1
EXHIBIT 2.1
MERGER AGREEMENT AND PLAN OF REORGANIZATION
MERGER AGREEMENT AND PLAN OF REORGANIZATION made as of this 17th day of
May, 2000, by and between Medical Monitors, Inc., a Delaware corporation having
its principal place of business at 0000 Xxxxxxxx Xxxxxxxxx, 0xx Xxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000 ("Medical"), World Collectibles Holdings, Inc., a
Delaware corporation having its principal place of business at 0000 Xxxxxxxx
Xxxxxxxxx, 0xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000 ("WCID"), and World
Collectibles, Inc., a Nevada corporation having its principal place of business
at 0000 X. Xxxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxx 00000 ("WCIN").
WHEREAS, Medical, which presently has 50,000,000 shares of Common Stock,
par value $.01 per share ("Medical Common Stock") outstanding, shall use its
best efforts to cause its stockholders to approve a 1-for-135 reverse stock
split (the "Reverse Split"), resulting in approximately 370,370 shares of
Medical Common Stock outstanding (the "Medical Common Shares").
WHEREAS, WCID is a wholly owned subsidiary of Medical and is authorized
to issue 1,000 shares of common stock, par value $.01 (the "WCID Shares"), all
of which such WCID Shares are issued and outstanding and owned by Medical.
WHEREAS, the respective Boards of Directors of Medical, WCID and WCIN
(collectively the "Companies") deem it advisable and generally to the advantage
and welfare of the Companies, and their respective stockholders, that WCIN be
merged with and into WCID (the "Merger") under the terms and conditions
hereinafter set forth to be effected pursuant to the Nevada General Corporation
Law and the Delaware General Corporation Law and to be a tax free reorganization
under Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the
"Code").
2
NOW, THEREFORE, in consideration of the premises, covenants and
conditions hereof, the parties hereto do mutually agree as follows:
1. Vote on Merger and Related Matters.
(a) WCID and WCIN shall each, as soon as practicable but prior to
closing, and in no event later than 30 days after the execution and delivery
hereof, (i) cause a special meeting of its stockholders to be called to consider
and vote upon the Merger on the terms and conditions hereinafter set forth, or
(ii) obtain written consent of such stockholders as is necessary to approve the
Merger. If the Merger is approved in accordance with the applicable state laws,
subject to the further conditions and provisions of this Agreement, a closing of
this Agreement shall be held (the "Closing"), and Certificates of Merger and all
other documents or instruments deemed necessary or appropriate by the parties
hereto to effect the Merger shall be executed and filed with the Secretary of
State of the States of Nevada and Delaware as promptly as possible thereafter.
(b) As soon as practicable, but in no event more than 60 days after
the date hereof, Medical shall cause a special meeting of its stockholders to be
called to consider and vote upon (i) a Certificate of Amendment to Medical's
Certificate of Incorporation to approve the change of name of the Company to
"World Collectibles, Inc." (the "Name Change"), (ii) the Reverse Split, and
(iii) the transacting of such other business as may properly come before the
meeting or any adjournment thereof.
2. Representations, Warranties and Covenants of WCIN. WCIN
represents and warrants as follows:
(a) WCIN is, and on the effective date of the Merger (the "Effective
Date") will be, a duly organized and validly existing corporation in good
standing under the laws of its state of
2
3
incorporation and in such other jurisdictions as it is qualified to do business.
There are issued and outstanding, and on the Effective Date there will be issued
and outstanding, on a fully diluted basis, the shares of capital stock and other
equity interests in WCIN as are set forth on Exhibit 2(a) attached hereto and
incorporated herein, all of which such capital stock and equity interests are,
and on the Effective Date will be, duly authorized, validly issued, fully paid
and nonassessable. There are no, and on the Effective Date there will be no,
issued or outstanding rights, options or warrants to purchase any capital stock
or equity interest in WCIN, including but not limited to any common stock of
WCIN or any other issued or outstanding securities of any nature convertible
into or exercisable or exchangeable for common stock of WCIN. The outstanding
equity interests of WCIN have all been issued pursuant to an appropriate
exemption from the registration requirements of the Securities Act of 1933, as
amended (the "Securities Act") and from any applicable registration requirements
of the various states.
