EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of October
27, 2003, by and among Reality Wireless Networks, Inc., a Nevada corporation
(the "Company"), RWNT Acquisition, Inc., a Delaware corporation ("Acquisition")
and Orange Soda, Inc., a Delaware corporation ("OS").
RECITALS
WHEREAS, the Company and OS desire to merge Acquisition with and into
OS whereby OS shall be the surviving entity pursuant to the terms and conditions
set forth herein and whereby the transaction is intended to qualify as a tax
free reorganization pursuant to Section 368(a) of the Internal Revenue Code of
1986, as amended (the "IRC"), to the extent permitted by applicable law;
WHEREAS, in furtherance of such combination, the Boards of Directors of
the Company, Acquisition and OS have each approved the merger of Acquisition
with and into OS (the "Merger"), upon the terms and subject to the conditions
set forth herein, in accordance with the applicable provisions of the Delaware
General Corporation Law (the "DGCL").
WHEREAS, the stockholder of OS desires to exchange all of its shares of
the capital stock of OS (the "OS Capital Stock") for shares of the capital stock
of the Company (the "Company Capital Stock") as a tax free reorganization
pursuant to Section 368(a) of the IRC, to the extent permitted by applicable
law;
WHERAS, just prior to the Merger, OS's 1% Convertible Debentures Due
October __, 2008 in the aggregate principal amount of Nine Hundred Ninety Four
Thousand Dollars ($994,000) (the "OS First Debentures") and OS's 1% Convertible
Debenture Due October __, 2008 in the principal amount of Six Thousand Dollars
($6,000) (the "OS Second Debenture" and, together with the OS First Debentures,
the "OS Debentures") are convertible into shares of OS common stock par value
$0.001 per share (the "OS Common Stock") pursuant to the terms of the OS
Debentures and the Purchase Agreement (as defined below) and upon the
consummation of the Merger will be convertible into an equivalent number of
shares of the Company's common stock, par value $0.001 per share (the "Company
Common Stock") (the "Company Underlying Shares");
WHEREAS, upon the effectiveness of the Merger and pursuant to the terms
of this Agreement and the Purchase Agreement, the Company Underlying Shares will
be substituted for the OS Underlying Shares, the Company will assume the
obligations, jointly and severally, with OS under the OS Debentures and the
Company will assume the obligations of OS under that certain Convertible
Debenture Purchase Agreement dated even date herewith between OS and HEM Mutual
Assurance LLC ("HEM") (the "Purchase Agreement") and OS will be released from
certain of such obligations; and
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WHEREAS, all defined terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. At the Effective Time (as hereinafter defined) and
subject to and upon the terms and conditions of this Agreement and the DGCL,
Acquisition shall be merged with and into OS pursuant to the Merger. Following
the Merger, OS shall continue as the surviving corporation (the "Surviving
Corporation") and the separate corporate existence of Acquisition shall cease.
As part of the Merger and as more fully described in Section 2.1, (i) the One
Thousand (1,000) issued and outstanding shares of the OS Common Stock shall be
exchanged for Company Common Stock at the Exchange Ratio (as defined below) and
(ii) each share of Acquisition's issued and outstanding of common stock, par
value $.001 per share (the "Acquisition Common Stock"), shall be converted into
one validly issued, fully paid and non-assessable share of common stock, par
value of $.001 per share, of the Surviving Corporation (the "Surviving
Corporation Common Stock").
1.2 EFFECTIVE TIME. The Merger shall be consummated as
promptly as practicable after satisfaction of all conditions to the Merger set
forth herein, by filing with the Secretary of State of the State of Delaware a
certificate of merger (the "Certificate of Merger"), and all other appropriate
documents, executed in accordance with the relevant provisions of the DGCL. The
Merger shall become effective upon the filing of the Certificate of Merger. The
time of such filing shall be referred to herein as the "Effective Time."
1.3 EFFECTS OF THE MERGER. At the Effective Time, all the
rights, privileges, immunities, powers and franchises of Acquisition and OS and
all property, real, personal and mixed, and every other interest of, or
belonging to or due to each of Acquisition and OS shall vest in the Surviving
Corporation, and all debts, liabilities, obligations and duties of Acquisition
and OS, including, without limitation, the performance of all obligations and
duties of OS pursuant to the Purchase Agreement, the OS Debentures and the
exhibits, schedules and all documents executed in connection therewith or any
other Transaction Document (as defined in the Purchase Agreement), shall become
the debts, liabilities, obligations and duties of the Surviving Corporation
(except as assumed by the Company) without further act or deed, all in the
manner and to the full extent provided by the DGCL. Whenever a conveyance,
assignment, transfer, deed or other instrument or act is necessary to vest any
property or right in the Surviving Corporation, the directors and officers of
the respective constituent corporations shall execute, acknowledge and deliver
such instruments and perform such acts, for which purpose the separate existence
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of the constituent corporations and the authority of their respective directors
and officers shall continue, notwithstanding the Merger.
1.4 CERTIFICATE OF INCORPORATION. The Certificate of Incorporation of
OS, as in effect immediately prior to the Effective Time, shall be the
Certificate of Incorporation of the Surviving Corporation and thereafter may be
amended or repealed in accordance with its terms and applicable law.
1.5 BY-LAWS. At the Effective Time and without any further action on
the part of Acquisition and OS, the By-laws of OS shall be the By-laws of the
Surviving Corporation and thereafter may be amended or repealed in accordance
with their terms or the Certificate of Incorporation of the Surviving
Corporation and as provided by law.
1.6 DIRECTORS. The directors of Acquisition at the Effective Time shall
be the directors of the Surviving Corporation, until the earlier of their
resignation or removal or until their respective successors are duly elected and
qualified, as the case may be.
1.7 OFFICERS. The officers of Acquisition at the Effective Time shall
be the officers of the Surviving Corporation, until the earlier of their
resignation or removal or until their respective successors are duly appointed
and qualified, as the case may be.
1.8 TAX-FREE REORGANIZATION. The parties intend that the Merger shall
be treated as a tax-free reorganization pursuant to Section 368(a) of the IRC,
to the extent permitted by applicable law.
ARTICLE II
CONVERSION OF OS SHARES AND ASSUMPTION OF OS DEBENTURES
2.1 CONVERSION AND CANCELLATION OF OS COMMON STOCK. As of the Effective
Time, by virtue of the Merger and without any action on the part of the Company,
Acquisition or OS or the holders of any shares of the capital stock of
Acquisition or OS:
(a) Subject to the provisions of Sections 2.4 and 2.5, each
share of OS Common Stock (the "OS Common Stock Shares") issued and outstanding
immediately prior to the Effective Time (other than shares canceled in
accordance with Section 2.1(b) and other than with respect to the escrow shares
deposited by OS with the Escrow Agent (as defined below) in accordance with the
Purchase Agreement (the "OS Escrow Shares") which shall be automatically
cancelled and replaced with an equal number of Company Escrow Shares in
accordance with Section 2.2, shall be converted into 0.10 (the "Exchange Ratio")
of a validly issued, fully paid and nonassessable share of Company Common Stock
(the "Company Common Stock Shares"). As of the Effective Time, each OS Common
Stock Share shall no longer be outstanding and shall automatically be canceled
and cease to exist, and each holder of a certificate representing any OS Common
Stock Share shall cease to have any rights with respect thereto other than the
right to receive Company Common Stock Shares to be issued in consideration
therefor upon the surrender of such certificate, properly endorsed to the
Company.
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(b) Each share of OS Capital Stock held in the treasury of the
OS and each share of OS Capital Stock owned by Acquisition or Company shall be
canceled without any conversion thereof and no payment, distribution or other
consideration shall be made with respect thereto.
(c) Each issued and outstanding share of Acquisition Common
Stock shall be converted into one validly issued, fully paid and nonassessable
share of Surviving Corporation Common Stock.
2.2 ESCROW MATERIALS. (a) At the Post-Closing, the Company shall
deposit into escrow with Gottbetter & Partners, LLP, as escrow agent (the
"Escrow Agent") the following, which are hereinafter collectively referred to as
the "Escrow Materials," (i) the escrow agreement annexed hereto and made a part
hereof as EXHIBIT 2.2(A) (the "Escrow Agreement"), (ii) certificates
representing Forty One Million (41,000,000) shares of duly issued Company Common
Stock, without restriction and freely tradable pursuant to Rule 504 of
Regulation D of the Securities Act (the "Company Escrow Shares"), in share
denominations specified by the Purchaser, registered in the name of the
Purchaser and/or its assigns; and (iii) a power of attorney with respect to the
Company Underlying Shares and the Company Escrow Shares, in the form annexed to
the Escrow Agreement as Appendix I. At the Post-Closing, upon the Company
fulfilling its obligations under this Section 2.2, Escrow Agent shall release to
the Company the OS Escrow Shares cancelled in accordance with Section 2.1. The
Escrow Materials shall be held in escrow in accordance with the Escrow
Agreement. The Escrow Materials shall be released from escrow only in accordance
with this Section 2.2, the Purchase Agreement, the Notes, the OS Debentures and
the Escrow Agreement.
(b) Upon the effectiveness of the Merger and in accordance
with Section 2.7 hereof, the Company shall substitute the Company Underlying
Shares and the Company Escrow Shares for the OS Underlying Shares and the OS
Escrow Shares with regard to all of the rights and obligations, specifically
including the conversion rights, under the OS Debentures, and the OS Escrow
Shares shall be cancelled.
2.3 [INTENTIONALLY LEFT BLANK].
