EXHIBIT 10.1
AGREEMENT
AND
PLAN OF MERGER
BY AND AMONG
APOLLO ACQUISITION II, INC., a Florida corporation,
APOLLO INTERNATIONAL OF DELAWARE, INC., a Delaware corporation,
TRANS-WORLD POWERNET, INC., a Florida corporation,
AND
XXXXXXX X. XXXX,
LYE HIN XXX,
XXX-XXXX XXXX,
XXXX XXXXX XXXX,
XX XXX XXXX,
XXXX-XXXX XXX
TABLE OF CONTENTS
1. THE MERGER................................................................1
1.1 The Merger.............................................................1
1.2 Effectiveness of the Merger............................................2
1.3 Effect of the Merger...................................................2
1.4 Surviving Corporation..................................................2
1.5 Status and Conversion of Shares........................................2
1.6 Books and Records......................................................2
2. MERGER CONSIDERATION......................................................2
2.1 Merger Consideration...................................................2
3. FURTHER ASSURANCES........................................................3
4. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER.........................3
5. REPRESENTATIONS AND WARRANTIES OF APOLLO..................................3
6. THE STOCKHOLDER'S OBLIGATIONS BEFORE THE CLOSING DATE.....................3
6.1 Access to Information..................................................3
6.2 Conduct of Business in Normal Course...................................4
6.3 Preservation of Business and Relationships.............................4
6.4 Maintenance of Insurance...............................................4
6.5 Corporate Matters......................................................4
7. ADDITIONAL AGREEMENTS OF THE PARTIES......................................5
7.1 Confidentiality........................................................5
7.2 Due Diligence Investigation............................................6
7.3 Additional Representations and Warranties of the Stockholder...........6
7.4 Additional Agreements and Instruments..................................6
7.5 Non-Interference.......................................................6
7.6 Appointment of Xxxx Xxxx as Director...................................6
7.7 Publicity..............................................................6
7.8 PTE (Singapore) Project................................................6
8 CONDITIONS PRECEDENT TO APOLLO PERFORMANCE.................................7
8.1 Accuracy of Representations and Warranties.............................7
8.2 Performance............................................................7
8.3 Certification..........................................................7
8.4 Resolutions............................................................7
8.5 Good Standing Certificates.............................................7
8.6 Absence of Litigation..................................................7
8.7 Non-Competition Agreement..............................................7
8.8 Consents...............................................................8
8.9 Settlement of Accounts.................................................8
8.10 Condition of Property.................................................8
8.11 No Material Adverse Change............................................8
8.12 Resignations; Banking Arrangements....................................8
8.13 Satisfactory Due Diligence Investigation..............................8
8.14 Lessor's Consent......................................................8
8.15 Underwriter Approval..................................................8
8.16 Execution and Delivery of Exhibits....................................8
8.17 Proceedings and Instruments Satisfactory..............................9
8.18 Stockholder Voting Agreement..........................................9
8.19 Employment Following the Merger.......................................9
8.20 Fairness Opinion......................................................9
9. CONDITIONS PRECEDENT TO THE COMPANY'S AND THE STOCKHOLDER'S PERFORMANCE...9
9.1 Accuracy of Representations and Warranties.............................9
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9.2 Performance............................................................9
9.3 Certification..........................................................9
9.4 Resolutions............................................................9
9.5 Execution and Delivery of Exhibits....................................10
9.6 Proceedings and Instruments Satisfactory..............................10
10. CLOSING.................................................................10
10.1 Place and Date of Closing...........................................10
10.2 Actions at Closing..................................................10
11. TERMINATION OF AGREEMENT................................................10
11.1 General.............................................................10
11.2 Effect of Termination...............................................10
12. INDEMNIFICATION.........................................................11
12.1 General.............................................................11
12.2 Limitations on Certain Indemnity....................................11
12.3 Claims for Indemnity................................................11
12.4 Right to Defend.....................................................12
13. POST-CLOSING EVENTS.....................................................12
13.1 Accounting Cooperation..............................................12
14. COSTS...................................................................12
14.1 Finder's or Broker's Fees...........................................12
14.2 Expenses............................................................13
15. PARTIES.................................................................13
15.1 Parties in Interest.................................................13
15.2 Notices.............................................................13
16. MISCELLANEOUS...........................................................14
16.1 Amendments and Modifications........................................14
16.2 Non-Assignability; Binding Effect...................................14
16.3 Severability........................................................14
16.4 Attorneys' Fees.....................................................14
16.5 Governing Law; Jurisdiction.........................................14
16.6 Effect of Headings..................................................14
16.7 Entire Agreement; Waivers...........................................14
16.8 Counterparts........................................................15
Exhibit A - Sample Form of Articles of Merger
Exhibit A-1 - Representations and Warranties of Stockholder
Exhibit A-2 - Representations and Warranties of Apollo
Exhibit B - Subscription Agreement
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), entered into as of this
21st day of November, 1997, by and among APOLLO ACQUISITION II, INC., a Florida
corporation having its offices at 0000 X. XX Xxx. 00, Xxxxx 000, Xxxxxx Xxxxx,
Xxxxxxx 00000 (the "Merger Subsidiary"); APOLLO INTERNATIONAL OF DELAWARE, INC.,
a Delaware corporation having its offices at 0000 X. XX Xxx. 00, Xxxxx 000,
Xxxxxx Xxxxx, Xxxxxxx 00000 ("Apollo"); TRANS-WORLD POWERNET, INC., a Florida
corporation having its offices at 00000 Xxxxxxxxx Xxxx., #000, Xxxxxxxxxx,
Xxxxxxx 00000 (the "Company"); and XXXXXXX X. XXXX ("X. Xxxx"), LYE HIN LIM
("Lim"), SIU-XXXX XXXX, ("X. Xxxx"), XXXX XXXXX XXXX, ("X.X. Xxxx"), XX XXX
XXXX, ("X. Xxxx"), and XXXX-XXXX XXX ("Xxx") each having an address at 00000
Xxxxxxxxx Xxxx., #000, Xxxxxxxxxx, Xxxxxxx 00000 (X. Xxxx, Xxx, X. Xxxx, X.X.
Xxxx, X. Xxxx and Xxx are hereinafter referred to collectively as the
"Stockholder").
WITNESSETH:
WHEREAS, the Stockholder is the record and beneficial owner of all of the
issued and outstanding shares of the capital stock of the Company (the "Stock");
and the Company is engaged primarily in the business of power substation
automation and utility networking solutions; and
WHEREAS, the Merger Subsidiary is the wholly-owned subsidiary of Apollo,
which Merger Subsidiary will statutorily merge with and into the Company (such
merger being referred to herein as the "Merger") and thereby vest title in all
of the outstanding shares of the Company in the name of Apollo, pursuant to and
in accordance with the terms and conditions of this Agreement; and
WHEREAS, the Board of Directors and the Stockholder of the Company, the
Board of Directors of Apollo and the Board of Directors of the Merger Subsidiary
and Apollo, as sole stockholder of the Merger Subsidiary, have all authorized
and approved the Merger and the consummation of the other transactions
contemplated by this Agreement, all on the terms and subject to the conditions
set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein set forth, the parties hereby covenant and agree
as follows:
1. THE MERGER
1.1 The Merger. At the time of the Closing on the Closing Date (as
hereinafter defined) and in accordance with the provisions of this Agreement and
the applicable provisions of the corporation laws of the jurisdiction in which
the Merger is to take place (in such instance, "Applicable Law"), the Merger
Subsidiary shall be merged with and into the Company, in accordance with the
terms and conditions of this Agreement and a certificate of merger in
substantially the form of EXHIBIT A annexed hereto, subject to such changes as
to form (but not substance) as may be required by Applicable Law, hereinafter
referred to as the "Articles of Merger". The Company shall be the surviving
corporation of the Merger (the Company, in such capacity, being hereinafter
sometimes referred to as the "Surviving Corporation"). Thereupon, the separate
existence of the Merger Subsidiary shall cease, and the Company, as the
Surviving Corporation, shall continue its corporate existence under Applicable
Law under its current name.
1.2 EFFECTIVENESS OF THE MERGER. As soon as practicable upon or after
the satisfaction or waiver of the conditions precedent set forth in Sections 8
and 9 of this Agreement, the Merger Subsidiary and the Company will execute
appropriate Articles of Merger, and shall file or cause to be filed such
Articles of Merger with the Secretary of State of the jurisdiction in which the
Merger Subsidiary and Company are incorporated; and the subject Merger shall
become effective as of the date thereof, and the Closing shall be deemed to
occur as of the last such effective date in accordance with Section 10 of this
Agreement.
1.3 EFFECT OF THE MERGER. Upon the effectiveness of the Merger, (a)
the Surviving Corporation shall own and possess all assets and property of every
kind and description, and every interest therein, wherever located, and all
rights, privileges, immunities, powers, franchises and authority of a public as
well as of a private nature, of the Merger Subsidiary and Company (the
"Constituent Corporations"), and all obligations owed to, belonging to or due to
each of the Constituent Corporations, all of which shall be vested in the
Surviving Corporation pursuant to Applicable Law without further act or deed,
and (b) the Surviving Corporation shall be liable for all claims, liabilities
and obligations of the Constituent Corporations, all of which shall become and
remain the obligations of the Surviving Corporation pursuant to Applicable Law
without further act or deed.
1.4 SURVIVING CORPORATION. Upon the effectiveness of the Merger, the
Articles of Incorporation, By-Laws, directors and officers of the Surviving
Corporation shall be identical to those of the Company as in effect immediately
prior to the effectiveness of such Merger, subject, however, to those
resignations tendered in accordance with Section 8.12 of this Agreement (all of
which shall be deemed effective upon the effectiveness of such Merger).