(b) WCIN has, and on the Effective Date will not have, any
subsidiaries, nor does it own any direct or indirect interest in any other
business entity.
(c) WCIN has, and on the Effective Date will have, full power and
authority to enter into this Agreement and, subject to any required stockholder
or other third party approval in accordance with the laws of the State of
Nevada, to consummate the transactions contemplated hereby. This Agreement and
the transactions contemplated hereby have been duly approved by the Board of
Directors of WCIN and, prior to the Closing Date, by the respective stockholders
of WCIN. This Agreement has been duly executed and delivered by WCIN and
constitutes a valid and binding obligation of WCIN, enforceable against it in
accordance with its terms, except as such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws
hereafter in effect relating to creditors' rights.
3
4
(d) WCIN is qualified or licensed as a foreign corporation in all
jurisdictions where its respective business or ownership of assets so requires,
except where the failure to be qualified or licensed would not have a material
adverse effect on the respective businesses of WCIN.
(e) The balance sheet of WCIN at May 15, 2000 ("Balance Sheet"),
attached hereto as Exhibit 2(e), presents the financial position as of the date
thereof. The Balance Sheet has been prepared in conformity with generally
accepted accounting principles.
(f) There has not been, and on the Effective Date there will not
have been in the aggregate, any material adverse change in the condition,
financial or otherwise, of WCIN from that set forth in the Balance Sheet.
(g) Except for transactions occurring in the ordinary course of
business, there has not been, and on the Effective Date there will not have
been, any transactions involving WCIN since the date of the Balance Sheet.
(h) There are, and on the Effective Date will be, no liabilities
(including, but not limited to, tax liabilities) or claims against WCIN (whether
such liabilities or claims are contingent or absolute, direct or indirect,
matured or unmatured) not appearing on the Balance Sheet, other than liabilities
incurred in the ordinary course of business.
(i) All federal, state, county and local income, excise, property
and other tax returns required to be filed by WCIN have been filed, and all
required taxes, fees or assessments have been paid or an adequate reserve
therefor has been established in the Balance Sheet.
(j) WCIN has, and on the Effective Date will have, good and
marketable title to all of its respective furniture, fixtures, equipment and
other assets as set forth in the Balance Sheet, and
4
5
such assets are owned free and clear of all security interests, pledges, liens,
restrictions and encumbrances of every kind and nature.
(k) WCIN is the owner of its inventory as set forth in the Balance
Sheet and has good and marketable title thereto. Such inventory is clean,
current and saleable in the ordinary course of business.
(l) A copy of all agreements, contracts, arrangements,
understandings and commitments, whether written or oral, to which WCIN is, or on
the Effective Date will be, a party, or from which WCIN will receive substantial
benefits and which are material to WCIN (collectively, "Contracts"), have been
delivered to Medical. A list of such Contracts as to WCIN is attached hereto as
Exhibit 2(1) and shall be amended at the Effective Date to reflect any Contracts
entered into between the date hereof and the Effective Date. WCIN is not now,
nor will be on the Effective Date, in material default under any Contract. The
validity and enforceability of, and rights of WCIN contained in such Contracts
shall not be adversely effected by the Merger or the transactions contemplated
hereby or any actions taken in furtherance hereof.
(m) There are, and on the Effective Date there will be, no legal,
administrative, arbitral or other proceedings, claims, actions or governmental
investigations of any nature pending, or to WCIN's knowledge, threatened,
involving WCIN individually or in the aggregate in which an unfavorable
determination could result in suspension or termination of WCIN's business or
authority to conduct such business in any jurisdiction or could result in the
payment by WCIN of more than $10,000, or challenging the validity or propriety
of the transactions contemplated by this Agreement and, to WCIN's best
knowledge, there is no reasonable basis for any such proceeding, claim, action
or governmental investigation. WCIN is not a party to any order, judgment or
decree which will, or might
5
6
reasonably be expected to, materially adversely affect the business, operations,
properties, assets or financial condition of WCIN.