2.4 ADJUSTMENT OF THE EXCHANGE RATIO. In the event that, prior to the
Effective Time, any stock split, combination, reclassification or stock dividend
with respect to the Company Common Stock or OS Common Stock, any change or
conversion of Company Common Stock or OS Common Stock or into other securities
or any other dividend or distribution with respect to the Company Common Stock
or OS Common Stock (other than regular quarterly dividends) should occur or, if
a record date with respect to any of the foregoing should occur, appropriate and
proportionate adjustments shall be made to the Exchange Ratio, and thereafter
all references to an Exchange Ratio shall be deemed to be to such Exchange Ratio
as so adjusted.
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2.5 NO FRACTIONAL SHARES. No certificates or scrip representing
fractional shares of Company Common Stock shall be issued upon the surrender for
exchange of certificates and such fractional share shall not entitle the record
or beneficial owner thereof to vote or to any other rights as a stockholder of
the Company. The number of shares of Company Common Stock to be issued shall be
rounded up to the nearest whole share.
2.6 FURTHER ASSURANCES. If at any time after the Effective Time the
Surviving Corporation shall consider or be advised that any deeds, bills of
sale, assignments or assurances or any other acts or things are necessary,
desirable or proper (a) to vest, perfect or confirm, of record or otherwise, in
the Surviving Corporation, its right, title or interest in, to or under any of
the rights, privileges, powers, franchises, properties or assets of either OS or
Acquisition or (b) otherwise to carry out the purposes of this Agreement, the
Surviving Corporation and its proper officers and directors or their designees
shall be authorized (to the fullest extent allowed under applicable law) to
execute and deliver, in the name and on behalf of either OS or Acquisition , all
such deeds, bills of sale, assignments and assurances and do, in the name and on
behalf of OS or Acquisition, all such other acts and things necessary, desirable
or proper to vest, perfect or confirm its right, title or interest in, to or
under any of the rights, privileges, powers, franchises, properties or assets of
OS or Acquisition, as applicable, and otherwise to carry out the purposes of
this Agreement.
2.7 OS DEBENTURES. (a) As of the Effective Time, the Company assumes,
jointly and severally with OS, all of the obligations and responsibilities under
the OS Debentures to the holder or holders of the OS Debentures. With respect to
the OS Debentures, at the Effective Time, the Company shall (i) replace the OS
Underlying Shares, with the Company Underlying Shares and (ii) replace the
Escrow Shares deposited by OS with the Escrow Agent with the Company Escrow
Shares.
(b) At the Effective Time, (i) all references in the OS Debentures to
Company Common Stock (as defined in the OS Debentures) shall be references to
Company Common Stock (as defined herein) and (ii) all references to the Company
(as defined in the OS Debentures) in the OS Debentures shall be read as
references to the Company (as defined herein) as if the OS Debentures were
issued on the date the OS Debentures were issued, by the Company (as defined
herein), specifically including all calculations in the OS Debentures such as
the determination of the conversion price, the Conversion Price, the Fixed
Conversion Price and the Floating Conversion Price. The Exchange Ratio (as
defined herein) shall have no effect on the OS Debentures or the assumption
thereof by the Company (as defined herein).
(c) At the Effective Time, OS shall assign and the Company shall assume
all of OS's obligations and covenants under the Purchase Agreement as if the
Company executed the Purchase Agreement instead of OS on the date thereof. At
the Effective Time, all references to the Company (as defined in the Purchase
Agreement) in the Purchase Agreement shall mean the Company (as defined herein)
and all references to dates or tolling of periods shall be read as if the
Company (as defined herein) executed the Purchase Agreement instead of the
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Company (as defined in the Purchase Agreement). At the Effective Time, all of
the remedies available to the current and future holders of the OS Debentures
under the Purchase Agreement against the Company (as defined in the Purchase
Agreement) shall be available against the Company (as defined herein).
(d) The provisions described in this Section 2.7 shall not be amended
and shall be in effect until the earlier of (i) the date all of the OS
Convertible Debentures have been converted into Company Common Stock Shares and
(ii) six (6) years from the date the OS Debentures were issued.
(e) The current and future holders of the OS Debentures shall be third
party beneficiaries of this Agreement. There shall be no other third party
beneficiaries to this Agreement or any part hereof.
ARTICLE III
CLOSING
Subject to satisfaction of the conditions to closing set forth in this
Agreement and unless this Agreement is otherwise terminated in accordance with
the provisions contained herein, the closing of the Merger and the Contemplated
Transactions (the "Post-Closing") shall take place at the offices of Gottbetter
& Partners, LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx as promptly as
practicable after satisfaction of the conditions set forth in this Agreement,
which in no event shall be more than ten days after the Closing Date under the
Purchase Agreement (except if such 10th day is not a Business Day, then the next
Business Day) (the "Post-Closing Date").
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
1.1 4.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND ACQUISITION.
Except as disclosed in the Reports (as defined below) or in a document of even
date herewith referring to the representations and warranties in this Agreement
and delivered by Company to OS prior to the execution and delivery of this
Agreement (the "Company Disclosure Schedule"), Acquisition and the Company
hereby make the following representations and warranties to OS, all of which
shall survive the Post-Closing, subject to the limitations set forth in Section
8.1 hereof:
(a) ORGANIZATION AND GOOD STANDING. Acquisition is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, with full corporate power and authority to conduct its
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business as it is now being conducted, to own or use the properties and assets
that it owns or uses, and to perform all its obligations under this Agreement.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, with full corporate power and
authority to conduct its business as it is now being conducted, to own or use
the properties and assets that it owns or uses, and to perform all its
obligations under this Agreement and, upon the Post-Closing the OS Debentures.
Company has no subsidiaries other than Acquisition and other than as set forth
on the Company Disclosure Schedule (individually, a "SUBSIDIARY" and
collectively, the "SUBSIDIARIES"). Acquisition has no subsidiaries. Each of the
Company and Acquisition is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction in which either the ownership or
use of the properties owned or used by it, or the nature of the activities
conducted by it, requires such qualification, except for such failures to be so
qualified or in good standing would not have a Material Adverse Effect.
(b) AUTHORITY; NO CONFLICT.
i. This Agreement and any agreement executed in
connection herewith by Company or Acquisition constitute the legal, valid and
binding obligations of the Company and Acquisition, as the case may be,
enforceable against the Company and Acquisition, as the case may be, in
accordance with their respective terms, except as such enforceability is limited
by bankruptcy, insolvency and other laws affecting the rights of creditors and
by general equitable principles. The Company has the absolute and unrestricted
right, power, authority and capacity to execute and deliver this Agreement and
any agreement executed by it in connection herewith and to perform its
obligations hereunder and thereunder.
ii. Neither the execution and delivery of this
Agreement by each of the Company and Acquisition, nor the consummation or
performance by each of any of its respective obligations contained in this
Agreement or in connection with the Contemplated Transactions will, directly or
indirectly (with or without notice or lapse of time):
a. contravene, conflict with or result in a
violation of (x) any provision of the Organizational Documents of the Company or
Acquisition, as the case may be, or (y) any resolution adopted by the board of
directors or the stockholders of the Company or Acquisition, as the case may be;
b. contravene, conflict with or result in a
violation of, or give any governmental body or other Person the right to
challenge any of the Contemplated Transactions or to exercise any remedy or
obtain any relief under, any Legal Requirement or any Order to which the Company
or Acquisition or any of the assets owned or used by the Company or Acquisition
may be subject;
c. contravene, conflict with or result in a
violation or breach of any provision of, or give any Person the right to declare
a default or exercise any remedy under, or to accelerate the maturity or
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performance of, or to cancel, terminate or modify, this Agreement, the OS
Debentures (once assumed by Company) or any Applicable Contract;
d. result in the imposition or creation of
any material encumbrance upon or with respect to any of the material assets
owned or used by the Company or Acquisition;
e. cause the Company or Acquisition to
become subject to, or to become liable for the payment of, any tax; or
f. cause any of the assets owned by the
Company or Acquisition to be reassessed or revalued by any taxing authority or
other governmental body, except in connection with the transfer of real estate
pursuant to this Agreement or the Contemplated Transactions, if any.
(c) CAPITALIZATION. The capitalization of the Company as of
June 30, 2003 is as set forth in the Form 10-Q for the period ended June 30,
2003 (the "JUNE 10-Q"), increased as set forth in the next sentence. The Company
has not issued any capital stock since that date other than pursuant to (i)
employee benefit plans disclosed in the Reports (as defined in Section 4.1(d))
or (ii) outstanding warrants, options or other securities disclosed in the
Reports. All of the issued and outstanding shares of the Company Capital Stock
have been duly authorized and validly issued and are fully paid and
non-assessable. Except for this Agreement and as disclosed in the Reports, there
are no outstanding options, warrants, script, rights to subscribe to,
registration rights, calls or commitments of any character whatsoever relating
to, or securities, rights or obligations convertible into or exchangeable for,
or giving any Person any right to subscribe for or acquire, any shares of the
Company Common Stock, or contracts, commitments, understandings, or arrangements
by which the Company or any Subsidiary is or may become bound to issue
additional shares of the Company Common Stock, or securities or rights
convertible or exchangeable into shares of the Company Common Stock. None of the
outstanding Company Capital Stock was issued in violation of the Securities Act
or any other legal requirement.
(d) FINANCIAL STATEMENTS. The Company has delivered or made
available to OS copies of its Form 10-K Annual Report for the fiscal year ended
December 31, 2002 and copies of its quarterly reports on Form 10-Q for the
quarters ended March 31, 2003 and June 30, 2003, each as filed with the SEC and
including, in each case, any amendments thereto (collectively, the "Reports").
