transactions that are material to BRAVO.
(h) The BRAVO Common Stock shall continue to be quoted on the OTC
Bulletin Board.
(i) POINT BREAK Shareholders holding no more than 10% of the
issued and outstanding POINT BREAK common stock shall have
perfected appraisal rights for their shares in accordance with
the Nevada Law.
ARTICLE VII
POST-CLOSING COVENANTS
The parties covenant to take the following actions after the Closing Date:
7.1 FURTHER INFORMATION. Following the Closing, each party will afford to
the other party, its counsel and its accountants, during normal
business hours, reasonable access to the books, records and other data
of POINT BREAK or BRAVO, as the case may be, relating to the business
of POINT BREAK or BRAVO in their possession with respect to periods
prior to the Closing and the right to make copies and extracts
therefrom, to the extent that such access may be reasonably required by
the requesting party (a) to facilitate the investigation, litigation
and final disposition of any claims which may have been or may be made
against any party or its affiliates and (b) for any other reasonable
business purpose.
7.2 RECORD RETENTION. Each party agrees that for a period of not less than
five years following the Closing Date, such party shall not destroy or
otherwise dispose of any of the Books and Records of POINT BREAK or
BRAVO relating to the business of POINT BREAK or BRAVO in his or its
possession with respect to periods prior to the Closing Date. Each
party shall have the right to destroy all or part of such Books and
Records after the fifth anniversary of the Closing Date or, at an
earlier time by giving each other party hereto 30 days prior written
notice of such intended disposition and by offering to deliver to the
other party or parties, at the other party's or parties' expense,
custody of such Books and Records as such party may intend to destroy.
7.3 POST-CLOSING ASSISTANCE. POINT BREAK and BRAVO will provide each other
with such assistance as may reasonably be requested in connection with
the preparation of any Tax Return, any audit or other examination by
any taxing authority, or any judicial or
Share Exchange Agreement - Page 22
administrative proceedings relating to liability for Taxes, and each
will retain and provide the requesting party with any records or
information that may be reasonably relevant to such return, audit or
examination, proceedings or determination. The party requesting
assistance shall reimburse the other party for reasonable out-of-pocket
expenses incurred in providing such assistance. Any information
obtained pursuant to this SECTION 7.3 or pursuant to any other Section
hereof providing for the sharing of information or the review of any
Tax Return or other schedule relating to Taxes shall be kept
confidential by the parties hereto.
7.4 ISSUANCE OF SHARES DURING ESCROW PERIOD. During the Escrow Period,
BRAVO shall not issue any shares of its common stock for consideration
less than the market price on the date of issue without the prior
written consent of Xxxx XxXxxxxx, except and only to the extent
necessary to raise additional monies to fund the production of 13
episodes of "The Strip Poker Invitational," as contemplated by SECTION
1.14 above.
ARTICLE VIII
SURVIVAL
8.1 SURVIVAL OF AGREEMENTS, REPRESENTATIONS AND WARRANTIES. Notwithstanding
any investigation conducted or notice or knowledge obtained by or on
behalf of any party hereto, each agreement in this Agreement shall
survive the Closing without limitation as to time until fully performed
and each representation and warranty in this Agreement or in the
Exhibits, Schedules or certificates delivered pursuant to this
Agreement shall survive the Closing for a period of two years (other
than the representations and warranties contained in SECTION 3.5 which
shall survive the Closing without limitation as to time, and other than
the representations and warranties contained in SECTION 3.14, which
shall survive the Closing until the earlier of (i) three and one-half
years from the Closing Date and (ii) three years following the date on
which BRAVO files the Tax Return relating to the taxable period from
April 1, 2005 through the Closing Date). Notice must be given to the
party from whom indemnification is sought of any claim for
indemnification under Article VIII prior to the termination of the
relevant survival period.
ARTICLE IX
TERMINATION OF AGREEMENT
9.1 TERMINATION. This Agreement may be terminated at any time prior to the
Closing as follows:
(a) by mutual written consent of BRAVO and POINT BREAK;
(b) by BRAVO or POINT BREAK by written notice to the other party
hereto, if the Closing shall not have occurred on or prior to
the close of business on June 30, 2005 (unless such event has
been caused by a breach of this Agreement by the party seeking
such termination);
Share Exchange Agreement - Page 23
(c) by BRAVO or by POINT BREAK if a Governmental or Regulatory
Body has permanently enjoined or prohibited consummation of
the Share Exchange and such court or government action is
final and nonappealable;
(d) by BRAVO if POINT BREAK has failed to comply in any material
respect with any of its covenants or agreements under this
Agreement that are required to be complied with prior to the
date of such termination; or
(e) by POINT BREAK if BRAVO has failed to comply in any material
respect with any of its covenants or agreements under this
Agreement that are required to be complied with prior to the
date of such termination.