(n) From the date of the Balance Sheet, there have been, and through
the Effective Date there will be (i) no bonuses or extraordinary compensation to
any of the officers, directors or stockholders of WCIN, (ii) no loans made to or
any other transactions with any of the officers, directors or stockholders of
WCIN or their families, and (iii) no dividends or other distributions declared
or paid by WCIN.
(o) WCIN has, and on the Effective Date will have, maintained
casualty and liability policies and other insurance policies with respect to its
business which are appropriate and customary for businesses similar in size,
industry and risk profile.
(p) Since its inception, WCIN has, and on the Effective Date will
have, in all material respects operated its business and conducted its affairs
in compliance with all applicable laws, rules and regulations, except where the
failure to so comply did not have and would not be expected to have a material
adverse effect on its business or property.
(q) There are, and on the Effective Date there will be, no loans,
leases or other Contracts outstanding between WCIN and any of its officers,
directors or any person related to or affiliated with any such officers or
directors.
(r) During the past five year period, neither WCIN, nor any of its
officers or directors, nor any person intended upon consummation of the Merger
to become an officer or director of Medical or any successor entity or
subsidiary, has been the subject of:
(1) a petition under the Federal bankruptcy laws or any other
insolvency or moratorium law or has a receiver, fiscal agent or similar officer
been appointed by a court for the
6
7
business or property of WCIN or such person, or any partnership in which WCIN or
any such person was a general partner at or within two years before the time of
such filing, or any corporation or business association of which WCIN or any
such person was an executive officer at or within two years before the time of
such filing;
(2) a conviction in a criminal proceeding or a named subject of
a pending criminal proceeding (excluding traffic violations which do not relate
to driving while intoxicated or driving under the influence);
(3) any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction, permanently or
temporarily enjoining WCIN or any such person from, or otherwise limiting, the
following activities:
(i) Acting as a futures commission merchant, introducing
broker, commodity trading advisor, commodity pool operator, floor broker,
leverage transaction merchant, any other person regulated by the United States
Commodity Futures Trading Commission or an associated person of any of the
foregoing, or as an investment adviser, underwriter, broker or dealer in
securities, or as an affiliated person, director or employee of any investment
company, bank, savings and loan association or insurance company, or engaging in
or continuing any conduct or practice in connection with such activity;
(ii) Engaging in any type of business practice; or
(iii) Engaging in any activity in connection with the
purchase or sale of any security or commodity or in connection with any
violation of Federal, state or other securities laws or commodities laws;
7
8
(4) any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any Federal, state or local authority barring,
suspending or otherwise limiting for more than 60 days the right of WCIN or any
such person to engage in any activity described in the preceding subparagraph,
or to be associated with persons engaged in any such activity;
(5) a finding by a court of competent jurisdiction in a civil
action or by the Securities and Exchange Commission (the "Commission") to have
violated any securities law, regulation or decree and the judgment in such civil
action or finding by the Commission has not been subsequently reversed,
suspended or vacated; or
(6) a finding by a court of competent jurisdiction in a civil
action or by the Commodity Futures Trading Commission to have violated any
federal commodities law, and the judgment in such civil action or finding by the
Commodity Futures Trading Commission has not been subsequently reversed,
suspended or vacated. All items described in clauses (1) through (6) above are
collectively referred to herein as "Bad Events."
(s) WCIN does not have any pension plan, profit sharing or similar
employee benefit plan, except as set forth on the Schedule of Exceptions.
(t) Except for the consent and approval of the stockholders of WCIN
and the filing of the Certificate of Merger, no consents or approvals of, or
filings or registrations with, any third party or any public body or authority
are necessary in connection with (i) the execution and delivery by WCIN of this
Agreement and (ii) the consummation by WCIN of the Merger and of all other
transactions contemplated hereby.
(u) WCIN does not know of any person who rendered any service in
connection with the introduction of Medical, WCIN or WCID to any of the other
Companies and knows of no
8
9
claim by anyone for a "finder's fee" or similar type of fee in connection with
the Merger and the other transactions contemplated hereby.
(v) None of the information supplied or to be supplied by or about
WCIN for inclusion or incorporation by reference in any information supplied to
holders of Medical Common Stock concerning the Merger contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they are made, not misleading.