The financial statements contained in the Reports are in all material respects
in accordance with the books and records of the Company and have been prepared
in accordance with GAAP applied on a consistent basis throughout the periods
indicated, all as more particularly set forth in the notes to such statements.
The consolidated balance sheets contained in such Reports (the "Company Balance
Sheets") present fairly in all material respects as of their dates the
consolidated financial condition of the Company and its subsidiaries. Except as
and to the extent reflected or reserved against in the Company Balance Sheets
(including the notes thereto), the Company did not have, as of the date of any
such Company Balance Sheet, any material liabilities or obligations (absolute or
contingent) of a nature customarily reflected in a balance sheet or the notes
thereto. The consolidated statements of operations, consolidated statements of
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stockholders' equity and changes in consolidated statements of cash flows
present fairly in all material respects the results of operations and changes in
financial position of the Company and its subsidiaries for the periods
indicated.
(e) SEC FILINGS. The Company has filed all reports required to
be filed with the SEC under the rules and regulations of the SEC and all such
reports have complied in all material respects, as of their respective filing
dates and effective dates, as the case may be, with all the applicable
requirements of the Securities Exchange Act of 1934, as amended. As of the
respective filing and effective dates, none of such reports (including without
limitation, the Reports) contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.
(f) ABSENCE OF MATERIAL ADVERSE CHANGE. Since the date of the
latest Company Balance Sheets, there have been no events, changes or occurrences
which have had or are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect.
(g) ISSUANCE OF COMPANY SECURITIES. The Company Common Stock
Shares, and when issued in accordance with this Agreement, the Purchase
Agreement, the OS Debentures and the Escrow Agreement, the Company Underlying
Shares and the Company Escrow Shares, shall be duly authorized, validly issued,
fully-paid and nonassessable. The Company currently has, and at all times while
the OS Debentures are outstanding will maintain, an adequate reserve of shares
of the Company Common Stock to enable it to perform its obligations under this
Agreement and OS Debentures. Except as set forth in the Reports, there is no
equity line of credit or convertible security or instrument outstanding of the
Company.
(h) UNDISCLOSED LIABILITIES. Except as disclosed in any
Schedule to this Agreement, none of the Company, Acquisition or the Subsidiaries
has any material obligations and liabilities (contingent or otherwise) except
those liabilities (i) that are reflected in the Company Balance Sheets or in the
notes thereto, or disclosed in the notes therein in accordance with GAAP or, in
accordance with GAAP, are not required to be so reflected or disclosed, or (ii)
that were incurred after the date of the Company Balance Sheets in the Ordinary
Course of Business, none of which results from, arises out of, relates to, is in
the nature of, or was caused by any breach of contract, breach of warranty,
tort, infringement, or violation of law or could reasonably be expected to have
a Material Adverse Effect.
(i) TAXES.
i. The Company has filed or caused to be filed on a
timely basis all tax returns that are or were required to be filed by it
pursuant to applicable Legal Requirements. The Company has paid, or made
provision for the payment of, all taxes that have or may have become due
pursuant to those tax returns or otherwise, or pursuant to any assessment
received by the Company, except such taxes, if any, as are listed in the Company
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Disclosure Schedule and are being contested in good faith as to which adequate
reserves have been provided in the Company Balance Sheets.
ii. All tax returns filed by the Company are true,
correct and complete in all material respects.
(j) EMPLOYEE BENEFITS. Except as disclosed in the Reports, the
Company does not sponsor or otherwise maintain a "pension plan" within the
meaning of Section 3(2) of ERISA or any other retirement plan other than the
Company Profit Sharing and 401(k) Plan and Trust that is intended to qualify
under Section 401 of the Code, nor do any unfunded liabilities exist with
respect to any employee benefit plan, past or present. No employee benefit plan,
any trust created thereunder or any trustee or administrator thereof has engaged
in a "prohibited transaction," as defined in Section 4975 of the Code, which may
have a Material Adverse Effect.
(k) GOVERNMENTAL AUTHORIZATIONS. The Company, Acquisition and
the Subsidiaries have all permits that are legally required to enable them to
conduct their business in all material respects as now conducted.
(l) LEGAL PROCEEDINGS; ORDERS.
i. Except as set forth in the Reports, there is no
material pending Proceeding:
a. that has been commenced by or against the
Company, Acquisition or the Subsidiaries, or any of the assets owned or used by,
the Company, Acquisition or the Subsidiaries; or
b. that challenges, or that may have the
effect of preventing, delaying, making illegal, or otherwise interfering with,
any Contemplated Transaction.
ii. Except as set forth in the Reports:
a. there is no material Order to which the
Company or the Subsidiaries, or any of the assets owned or used by the Company,
Acquisition or the Subsidiaries, is subject; and
b. no officer, director, agent, or employee
of the Company or Acquisition is subject to any material Order that prohibits
such offer, director, agent or employee from engaging in or continuing any
conduct, activity or practice relating to the business of the Company or
Acquisition, as the case may be.
(m) ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as set forth
in the Reports, since the date of the most recent Company Balance Sheets, the
Company and the Subsidiaries and Acquisition, since the date of its inception,
have conducted their business only in the Ordinary Course of Business, and other
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than as contemplated by this Agreement or the Contemplated Transactions there
has not been any:
i. change in the authorized or issued Company Capital
Stock or the authorized or issued capital stock of Acquisition and the
Subsidiaries; grant of any stock option or right to purchase shares of capital
stock of the Company; issuance of any equity lines of credit, security
convertible into such capital stock; grant of any registration rights; purchase,
redemption, retirement, or other acquisition or payment of any dividend or other
distribution or payment in respect of shares of capital stock;
ii. amendment to the Organizational Documents of the
Company, Acquisition or the Subsidiaries;
iii. damage to or destruction or loss of any material
asset or property of the Company, Acquisition or the Subsidiaries, whether or
not covered by insurance, causing a Material Adverse Effect;
iv. receipt of notice that any of their substantial
customers have terminated or intends to terminate their relationship, which
termination would have a Material Adverse Effect;
v. entry into any transaction other than in the
Ordinary Course of Business;
vi. entry into, termination of, or receipt of written
notice of termination of any material (i) license, distributorship, dealer,
sales representative, joint venture, credit, or similar agreement, or (ii)
contract or transaction;
vii. sale (other than sales of inventory in the
Ordinary Course of Business), lease, or other disposition of any asset or
property of the Company, Acquisition or the Subsidiaries or mortgage, pledge, or
imposition of any lien or other encumbrance on any material asset or property of
the Company, Acquisition or the Subsidiaries;
viii. cancellation or waiver of any claims or
rights with a value to the Company in excess of $10,000;
ix. material change in the accounting methods used by
the Company, Acquisition or the Subsidiaries; or
x. agreement, whether oral or written, by the
Company, Acquisition or the Subsidiaries to do any of
the foregoing.
(n) NO DEFAULT OR VIOLATION. The Company, Acquisition and the
Subsidiaries (i) are in material compliance with all applicable material terms
and requirements of each material contract under which they have or had any
obligation or liability or by which they or any of the assets owned or used by
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them is or was bound and (ii) is not in material violation of any Legal
Requirement.
(o) CERTAIN PAYMENTS. Since the most recent date of the
Company Balance Sheets, neither the Company, Acquisition or the Subsidiaries,
nor any director, officer, agent or employee of the Company or the Subsidiaries
has directly or indirectly (a) made any contribution, gift, bribe, rebate,
payoff, influence payment, kickback or other payment to any Person, private or
public, regardless of form, whether in money, property or services (i) to obtain
favorable treatment in securing business, (ii) to pay for favorable treatment
for business secured, (iii) to obtain special concessions or for special
concessions already obtained, for or in respect of the Company, Acquisition or
the Subsidiaries or (iv) in violation of any Legal Requirement, or (b)
established or maintained any fund or asset that has not been recorded in the
books and records of the Company, Acquisition or the Subsidiaries.
(p) BROKERS OR FINDERS. The Company and Acquisition have not
incurred any obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other similar payment in connection with
this Agreement.
4.2 REPRESENTATIONS AND WARRANTIES OF OS. OS hereby makes the
following representations and warranties to the Company, all of which shall
survive the Post-Closing, subject to the limitations set forth in Section 8.2
hereof:
(a) ORGANIZATION, GOOD STANDING AND PURPOSE. OS is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware with full power and authority to conduct its businesses
as it is now being conducted, to own or use the properties and assets that it
owns or uses, and to perform all of its obligations under this Agreement. OS has
no subsidiaries. OS is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction in which either the ownership or use
of the properties owned or used by it, or the nature of the activities conducted
by it, requires such qualification, except for such failures to be so qualified
or in good standing would not have a Material Adverse Effect. OS was formed to
assist small communications companies with their growth strategies.