Should POINT BREAK terminate this Agreement for any reason other than a
default by BRAVO as described in SECTION 9.1(E) hereof, POINT BREAK
shall be liable for all damages caused by the failure to close.
Similarly, if BRAVO should terminate this Agreement for any reason
other than a default by POINT BREAK as described in SECTION 9.1(D)
hereof, BRAVO shall be liable for all damages caused by the failure to
close.
9.2 SURVIVAL AFTER TERMINATION. If this Agreement is terminated pursuant to
SECTION 9.1, (a) this Agreement shall become null and void and of no
further force and effect, except for the provisions of SECTION 5.1
relating to the obligation to keep confidential certain information and
(b) there shall be no liability on the part of POINT BREAK or BRAVO or
their respective affiliates.
ARTICLE X
MISCELLANEOUS
10.1 EXPENSES. Each party shall be responsible for its own legal and
accounting fees in connection with the Share Exchange.
10.2 FURTHER ASSURANCES. At any time and from time to time after the Closing
Date at the request of BRAVO, and without further consideration, POINT
BREAK will execute and deliver such other instruments of sale,
transfer, conveyance, assignment and confirmation and take such other
action as BRAVO may reasonably deem necessary or desirable in order to
transfer, convey and assign the Shares to BRAVO and to assist BRAVO in
exercising all rights with respect thereto. The parties shall use their
best efforts to fulfill or obtain the fulfillment of the conditions to
the Closing, including, without limitation, the execution and delivery
of any document or other papers, the execution and delivery of which
are conditions precedent to the Closing.
10.3 NOTICES. All notices, requests, demands and other communications
required or permitted to be given hereunder shall be in writing and
shall be given personally, sent by facsimile transmission or sent by
prepaid air courier or certified or express mail, postage prepaid. Any
such notice shall be deemed to have been given (a) when received, if
delivered in person, sent by facsimile transmission and confirmed in
writing within three (3) business days
Share Exchange Agreement - Page 24
thereafter or sent by prepaid air courier or (b) three (3) business
days following the mailing thereof, if mailed by certified first class
mail, postage prepaid, return receipt requested, in any such case as
follows (or to such other address or addresses as a party may have
advised the other in the manner provided in this SECTION 10.3):
If to POINT BREAK:
Point Break Productions, Inc.
#000 000 Xxxxx Xxxxxx
Xxxxxxxxxx Xxxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxxxxxxxx, President
with a copy to:
Xxxxxxx X'Xxxx
000 00xx Xxxxxx, Xxxx X
Xxxxxxxxxx Xxxxx, XX 00000
If to BRAVO:
Bravo Resources Ltd.
#000 0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0
Attention: Xxxxxx Xxxxxx, President
With a copy to:
Xxxx Xxxx Xxxx Xxxxxxxxxx & Xxxxxxxxx, P.C.
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxx X. Xxxxxxxxx, Esq.
10.4 MEDIATION. The parties hereto encourage the prompt and equitable
settlement of all controversies or claims (a "DISPUTE") between or
among the parties and their affiliates including but not limited to
those arising out of or relating to this Agreement or the transactions
contemplated hereby. At any time, either party can give the other
written notice that it desires to settle a Dispute. Within 10 days of
delivery of such notice, the parties agree to cause their officers
having authority to resolve such differences to meet for two out of
four continuous days (the "NEGOTIATION PERIOD"), the parties agree to
submit their Dispute to a mediator to work with them to resolve their
differences. Such mediator shall be selected by mutual agreement of the
parties. The parties shall participate in the mediation proceeding in
good faith with the intention to settle. The mediation shall be
conducted pursuant to the rules generally used by the mediator in the
mediator's practice, which rules may be modified or amended with the
written consent of the parties. No later than three business days prior
to the mediation, each party shall deliver to the mediator all
information reasonably required for the mediator to understand the
Dispute and the issues presented. The mediation shall be
Share Exchange Agreement - Page 25
determined upon the first to occur of the following: (i) by the
execution of a settlement agreement resolving the Dispute by the
parties; (ii) by a written declaration of the mediator to the effect
that further efforts at mediation are no longer worthwhile; or (iii)
after the completion of two full days of mediation effect that
mediation proceedings are terminated. No party shall xxx any other
party hereto in connection with any Dispute, except for enforcement of
the negotiation and mediation process set forth herein, and the
arbitration provisions set forth in SECTION 10.5 hereof shall not be
applicable, in each case, prior to termination of the Negotiation
Period and of the mediation as provided above.