1.5 STATUS AND CONVERSION OF SHARES. Upon the effectiveness of the
Merger:
(a) Each share of common stock of the Merger Subsidiary
outstanding immediately prior to the effectiveness of the Merger shall be
converted into and shall become one (1) share of common stock of the Surviving
Corporation; and
(b) Each share of capital stock of the Company (the "Company
Stock") issued and outstanding immediately prior to the effectiveness of the
Merger shall be canceled and extinguished and converted into the right to
receive a proportionate amount of the consideration payable in respect of all of
the outstanding shares of such Company Stock pursuant to Section 2 of this
Agreement. Such consideration shall be paid and delivered to the Stockholder, as
the only holder of the outstanding Company Stock, upon surrender to the
Surviving Corporation of the certificates representing such shares of
outstanding Company Stock at the time and place of the Closing as provided in
Section 10 of this Agreement.
1.6 BOOKS AND RECORDS. On the Closing Date, the Stockholder shall
deliver, and shall cause the Company to deliver, to Apollo all of the stock
books, records and minute books of the Company, all financial and accounting
books and records of the Company, all tax returns and records of the Company,
and all supplier, client, customer, sales and other business records of the
Company.
2. MERGER CONSIDERATION.
2.1 MERGER CONSIDERATION. In exchange for 100% of the issued and
outstanding shares of capital stock of the Company, the consideration to be
received by the Stockholder in the Merger (the "Merger Consideration") shall
consist of the following:
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(a) An amount in cash (the "Cash Consideration") which shall
equal the aggregate sum of Two Hundred Thousand Dollars ($200,000.00) in
immediately available funds payable in two equal installments of $100,000; the
first installment shall be due and payable on the Closing Date, and the second
installment shall be due and payable on the first anniversary of the Closing
Date; and
(b) An aggregate of 240,000 shares of Common Stock of Apollo (the
"Apollo Stock" or "Apollo Shares") shall be delivered to the Stockholder on the
Closing Date, which Apollo Stock shall not be registered under the Securities
Act of 1933, as amended, and which shall be subject to the same underwriter's
lock-up (the "Underwriter Lock-Up") as shares held by officers and directors of
Apollo. In accordance with the terms of the Underwriter Lock-Up, the Stockholder
will not, from the date hereof through the period ending July 10, 1999, without
the prior consent of May Xxxxx Group, Inc., publicly sell any securities of
Apollo owned directly or indirectly by the Stockholder or owned beneficially by
the Stockholder, or otherwise sell or transfer such securities unless the
transferee agrees in writing to be bound by the terms of the Underwriter
Lock-Up. Upon expiration of the Underwriter Lock-Up, the Apollo Shares may be
sold by each Stockholder in accordance with Rule 144.
(c) The shares of Apollo Stock issued at the Closing shall be
subject to the terms and conditions of the Subscription Agreement in the form of
EXHIBIT B annexed hereto and made a part hereof as concerns, among other things,
Stockholder investment intent and acknowledgment of (i) disclosure made by
Apollo and (ii) transfer restrictions on the Apollo Stock.
3. FURTHER ASSURANCES.
From time to time from and after the Closing, the parties shall execute and
deliver, or cause to be executed and delivered, any and all such further
agreements, certificates and other instruments, and shall take or cause to be
taken any and all such further action, as any of the parties may reasonably deem
necessary or desirable in order to carry out the intent and purposes of this
Agreement.
4. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER.
Each Stockholder, jointly and severally hereby represents and warrants to
Apollo and the Merger Subsidiary as to the representations and warranties set
forth in EXHIBIT A-1.
5. REPRESENTATIONS AND WARRANTIES OF APOLLO.
Apollo represents and warrants jointly and severally to each of the
Stockholders as to the representations and warranties set forth in EXHIBIT A-2.
6. THE STOCKHOLDER'S OBLIGATIONS BEFORE THE CLOSING DATE.
The Company and Stockholder jointly and severally covenant and agree that,
from the date hereof until the Closing Date:
6.1 ACCESS TO INFORMATION. The Company and the Stockholder shall
permit Apollo and its counsel, accountants and other representatives, to have
reasonable access during normal business hours to all properties, books,
accounts, records, contracts, documents and information relating to the Company,
and shall, not less than ten days prior to the Closing Date, provide Apollo and
the Buyer with
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unaudited financial statements of the Company for the nine months ended
September 30, 1997 (collectively, the "Unaudited Financial Statements"), and if
the Closing Date shall be later than December 31, 1997, audited financial
statements of the Company for such later period as shall be requested by Apollo.
Such Unaudited Financial Statements shall include balance sheets, statements of
operations, statements of stockholders' equity, statements of cash flows and
appropriate notes thereto, and shall be prepared in accordance with Regulation
S-X, as promulgated under the Securities Act of 1933, as amended. The Company
and Stockholder shall also provide Apollo's accountants, Most Xxxxxxxx & Co.
("MHC"), with all such representation letters, indemnification agreements and
other materials as shall be reasonably requested by MHC. Apollo and its
representatives shall also be permitted to freely consult with the Company's
counsel concerning the business of the Company.
6.2 CONDUCT OF BUSINESS IN NORMAL COURSE. The Company shall carry on
its business activities in substantially the same manner as heretofore
conducted, and shall not make or institute any unusual or novel methods of
service, sale, purchase, lease, management, accounting or operation that will
vary materially from those methods used by the Company as of the date hereof,
without in each instance obtaining the prior written consent of Apollo.
6.3 PRESERVATION OF BUSINESS AND RELATIONSHIPS. The Company shall,
without making or incurring any unusual commitments or expenditures, use its
best efforts to preserve its business organization intact and to preserve its
present relationships with referral sources, clients, customers, suppliers and
others having business relationships with it.
6.4 MAINTENANCE OF INSURANCE. The Company shall continue to carry its
existing insurance, to the extent obtainable upon reasonable terms.
6.5 CORPORATE MATTERS. The Company and/or the Stockholder shall not,
without the prior written consent of Apollo:
(a) amend its Articles of Incorporation or By-Laws, except as may
otherwise be required hereunder;
(b) issue any shares of its capital stock;
(c) issue or create any warrants, obligations, subscriptions,
options, convertible securities or other commitments under which any additional
shares of its capital stock might be directly or indirectly issued;
(d) amend, cancel or modify any Material Contract or enter into
any material new agreement, commitment or transaction except, in each instance,
in the ordinary course of business;
(e) pay, grant or authorize any salary increases or bonuses
except in the ordinary course of business and consistent with past practice, or
enter into any employment, consulting or management agreements;
(f) modify in any material respect any material agreement to
which it is a party or by which it may be bound, except in the ordinary course
of business;
(g) make any change in its management personnel;
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(h) except pursuant to commitments in effect on the date hereof
(to the extent disclosed in this Agreement or in any Schedule hereto), make any
capital expenditure(s) or commitment(s), whether by means of purchase, lease or
otherwise, or any operating lease commitment(s), in excess of $5,000.00 in the
aggregate;
(i) sell, assign or dispose of any capital asset(s) with a net
book value in excess of $5,000.00 as to any one item;
(j) materially change its method of collection of accounts or
notes receivable, accelerate or slow its payment of accounts payable, or prepay
any of its obligations or liabilities, other than prepayments to take advantage
of trade discounts not otherwise inconsistent with or in excess of historical
prepayment practices;
(k) declare, pay, set aside or make any dividend(s) or other
distribution(s) of cash or other property, redeem any outstanding shares of its
capital stock, or purchase any outstanding shares of capital stock of or equity
interest in any other corporation or entity;
(l) incur any liability or indebtedness except, in each instance,
in the ordinary course of business;
(m) subject any of its assets or properties to any further liens
or encumbrances, other than Permitted Liens;
(n) forgive any liability or indebtedness owed to it by any of
the stockholders of the Company or any of their respective Affiliates;
(o) effect any material transaction involving the Company which
is not consistent with the past practices of the Company or not in
furtherance of the business of the Company; or
(p) agree to do, or take any action in furtherance of, any of the
foregoing.
7. ADDITIONAL AGREEMENTS OF THE PARTIES.
7.1 CONFIDENTIALITY. Notwithstanding anything to the contrary
contained in this Agreement, and subject only to any disclosure requirements
which may be imposed upon Apollo under applicable state or federal securities or
antitrust laws, it is expressly understood and agreed by Apollo, the Company and
the Stockholder that (a) this Agreement, the Schedules hereto, and the
conversations, negotiations and transactions relating hereto and/or contemplated
hereby, and (b) all financial information, business records and other non-public
information concerning the Company or Apollo which any of Apollo, the Company
and the Stockholder or their respective representatives has received or may
hereafter receive, shall be maintained in the strictest confidence by Apollo,
the Company and the Stockholder and their respective representatives, and shall
not be disclosed to any person that is not associated or affiliated with any of
Apollo, the Company and the Stockholder and involved in the transactions
contemplated hereby, without the prior written approval of the Stockholder or
Apollo, as applicable. The parties hereto shall use their best efforts to avoid
disclosure of any of the foregoing or undue disruption of any of the business
operations or personnel of the Company or Apollo. In the event that the
transactions contemplated hereby shall not be consummated for any reason, each
of Apollo, the
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Company and the Stockholder covenants and agrees that neither it nor its
representatives shall retain any documents, lists or other writings which they
may have received or obtained in connection herewith or any documents
incorporating any of the information contained in any of the same (all of which,
and all copies thereof in the possession or control of themselves or their
representatives, shall be returned to the original source of the material at
issue). The parties hereto shall be responsible for any damages sustained by
reason of their respective breaches of this Section 7.1, and this Section 7.1
may be enforced by injunctive relief.
7.2 DUE DILIGENCE INVESTIGATION. At all times prior to the Closing
Date, Apollo and its representatives shall be permitted to conduct during normal
business hours a full and complete due diligence investigation of the assets,
business, properties, financial condition and prospects of the Company, the
results of which due diligence investigation shall be satisfactory to Apollo. In
connection with such due diligence investigation, the Company shall furnish to
Apollo the Unaudited Financial Statements as required under Section 6.1 hereof.