(w) The execution and delivery by WCIN of this Agreement, the
consummation and performance of the transactions herein contemplated, and
compliance with the terms of this Agreement will not conflict with, result in a
breach of or constitute or give rise to a default under (i) any indenture,
mortgage, deed of trust or other agreement, instrument or Contract to which WCIN
is now a party or by which is it bound; (ii) the Certificate of Incorporation or
the By-laws of WCIN, as amended; or (iii) any law, order, rule, regulation,
writ, injunction, judgment or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over WCIN or
any of its businesses or properties wherein such breach could have a material
adverse effect on WCIN or any of its respective businesses or properties.
(x) The stockholders of WCIN are acquiring the shares of Medical
Common Stock to be issued to them as a result of the Merger for investment
purposes only and not with a view to, or sale in connection with, any
distribution within the meaning of the Securities Act.
3. Representations and Warranties of WCID. WCID represents and warrants
as follows:
(a) WCID is and on the Effective Date will be, a duly organized and
validly existing corporation in good standing under the laws of the State of
Delaware, authorized to issue only the
9
10
WCID Shares. On the Effective Date there will be issued and outstanding 1,000
shares of common stock of WCID, which shall be fully paid and nonassessable and
all of which shall be owned by Medical. There are, and on the Effective Date
there will be, no issued or outstanding options or warrants to purchase WCID
Shares or any issued or outstanding securities of any nature convertible into
WCID Shares, or any agreements or understandings to issue any WCID Shares,
options or warrants.
(b) WCID has been organized solely for the purpose of consummating
the Merger and, since its inception, has had no business activity of any nature
other than those related to its organization or as contemplated by this
Agreement.
(c) WCID has, and on the Effective Date will have, full power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement and the transactions contemplated hereby
have been duly approved by the Board of Directors of WCID .
(d) Since its inception, WCID has not issued or committed itself to
issue, and to the Effective Date will not issue or commit to issue, any common
stock or any options, rights, warrants, or other securities convertible into
common stock, except for the issuance of the WCID Shares to Medical.
(e) Except for the consent and approval of the stockholders of WCID,
the filing of the Certificate of Merger and approval by Medical stockholders of
the Name Change and Reverse Stock Split, no consents or approvals of, or filings
or registrations with, any third party or any public body or authority are
necessary in connection with (i) the execution and delivery by WCID of
10
11
this Agreement and (ii) the consummation by WCID of the Merger and the other
transactions contemplated hereby.
(f) The execution and delivery by WCID of this Agreement, the
consummation and performance of the transactions herein contemplated, and
compliance with the terms of this Agreement by WCID will not conflict with,
result in a breach of, or constitute or give rise to a default under any
indenture, mortgage, deed of trust or other agreement, instrument or contract to
which WCID is now a party or by which any of its respective assets or properties
are bound, or its Certificate of Incorporation, as amended, or by-laws, as
amended, or any law, order, rule or regulation, writ, injunction, judgment or
decree of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over WCID or any of its respective businesses or
properties.
4. Representations and Warranties of Medical. Medical represents and
warrants as follows:
(a) Medical is a duly organized and validly existing corporation in
good standing under the laws of the State of Delaware, authorized to issue an
aggregate of 50,000,000 shares of Medical Common Stock. On the Effective Date,
giving effect to the Reverse Split, there will be issued and outstanding
approximately 370,370 shares of Medical Common Stock, all of which such issued
and outstanding shares will be validly issued, fully paid and nonassessable. All
fractional shares that would be issued as a result of the Reverse Split shall be
rounded up to the next whole number. Except as contemplated by this Agreement,
on the Effective Date there will be no issued or outstanding options, warrants
or other rights, or commitments or agreements of any kind, contingent or
otherwise, to purchase or otherwise acquire shares of Medical Common Stock or
any issued or outstanding securities of any nature convertible into shares of
Medical Common Stock. There is no proxy or any
11
12
other agreement, arrangement or understanding of any kind authorized or
outstanding which restricts, limits or otherwise affects the right to vote any
shares of Medical Common Stock.
(b) Medical's business has been in inactive status since 1981 as
described in its filings with the Commission (the "SEC Filings"), and except for
transactions related to conversion of debt or other obligations, it has not
engaged in any other business or activity since 1981.
