Exhibit 2.1
EXCHANGE AGREEMENT
This EXCHANGE AGREEMENT is entered into as of April 1, 2004, by and
among LensCard Corporation, a Delaware corporation ("LCC"), on the one hand, and
LensCard US LLC, a Delaware limited liability company (formerly, Universal
Magnifier, LLC, a California limited liability company) ("LCUS"), and each of
the members of LCUS, namely, Xxxx Xxxxxxxxxxx, an individual ("X. Xxxxxxxxxxx"),
Forest Xxxxxxxxxxx, an individual ("X. Xxxxxxxxxxx"), Xxxxxxx X. Xxxx, an
individual ("Xxxx"), and Xxx Xxxxxxxx, an individual ("Berthoud") (X.
Xxxxxxxxxxx, X. Xxxxxxxxxxx, Xxxx and Berthoud are sometimes hereinafter
referred to collectively as the "Members"), on the other hand.
RECITALS
WHEREAS, reference is made to that certain Operating Agreement for
LCUS (formerly, Universal Magnifier, LLC) made as of February 4, 1998 (the
"Operating Agreement");
WHEREAS, capitalized terms used but not defined in this Agreement
have the meanings ascribed to such terms in the Operating Agreement;
WHEREAS, the Members collectively own 100% of the issued and
outstanding Membership Interests of LCUS;
WHEREAS, pursuant to and in compliance with Article VII (Transfer and
Assignment of Interests) of the Operating Agreement, and Section 4(2) of the
Securities Act of 1933, as amended (the "Securities Act"), and Rule 506
promulgated thereunder, the Members, as a group, desire to transfer their
Membership Interests in their entirety to LCC in exchange for the issuance to
the Members of an aggregate of 1,000,000 shares of the $0.001 par value per
share Common Stock of LCC ("Common Stock");
WHEREAS, the transactions contemplated by this Agreement are part of
a series of integrated, mutually dependent transactions, which are set forth in
the transaction documents listed on Exhibit A attached hereto;
AGREEMENT
NOW, THEREFORE, for good and valid business purposes and in
consideration of the mutual covenants and agreements contained herein, and for
other valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Transfer of LCUS Membership Interests to LCC. As of the Effective
Time (as defined in Section 3 below), each of the Members hereby
transfers, conveys, assigns and delivers to LCC, and LCC hereby
acquires from the Members, each Member's entire right, title and
interest in and to such Member's Membership Interest, in exchange for
the consideration set forth in Section 2 below.
2. Consideration. In exchange for each Member's entire right, title and
interest in and to such Member's Membership Interest, at the
Effective Time, LCC shall issue the number of shares of Common Stock
set forth opposite each Member's name below (collectively, the "LCC
Shares"):
Member # Shares of Common Stock
X. Xxxxxxxxxxx 10,000
X. Xxxxxxxxxxx 235,000
Xxxx 5,000
Berthoud 750,000
3. Effective Time. The "Effective Time" is defined as that date which is
the date on which the merger described in that certain Agreement of
Merger dated as of the date hereof, by and between LensCard
International Limited, a British Virgin Islands International
Business Company, and LCC is consummated and is effective.
4. Waiver of Anti-Assignment Provision. As of the Effective Time, each
of the Members hereby forever waives any and all rights he may have
to the performance by each other Member of each such other Member's
obligations under Section 7.1 (Transfer and Assignment of Interests)
of the Operating Agreement.
5. Waiver of Right of First Refusal. As of the Effective Time, each of
the Members hereby forever waives any and all rights he may have to
the performance by each of other Member of each such other Member's
obligations under Section 7.8 (Right of First Refusal) of the
Operating Agreement.
6. LCC Becomes Sole Member of LCUS. In accordance with Section 7.3 of
the Operating Agreement, at the Effective Time, LCC shall become the
substitute Member for all the Members and shall become the sole
Member of LCUS, such that LCUS shall become a wholly owned subsidiary
of LCC. In accordance with Section 7.3 of the Operating Agreement, as
of the Effective Time, LCC hereby accepts and adopts the terms and
provisions of the Operating Agreement and agrees to pay any
reasonable expenses in connection with its admission as a new Member.
7. Representations and Warranties of the Members. Each of the Members
represents and warrants, severally and not jointly, to LCC, that, as
of the date hereof and as of the Effective Time:
a. such Member has not transferred, assigned, licensed,
hypothecated any of his rights in his Membership Interest
to any third party;
2
b. there are no liens, claims, charges or other encumbrances
against such Member's Membership Interest;
c. the LCC Shares to be acquired hereunder by such Member
will be acquired for investment for such Member's own
account, not as a nominee or agent, and not with a view to
the resale or distribution thereof;
d. such Member is an accredited investor as defined in
Regulation D of the Securities Act and/or has such
knowledge and experience in financial and business
matters, either alone or with such Member's
representative(s), that he is capable of evaluating the
merits and risks of his investment in the LCC Shares;
e. such Member understands and agrees that the LCC Shares may
not be sold, transferred or otherwise disposed of without
registration under the Securities Act or an exemption
therefrom; and
f. such Member understands and agrees that each certificate
representing LCC Shares shall bear substantially the
following legend:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT
BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED
UNLESS REGISTERED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE
SATISFACTORY TO THE COMPANY THAT AN EXEMPTION THEREFROM IS
AVAILABLE."