(b) AUTHORITY; NO CONFLICT.
i. This Agreement and any agreement executed in
connection herewith have been duly authorized by all required action of OS and
constitute the legal, valid and binding obligations of OS, enforceable against
OS in accordance with their respective terms. OS has the absolute and
unrestricted right, power and authority to execute and deliver this Agreement
and any agreements executed in connection herewith and to perform its
obligations hereunder and thereunder.
ii Neither the execution and delivery of this
Agreement by OS, nor the consummation or performance by it of any of its
obligations contained in this Agreement or in connection with the Contemplated
Transactions by the Company will, directly or indirectly (with or without notice
or lapse of time):
12
a. contravene, conflict with or result in a violation
of (x) any provision of the Organizational Documents of OS or (y) any resolution
adopted by the board of directors or the stockholders of OS;
b. contravene, conflict with or result in a violation
of, or give any governmental body or other Person the right to challenge any of
the Contemplated Transactions or to exercise any remedy or obtain any relief
under, any Legal Requirement or any Order to which OS or any of the assets owned
or used by OS may be subject;
c. contravene, conflict with or result in a violation
or breach of any provision of, or give any Person the right to declare a default
or exercise any remedy under, or to accelerate the maturity or performance of,
or to cancel, terminate or modify, this Agreement, the Purchase Agreement, the
OS Debentures or any Applicable Contract;
d. result in the imposition or creation of any
material encumbrance upon or with respect to any of the material assets owned or
used by OS;
e. cause OS to become subject to, or to become liable
for the payment of, any tax; or
f. cause any of the assets owned by OS to be
reassessed or revalued by any taxing authority or other governmental body,
except in connection with the transfer of real estate pursuant to this Agreement
or the Contemplated Transactions.
iii. OS is not required to obtain any consent from
any Person in connection with the execution and delivery of this Agreement or
the consummation or performance of any of the Contemplated Transactions, other
than the requisite approval of its sole stockholder, Jehu Hand (the "OS
STOCKHOLDER"), which approval has been obtained.
(c) CAPITALIZATION. The entire authorized OS Capital Stock
consists of 41,001,000 shares OS Common Stock, of which 1,000 shares are issued
and outstanding and held by the OS Stockholder and 41,000,000 of which are held
in escrow pursuant to the OS Escrow Agreement (as defined below). With the
exception of the OS Common Stock Shares and the OS Debentures, there are no
other outstanding equity or debt securities of the Company. No legend or other
reference to any purported encumbrance appears upon any certificate representing
the OS Common Stock Shares, other than applicable Securities Act legends. The OS
Common Stock Shares have been duly authorized and validly issued and are fully
paid and non-assessable. Except for the OS Debentures and the agreements
relating thereto set forth in the Purchase Agreement, there are no outstanding
options, voting agreements or arrangements, warrants, script, rights to
subscribe to, registration rights, calls or commitments of any character
whatsoever relating to, or, securities, rights or obligations convertible into
or exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of OS Capital Stock or other securities, or contracts, commitments,
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understandings, or arrangements by which OS is or may become bound to issue
additional shares of OS Capital Stock or other securities, or securities or
rights convertible or exchangeable into shares of OS Capital Stock or other
securities. Except as set forth in this Section 4.2(c), OS has no outstanding
equity, debt, debt or equity equivalent security, or debt or equity lines of
credit. None of the outstanding OS Common Stock Shares were issued in violation
of the Securities Act or any other legal requirement. OS does not own, and has
no contract to acquire, any equity securities or other securities of any Person
or any direct or indirect equity or ownership interest in any other business.
The OS Escrow Shares have been duly authorized, validly issued, fully paid and
are nonassessable pursuant to the escrow agreement between OS, HEM, and the
Escrow Agent (the "OS Escrow Agreement"). The OS Underlying Shares have been
duly authorized, and when and if issued pursuant to the terms of the Purchase
Agreement, will be fully paid and nonassessable.
(d) FINANCIAL STATEMENTS. OS has delivered to the Company a
balance sheet of OS as at October 20, 2003 (the "OS Balance Sheet"), and a
statement of operations for the period from inception to October 20, 2003. Such
financial statements were prepared in accordance with GAAP, are set forth in
Schedule 4.2(d) hereto and fairly present the financial condition and the
results of operations of OS as at October 20, 2003 of and for the period then
ended.
(e) ABSENCE OF MATERIAL ADVERSE CHANGE. Since the date of the
most recent OS Balance Sheet provided under Section 4.2(d) hereof, there have
been no events, changes or occurrences which have had or are reasonably likely
to have, individually or in the aggregate, a material adverse effect on OS.
(f) BOOKS AND RECORDS. The books of account, minute books,
stock record books, and other records of OS, all of which have been made
available to the Company and original copies of which will be delivered to the
Company at the Post-Closing, are complete and correct and have been maintained
in accordance with sound business practices, including the maintenance of an
adequate system of internal controls. The minute books of OS contain accurate
and complete records of all meetings held of, and corporate action taken by, the
stockholders, the Board of Directors, and any committees of the Board of
Directors of OS.
(g) NO UNDISCLOSED LIABILITIES. There are no material
liabilities of OS, whether absolute, accrued, contingent, or otherwise, other
than the OS Debentures and as set forth in Schedule 4.2(g).
(h) TITLE TO PROPERTIES; ENCUMBRANCES. OS has good and
marketable title to all the properties, interest in such properties and assets,
real and personal, reflected in the OS Balance Sheet or acquired after the date
of such balance sheet, free and clear of all mortgages, liens, pledges, charges
or encumbrances except (i) mortgages and other encumbrances referred to in the
notes to the OS Balance Sheet. OS neither owns nor leases any real property.
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(i) LEGAL PROCEEDINGS; ORDERS.
i. Except as set forth in Schedule 4.2(i) hereto,
there is no pending Proceeding:
a. that has been commenced or threatened by
or against OS or any of its officers, directors, agents or employees as such or
that otherwise relates to or may affect the business of, or any of the assets
owned or used by, OS; or
b. that challenges, or that may have the
effect of preventing, delaying, making illegal, or otherwise interfering with,
any Contemplated Transaction.
ii. Except as set forth in Schedule 4.2(i) hereto:
a. there is no Order to which OS, or any of
the assets owned or used by OS, is subject; and
b. no officer, director, agent, or employee
of OS is subject to any Order that prohibits such offer, director, agent or
employee from engaging in or continuing any conduct, activity or practice
relating to the business of OS.
(j) BROKERS OR FINDERS. OS has incurred no liability,
contingent or otherwise, for brokerage or finders' fees or agents' commissions
or other similar payment in connection with this Agreement.
(k) NO DEFAULT OR VIOLATION. Schedule 4.2(k) hereto lists each
contract, agreement and commitment to which OS is a party or otherwise bound
(each, an "OS Contract") or has any obligation or liability pursuant thereto. OS
(i) is in compliance with all terms and requirements of each OS Contract and
(ii) is not in violation of any Legal Requirement.
(l) TAXES.
i. OS has filed or caused to be filed on a timely
basis all tax returns that are or were required to be filed by it pursuant to
applicable Legal Requirements. OS has paid, or made provision for the payment
of, all taxes that have or may have become due pursuant to those tax returns or
otherwise, or pursuant to any assessment received by OS, except such taxes, if
any, as are listed in Schedule 4.2(l) hereto and are being contested in good
faith as to which adequate reserves have been provided in the OS Balance Sheets.
ii. All tax returns filed by OS are true, correct and complete
in all material respects and no taxes are currently owed or tax returns due by
or on behalf of OS.
(m) ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as set forth
in Schedule 4.2(m) hereto, since the date of the OS Balance Sheet, OS has
conducted its business only in the Ordinary Course of Business, there has not
been any material adverse effect on OS's business or operations, and there has
not been any:
15
i. change in the authorized or issued capital stock
of OS; grant of any stock option or right to
purchase shares of capital stock of OS; issuance of any security convertible
into such capital stock; grant of any registration rights; purchase, redemption,
retirement, or other acquisition or payment of any dividend or other
distribution or payment in respect of shares of capital stock;
ii. amendment to the Organizational Documents of OS;
iii. damage to or destruction or loss of any asset or
property of OS, whether or not covered by insurance or any other event or
circumstance, materially and adversely affecting the properties, assets,
business, financial condition, or prospects of OS;
iv. receipt of notice that any of its substantial
customers have terminated or intends to terminate their relationship, which
termination would have a material adverse effect on its financial condition,
results or operations, business assets or properties of OS;
v. entry into any transaction other than in the
Ordinary Course of Business;
vi. entry into, termination of, or receipt of written
notice of termination of any (i) license, distributorship, dealer, sales
representative, joint venture, credit, or similar agreement, or (ii) contract or
transaction;
vii. sale, lease, or other disposition of any asset
or property of OS or mortgage, pledge, or imposition of any lien or other
encumbrance on any asset or property of OS;
viii. cancellation or waiver of any claims or
rights with a value to OS in excess of $10,000;
ix. material change in the accounting methods used by
OS;
x. accrual or payment of any salaries or other
compensation, increase in salaries, compensation or bonuses or retention or
hiring of, any consultant or employee;
xi. debt or other liability incurred, other than the
OS Debentures; or
xii. agreement, whether oral or written, by OS to do
any of the foregoing, other than the Purchase
Agreement.
16
(n) COMPLIANCE WITH LAW. Except as set forth in Schedule
4.2(n) hereto:
i. OS has complied in all material respects with, and
is not in violation of, in any material respect, any Law to which it or its
business is subject; and
ii. OS has obtained all licenses, permits,
certificates or other governmental authorizations (collectively
"Authorizations") necessary for the ownership or use of its assets and
properties or the conduct of its business; and
(iii) OS has not received written notice of violation
of, or knows of any material violation of, any Laws to which it or its business
is subject or any Authorization necessary for the ownership or use of its assets
and properties or the conduct of its business.