The Company and the Stockholder shall, and shall cause the principal executive
officers, legal and financial representatives, agents and employees of the
Company to, fully cooperate to enable Apollo and its representatives to conduct
a full due diligence investigation of the Company, including interviews with
personnel and/or contacts with suppliers or customers. Such due diligence
investigation shall include, but shall not necessarily be limited to, the audit
to be performed by Apollo's accountants as contemplated by Section 6.1 above.
7.3 ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER. Each
Stockholder, jointly and severally, hereby further represents and warrants to
Apollo and the Merger Subsidiary, as follows:
7.4 ADDITIONAL AGREEMENTS AND INSTRUMENTS. On or before the Closing
Date, the Stockholder, Apollo and the Merger Subsidiary (as appropriate) shall
execute, deliver and file the Articles of Merger and all exhibits, agreements,
certificates, instruments and other documents, not inconsistent with the
provisions of this Agreement, which, in the opinion of counsel to Apollo, shall
reasonably be required to be executed, delivered and filed in order to
consummate the Merger and the other transactions contemplated by this Agreement.
7.5 NON-INTERFERENCE. None of the parties shall cause to occur any
act, event or condition which would cause any of their respective
representations and warranties made in this Agreement to be or become untrue or
incorrect in any material respect as of the Closing Date, or would interfere
with, frustrate or render unreasonably expensive the satisfaction by the other
party or parties of any of the conditions precedent set forth in Sections 8 and
9 below.
7.6 APPOINTMENT OF XXXX XXXX AS DIRECTOR. Within a reasonable period
of time following the Closing Date, Apollo shall use its best efforts to elect
Xxxx Xxxx to the Board of Directors of Apollo for a one-year term.
7.7 PUBLICITY. The Company, Stockholder, Merger Subsidiary and Apollo
hereby agree that Apollo will control the text of and the issuance of any public
press releases or statements pertaining to the transactions contemplated hereby.
7.8 PTE (SINGAPORE) PROJECT. The parties acknowledge that the Power
Automation Pte. Lts. (Singapore) Ras Lafan project (the "Project") was
contracted to the Company in March, 1997. The expected closing date of the
Project is December 31, 1997. Until the closing, all aspects of the Project
shall be the responsibility of and will be handled by the Stockholder; Apollo
will not interfere
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with or participate in the negotiations concerning the closing unless otherwise
requested to do so by the parties. All costs, fees and expenses associated with
completing the closing of the Project shall be borne solely by the Stockholder,
and all revenues and benefits earned and received by Stockholder prior to the
closing of the Project shall inure to the benefit of the Stockholder. All costs,
fees and expenses associated with the Project subsequent to the closing of the
Project shall be borne by Apollo, and all revenues and benefits earned and
received from the Project subsequent to its closing shall inure to the benefit
of Apollo.
8. CONDITIONS PRECEDENT TO APOLLO PERFORMANCE.
The obligations of Apollo to consummate the transactions contemplated
by this Agreement are further subject to the satisfaction, at or before the
Closing Date, of all the following conditions, any one or more of which may be
waived in writing by Apollo:
8.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made by the Stockholder in this Agreement, in any Schedule(s)
hereto, and/or in any written statement delivered to Apollo under this Agreement
shall be true and correct in all material respects on and as of the Closing Date
as though such representations and warranties were made on and as of that date.
8.2 PERFORMANCE. The Company and the Stockholder shall have performed,
satisfied and complied with all covenants, agreements and conditions required by
this Agreement to be performed, satisfied or complied with by them on or before
the Closing Date.
8.3 CERTIFICATION. Apollo shall have received a certificate, dated the
Closing Date, signed by the Stockholder, certifying, in such detail as Apollo
and its counsel may reasonably request, that the conditions specified in
Sections 8.1 and 8.2 above have been fulfilled.
8.4 RESOLUTIONS. Apollo shall have received certified resolutions of
the Board of Directors and the stockholders of the Company, in form reasonably
satisfactory to counsel for Apollo, authorizing the Company's execution,
delivery and performance of this Agreement and the Merger, and all actions to be
taken by the Company hereunder.
8.5 GOOD STANDING CERTIFICATES. The Stockholder shall have delivered
to Apollo a certificate or telegram issued by the Secretary of State of the
jurisdiction of incorporation of the Company, evidencing the good standing of
the Company in its jurisdiction of incorporation as of a date not more than ten
(10) calendar days prior to the Closing Date.
8.6 ABSENCE OF LITIGATION. No action, suit or proceeding by or before
any court or any governmental body or authority, against any Company or any
Stockholder or pertaining to the transactions contemplated by this Agreement or
their consummation, shall have been instituted on or before the Closing Date,
which action, suit or proceeding would, if determined adversely, have a material
adverse effect on the business, financial condition, operations or prospects of
the Company, or impair the ability of any of the stockholders of the Company to
deliver in the Merger all of their common stock of the Company free and clear of
all pledges, liens, claims, charges, options, calls, encumbrances, restrictions
and assessments whatsoever.
8.7 NON-COMPETITION AGREEMENT. On the Closing Date, the Company,
Apollo, and each Stockholder shall execute and deliver to Apollo a two-year
non-competition agreement in favor of the Surviving Corporation and Apollo and
satisfactory to the parties and their counsel wherein, among
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other things, the Stockholder covenants not to compete with the business
presently conducted by Apollo and Surviving Corporation domestically and
internationally, and shall not solicit orders for any products from any present
or former customers of the Company wherever such present or former customers are
located, (the "Non-Competition Agreement").
8.8 CONSENTS. All necessary disclosures to and agreements and consents
of (a) any parties to any Material Contracts and/or any licensing authorities
which are material to the Company's business (including all outstanding
indebtedness and leases), and (b) any governmental authorities or agencies to
the extent required in connection with the transactions contemplated by this
Agreement, shall have been obtained, shall be in such form as shall be
satisfactory to Apollo and true and complete copies thereof shall be delivered
to Apollo on or before the Closing Date.
8.9 SETTLEMENT OF ACCOUNTS. All debts, liabilities and other monetary
obligations owed to the Company by any of the stockholders of the Company and/or
any of their Affiliates (including, without limitation, amounts owed by
Stockholder to the Company) on or prior to the Closing Date, shall have been
fully paid to the Company in immediately available funds, such that no such
debts, liabilities or obligations shall be outstanding on and after the Closing
Date.
8.10 CONDITION OF PROPERTY. Between the date of this Agreement and the
Closing Date, assets of the Company having an aggregate fair market value of
$10,000.00 or more shall not have been lost, destroyed or irreparably damaged by
fire, flood, explosion, theft or any other cause, unless covered by insurance.
8.11 NO MATERIAL ADVERSE CHANGE. On the Closing Date, there shall not
have occurred any event or condition materially and adversely affecting the
financial condition, results of operations or business prospects of the Company
from those reflected in the Audited Financial Statements.
8.12 RESIGNATIONS; BANKING ARRANGEMENTS. The Company and/or the
Stockholder shall have delivered to the Surviving Corporation the written
resignations, dated and effective on the Closing Date, of such of the officers
and directors of the Company as may be requested by Apollo. In addition, to the
extent requested by Apollo, the Stockholder shall have executed and delivered
such certificates and documents as may be necessary or appropriate to change the
authorized signatories on all bank accounts and/or safe deposit boxes maintained
by or in the name of the Company.
8.13 SATISFACTORY DUE DILIGENCE INVESTIGATION. Apollo, in its sole and
absolute discretion, shall be satisfied with the results of its due diligence
investigation of, without limitation, the Stockholder, the Company, the
Company's business and its financial condition.
8.14 LESSOR'S CONSENT. If required under the Company's lease, the
consent of the Lessor to the assignment of the lease of its facilities.
8.15 UNDERWRITER APPROVAL. The underwriter for Apollo shall have
approved the transaction contemplated by this Agreement in form satisfactory to
Apollo.
8.16 EXECUTION AND DELIVERY OF EXHIBITS. On or before the Closing
Date, the Company shall have executed and delivered to the Merger Subsidiary the
appropriate Articles of Merger, and the Stockholder shall have executed and
delivered to the other parties thereto the Subscription Agreement and the
Non-Competition Agreement.
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8.17 PROCEEDINGS AND INSTRUMENTS SATISFACTORY. All proceedings,
corporate or other, to be taken in connection with the transactions contemplated
by this Agreement, and all documents incidental thereto, shall be reasonably
satisfactory in form and substance to Apollo and its counsel. The Stockholder
shall have submitted to Apollo or its representatives for examination the
originals or true and correct copies of all records and documents relating to
the business and affairs of the Company which Apollo may have requested in
connection with said transactions.
8.18 STOCKHOLDER VOTING AGREEMENT. S The Stockholder and Xxxxx X.
Xxxxxx shall each enter into a stockholder voting agreement pursuant to which
each Stockholder shall grant to Xxxxx X. Xxxxxx its irrevocable proxy to vote
the Apollo Shares during the Underwriter Lock-Up.
8.19 EMPLOYMENT FOLLOWING THE MERGER. At Closing, either Apollo or the
Company (as determined in the sole and exclusive discretion of Apollo) shall
enter into an employment agreement, in form and substance mutually satisfactory
to the parties and their counsel, with Xxxx Xxxx, the terms of which shall
expire two (2) years from the Closing Date.
8.20 FAIRNESS OPINION. Apollo and the Company shall have received
reports satisfactory to them from their respective investment bankers as to the
fairness of the transaction from a financial perspective to the stockholders of
each.
9. CONDITIONS PRECEDENT TO THE COMPANY'S AND THE STOCKHOLDER'S
PERFORMANCE.
The obligations of the Company to consummate the Merger and of the
Stockholder to consummate the transactions contemplated by this Agreement are
further subject to the satisfaction, at or before the Closing Date, of all of
the following conditions, any one or more of which may be waived in writing by
each Shareholder:
9.1 ACCURACY OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made by Apollo in this Agreement and/or in any written statement
delivered by Apollo under this Agreement shall be true and correct in all
material respects on and as of the Closing Date as though such representations
and warranties were made on and as of that date.