10.5 ARBITRATION. Any dispute, controversy, or claim arising out of,
relating to, or in connection with, this Agreement or the agreements or
transactions contemplated by this Agreement shall be finally settled by
binding arbitration. The arbitration shall be conducted and the
arbitrator chosen in accordance with the rule of the American
Arbitration Association in effect at the time of the arbitration,
except as they may be modified herein or by mutual agreement of BRAVO
and POINT BREAK. In connection with any such arbitration, each party
shall be afforded the opportunity to conduct discovery in accordance
with the Federal Rules of Civil Procedure.
(a) The seat of the arbitration shall be in Las Vegas, Nevada.
Each of POINT BREAK and BRAVO hereby irrevocably submits to
the jurisdiction of the arbitrator in Las Vegas, Nevada, and
waives any defense in an arbitration based upon any claim that
such party is not subject personally to the jurisdiction of
such arbitrator, that such arbitration is brought in an
inconvenient format, or that such venue is improper.
(b) The arbitral award shall be in writing and shall be final and
binding on each of the parties to this Agreement. The award
may include an award of costs, including reasonable attorneys'
fees and disbursements. Judgment upon the award may be entered
by any court having jurisdiction thereof or having
jurisdiction over the parties or their assets. POINT BREAK and
BRAVO acknowledge and agree that by agreeing to these
arbitration provisions each of the parties hereto is waiving
any right that such party may have to a jury trial with
respect to the resolution of any dispute under this Agreement
or the agreements or transactions contemplated hereby.
10.6 PUBLICITY. No publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be made without
advance approval thereof by BRAVO and POINT BREAK except as may be
required by applicable law or the rules and regulations of the
applicable regulatory authorities.
10.7 ENTIRE AGREEMENT. This Agreement (including the Exhibits and Schedules)
and the agreements, certificates and other documents delivered pursuant
to this Agreement contain the entire agreement among the parties with
respect to the transactions described herein, and supersede all prior
agreements, written or oral, with respect thereto.
10.8 WAIVERS AND AMENDMENTS. This Agreement may be amended, superseded,
canceled, renewed or extended, and the terms hereof may be waived, only
by a written instrument signed by the parties or, in the case of a
waiver, by the party waiving compliance. No delay
Share Exchange Agreement - Page 26
on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof
10.9 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada without regard to
principles of conflicts of law.
10.10 BINDING EFFECT, NO ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns. This Agreement is not assignable by any party hereto
without the prior written consent of the other parties hereto except by
operation of law and any other purported assignment shall be null and
void.
10.11 COUNTERPARTS. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together
constitute one and the same instrument. Each counterpart may consist of
a number of copies hereof each signed by less than all, but together
signed by all of the parties hereto.
10.12 EXHIBITS AND SCHEDULES. The Exhibits and Schedules are a part of this
Agreement as if fully set forth herein. All references herein to
Sections, subsections, clauses, Exhibits and Schedules shall be deemed
references to such parts of this Agreement, unless the context shall
otherwise require.
10.13 EFFECT OF DISCLOSURE ON SCHEDULES. Any item disclosed on any Schedule
to this Agreement shall only be deemed to be disclosed in connection
with (a) the specific representation and warranty to which such
Schedule is expressly referenced, (b) any specific representation and
warranty which expressly cross-references such Schedule and (c) any
specific representation and warranty to which any other Schedule to
this Agreement is expressly referenced if such other Schedule expressly
cross-references such Schedule.
10.14 HEADINGS. The headings in this Agreement are for reference only, and
shall not affect the interpretation of this Agreement.
10.15 SEVERABILITY OF PROVISIONS. If any provision or any portion of any
provision of this Agreement or the application of such provision or any
portion thereof to any person or circumstance, shall be held invalid or
unenforceable, the remaining portion of such provision and the
remaining provisions of this Agreement, or the application of such
provision or portion of such provision as is held invalid or
unenforceable to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby.
Share Exchange Agreement - Page 27
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
BRAVO:
BRAVO RESOURCES LTD.
By: /s/ XXXXXX XXXXXX
----------------------------------------
Xxxxxx Xxxxxx, President
POINT BREAK:
POINT BREAK PRODUCTIONS, INC.
By: /s/ XXXXXXXXXXX XXXXXXXXXX
----------------------------------------
Xxxxxxxxxxx Xxxxxxxxxx, President
Share Exchange Agreement - Page 28