(o) ENVIRONMENTAL LAWS. OS has not received any notice or
claim (and is not aware of any facts that would form a reasonable basis for any
claim), or entered into any negotiations or agreements with any other Person,
and, to the best knowledge of OS, OS is not the subject of any investigation by
any governmental or regulatory authority, domestic or foreign, relating to any
material or potentially material liability or remedial action under any
Environmental Laws. There are no pending or, to the knowledge of OS, threatened,
actions, suits or proceedings against OS or any of its properties, assets or
operations asserting any such material liability or seeking any material
remedial action in connection with any Environmental Laws.
(p) INTELLECTUAL PROPERTY. (i) OS owns, or is validly licensed
or otherwise has the right to use, all patents, and patent rights ("Patents")
and all trademarks, trade secrets, trademark rights, trade names, trade name
rights, service marks, service xxxx rights, copyrights and other proprietary
intellectual property rights and computer programs (the "Intellectual Property
Rights"), in each case, which are material to the conduct of the business of OS.
(ii) To the best knowledge of OS, OS has not
interfered with, infringed upon (without license to infringe), misappropriated
or otherwise come into conflict with any Patent of any other Person. OS has not
interfered with, infringed upon, misappropriated or otherwise come into conflict
with any Intellectual Property Rights of any other Person. OS has not received
any written charge, complaint, claim, demand or notice alleging any such
interference, infringement, is appropriation or violation (including any claim
that OS must license or refrain from using any Patents or Intellectual Property
Rights of any other Person) which has not been settled or otherwise fully
resolved. To the best knowledge of OS, no other Person has interfered with,
infringed upon (without license to infringe), misappropriated or otherwise come
into conflict with any Patents or Intellectual Property Rights of OS.
(q) EMPLOYEES. (a) OS has no employees other than Jehu Hand,
who is the President of OS; (b) Jehu Hand has been fully paid for all services
rendered by him to OS in his capacity as President of OS and is owed no further
salary or compensation in connection therewith; (c) OS has complied in all
17
respects with all applicable Laws respecting employment and employment
practices, terms and conditions of employment, wages and hours, and OS is not
liable for any arrears of wages or any taxes or penalties for failure to comply
with any such Laws; (d) OS believes that OS's relations with its employees is
satisfactory; (e) there are no controversies pending or, to the best knowledge
of OS, threatened between OS and any of its employees or former employees; (f)
OS is not a party to any collective bargaining agreement or other labor union
contract applicable to persons employed by OS, nor, to the best knowledge of OS,
are there any activities or proceedings of any labor union to organize any such
employees; (g) there are no unfair labor practice complaints pending against OS
before the National Labor Relations Board or any current union representation
questions involving employees of OS; (h) there is no strike, slowdown, work
stoppage or lockout existing, or, to the best knowledge of OS, threatened, by or
with respect to any employees of OS; (i) no charges are pending before the Equal
Employment Opportunity Commission or any state, local or foreign agency
responsible for the prevention of unlawful employment practices with respect to
OS; (j) there are no claims pending against OS before any workers' compensation
board; (k) OS has not received notice that any Federal, state, local or foreign
agency responsible for the enforcement of labor or employment laws intends to
conduct an investigation of or relating to OS and, to the best knowledge of OS,
no such investigation is in progress; and (l) OS has no consultants or
independent contractors.
(r) EMPLOYEE BENEFIT PLANS. There no "employee pension benefit
plans" (as defined in Section 3(2) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA")) or "employee welfare benefit plans" (as
defined in Section 3(1) of ERISA) maintained, or contributed to, by OS for the
benefit of any current or any former employees, officers or directors of OS.
(s) RULE 504 SECURITIES. The OS Debentures (which include the
Escrow Shares for the OS Underlying Shares) were sold in accordance with Rule
504 of Regulation D of the Securities Act of 1933, as amended (the "Securities
Act"), and Section 00-00-000 of the Colorado Securities Act of the Colorado
Revised Statutes (the "Colorado Act") and regulation 51-3.13B promulgated
thereunder, to an accredited investor residing in the State of Colorado.
Accordingly, at the Effective Time and pursuant to Rule 504, the Colorado Act,
and Section 3(a)(9) of the Securities Act, the OS Debentures (which include the
Company Escrow Shares for the Company Underlying Shares) shall continue to be
without restriction and shall be freely tradable in accordance with Rule 504.
ARTICLE V
COVENANTS
5.1 COVENANTS OF THE COMPANY AND ACQUISITION.
(a) CONDUCT OF BUSINESS. Between the date hereof and up to and
including the Post-Closing Date, each of the Company and Acquisition shall:
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i. conduct its business only in the Ordinary Course
of Business;
ii. use its commercially reasonable efforts to
preserve intact the current business organization of the Company and
Acquisition, as the case may be, keep available the services of the current
officers, employees and agents of the Company and Acquisition, as the case may
be, and maintain the relations and good will with suppliers, customers,
landlords, creditors, employees, agents and others having business relationships
with the Company and Acquisition, as the case may be;
iii. not pay, incur or declare any dividends or
distributions with respect to its stockholders or amend its Certificate of
Incorporation or By-Laws, without the prior written consent of the OS Debenture
Holder;
iv. not authorize, issue, sell, purchase or redeem
any shares of its capital stock or any options or other rights to acquire
ownerships interests without the prior written consent of the OS Debenture
Holder except as may be required by pre-existing commitments disclosed herein or
in the Reports;
v. not incur any indebtedness for money borrowed or
issue any debt securities, or incur or suffer to be incurred any liability or
obligation of any nature whatsoever, except those incurred in the Ordinary
Course of Business, or cause or permit any material lien, encumbrance or
security interest to be created or arise on or in respect of any material
portion of its properties or assets;
vi. not make any investment of a capital nature
either by purchased stock or securities, contribution to capital, property
transfer or otherwise, or by the purchase of any property or assets of any other
Person;
vii. not do any other act which would cause any
representation or warranty of the Company in this Agreement to be or become
untrue in any material respect or that is not in the Ordinary Course of
Business;
viii. report periodically to the OS Debenture Holder
concerning the status of the business and operations of the Company upon the
reasonable request of the OS Debenture Holder; and
ix. confer with the OS Debenture Holder concerning
operational matters of a material nature upon the reasonable request of the OS
Debenture Holder.
(b) PROPOSALS; OTHER OFFERS. Commencing on the date of
execution of this Agreement up to and including the Post-Closing Date, each of
the Company and Acquisition shall not, directly or indirectly (whether through
an employee, a representative, an agent or otherwise), solicit or encourage any
inquiries or proposals, engage in negotiations for or consent to or enter into
any agreement providing for the acquisition of its business. Each of the Company
and Acquisition shall not, directly or indirectly (whether through an employee,
19
a representative, an agent or otherwise) disclose any nonpublic information
relating to the Company and Acquisition or afford access to any of the books,
records or other properties of the Company and Acquisition to any person or
entity that is considering, has considered or is making any such acquisition
inquiry or proposal relating to the Company's and Acquisition's business.
(c) FURTHER ASSURANCES. Prior to the Post-Closing Date, with
the cooperation of OS where appropriate, each of the Company and Acquisition
shall use commercially reasonable efforts to:
i. promptly comply with all filing requirements which
federal, state or local law may impose on the Company or Acquisition, as the
case may be, with respect to the Contemplated Transactions by this Agreement;
and
ii. take all actions necessary to be taken, make any
filing and obtain any consent, authorization or approval of or exemption by any
governmental authority, regulatory agency or any other third party (including
without limitation, any landlord or lessor of the Company and any party to whom
notification is required to be delivered or from whom any form of consent is
required) which is required to be filed or obtained by the Company or
Acquisition in connection with the Contemplated Transactions by this Agreement.
(d) ACCESS TO ADDITIONAL AGREEMENTS AND INFORMATION. Prior to
the Post-Closing Date, the Company and Acquisition shall make available to the
OS Debenture Holder (as well as its counsel, accountants and other
representatives) any and all agreements, contracts, documents, other instruments
and personnel material to the Company's business, including without limitation,
those contracts to which the Company or Acquisition is a party and those by
which each of its business or any of the Company's or Acquisition's assets are
bound.
5.2 COVENANTS OF OS.
(a) CONDUCT OF BUSINESS. Between the date hereof and up to and
including the Post-Closing Date, OS shall:
i. conduct its business only in the Ordinary Course
of Business;
ii. use its commercially reasonable efforts to
preserve intact the current business organization of
OS, keep available the services of the current officers, employees and agents of
OS, and maintain the relations and good will with suppliers, customers,
landlords, creditors, employees, agents and others having business relationships
with OS;
iii. not pay, incur or declare any dividends or
distributions with respect to its stockholders or amend its Certificate of
Incorporation or By-Laws, without the prior written consent of the Company and
OS Debenture Holder;
20
iv. not authorize, issue, sell, purchase or redeem
any shares of its capital stock or any options or other rights to acquire
ownerships interests without the prior written consent of the Company and OS
Debenture Holder;
v. not incur any indebtedness for money borrowed or
issue and debt securities, or incur or suffer to be incurred any liability or
obligation of any nature whatsoever, or cause or permit any material lien,
encumbrance or security interest to be created or arise on or in respect of any
material portion of its properties or assets;
vi. not make any investment of a capital nature
either by purchased stock or securities, contribution to capital, property
transfer or otherwise, or by the purchase of any property or assets of any other
Person;
vii. not do any other act which would cause
representation or warranty of OS in this Agreement to be or become untrue in any
material respect or that is not in the Ordinary Course of Business consistent
with past practice;
viii. report periodically to the Company and the OS
Debenture Holder concerning the status of the business and operations of OS; and
ix. confer with the Company and the OS Debenture
Holder concerning operational matters of a material nature.