9.2 PERFORMANCE. Apollo shall have performed, satisfied and complied
with all covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by Apollo on or before the Closing Date.
9.3 CERTIFICATION. The Stockholder shall have received a certificate,
dated the Closing Date, signed by Apollo certifying, in such detail as the
Stockholder and its counsel may reasonably request, that the conditions
specified in Sections 9.1 and 9.2 above have been fulfilled.
9.4 RESOLUTIONS. The Stockholder shall have received certified
resolutions of the Board of Directors of Apollo and the Merger Subsidiary, in
form reasonably satisfactory to counsel for the Stockholder, authorizing the
Merger and Apollo's execution, delivery and performance of this Agreement and
all actions to be taken by Apollo and the Merger Subsidiary hereunder.
9
9.5 EXECUTION AND DELIVERY OF EXHIBITS. The Merger Subsidiary shall
have executed and delivered to the Company the Articles of Merger, and Apollo
and the Surviving Corporation (as applicable) shall have executed and delivered
to the Stockholder the Non-Competition Agreement.
9.6 PROCEEDINGS AND INSTRUMENTS SATISFACTORY. All proceedings to be
taken in connection with the transactions contemplated by this Agreement, and
all documents incidental thereto, shall be reasonably satisfactory in form and
substance to the Stockholder and their counsel.
10. CLOSING.
10.1 PLACE AND DATE OF CLOSING. Unless this Agreement shall be
terminated pursuant to Section 11 below, the consummation of the transactions
contemplated by this Agreement (the "Closing") shall take place at the offices
of Xxxxxxxxx Xxxxxxx, 000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx
00000, or such other location as is agreed to between the parties, at 10:00 A.M.
local time on November 21, 1997, or such later date (not later than November 26,
1997) as may be reasonably agreeable to all parties (the date of the Closing
being referred to in this Agreement as the "Closing Date").
10.2 ACTIONS AT CLOSING. On the Closing Date, simultaneous with the
Closing, the parties shall file or cause to be filed Articles of Merger with the
Secretary of State of the applicable jurisdiction. At the Closing, the parties
shall make all payments and deliveries stated in this Agreement to be made at
the Closing and/or on or prior to the Closing Date.
11. TERMINATION OF AGREEMENT.
11.1 GENERAL. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing: (a) by
Apollo if it is not satisfied, in its sole and absolute discretion, with the
results of its due diligence investigation; (b) by the mutual written consent of
Apollo, the Company and the Stockholder; (c) by Apollo, or by the Company and
the Stockholder, if: (i) a material breach shall exist with respect to the
written representations and warranties made by the other party or parties, as
the case may be, (ii) the other party or parties, as the case may be, shall take
any action prohibited by this Agreement, if such actions shall or may have a
material adverse effect on the Company or on Apollo, and/or the transactions
contemplated hereby, (iii) the other party or parties, as the case may be, shall
not have furnished, upon reasonable notice therefor, such certificates and
documents required in connection with the transactions contemplated hereby and
matters incidental thereto as it or they shall have agreed to furnish, and it is
reasonably unlikely that the other party or parties will be able to furnish such
item(s) prior to the Outside Closing Date specified below, or (iv) any consent
of any third party to the transactions contemplated hereby (whether or not the
necessity of which is disclosed herein or in any Schedule hereto) is reasonably
necessary to prevent a default under any outstanding material obligation of any
party hereto and such consent is not obtainable without material cost or penalty
(unless the party or parties not seeking to terminate this Agreement agrees or
agree to pay such cost or penalty); or (e) by Apollo, or by the Company and the
Stockholder, at any time on or after November 26, 1997 (the "Outside Closing
Date"), if the transactions contemplated hereby shall not have been consummated
prior thereto, and the party directing termination shall not then be in breach
or default of any obligations imposed upon such party by this Agreement.
11.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement pursuant to this Section 11, prompt written notice shall be given by
the terminating party to the other party, and no
10
party to this Agreement shall have any further liability to the other, except as
provided in Section 7.3 above or Section 14, below.
12. INDEMNIFICATION.
12.1 GENERAL.
(a) Each of the individuals comprising the Stockholder, jointly
and severally (for purposes of this Section 12, the "Stockholders") shall
defend, indemnify and hold harmless the Surviving Corporation and Apollo from,
against and in respect of any and all claims, losses, costs, expenses,
obligations, liabilities, damages, recoveries and deficiencies, including
interest, penalties, fines and reasonable attorneys' fees, that the Surviving
Corporation and/or Apollo may incur, sustain or suffer (x) as a result of any
breach of, or failure by the Stockholders or the Company, to perform, any of the
representations, warranties, covenants or agreements of the Stockholders or the
Company contained in this Agreement or in any Schedule(s) furnished by or on
behalf of the Stockholders or the Company under this Agreement, including
without limitation any audit costs incurred by an Internal Revenue Service audit
of the Company which results in a tax deficiency for the tax year(s) audited,
and (y) arising out of or relating to the litigation described in Part A-1(20)
of the Disclosure Letter ((x) and (y) are referred to herein as the "Losses").
(b) The Surviving Corporation and Apollo shall jointly and
severally defend, indemnify and hold harmless the Stockholder from, against and
in respect of any and all claims, losses, costs, expenses, obligations,
liabilities, damages, recoveries and deficiencies, including interest, penalties
and reasonable attorneys' fees, that such Stockholders may incur, sustain or
suffer as a result of any breach of, or failure by Apollo to perform, any of the
representations, warranties, covenants or agreements of Apollo contained in this
Agreement.
12.2 LIMITATIONS ON CERTAIN INDEMNITY.
(a) As used in this Section 12.2, "Losses" shall mean and refer
to, collectively, Losses as defined in Section 12.1(a) above.
(b) The Surviving Corporation and Apollo shall be entitled to
indemnification by the Stockholder, jointly and severally, for Losses referenced
under Section 12.1(a), and the Stockholder shall be entitled to indemnification
by the Surviving Corporation and Apollo for losses referenced under Section
12.1(b), only in respect of claims for which notice of claim shall have been
given on or before the third anniversary of the Closing Date, or, with respect
to Losses relating to a breach of any warranties under Section 4 above, the
expiration of the final statute of limitations for those tax returns covered by
the warranties under Section 4 above; PROVIDED, HOWEVER, that none of the
Surviving Corporation, Apollo or the Stockholder shall be entitled to
indemnification in the event that the subject claim for indemnification relates
to a third-party claim and the prospective indemnified party (as the case may
be) delayed giving notice thereof to such an extent as to cause material
prejudice to the defense of such third-party claim.
12.3 CLAIMS FOR INDEMNITY. Whenever a claim shall arise for which any
party shall be entitled to indemnification hereunder, the indemnified party
shall notify the indemnifying party in writing within thirty (30) days of the
indemnified party's first receipt of notice of, or the indemnified party's
obtaining actual knowledge of, such claim, and in any event within such shorter
period as may be necessary for the indemnifying party or parties to take
appropriate action to resist such claim. Such
11
notice shall specify all facts known to the indemnified party giving rise to
such indemnity rights and shall estimate (to the extent reasonably possible) the
amount of potential liability arising therefrom. If the indemnifying party shall
be duly notified of such dispute, the parties shall attempt to settle and
compromise the same or may agree to submit the same to American Arbitration
Association arbitration in Orlando, Florida or, if unable or unwilling to do any
of the foregoing, such dispute shall be settled by appropriate litigation, and
any rights of indemnification established by reason of such settlement,
compromise, arbitration or litigation shall promptly thereafter be satisfied by
those indemnifying parties obligated to make indemnification hereunder in such
amount as shall be necessary to satisfy all applicable Losses determined in
accordance with such settlement and compromise, or by final nonappealable order
or judgment of the applicable judicial or arbitration panel. Losses which take
the form of litigation or arbitration costs and expenses (including reasonable
attorneys' fees) which are not incurred in connection with an action or demand
by a third party against the indemnified party or any of its Affiliates, shall
not be paid on an ongoing basis as incurred, but rather all such costs and
expenses incurred by the prevailing party in any such action shall be paid by
the other party thereto.
12.4 RIGHT TO DEFEND. If the facts giving rise to any claim for
indemnification shall involve any actual or threatened action or demand by any
third party against the indemnified party or any of its Affiliates, the
indemnifying party or parties shall be entitled (without prejudice to the
indemnified party's right to participate at its own expense through counsel of
its own choosing), at their expense and through a single counsel of their own
choosing, to defend or prosecute such claim in the name of the indemnifying
party or parties, or any of them, or if necessary, in the name of the
indemnified party. All Losses which take the form of claims for litigation costs
and expenses (including reasonable attorneys' fees) shall be paid to the
indemnified party in cash on an ongoing basis as incurred. In any event, the
indemnified party shall give the indemnifying party advance written notice of
any proposed compromise or settlement of any such claim. If the remedy sought in
any such action or demand is solely money damages, the indemnifying party shall
have thirty (30) days after receipt of such notice of settlement to object to
the proposed compromise or settlement, and if it does so object, the
indemnifying party shall be required to undertake, conduct and control, through
counsel of its own choosing and at its sole expense, the settlement or defense
thereof, and the indemnified party shall cooperate with the indemnifying party
in connection therewith.
13. POST-CLOSING EVENTS.
In addition to the post-Closing covenants set forth in Sections 3 and
7 above, the parties hereby further agree that, from and after the Closing:
13.1 ACCOUNTING COOPERATION. The Stockholder shall cause the
accountants heretofore retained by the Company to cooperate with Apollo's
accountants, MHC, in connection with any ongoing audit work relating to periods
prior to the Closing Date, as required by applicable federal and state
securities laws, and other reasonable requirements. Such cooperation shall
include, without limitation, providing such assurances, comfort letters and
access to work papers as may reasonably be requested by Apollo and its
accountants.
14. COSTS.
14.1 FINDER'S OR BROKER'S FEES. Apollo (on the one hand) and the
Stockholder (on the other hand) represents and warrants that neither they nor
any of their respective Affiliates have dealt with any broker or finder in
connection with any of the transactions contemplated by this Agreement, and no
12
broker or other person is entitled to any commission or finder's fee in
connection with any of these transactions.