8. Governing Law. This Agreement shall be governed according to the laws
of the State of California.
9. Recitals. The Recitals above are hereby incorporated into and made a
part of this Agreement.
10. Entire Agreement. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties hereto
with respect to the subject matter hereof and contains all of the
covenants and agreements between the parties with respect to such
subject matter. Each party to this agreement acknowledges that no
representations, inducements, promises, or agreements, oral or
otherwise, have been made by any party, or anyone acting on behalf of
any party, which are not embodied herein, and that no other
agreement, statement, or promise not contained in this Agreement
shall be valid or binding on either party.
11. Arbitration. The parties hereby agree that all controversies, claims
and matters of difference shall be resolved by binding arbitration
before the American Arbitration Association (the "AAA") located in
Los Angeles County, California according to the rules and practices
of the AAA from time-to-time in force; provided however that the
parties hereto reserve their rights to seek and obtain injunctive or
other equitable relief from a court of competent jurisdiction,
without waiving the right to compel such arbitration pursuant to this
section. The arbitrator shall apply California law in rendering a
decision.
3
12. Severability. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any
extent, be determined to be invalid, illegal or unenforceable under
present or future laws effective during the term of this Agreement,
then and, in that event: (A) the performance of the offending term or
provision (but only to the extent its application is invalid, illegal
or unenforceable) shall be excused as if it had never been
incorporated into this Agreement, and, in lieu of such excused
provision, there shall be added a provision as similar in terms and
amount to such excused provision as may be possible and be legal,
valid and enforceable, and (B) the remaining part of this Agreement
(including the application of the offending term or provision to
persons or circumstances other than those as to which it is held
invalid, illegal or unenforceable) shall not be affected thereby and
shall continue in full force and effect to the fullest extent
provided by law.
13. Preparation of Agreement. It is acknowledged by each party that such
party either had separate and independent advice of counsel or the
opportunity to avail itself of the same in connection with this
Agreement. In light of these facts it is acknowledged that no party
shall be construed to be solely responsible for the drafting hereof,
and therefore any ambiguity shall not be construed against any party
as the alleged draftsman of this Agreement.
14. Amendments. This agreement may be amended only by a written
instrument duly executed by the parties or their respective permitted
successors or assigns.
15. Counterparts. This Agreement may be executed manually or by facsimile
signature in any number of counterparts, each of which shall be
deemed an original, and all of which together shall constitute one
and the same instrument, binding on all parties hereto.
16. Headings. The section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning
or interpretation of this Agreement.
17. Attorneys Fees. If any legal action, arbitration or other proceeding
is brought for the enforcement of this Agreement or because of any
dispute, breach, default or claim hereunder, the successful or
prevailing party shall be entitled to recover reasonable attorneys
fees and other costs it incurs in such action, arbitration or
proceeding, in addition to any other relief to which it may be
entitled.
[SIGNATURE PAGE FOLLOWS]
4
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized representatives as of the date first
written above.
LENSCARD CORPORATION, a Delaware corporation
By: /s/ Xxxx Xxxxxxxxxxx
------------------------
Name: Xxxx Xxxxxxxxxxx
Its: Chief Executive Officer
/s/ Xxxx Xxxxxxxxxxx
--------------------
XXXX XXXXXXXXXXX
/s/ Forest Xxxxxxxxxxx
----------------------
FOREST XXXXXXXXXXX
/s/ Xxxxxxx X. Xxxx
-------------------
XXXXXXX X. XXXX
/s/ Xxx Xxxxxxxx
----------------
XXX XXXXXXXX
ACKNOWLEDGED AND ACCEPTED:
LENSCARD US, LLC, a Delaware limited liability
company (formerly Universal Magnifier, LLC, a
California Limited liability company)
By: /s/ Xxx Xxxxxxxx
-----------------------------
Xxx Xxxxxxxx, Manager
By: /s/ Xxxx Xxxxxxxxxxx
------------------------------
Xxxx Xxxxxxxxxxx, Manager
5
EXHIBIT A
INTEGRATED, MUTUALLY DEPENDENT TRANSACTION DOCUMENTS
1. Exchange Agreement, by and among LCC, on the one hand, and Xxxx,
Xxxxxxxxxxx and Xxxxxxx Paradise (collectively, the "PSA Owners"), on the
other hand, pursuant to which the PSA Owners will transfer all of their
rights, title and interests in and to the US Future Payments and the
International Future Payments (each as defined therein), to LCC in
exchange for an aggregate of 5,500,000 newly issued shares of LCC common
stock.
2. Exchange Agreement, by and between LCC and PSA Co., Inc., a Delaware
corporation, pursuant to which LCC will transfer to PSA Co., Inc. all of
LCC's right, title and interest in and to the PSA Assets, in exchange for
25,000 shares of common stock of PSA Co., Inc.
3. Agreement of Merger, by and between LCI and LCC, pursuant to which LCI
will merge with and into LCC.
6