(b) PROPOSALS; OTHER OFFERS. Commencing on the date of
execution of this Agreement through the Post-Closing Date, OS shall not,
directly or indirectly (whether through an employee, a representative, an agent
or otherwise), solicit or encourage any inquiries or proposals, engage in
negotiations for or consent to or enter into any agreement providing for the
acquisition of its business. OS shall not, directly or indirectly (whether
through an employee, a representative, an agent or otherwise) disclose any
nonpublic information relating to OS or afford access to any of the books,
records or other properties of OS to any person or entity that is considering,
has considered or is making any such acquisition inquiry or proposal relating to
the OS's business.
(c) FURTHER ASSURANCES. Prior to the Post-Closing Date, with
the cooperation of the Company where appropriate, OS shall:
i. promptly comply with all filing requirements which
federal, state or local law may impose on OS with respect to the Contemplated
Transactions by this Agreement and cooperate with the Company regarding the
same; and
ii. take all actions necessary to be taken, make any
filing and obtain any consent, authorization or approval of or exemption by any
governmental authority, regulatory agency or any other third party (including
without limitation, any landlord or lessor of OS and any party to whom
notification is required to be delivered or from whom any form of consent is
required) which is required to be filed or obtained by OS in connection with the
Contemplated Transactions by this Agreement.
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(d) ACTIONS BY OS. OS shall take no action or enter into any
agreements or arrangements except as may be required by this Agreement.
(e) NO CHANGE IN CAPITAL STOCK. Prior to the Effective Time,
no change will be made in the authorized, issued or outstanding capital stock of
OS, and no subscriptions, options, rights, warrants, calls, commitments or
agreements relating to the authorized, issued or outstanding capital stock of OS
will be entered into, issued, granted or created.
(f) ACCESS TO ADDITIONAL AGREEMENTS AND INFORMATION. Prior to
the Post-Closing Date, OS shall make available to the Company and OS Debenture
Holder (as well as its counsel, accountants and other representatives) any and
all agreements, contracts, documents, other instruments and personnel material
of OS's business, including without limitation, those contracts to which OS is a
party and those by which its business or any of OS's assets are bound.
(g) FURTHER ASSURANCES. Prior to the Post-Closing Date, with
the cooperation of the Company where appropriate, OS shall use commercially
reasonable efforts to:
i. promptly comply with all filing requirements which
federal, state or local law may impose on OS with respect to the Contemplated
Transactions by this Agreement; and
ii. take all actions necessary to be taken, make any
filing and obtain any consent, authorization or approval of or exemption by any
governmental authority, regulatory agency or any other third party (including
without limitation, any landlord or lessor of OS and any party to whom
notification is required to be delivered or from whom any form of consent is
required) which is required to be filed or obtained by OS in connection with the
Contemplated Transactions by this Agreement.
5.3 GOVERNMENTAL FILINGS AND CONSENTS. The Company,
Acquisition and OS shall cooperate with one another in filing any necessary
applications, reports or other documents with any federal or state agencies,
authorities or bodies having jurisdiction with respect to the business of the
Company, Acquisition or OS and in seeking any necessary approval, consultation
or prompt favorable action of, with or by any of such agencies, authorities or
bodies.
5.4 PUBLICITY. Any public announcement or press release
relating to this Agreement or the Contemplated Transactions must be approved by
the OS Debenture Holder and the Company in writing before being made or
released. The Company shall have the right to issue a press release or make
other disclosure without the OS Debenture Holder's written approval if in the
opinion of the Company's counsel such a release is necessary to comply with SEC
Rules and Regulations or other Law; PROVIDED THAT, the OS Debenture Holder
receives a copy of such prepared press release or other disclosures for purposes
of review at least 24 hours before it is issued. This 24 hour period may be
22
shortened if in the opinion of the Company's counsel it is required by Law;
PROVIDED THAT, the OS Debenture Holder and the Company receives a copy of such
release as long as reasonably practical before it is issued.
5.5 TAX RETURNS. The current officers of the Company shall
have the right to prepare any tax returns of the Company with respect to any
period that ends on or before the Post-Closing Date. Such tax returns shall be
timely filed by the Company. OS shall cooperate with said officers in the
preparation of such tax returns.
ARTICLE VI
CONDITIONS
6.1 CONDITIONS TO OBLIGATIONS OF OS. The obligation of OS to
consummate the Contemplated Transactions is subject to the fulfillment of each
of the following conditions, any of which may be waived by OS in its sole
discretion:
(a) COPIES OF RESOLUTIONS. At the Post-Closing (i) the Company
shall have furnished OS with a certificate of its CEO or President, as the case
may be, in the form of EXHIBIT 6.1(A) annexed hereto, certifying that attached
thereto are copies of resolutions duly adopted by the board of directors of the
Company authorizing the execution, delivery and performance of this Agreement
and all other necessary or proper corporate action to enable the Company to
comply with the terms of this Agreement and (ii) Acquisition shall have
furnished OS with a certificate of its CEO or President, as the case may be, in
the form of EXHIBIT 6.1(E) annexed hereto, certifying that attached thereto are
copies of resolutions duly adopted by the board of directors of Acquisition
authorizing the execution, delivery and performance of this Agreement and all
other necessary or proper corporate action to enable Acquisition to comply with
the terms of this Agreement.
(b) OPINION OF COMPANY'S COUNSEL. The Company shall have
furnished to OS, at the Post-Closing, an opinion of its legal counsel, dated as
of the Post-Closing Date, substantially in the form of EXHIBIT 6.1(B) annexed
hereto.
(c) OPINION OF COMPANY'S SPECIAL SECURITIES COUNSEL. The
Company shall have furnished to OS, at the Post-Closing, with an opinion of the
special securities counsel to the Company, dated as of the Post-Closing Date,
substantially in the form of EXHIBIT 6.1(C) annexed hereto.
(d) INSTRUCTION LETTER TO TRANSFER AGENT. The Company shall
have furnished OS, at the Post-Closing, with a letter to its transfer agent, to
accept the legal opinion set forth in Section 6.1(c), dated as of the
Post-Closing Date, substantially in the form of EXHIBIT 6.1(D) annexed hereto.
(e) ACCURACY OF REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF
COVENANTS. Each of the representations and warranties of the Company and
Acquisition set forth in this Agreement was true, correct and complete in all
material respects when made (except for representations and warranties that
speak as of a specific date, which representations and warranties shall be true,
23
correct and complete in all material respects as of such date) and shall also be
true, correct and complete in all material respects at and as of the
Post-Closing Date (except for representations and warranties that speak as of a
specific date, which representations and warranties shall be true, correct and
complete in all material respects as of such date), with the same force and
effect as if made at and as of the Post-Closing Date. The Company shall have
performed and complied in all material respects with all agreements and
covenants required by this Agreement to be performed by the Company and
Acquisition at or prior to the Post-Closing Date.
(f) DELIVERY OF CERTIFICATE. (A) The Company shall have
delivered to OS a certificate, in the form of EXHIBIT 6.1(F) annexed hereto,
dated the Post-Closing Date, and signed by the CEO or President of the Company
affirming that the representations and warranties as set forth in Section 4.1
were and are true, correct and complete as required by Section 6.1(e) and (B)
Acquisition shall have delivered to OS a certificate, in the form of EXHIBIT
6.1(H) annexed hereto, dated the Post-Closing Date, and signed by the CEO or
President of Acquisition affirming that the representations and warranties as
set forth in Section 4.1 were and are true, correct and complete as required by
Section 6.1(e).
(g) CONSENTS AND WAIVERS. At the Post-Closing, any and all
necessary consents, authorizations, orders or approvals shall have been
obtained, except as the same shall have been waived by the OS Debenture Holder.
(h) LITIGATION. On the Post-Closing Date, there shall be no
effective injunction, writ or preliminary restraining order or any order of any
kind whatsoever with respect to the Company issued by a court or governmental
agency (or other governmental or regulatory authority) of competent jurisdiction
restraining or prohibiting the consummation of the Contemplated Transactions or
making consummation thereof unduly burdensome to OS. On the Post-Closing Date
and immediately prior to consummation of the Contemplated Transactions, no
proceeding or lawsuit shall have been commenced, be pending or have been
threatened by any governmental or regulatory agency or authority or any other
Person restraining or prohibiting the consummation of the Contemplated
Transactions.
(i) DELIVERY OF DOCUMENTS AND OTHER INFORMATION. Prior to the Post-Closing Date,
the Company and Acquisition shall have made available or delivered to OS all of
the agreements, contracts, documents and other instruments requested by OS.
6.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY AND ACQUISITION.
The obligations of the Company and Acquisition to consummate the Contemplated
Transactions are subject to the fulfillment of each of the following conditions,
any of which may be waived by the Company and Acquisition, in their sole
discretion:
(a) COPIES OF RESOLUTIONS. At the Post-Closing, OS shall have
furnished the Company with a certificate of its President, in the form of
EXHIBIT 6.2(A) annexed hereto, certifying that attached thereto are copies of
24
resolutions duly adopted by the board of directors of OS authorizing the
execution, delivery and performance of the terms of this Agreement and all other
necessary or proper corporate action to enable OS to comply with the terms of
this Agreement.
(b) OPINION OF OS'S COUNSEL. OS shall have furnished to the
Company, at the Post-Closing, with an opinion of counsel to OS, dated as of the
Post-Closing Date, substantially in the form of EXHIBIT 6.2(B) annexed hereto.