14.2 EXPENSES. Each party to this Agreement shall be responsible for
its own costs and fees incurred in connection with the negotiation and
preparation of this Agreement and exhibits referenced herein, and the
consummation of the transactions contemplated hereby. Except as otherwise
provided herein, Apollo shall pay all closing expenses; PROVIDED, that all
professional fees and costs for the negotiation and review of this Agreement and
for preparation of closing schedules and financial statements (as required under
Section 6.1 hereof), that are incurred by and on behalf of the Company and the
Stockholder shall be borne by the Stockholder. Anything elsewhere contained in
this Agreement to the contrary notwithstanding, no expenses of any Stockholder
in connection with the transactions contemplated by this Agreement shall be
attributed to or paid by the Company.
15. PARTIES.
15.1 PARTIES IN INTEREST. Nothing in this Agreement, whether expressed
or implied, is intended to confer any rights or remedies under or by reason of
this Agreement on any persons other than the parties to it and their respective
heirs, executors, administrators, personal representatives, successors and
permitted assigns, nor is anything in this Agreement intended to relieve or
discharge the obligations or liability of any third persons to any party to this
Agreement, nor shall any provision give any third persons any right of
subrogation or action over or against any party to this Agreement.
15.2 NOTICES. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given (i) on the date of service if served personally on the party to whom
notice is to be given, or on the day after the date sent by recognized overnight
courier service with all charges prepaid, or (ii) three (3) days after being
deposited in the United States mail if sent by first class mail, registered or
certified, postage prepaid, and properly addressed as follows:
(a) If to Apollo or the Merger Subsidiary:
Xxxxxx X. Xxxxx
Chief Financial Officer
Apollo International of Delaware
0000 X. X.X. Xxxxxxx 00, Xxxxx 000
Xxxxxx Xxxxx, XX 00000
with a copy to:
Xxxxxxxxx Traurig
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esquire
13
(b) If to the Company or to any Stockholder:
Trans-World Powernet, Inc.
00000 Xxxxxxxxx Xxxx., #000
Xxxxxxxxxx, Xxxxxxx 00000
or to such other address as either party shall have specified by notice in
writing given to the other party.
16. MISCELLANEOUS.
16.1 AMENDMENTS AND MODIFICATIONS. No amendment or modification of
this Agreement or any Exhibit or Schedule hereto shall be valid unless made in
writing and signed by the party to be charged therewith.
16.2 NON-ASSIGNABILITY; BINDING EFFECT. Other than the assignment of
rights by Apollo to the Merger Subsidiary as and to the extent contemplated by
Section 1 above, neither this Agreement, nor any of the rights or obligations of
the parties hereunder, shall be assignable by any party hereto without the prior
written consent of all other parties hereto. Otherwise, this Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, personal representatives,
successors and permitted assigns.
16.3 SEVERABILITY. In the event that any provision or any portion of
any provision of this Agreement shall be held invalid, illegal or unenforceable
under applicable law, the remainder of this Agreement shall remain valid and
enforceable, unless such invalidity, illegality or unenforceability
substantially diminishes the rights and obligations, taken as a whole, of any
party hereunder.
16.4 ATTORNEYS' FEES. In the event of suit to enforce the terms of
this Agreement, the prevailing party shall be entitled to collect from the
non-prevailing party reasonable attorneys' fees, costs and expenses (including
those incurred through all trial, appellate and post-judgment collection
proceedings).
16.5 GOVERNING LAW; JURISDICTION. Except to the extent that Applicable
Law shall govern with respect to the Merger, this Agreement shall be construed
and interpreted and the rights granted herein governed in accordance with the
laws of the State of Florida applicable to contracts made and to be performed
wholly within such State.
16.6 EFFECT OF HEADINGS. The Section headings used in this Agreement
and the titles of the Schedules hereto are included for purposes of convenience
only, and shall not affect the construction or interpretation of any of the
provisions hereof or of the information set forth in such Schedules.
16.7 ENTIRE AGREEMENT; WAIVERS. This Agreement constitutes the entire
agreement between the parties pertaining to the subject matter hereof, and
supersedes all prior agreements or understandings as to such subject matter. No
party hereto has made any representation or warranty or given any covenant to
the other except as set forth in this Agreement and the Schedules and Exhibits
hereto. No waiver of any of the provisions of this Agreement shall be deemed, or
shall constitute, a waiver of any other provisions, whether or not similar, nor
shall any waiver constitute a continuing waiver. No waiver shall be binding
unless executed in writing by the party making the waiver.
14
16.8 COUNTERPARTS. This Agreement may be executed simultaneously in
any number of counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
[Signature Page Follows]
15
IN WITNESS WHEREOF, the parties have executed this Agreement on and as of
the date first set forth above.
APOLLO ACQUISITION II, INC.
By: /s/ XXXXX X. XXXXXX
-----------------------
Name: Xxxxx X. Xxxxxx
Its: President
APOLLO INTERNATIONAL OF DELAWARE, INC.
By: /s/ XXXXX X. XXXXXX
-----------------------
Name: Xxxxx X. Xxxxxx
Its: President
TRANS-WORLD POWERNET, INC.
By: /s/ XXXXXXX X. XXXX
-----------------------
Name: Xxxxxxx X. Xxxx
Its: President
STOCKHOLDER:
/s/ XXXXXXX X. XXXX
--------------------------
Xxxxxxx X. Xxxx
/s/ LYE HIN LIM
------------------------------
Lye Hin Lim
/s/ SIU-XXXX XXXX
------------------------------
Siu-xxxx Xxxx
/s/ XXXX XXXXX TANG
------------------------------
Xxxx Xxxxx Xxxx
/s/ YU XXX XXXX
------------------------------
Yu Xxx Xxxx
/s/ XXXX-XXXX XXX
------------------------------
Xxxx-Xxxx Xxx
EXHIBIT A
ARTICLES OF MERGER
STATE OF FLORIDA
ARTICLES OF MERGER
OF
APOLLO ACQUISITION II, INC.
A FLORIDA CORPORATION,
INTO
TRANS-WORLD POWERNET, INC.,
A FLORIDA CORPORATION
Pursuant to Section 607.1101 of the Florida Business Corporation Act (the
"Act"), the undersigned corporations adopt the following Articles of Merger:
FIRST: The plan of merger is set forth in the Agreement and Plan of Merger
dated November 24, 1997 (the "Plan of Merger") by and between Apollo
International of Delaware, Inc., a Delaware corporation ("Parent"), Apollo
Acquisition II, Inc., a Florida corporation and a wholly-owned subsidiary of
Parent ("Subsidiary"), Trans-World Powernet, Inc., a Florida corporation
("Trans-World"), and Xxxxxxx X. Xxxx, Lye Hin Xxx, Xxx-Xxxx Xxxx, Xxxx Xxxxx
Xxxx, Xx Xxx Xxxx and Xxxx-Xxxx Xxx, with Subsidiary merging with and into
Trans-World, with Trans-World being the surviving corporation. An executed copy
of the Plan of Merger is attached hereto as EXHIBIT A and made a part hereof.
SECOND: Pursuant to Section 607.1105(1)(b) of the Act, the effective date
of the merger contemplated hereby shall be the date on which these Articles of
Merger are filed with the Secretary of State of the State of Florida.
THIRD: The Plan of Merger was approved and adopted by each of the Board of
Directors and shareholders of Subsidiary and Trans-World on the 24th day of
November, 1997.
IN WITNESS WHEREOF, each of the undersigned corporations has caused these
Articles of Merger to be executed on its behalf by its duly authorized officers
as of this 24th day of November, 1997.
APOLLO ACQUISITION II, INC.
a Florida corporation
By:
------------------------
Xxxxxx X. Xxxxx
Vice President and Secretary
TRANS-WORLD POWERNET, INC.
a Florida corporation
By:
-------------------------
Xxxxxxx X. Xxxx
President
EXHIBIT A-1
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER.
Each of Shareholders, jointly and severally hereby represents and
warrants to Apollo and the Merger Subsidiary as follows (all references to a
subsection of PART A-1 of the Disclosure Letter shall be found in SCHEDULE B to
the Disclosure Letter):
1. TITLE TO THE STOCK. The Stockholder has good, valid and marketable
title to the Stock in the amounts and proportions as set forth in the Disclosure
Letter dated the date hereof (which has been separately delivered to Apollo and
is incorporated herein by reference and made a part hereof as if fully set forth
herein, the "Disclosure Letter"), all of which Company Stock has been duly
authorized and validly issued and is fully paid and non-assessable, and is (and
on the Closing Date will be) free and clear of all pledges, liens, claims,
charges, options, calls, encumbrances, restrictions and assessments whatsoever
(except any restrictions which may be created by operation of state or federal
securities laws). The Stockholder is the only record and beneficial owner of
100% of the issued and outstanding shares of Company Stock.
2. VALID AND BINDING AGREEMENT.
(a) The execution, delivery and performance of this Agreement and
the consummation of the Merger and the other transactions contemplated hereby by
the Company have been duly and validly authorized by the Board of Directors and
the stockholders of the Company, and the Company has the full legal right, power
and authority to execute and deliver this Agreement, to perform its obligations
hereunder, and to consummate the transactions contemplated hereby. This
Agreement constitutes the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except to the
extent limited by bankruptcy, insolvency, reorganization and other laws
affecting creditors' rights generally, and except that the remedy of specific
performance or similar equitable relief is available only at the discretion of
the court before which enforcement is sought.
(b) The Company and the Stockholder have full legal right, power
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. This Agreement and, when executed and
delivered by the Stockholder, the Non-Competition Agreement (as defined in
Section 8.7 of the Agreement), constitutes and will constitute the legal, valid
and binding obligations of the Company and the Stockholder (as applicable),
enforceable against the Company and the Stockholder (as applicable) in
accordance with their respective terms, except to the extent limited by
bankruptcy, insolvency, reorganization and other laws affecting creditors'
rights generally, and except that the remedy of specific performance or similar
equitable relief is available only at the discretion of the court before which
enforcement is sought.
3. ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company: (a) is
a corporation duly organized, validly existing and in good standing under the
laws of its state of incorporation; (b) has all necessary corporate power and
authority to carry on its business and to own, lease and operate its properties;
and (c) is qualified to do business as a foreign corporation in each foreign
jurisdiction where such qualification is required by law. True and complete
copies of the Articles of Incorporation and By-Laws of the Company (including
all amendments thereto), and a correct and complete list of the officers and
directors of the Company, are annexed to the Disclosure Letter.
4. CAPITAL STRUCTURE; STOCK OWNERSHIP.
(a) The authorized capital stock of the Company is as set forth
in its Articles of Incorporation and the Company Stock constitutes all of the
issued and outstanding capital stock of the Company. The shares of the Stock and
the record and beneficial owner thereof is as set forth in PART A-1, 4(a) of the
Disclosure Letter, and no other shares of capital stock of the Company are
issued or outstanding.
(b) There are no outstanding subscriptions, options, rights,
warrants, convertible securities or other agreements or calls, demands or
commitments obligating the Company to issue, transfer or purchase any shares of
its capital stock, or obligating any Stockholder to transfer any shares of
Company Stock owned by such Stockholder. No shares of capital stock of the
Company are reserved for issuance pursuant to stock options, warrants,
agreements or other rights to purchase capital stock.
5. SUBSIDIARIES AND INVESTMENTS. The Company does not own, directly or
indirectly, any stock or other equity securities of any corporation or entity,
or has any direct or indirect equity or ownership interest in any person, firm,
partnership, corporation, venture or business other than the business conducted
by the Company.
6. FINANCIAL INFORMATION. PART A-1(6) of the Disclosure Letter
contains: (i) an aging schedule of accounts receivable and accounts payable of
the Company as of November 11, 1997; (ii) a list of the outstanding principal
balance of and approximate accrued interest on all indebtedness including
without limitation accounts payable and loans and/or notes payable of the
Company as of November 11, 1997; (iii) a list of all obligations of the Company
to any of the stockholders of the Company and/or any of their respective
Affiliates on the date hereof; (iv) a list of all obligations of the Company
guaranteed by any of the stockholders of the Company on the date hereof, and the
terms of such guarantees; and (v) a list reflecting the nature and amount of all
obligations owed to the Company on the date hereof by any of the stockholders of
the Company and/or any of their respective Affiliates. Wherever used herein, the
term "Affiliate" means, as respects any person or entity, any other person or
entity that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with the first person or
entity.
7. NO MATERIAL CHANGES. Since November 11, 1997, the business of the
Company has continued to be operated only in the ordinary course, and there has
not been:
(a) Any material change in the financial condition, operations or
business of the Company from that shown on the Unaudited Financial Statements
(as defined in Section 6.1 of the Agreement), or any material transaction or
commitment effected or entered into outside of the normal course of the
Company's business;
(b) Any damage, destruction or loss, whether covered by insurance
or not, materially and adversely affecting the business, operations, assets,
properties, financial condition or prospects of the Company;
(c) Any declaration, setting aside or payment of any dividend or
other distribution with respect to the Company Stock, any other payment of any
kind by the Company to any of the stockholders of the Company or any of their
respective Affiliates outside of the ordinary course of business, any
forgiveness of any debt or obligation owed to the Company by any of the
stockholders of the Company or any of their respective Affiliates, or any direct
or indirect redemption, purchase or other acquisition by the Company of any
capital stock of the Company; or
(d) Any other event or condition arising from or out of the
operation of the Company which has or may materially and adversely affect the
business, financial condition, results of operations or prospects of the
Company.
8. TAX RETURNS AND AUDITS.
(a) Except as disclosed in PART A-1(8) of the Disclosure Letter,
[i] on the date hereof and on the Closing Date, all federal, state and local tax
returns and tax reports required to be filed by the Company on or before the
date of this Agreement or the Closing Date, as the case may be, have been and
will have been timely filed with the appropriate governmental agencies in all
jurisdictions in which such returns and reports are required to be filed; [ii]
all federal, state and local income, franchise, sales, use, property, excise and
other taxes (including interest and penalties and including estimated tax
installments where required to be filed and paid) due
from or with respect to the Company as of the date hereof and as of the Closing
Date have been and will have been fully paid, and appropriate accruals shall
have been made on the Company's books for taxes not yet due and payable; [iii]
as of the Closing Date, all taxes and other assessments and levies which the
Company is required by law to withhold or to collect on or before the Closing
Date will have been duly withheld and collected, and will have been paid over to
the proper governmental authorities to the extent due and payable on or before
the Closing Date; and [iv] there are no outstanding or pending claims,
deficiencies or assessments for taxes, interest or penalties with respect to any
taxable period of the Company. At and after the Closing Date, the Company will
not have any liability for any federal, state or local income tax with respect
to any taxable period ending on or before the Closing Date, except as and to the
extent disclosed in PART A-1(8) of the Disclosure Letter. Discretionary
decisions made by Apollo and its management with respect to filing or amending
any tax returns of the Company concerning periods ended on or prior to the
Closing Date, which decisions are not required under applicable law and which
decisions result in additional liability to the Company other than as disclosed
in this Agreement or the Schedules annexed hereto, shall not result in any
breach of representations and warranties contained in this Subsection 8(a).
(b) There are no audits pending with respect to any federal,
state or local tax returns of the Company, and no waivers of statutes of
limitations have been given or requested with respect to any tax years or tax
filings of the Company.
9. PERSONAL PROPERTY; LIENS. The Company has and owns good and
marketable title to all of its personal property, free and clear of all liens,
pledges, claims, security interests and encumbrances whatsoever, except for: (a)
liens securing the Company's indebtedness for money borrowed as reflected in the
Unaudited Financial Statements, pursuant to the security agreements listed in
PART A-1(9) of the Disclosure Letter; (b) liens securing the deferred purchase
price of machinery, equipment, vehicles and/or other fixed assets, as indicated
on PART A-1(9) of the Disclosure Letter; (c) liens for current taxes not yet due
and payable or which are being contested in good faith by appropriate
proceedings; and (d) liens, pledges, claims, security interests, encumbrances,
mortgages, conditions or restrictions which are not, individually or in the
aggregate, material in character or amount and do not interfere with the use
made or presently proposed to be made of any such property (collectively,
"Permitted Liens"). All material items of machinery, equipment, vehicles and
other fixed assets owned or leased by the Company are listed in PART A-1(9) of
the Disclosure Letter.
10. REAL PROPERTY.
(a) The Company does not own or have any interest of any kind
(whether ownership, lease or otherwise) in any real property except to the
extent of the Company's leasehold interest under the lease for its business
premises, and true and complete copies of all real property leases (including
all amendments thereto) to which the Company is a party in any capacity are
attached to SCHEDULE A of the Disclosure Letter (the "Leases").
(b) The Company (and, to the best of the Stockholder's knowledge,
the landlord thereunder) is presently in compliance with all of its obligations
under the Leases, and the premises leased thereunder are in good condition
(reasonable wear and tear excepted), are adequate for the operation of the
Company's business as presently conducted, and a default, termination, or
modification of currently effective payment or other terms thereunder will not
be effected as a result of consummation of the Merger and the transactions
contemplated by this Agreement.
11. ACCOUNTS RECEIVABLE. All accounts receivable of the Company are
set forth in PART A-1(6)(i) of the Disclosure Letter.
12. INVENTORIES. All inventories are shown in PART A-1(12) of the
Disclosure Letter, and consist of items which are of a quality and quantity
which are useable in the ordinary course of the Company's business.
13. INSURANCE POLICIES. A true and correct schedule of all insurance
coverage held by the Company concerning its business and properties is set forth
in SCHEDULE A of the Disclosure Letter; and except as
set forth therein such coverage insures all of the Company's assets for the full
replacement cost thereof (net of reasonable deductibles), and are adequate for
the normal operation of the Company's businesses.
14. PERMITS AND LICENSES. Except as set forth in PART A-1(14) of the
Disclosure Letter, the Company possesses all required permits, licenses and/or
franchises, from whatever governmental authorities or agencies (domestic and/or
foreign) requiring the same and having jurisdiction over the Company, necessary
in order to operate its business in the manner presently conducted, all of which
permits, licenses and/or franchises are valid, current and in full force and
effect; and none of such permits, licenses or franchises will be voided, revoked
or terminated, or voidable, revocable or terminable, upon and by reason of the
Merger and consummation of the transaction contemplated by this Agreement.
15. CONTRACTS AND COMMITMENTS.
(a) PART A-1(15) of the Disclosure Letter lists all material
contracts, leases, commitments, indentures and other agreements to which the
Company is a party (collectively, "Material Contracts").
(b) To the best of the Stockholder's knowledge, except as set
forth in PART A-1(15) of the Disclosure Letter: (i) all Material Contracts are
in full force and effect; (ii) the Company has received any written notice that
any Material Contract is in material breach or default or is now subject to any
condition or event which has occurred and which, after notice or lapse of time
or both, would constitute a material default by any party under any such
contract, lease, agreement or commitment; and (iii) none of the Material
Contracts will be voided, revoked or terminated, or voidable, revocable or
terminable, upon and by reason of the Merger and the consummation of the
transactions contemplated by this Agreement.
(c) To the best of the Stockholder's knowledge, no purchase
commitment by the Company is in excess of the normal, ordinary and usual
requirements of the business of the Company.
(d) Except for the Leases and otherwise as set forth in PART
A-1(15), the Company does not have any outstanding contracts or commitments that
are not cancelable by the Company without penalty, premium or liability (for
severance or otherwise) on less than thirty (30) days' prior written notice.
(e) There is no outstanding power of attorney granted by the
Company to any person, firm or corporation for any purpose whatsoever.