(c) OPINION OF OS'S SPECIAL SECURITIES COUNSEL. OS shall have
furnished to the Company, at the Closing, with an opinion of the special
securities counsel to OS dated as of the Post-Closing Date, substantially in the
form of EXHIBIT 6.2(C) annexed hereto.
(d) ACCURACY OF REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF
COVENANTS. Each of the representations and warranties of OS was true, correct
and complete in all material respects when made (except for representations and
warranties that speak as of a specific date, which representations and
warranties shall be true, correct and complete in all material respects as of
such date) and shall also be true, correct and complete in all material respects
at and as of the Post-Closing Date (except for representations and warranties
that speak as of a specific date, which representations and warranties shall be
true, correct and complete in all material respects as of such date), with the
same force and effect as if made at and as of the Post-Closing Date. OS shall
have performed and complied in all material respects with all agreements and
covenants required by this Agreement to be performed by OS at or prior to the
Post-Closing Date.
(e) DELIVERY OF CERTIFICATE. OS shall have delivered to the
Company a certificate, in the form of EXHIBIT 6.2(E) annexed hereto, dated the
Post-Closing Date and signed by the CEO or President of OS, affirming that the
representations and warranties of OS as set forth in Section 4.2 were and are
true, correct and complete and OS's agreements and covenants have been performed
as required by Section 6.2(d).
(f) COMPLIANCE WITH RULE 504. In connection with the issuance
of the Securities by OS under the Purchase Agreement, on or prior to the
Post-Closing Date OS shall be in full compliance with Rule 504 of Regulation D
of the Securities Act of 1933, as amended, and OS shall have delivered to the
Company at the Post-Closing a filed copy of the Form D required to be filed with
the SEC in connection therewith.
(g) CONSENTS AND WAIVERS. On or prior to the Post-Closing
Date, any and all necessary consents, authorizations, orders or approvals shall
have been obtained, except as the same shall have been waived by the Company.
(h) LITIGATION. On the Post-Closing Date, there shall be no
effective injunction, writ or preliminary restraining order or any order of any
kind whatsoever with respect to OS issued by a court or governmental agency (or
other governmental or regulatory authority) of competent jurisdiction
restraining or prohibiting the consummation of the Contemplated Transactions or
25
making the consummation thereof unduly burdensome to the Company or OS. On the
Post-Closing Date, no proceeding or lawsuit shall have been commenced,
threatened or be pending or by any governmental or regulatory agency or
authority or any other person with respect to the Contemplated Transactions.
(i) DELIVERY OF DOCUMENTS AND OTHER INFORMATION. Prior to the
Post-Closing Date, OS shall have made available or delivered to the Company all
of the agreements, contracts, documents and other instruments required to be
delivered pursuant to the provisions of this Agreement.
ARTICLE VII
TERMINATION
7.1 TERMINATION BY MUTUAL AGREEMENT. This Agreement
may be terminated at any time by mutual consent of the parties hereto, provided
that such consent to terminate is in writing and is signed by each of the
parties hereto.
7.2 TERMINATION FOR FAILURE TO CLOSE. This Agreement shall be
automatically terminated if the Closing shall not have occurred within ten (10)
days of the date hereof (except if such 10th day is not a Business Day, then the
next Business Day).
7.3 TERMINATION BY OPERATION OF LAW. This Agreement may be
terminated by any party hereto if there shall be any statute, rule or regulation
that renders consummation of the Contemplated Transactions illegal or otherwise
prohibited, or a court of competent jurisdiction or any government (or
governmental authority) shall have issued an order, decree or ruling, or has
taken any other action restraining, enjoining or otherwise prohibiting the
consummation of such transactions and such order, decree, ruling or other action
shall have become final and nonappealable.
7.4 TERMINATION FOR FAILURE TO PERFORM COVENANTS OR
CONDITIONS. This Agreement may be terminated prior to the Post-Closing Date:
(a) by OS if: (i) any of the representations and warranties
made in this Agreement by the Company or Acquisition shall not be materially
true and correct, when made or at any time prior to consummation of the
Contemplated Transactions as if made at and as of such time; (ii) any of the
conditions set forth in Section 6.1 hereof have not been fulfilled in all
material respects by the Post-Closing Date; (iii) the Company or Acquisition
shall have failed to observe or perform any of its material obligations under
this Agreement; or (iv) as otherwise set forth herein; or
(b) by the Company or Acquisition if: (i) any of the
representations and warranties of OS or the OS Stockholder shall not be
materially true and correct when made or at any time prior to consummation of
the Contemplated Transactions as if made at and as of such time; (ii) any of the
conditions set forth in Section 6.2 hereof have not been fulfilled in all
material respects by the Post-Closing Date; (iii) OS or the OS Stockholder shall
26
have failed to observe or perform any of their material respective obligations
under this Agreement; or (iv) as otherwise set forth herein.
7.5 EFFECT OF TERMINATION OR DEFAULT; REMEDIES. In the event
of termination of this Agreement as set forth above, this Agreement shall
forthwith become void and there shall be no liability on the part of any party
hereto, provided that such party is a Non-Defaulting Party (as defined below).
The foregoing shall not relieve any party from liability for damages actually
incurred as a result of such party's breach of any term or provision of this
Agreement.
7.6 REMEDIES; SPECIFIC PERFORMANCE. In the event that any
party shall fail or refuse to consummate the Contemplated Transactions or if any
default under or beach of any representation, warranty, covenant or condition of
this Agreement on the part of any party (the "Defaulting Party") shall have
occurred that results in the failure to consummate the Contemplated
Transactions, then in addition to the other remedies provided herein, the
non-defaulting party (the "Non-Defaulting Party") shall be entitled to seek and
obtain money damages from the Defaulting Party, or may seek to obtain an order
of specific performance thereof against the Defaulting Party from a court of
competent jurisdiction, provided that the Non-Defaulting Party seeking such
protection must file its request with such court within forty-five (45) days
after it becomes aware of the Defaulting Party's failure, refusal, default or
breach. In addition, the Non-Defaulting Party shall be entitled to obtain from
the Defaulting Party court costs and reasonable attorneys' fees incurred in
connection with or in pursuit of enforcing the rights and remedies provided
hereunder.
ARTICLE VIII
SURVIVAL; INDEMNIFICATION
8.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
All representations and warranties of the Company shall survive the execution
and delivery of this Agreement and the Post-Closing hereunder and shall
thereafter survive until the earlier of (i) the fourth anniversary of the
Post-Closing Date and (ii) the date of the OS Debentures have been fully
converted or otherwise cease to be outstanding (the "Conversion Date") and shall
then terminate except to the extent that notice of the Company's or Acquisition
liability in respect of any inaccuracy in or breach of any representation or
warranty shall have been given on or prior to such second anniversary or
Conversion Date.
8.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF OS. All
representations and warranties of OS shall terminate upon the Closing except to
the extent that notice of OS's liability in respect of any inaccuracy in or
breach of any representation or warranty shall have been given on or prior to
Closing.
8.3 OBLIGATION OF THE COMPANY TO INDEMNIFY. The Company agrees
to indemnify, defend and hold harmless OS (and its directors, officers,
employees, affiliates, stockholders, debenture holders, agents, attorneys,
successors and assigns) from and against all losses, liabilities, damages,
27
deficiencies, costs or expenses (including interest, penalties and reasonable
attorneys' and consultants' fees and disbursements) (collectively, "Losses")
based upon, arising out of or otherwise in respect of any (i) inaccuracy in any
representation or warranty of the Company contained in this Agreement or in the
Schedules and Exhibits hereto or (ii) breach by the Company of any covenant or
agreement contained in this Agreement.
8.4 OBLIGATION OF AND OS TO INDEMNIFY. OS agrees to indemnify,
defend and hold harmless the Company (and its directors, officers, employees,
affiliates, stockholders, agents, attorneys, successors and assigns) from and
against any Losses based upon, arising out of or otherwise in respect of any (i)
inaccuracy in any representation or warranty of OS contained in this Agreement
or (ii) breach by OS of any covenant or agreement contained in this Agreement.
8.5 NOTICE AND OPPORTUNITY TO DEFEND. (a) Promptly after
receipt by any Person entitled to indemnity under this Agreement (an
"Indemnitee") of notice of any demand, claim or circumstances which, with the
lapse of time, would or might give rise to a claim or the commencement (or
threatened commencement) of any action, proceeding or investigation (an
"Asserted Liability") that may result in a Loss, the Indemnitee shall give
notice thereof (the "Claims Notice") to any other party (or parties) who is or
may be obligated to provide indemnification pursuant to Section 8.3 or 8.4 (the
"Indemnifying Party"). The Claims Notice shall describe the Asserted Liability
in reasonable detail and shall indicate the amount (estimated, if necessary and
to the extent feasible) of the Loss that has been or may be suffered by the
Indemnitee.
(b) The Indemnifying Party may elect to compromise or defend,
at its own expense and by its own counsel, any Asserted Liability. If the
Indemnifying Party elects to compromise or defend such Asserted Liability, it
shall within 30 days after the date the Claims Notice is given (or sooner, if
the nature of the Asserted Liability so requires) notify the Indemnitee of its
intent to do so, and the Indemnitee shall cooperate, at the expense of the
Indemnifying Party, in the compromise of, or defense against, such Asserted
Liability. If the Indemnifying Party elects not to compromise or defend the
Asserted Liability, fails to notify the Indemnitee of its election as herein
provided or contests its obligation to indemnify under this Agreement, the
Indemnitee may pay, compromise or defend such Asserted Liability and all
reasonable expenses incurred by the Indemnitee in defending or compromising such
Asserted Liability, all amounts required to be paid in connection with any such
Asserted Liability pursuant to the determination of any court, governmental or
regulatory body or arbitrator, and amounts required to be paid in connection
with any compromise or settlement consented to by the Indemnitee, shall be borne
by the Indemnifying Party. Except as otherwise provided in the immediately
preceding sentence, the Indemnitee may not settle or compromise any claim over
the objection of the Indemnifying Party. In any event, the Indemnitee and the
Indemnifying Party may participate, at their own expense, in (but the Indemnitee
may not control) the defense of such Asserted Liability. If the Indemnifying
Party chooses to defend any claim, the Indemnitee shall make available to the
Indemnifying Party any books, records or other documents within its control that
are necessary or appropriate for such defense.
28
ARTICLE IX
DEFINITIONS
The following terms, which are capitalized in this Agreement,
shall have the meanings set forth below for the purpose of this Agreement.
"APPLICABLE CONTRACT" means any Contract (a) to which the
Company is a party and under which the Company has or may acquire any material
rights, (b) under which the Company or OS, as the case may be, is a party and
has or may become subject to any material obligation or material liability or
(c) by which the Company or OS, as the case may be, or any of the material
assets owned or used by it is or may become bound.
"CONTEMPLATED TRANSACTIONS" means all of the transactions
contemplated by this Agreement, including, without limitation:
(1) the Merger; and
(2) the performance by the parties of their
respective covenants and obligations under
this Agreement.
"ENVIRONMENTAL LAWS" means all applicable federal, state,
local or foreign laws, rules and regulations, orders, decrees, judgments,
permits, filings and licenses relating (i) to protection and clean-up of the
environment and activities or conditions related thereto, including those
relating to the generation, handling, disposal, transportation or release of
hazardous substances and (ii) the health or safety of employees in the workplace
environment, all as amended from time to time, and shall also include any common
law theory based on nuisance, trespass, negligence or other tortious conduct.
"ERISA" means the Employee Retirement Income Security Act of
1974 or any successor law, and regulations and rules issued pursuant to such law
or any successor law.
"GAAP" means generally accepted accounting principles in the
United States, applied on a consistent basis.
"LAW" means all applicable laws, statutes, ordinances, rules,
regulations, orders, writs, injunctions, judgments or decrees entered, enacted,
promulgated, enforced or issued by any court or other governmental or regulatory
authority, domestic or foreign.
"LEGAL REQUIREMENT" means any federal, state, local,
municipal, foreign, international, multinational or other administrative law,
ordinance, principle of common law, regulation, statute, treaty, court or
arbitrator.
"MATERIAL ADVERSE EFFECT" means a material adverse effect upon
the business or financial condition of the Company (when used in Section 4.1) or
OS (when used in Section 4.2), taken as a whole with any subsidiaries.
29
"ORDER" means any award, decision, injunction, judgment,
order, ruling, subpoena or verdict entered, issued, made or rendered by any
court, administrative agency or other governmental body or by any arbitrator.
"ORDINARY COURSE OF BUSINESS" means an action taken by a
Person where:
(1) such action is consistent with the past practices of such
Person and is taken in the ordinary course of the normal day-to-day operations
of such Person;
(2) such action is not required to be authorized by the board
of directors of such Person (or by any Person or group of Persons exercising
similar authority); and
(3) such action is similar in nature and magnitude to actions
customarily taken, without any authorization by the board of directors (or by
any Person or group of Persons exercising similar authority), in the ordinary
course of the normal day-to-day operations of other Persons that are in the same
line of business as such Person.
"ORGANIZATIONAL DOCUMENTS" means the articles or certificate
of incorporation and the by-laws of a corporation and any amendment thereto.
"PERSON" means any individual, corporation (including any
non-profit corporation), general or limited partnership, limited liability
company, joint venture, estate, trust, association, organization, labor union or
other entity or governmental body.
"PROCEEDING" means any action, arbitration, audit, hearing,
investigation, litigation or suit (whether civil, criminal, administrative,
investigative or informal) commenced, brought, conducted or heard by or before,
or otherwise involving, any governmental body or arbitrator.
"SEC" means the United States Securities and Exchange
Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
ARTICLE X
MISCELLANEOUS
10.1 FEES AND EXPENSES. Except as otherwise provided in this
Agreement, each party hereto will bear its own legal, accounting and other fees
and expenses incident to the Contemplated Transactions herein. Any fees and
expenses required to be paid by any party hereunder shall be limited to
reasonable and necessary fees and expenses
10.2 MODIFICATION, AMENDMENTS AND WAIVER. The parties hereto
may amend, modify or otherwise waive any provision of this Agreement by mutual
consent, provided that such consent and any amendment, modification or waiver is
in writing and is signed by each of the parties hereto.
30
10.3 ASSIGNMENT. Neither the Company nor OS shall have the
authority to assign its respective rights or obligations under this Agreement
without the prior written consent of the OS Debenture Holder.
10.4 SUCCESSORS. This Agreement shall be binding upon and, to
the extent permitted in this Agreement, shall inure to the benefit of the
parties and their respective successors and permitted assigns.
10.5 ENTIRE AGREEMENT. This Agreement and the exhibits,
schedules and other documents referred to herein contain the entire agreement
among the parties hereto with respect to the Contemplated Transactions and
supersede all prior agreements with respect thereto, whether written or oral.
10.6 GOVERNING LAW. This Agreement and the exhibits hereto shall be governed by
and construed in accordance with the laws of the State of New York, without
giving effect to principles of conflicts or choice of laws thereof. Any action
to enforce the terms of this Agreement or any of its exhibits shall be brought
exclusively in the state and/or federal courts situated in the County and State
of New York. Service of process in any action by either party to enforce the
terms of this Agreement may be made by serving a copy of the summons and
complaint, in addition to any other relevant documents, by commercial overnight
courier to the other party at its principal address set forth in this Agreement.
10.7 NOTICES. Any notice, request, demand, waiver, consent, approval, or
-------
other communication which is required or permitted to be given to any party
hereunder shall be in writing and shall be deemed given only if delivered to the
party personally or sent to the party by facsimile upon electronic confirmation
of receipt (promptly followed by a hard-copy delivered in accordance with this
Section 10.7) or three days after being mailed by registered or certified mail
(return receipt requested), with postage and registration or certification fees
thereon prepaid, or if sent by nationally recognized overnight courier, one day
after being mailed, addressed to the party at its address set forth below:
If to OS prior to
Post-Closing: Orange Soda, Inc.
00000 Xxxxx Xxxx, Xxxxx X
Xxxx Xxxxx, XX 00000
Attn: Jehu Hand, President
Tel: (000) 000-0000
Fax: (000) 000-0000
If to OS after Orange Soda, Inc.
Post-Closing: c/o Reality Wireless Networks, Inc.
000 Xxxx Xxxxxxxx, Xxxxx X
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
Tel:
Fax:
31
with copies to: The Xxxx Law Group, PLLC
000 0xx Xxx., Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: Xxxxxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
If to Acquisition: RWNT Acquisition, Inc.
c/o Reality Wireless Networks, Inc.
000 Xxxx Xxxxxxxx, Xxxxx X
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: The Xxxx Law Group, PLLC
000 0xx Xxx., Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: Xxxxxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
If to the Company: Reality Wireless Networks, Inc.
000 Xxxx Xxxxxxxx, Xxxxx X
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: The Xxxx Law Group, PLLC
000 0xx Xxx., Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: Xxxxxxx X. Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
or to such other persons or addresses as may be designated in writing by the
party to receive such notice. If mailed as aforesaid, the day of mailing or
transmission shall be the date any such notice shall be deemed to have been
delivered.
32
10.8 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be an original, but all of which shall
constitute but one agreement. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
10.9 RIGHTS CUMULATIVE. All rights, powers and privileges
conferred hereunder upon the parties, unless otherwise provided, shall be
cumulative and shall not be restricted to those given by law. Failure to
exercise any power given any party hereunder or to insist upon strict compliance
by any other party shall not constitute a waiver of any party's right to demand
exact compliance with any of the terms or provisions hereof.
10.10 SEVERABILITY OF PROVISIONS. The provisions of this
Agreement shall be considered severable in the event that any of such provisions
are held by a court of competent jurisdiction to be invalid, void or otherwise
unenforceable. Such invalid, void or otherwise unenforceable provisions shall be
automatically replaced by other provisions which are valid and enforceable and
which are as similar as possible in term and intent to those provisions deemed
to be invalid, void or otherwise unenforceable and the remaining provisions
hereof shall remain enforceable to the fullest extent permitted by law.
10.11 HEADINGS. The headings set forth in the articles and
sections of this Agreement and in the exhibits and the schedules to this
Agreement are inserted for convenience of reference only and shall not be deemed
to constitute a part hereof.
[SIGNATURE PAGE FOLLOWS]
33
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
have caused this Agreement to be executed and delivered on the date and year
first above written.
REALITY WIRELESS NETWORKS, INC.
By:
---------------------------------------
Xxxxxx Xxxxxx,
President
EXHIBITS TO THE MERGER AGREEMENT ARE ON FILE WITH THE COMPANY
ORANGE SODA, INC.
By:
---------------------------------------
Jehu Hand, President and
Chief Executive Officer
RWNT ACQUISITION, INC.
By:
---------------------------------------
Xxxxxx Xxxxxx
President
34