(f) The Company's lease of its present principal operating
facility at 00000 Xxxxxxxxx Xxxx., Xxxxx 000, Xxxxxxxxxx, Xxxxxxx 00000,
terminates on November 30, 2000.
16. CUSTOMERS AND SUPPLIERS. Neither the Stockholder nor, to the best
of the Stockholder's knowledge, the Company, has received any written notice of
any existing, announced or anticipated changes in the policies of any material
suppliers or referral sources which will materially, adversely affect the
business presently being conducted by the Company.
17. LABOR, BENEFIT AND EMPLOYMENT AGREEMENT.
(a) (x) Except as set forth in PART A-1(17) of the Disclosure
Letter, the Company is not a party to (i) any collective bargaining agreement or
other labor agreement, or (ii) any agreement with respect to the employment or
compensation of any non-hourly and/or non-union employee(s) which is not
terminable without penalty by the Company on not more than thirty (30) days'
prior written notice; (y) PART A-1(17) hereto sets forth the amount of all
compensation or remuneration (including any discretionary bonuses) to be paid by
the Company during the 1997 calendar year to employees or consultants who
presently receive aggregate compensation or remuneration at an annual rate in
excess of $10,000.00.
(b) Except as disclosed in PART A-1(17) of the Disclosure Letter,
the Company does not maintain, or have any liabilities or obligations of any
kind with respect to, any bonus, deferred compensation, pension, profit sharing,
retirement or other such benefit plan, and does not have any potential or
contingent liability in respect of any actions or transactions relating to any
such plan other than to make contributions thereto if, as and when due in
respect of periods subsequent to the date hereof.
(c) Except for the group insurance programs and any other
insurance listed in PART A-1(17) of the Disclosure Letter, the Company does not
maintain any medical, health, life or other employee benefit insurance programs
or any welfare plans (within the meaning of Section 3(1) of ERISA) for the
benefit of any current of former employees, and, except as required by statute
or governmental regulation, the Company does not have any liability, fixed or
contingent, for health or medical benefits to any former employee.
18. NO BREACH OF STATUTE, DECREE OR OTHER INSTRUMENT.
(a) Except as set forth in PART A-1(18) of the Disclosure Letter:
(i) neither the execution and delivery of this Agreement by the Company and/or
the Stockholder, nor the performance of or compliance with the terms and
provisions of this Agreement on the part of the Company and/or the Stockholder,
will violate or conflict with any term of the Articles of Incorporation or
By-Laws of the Company or any statute, law, rule or regulation of the
governmental authority affecting the existing business of the Company, or will
at the Closing Date conflict with, result in a breach of, or constitute a
default under, any of the terms, conditions or provisions of any judgment,
order, award, injunction, decree, contract, lease, agreement, indenture or other
instrument to which the Company or the Stockholder is a party or by which the
Company or the Stockholder is bound; (ii) no consent, authorization or approval
of or filing with any governmental authority or agency, or any third party, will
be required on the part of the Company or the Stockholder in connection with the
consummation of the transactions contemplated hereby; and (iii) the Company will
not be required, whether by law, regulation or administrative practice, to
reapply for or refile to obtain any of the licenses, permits or other
authorizations presently held by the Company and required for the operation of
its business as conducted on the date hereof.
(b) In connection with and as respects the Merger, the Company
and the Stockholder have waived any and all rights which it or he may have (by
way of right of first refusal, right of first offer, or otherwise) to purchase
any of the Company Stock by reason of the proposed disposition thereof by the
other pursuant to the Merger.
19. COMPLIANCE WITH LAWS.
(a) The Company is, and has been at all times during the one (1)
year period prior to the date hereof, in compliance with all domestic, foreign,
federal, state, local and municipal laws and ordinances and governmental rules
and regulations, and all requirements of insurance carriers, applicable to its
business, affairs, properties or assets.
(b) Neither the Stockholder or the Company, nor to the best of
the Stockholder's knowledge, any of the Company's directors, officers or
employees, has received any written notice of default or violation, nor is the
Company, or to the best of the Stockholder's knowledge, any of the Company's
directors, officers or employees, in default or violation, with respect to any
judgment, order, writ, injunction, decree, demand or assessment issued by any
court or any federal, state, local, municipal or other governmental agency,
board, commission, bureau, instrumentality or department, domestic or foreign,
relating to any aspect of the Company's business, affairs, properties or assets.
Neither the Stockholder nor the Company, nor to the best of the Stockholders'
knowledge, any of the Company's directors, officers or employees, has received
written notice of, been charged with, or is under investigation with respect to,
any violation of any provision of any federal, state, local, municipal or other
law or administrative rule or regulation, domestic or foreign, relating to any
aspect of the Company's business, affairs, properties or assets, which violation
would have a material adverse effect on the business, financial condition,
results of operations or prospects of the Company.
20. LITIGATION. Except as disclosed in PART A-1(20) of the Disclosure
Letter, there is no suit, action, arbitration, or legal, administrative or other
proceeding, or governmental investigation pending, or to the best knowledge of
the Stockholder, threatened, by or against the Company or any of its assets or
properties. The Stockholder is not aware of any state of facts, events,
conditions or occurrences which might properly constitute grounds for or the
basis of any suit, action, arbitration, proceeding or investigation against or
with respect to the Company.
21. PATENTS, LICENSES AND TRADEMARKS.
(a) There are not any patents, patent applications, copyright
registrations and applications, registered trade names, and trademark
registrations and applications, both domestic and foreign, which are presently
owned, filed or held by the Company and/or the Stockholder or any of the
Company's directors, officers, stockholders or employees and which in any way
relate to or are used in the business of the Company; (b) there are no licenses,
both domestic and foreign, which are owned or controlled by the Company or the
Stockholder and/or any of the Company's directors, officers, stockholders or
employees and which in any way relate to or are used in the business of the
Company; and (c) all franchises, licenses and/or similar arrangements granted to
the Company by others and/or to others by the Company.
(b) Stockholder warrants that the Company's products, including
without limitation all software programs, source codes, diagrams, schematics and
all other related documentation, data and materials in connection therewith
(collectively, the "Products") are of original development by the Company and
that the Products do not infringe upon or violate any patent, copyright,
trademark, invention, proprietary information, nondisclosure, or other right of
any third party.
22. TRANSACTIONS WITH AFFILIATES. Except as set forth in PART A-1(22)
of the Disclosure Letter, no material asset employed in the business of the
Company is owned by, leased from or leased to any of the stockholders of the
Company, any of their respective Affiliates, members of their families or any
partnership, corporation or trust for their benefit, or any other officer,
director or employee of the Company or any Affiliate of the Company.
23. BANK ACCOUNTS. Set forth in PART A-1(23) of the Disclosure Letter
is a correct and complete list of all bank accounts and safe deposit boxes
maintained by or on behalf of the Company, with indication of all persons having
signatory, access or other authority with respect thereto.
24. INVESTMENT. All shares of Apollo Stock which the Stockholder shall
acquire pursuant to this Agreement will be acquired by the Stockholder for its
own account, for investment purposes only, and not with a view to the resale or
distribution thereof. The Stockholder hereby acknowledges its receipt and review
of the most recent prospectus, annual report, quarterly report and current
report of Apollo as filed with the Securities and Exchange Commission, and
acknowledges and confirms that it has had the full and fair opportunity to
obtain such additional and/or updated information regarding Apollo as it has
deemed appropriate in connection with the transactions contemplated hereby. All
of the representations, warranties and other information contained in the
Subscription Agreement annexed as EXHIBIT B to the Agreement, when executed by
the Stockholder as of the date hereof, shall be true and correct.
25. DISCLOSURE AND DUTY OF INQUIRY. Neither Apollo nor the Merger
Subsidiary will be required to undertake any independent investigation to
determine the truth, accuracy and completeness of the representations and
warranties made by the Stockholder in this Agreement.
26. LIABILITIES.
(a) Except as set forth in PART A-1(26) of the Disclosure Letter
hereto (and to the extent not disclosed in other Schedules to this Agreement),
the Company has no separate indebtedness or payable outstanding which
individually exceed $5,000.00 or outstanding indebtedness or payables which in
the aggregate exceed $10,000.00. There are no material contingent or actual
liabilities of whatever nature, except as set forth in
PART A-1(27) of the Disclosure Letter, that are not disclosed in the Unaudited
Financial Statements, including but not limited to liabilities for sales and use
taxes, state and local taxes, payroll taxes and FICA payments, other mandated
fees, fines, or payments of any kind due and payable to any level of government.
(b) All indebtedness and accounts payable of the Company as of
the date of this Agreement are set forth in PART A-1(26) of the Disclosure
Letter hereto (to the extent not disclosed in other Schedules to this
Agreement), which obligations are identified by current outstanding principal
balance and accrued and unpaid interest, if any, owed to each creditor, together
with the name, address and telephone number of each such creditor.
27. NO CONSENTS. No consents to the transaction contemplated in this
Agreement are required other than as set forth in PART A-1(27) of the Disclosure
Letter, which, in the absence of such consents, will result in a default under
any leases or contracts (including without limitation loan agreements or other
debt instruments) to which the Company is a party, or will result in an
acceleration of any obligations of the Company.
EXHIBIT A-2
REPRESENTATIONS AND WARRANTIES OF APOLLO
Apollo hereby represents and warrants to the Stockholder as follows:
1. ORGANIZATION, GOOD STANDING AND QUALIFICATION.
(a) Apollo is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware, with all necessary
power and authority to execute and deliver this Agreement, to perform its
obligations hereunder, and to consummate the transactions contemplated hereby.
(b) The Merger Subsidiary is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation, with all necessary power and authority to consummate the Merger
with the Company as contemplated hereby. The Merger Subsidiary is a wholly-owned
subsidiary of Apollo, and will have no material assets or liabilities at the
time of the Closing.
2. AUTHORIZATION OF AGREEMENT. The execution, delivery and performance
of this Agreement and the consummation of the Merger and the other transactions
contemplated hereby by Apollo have been duly and validly authorized by the Board
of Directors of Apollo; and Apollo has (and, at the time of the Closing, the
Merger Subsidiary will have) the full legal right, power and authority to
execute and deliver this Agreement, to perform their respective obligations
hereunder, and to consummate the transactions contemplated hereby. No further
corporate authorization is necessary on the part of Apollo to consummate the
transactions contemplated hereby.
3. VALID AND BINDING AGREEMENT. This Agreement and, when executed and
delivered by Apollo, the Non-Competition Agreement, (as defined in Section 8.7
of the Merger Agreement), constitute and will constitute the legal, valid and
binding obligations of Apollo, enforceable against Apollo in accordance with
their respective terms, except to the extent limited by bankruptcy, insolvency,
reorganization and other laws affecting creditors' rights generally, and except
that the remedy of specific performance or similar equitable relief is available
only at the discretion of the court before which enforcement is sought.
4. NO BREACH OF STATUTE OR CONTRACT. Neither the execution and
delivery of this Agreement by Apollo, nor compliance with the terms and
provisions of this Agreement on the part of Apollo, will: (a) violate any
statute or regulation of any governmental authority, domestic or foreign,
affecting Apollo; (b) require the issuance of any authorization, license,
consent or approval of any federal or state governmental agency; or (c) conflict
with or result in a breach of any of the terms, conditions or provisions of any
judgment, order, injunction, decree, note, indenture, loan agreement or other
agreement or instrument to which Apollo is a party, or by which Apollo is bound,
or constitute a default thereunder.
5. BUSINESS AND FINANCIAL INFORMATION. The financial statements and
other information contained in the documents and reports referred to in EXHIBIT
A-1(24) are correct and complete in all material respects, and the financial
statements included therein present fairly the financial position of Apollo in
conformity with generally accepted accounting principles consistently applied
(subject, in the case of unaudited statements, to the absence of footnote
disclosures and to customary fiscal year-end audit adjustments which will not,
individually or in the aggregate, be material to the consolidated financial
condition of Apollo and its subsidiaries).
6. APOLLO SHARES. When transferred or issued to the Stockholder
pursuant to Section 2 of the Merger Agreement, all shares of common stock of
Apollo delivered to the Stockholder shall be duly authorized, validly issued and
fully paid and non-assessable, and free and clear of all pledges, liens, claims,
charges, options, calls, encumbrances, restrictions and assessments whatsoever
(except any restrictions which may be created by operation of state or federal
securities laws).
7. INVESTMENT. Apollo will be acquiring ownership of the outstanding
capital stock of the Surviving Corporation for its own account, for investment
purposes only, and not with a view to the resale or distribution thereof.
8. DISCLOSURE AND DUTY OF INQUIRY. The Stockholder is not and will not
be required to undertake any independent investigation to determine the truth,
accuracy and completeness of the representations and warranties made by Apollo
in this Agreement.
EXHIBIT B
SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT
THIS AGREEMENT is made and entered into as of the 24th day of November
1997, by and between Apollo International of Delaware, Inc., a Delaware
corporation (the "Company"), and the individual set forth on the signature page
hereof ("Subscriber").
WITNESSETH:
WHEREAS, Subscriber, is one (1) of six (6) shareholders in Trans-World
Powernet, Inc., a Florida corporation ("Trans-World"); and
WHEREAS, Subscriber is selling all of his interest in Trans-World (pursuant
to that certain Agreement and Plan of Merger entered into as of the 24th day of
November 1997, by and among the Company, Apollo Acquisition II, Inc.,
Trans-World, Subscriber, and the remaining five (5) shareholders of Trans-World
(the "Merger Agreement"); and
WHEREAS, pursuant to the Merger Agreement, Subscriber will be paid in part
with shares of common stock of the Company ("Shares").
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties hereto do hereby agree as follows:
1. PURCHASE OF SHARES.
2. REPRESENTATIONS AND WARRANTIES. Subscriber hereby represents, warrants
and covenants to the Company that in connection herewith:
(a) REVIEW AND EVALUATION OF INFORMATION REGARDING THE COMPANY:
Subscriber has had an opportunity to examine the governing instruments and the
material documents and records of the Company, to ask questions and receive
answers from the representatives of the Company concerning the Company's
financial condition and business and to obtain such other information that he
has deemed necessary to make a fully informed decision.
(b) PURCHASER'S FINANCIAL EXPERIENCE. Subscriber is sufficiently
experienced in financial and business matters to be capable of evaluating the
merits and risks of his investment in the Shares. Subscriber is familiar with
the nature and risks attending investments
(c) SUITABILITY OF INVESTMENT. Subscriber understands that the Shares
are speculative investments and involve a high degree of risk, including but not
limited to: there is no guarantee of success of the business of the Company; he
may not receive any return (economic or otherwise) on his investment, and
management and the majority shareholders have extreme latitude and generally,
the sole discretion, to determine the financial picture, operations and
potential dissolution of the Company. Subscriber has evaluated the merits and
risks of
Subscriber's proposed investment in the Shares, including those risks particular
to Subscriber's personal situation, and he has determined that this investment
is suitable for Subscriber. Subscriber has adequate financial resources for an
investment of this character, and at this time Subscriber could bear a complete
loss of his investment. Further, Subscriber will continue to have, after making
his investment in the Shares, adequate means of providing for his current needs,
the needs of those dependent on him, and possible personal contingencies.
(d) INVESTMENT INTENT. Subscriber is purchasing the Shares for
investment purposes only and for his own account, and has no present commitment,
agreement or intention to sell, distribute or otherwise dispose of any of them
or to enter into any such commitment or agreement.
(e) UNREGISTERED SECURITIES; LIMITATIONS ON DISPOSITION. Subscriber
understands that the Shares are being sold without registration under federal or
any state securities laws ("Securities Laws") by reason of specific exemptions
from registration and that the Company is relying on the information given
herein in its determination of whether such specific exemptions are available.
Subscriber understands that because the Shares have not been and will not be
registered under the Securities Laws, they cannot be sold unless and until they
are subsequently registered or an exemption from registration is available.
Subscriber represents that he can afford to hold the Shares for an indefinite
period of time.
(f) NON-RELIANCE. Subscriber is not relying on the Company or any
representation contained herein with respect to the tax or economic effect of
his investment in the Company.
(g) PROHIBITIONS ON CANCELLATION, TERMINATION, REVOCATION,
TRANSFERABILITY, AND ASSIGNMENT. Subscriber hereby acknowledges and agrees that,
except as may be specifically provided herein or by applicable law, he is not
entitled to cancel, terminate, or revoke this Agreement, and this Agreement
shall survive his death or disability. Subscriber further agrees that he may not
transfer or assign his rights or obligations under this Agreement without the
written consent of the Company.
(h) AUTHORITY TO ENTER INTO AGREEMENT. The Subscriber has the full
right, power, and authority to execute and deliver this Agreement and perform
its obligations hereunder.
(i) RESIDENCY. Subscriber is a bona fide resident of the State set
forth below his name on the signature page hereof.
(j) RESTRICTION ON TRANSFER. Subscriber covenants and agrees that he
will not, from the date hereof through the period ending July 10, 1999, without
the prior consent of May Xxxxx Group, Inc., publicly sell any securities of
Apollo owned directly or indirectly by the Subscriber or owned beneficially by
the Subscriber, or otherwise sell or transfer such securities unless the
transferee agrees in writing to be bound by the terms of this subsection.
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3. INDEMNIFICATION. Subscriber shall indemnify and hold harmless the
Company and its agents and counsel against any and all loss damage liability or
expense (including attorneys' fees and costs) which may be suffered by reason of
any breach of his representations, warranties or covenants contained in Section
2 hereof.
4. GOVERNING LAW; JURISDICTION. This Agreement will be governed by,
construed and enforced in accordance with the laws of the State of Florida,
without reference to its choice of law principles.
5. ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes and terminates any prior communication, agreement or
understanding, whether written or oral. This Agreement my only be modified by a
writing signed by all parties.
6. NOTICES. Whenever notice is provided for in this Agreement, it shall be
given in writing and hand delivered or mailed by registered or certified mail,
return receipt requested, to the party or parties to whom addressed at the
addresses set forth on the signature page of this Agreement. Any party may
change the address to which notice shall be delivered or mailed by notice duly
given.
7. INFORMATION BY SUBSCRIBER. Subscriber shall furnish to the Company such
information regarding Subscriber and the distribution proposed by Subscriber as
the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
referred to herein.
8. BENEFITS. This Agreement shall inure to the benefit of, and be binding
upon, the parties hereto and their respective heirs, beneficiaries, legal
representatives, successors, and assigns (including successive as well a
immediate successors to and assigns of said parties).
9. ATTORNEYS' FEES. In the event of suit or other legal proceeding,
including mediation or arbitration, to enforce the terms of this Agreement, the
prevailing party shall be entitled to collect from the non-prevailing party its
reasonable attorneys' fees, reasonable expenses and court costs, which shall
include any appellate proceeding.
10. SEVERABILITY. In the event that any of the provisions of this
Agreement, or portions thereof, are held to be unenforceable or invalid by any
court of competent jurisdiction, the validity and enforceability of the
remaining provisions, or portions thereof, shall not be affected thereby.
11. SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS. The
representations, warranties, covenants and agreements contained herein shall
survive the Subscriber's delivery of payment for the Shares and acceptance by
the Company of Subscriber's subscription to the Shares.
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12. PRONOUNS. All pronouns and any variations thereof shall be deemed to
refer to the masculine, feminine, neuter, singular or plural as the context may
require.
13. SECTION HEADINGS. The section headings contained herein are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
14. EXECUTION IN COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have executed this agreement as of the
date first written above.
APOLLO INTERNATIONAL OF
DELAWARE, INC.
By:
--------------------------
Xxxxx X. Xxxxxx, PRESIDENT
Address: 0000 X. X.X. Xxx 00, Xxxxx 000,
Xxxxxx Xxxxx, Xxxxxxx 00000
SUBSCRIBER:
-----------------------------
Name:
Address:
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Resident of the State of
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