(c) Medical is, and on the Effective Date will be, duly authorized,
qualified and licensed under any and all applicable laws, regulations,
ordinances or orders of public authorities to carry on its business in the
places and in the manner as presently conducted. The business of Medical does
not require it to be registered as an investment company or investment advisor,
as such terms are defined under the Investment Company Act and the Investment
Advisors Act of 1940.
(d) Medical has, and on the Effective Date will have, no
subsidiaries except for WCID.
(e) The financial statements of Medical, consisting of its Balance
Sheets as at December 31, 1999 and 1998, and its Statement of Operations for the
fiscal years ended December 31, 1999 and 1998, its Statement of Stockholders'
Equity as of December 31, 1999 and 1998, and its Statement of Cash Flows for the
fiscal years ended December 31, 1999 and 1998, all together with accompanying
notes, have been audited by independent public accountants, are complete and
correct in all material respects, present fairly the financial position of
Medical and the results of operations and changes in financial position for the
respective periods ended on such dates, and were prepared in accordance with
generally accepted accounting principles consistently applied during the
periods. All the financial statements referenced herein regarding Medical are
collectively referred to as the "Medical Financial Statements."
12
13
(f) There has not been, and on the Effective Date there will not
have been, any material change in the financial condition of Medical from that
set forth in the Medical Financial Statements except for (i) transactions in the
ordinary course of business, (ii) transactions relating to this Agreement, and
the incurring of expenses and liabilities relating to this Agreement not in
excess of $75,000 in the aggregate and (iii) conversions of debt and other
obligations into Medical Common Stock prior to the effectiveness of the Reverse
Split.
(g) There are, and on the Effective Date will be, no liabilities
(including, but not limited to, tax liabilities) or claims against Medical
(whether such liabilities or claims are contingent or absolute, direct or
indirect, accrued or unaccrued) not appearing on the Medical Financial
Statements, except for liabilities not in excess of $75,000 in the aggregate for
expenses incurred relating to this Agreement and the consummation of the
transactions contemplated hereby. On the Effective Date, Medical shall cause to
be issued to Xxxxxxx Xxxxxxx and Xxxxx Xxxxxxx, in consideration for the
cancellation of any and all debt owing by Medical to Xxxxxxx Xxxxxxx and Xxxxx
Xxxxxxx, 1,000,000 Medical Common Shares (post Reverse Split) to Xxxxxxx Xxxxxxx
and 1,000,000 Medical Common Shares (post Reverse Split) to Xxxxx Xxxxxxx.
(h) All federal, state, county and local income, excise, property or
other tax returns required to be filed by Medical have been filed and all
required taxes, fees or assessments have been paid. The federal income tax
returns and state and foreign income tax returns of Medical have not been
audited by the IRS or any other taxing authority within the past five (5) years.
Neither the IRS nor any state, local or other taxing authority has proposed any
additional taxes, interest or penalties with respect to Medical or any of its
operations or business, there are no pending, or to the knowledge of Medical
threatened, tax claims or assessments, and there are no pending, or to the
knowledge of Medical
13
14
threatened, tax examinations by any taxing authorities. Medical has not given
any waivers of rights (which are currently in effect) under applicable statutes
of limitations with respect to the federal income tax returns of Medical for any
year.
(i) Medical has, and on the Effective Date will have, no fixtures,
furniture, equipment, inventory or accounts receivable.
(j) Medical has, and on the Effective Date will have, no material
contracts to which it is, or on the Effective Date will be, a party, except as
described in the Medical Financial Statements.
(k) There are, and on the Effective Date there will be, no legal,
administrative, arbitral or other proceedings, claims, actions or governmental
investigations of any nature pending or to Medical's knowledge threatened in
writing, against Medical, including, but not limited to any stockholder claims
or derivative actions, or challenging the validity or propriety of the
transactions contemplated by this Agreement, and, to Medical's best knowledge,
there is no reasonable basis for any proceeding, claim, action or governmental
investigation against Medical. Medical is not a party to any order, judgment or
decree which will, or might reasonably be expected to, materially adversely
affect the business, operations, properties, assets or financial condition of
Medical.
(l) Medical has no patents, patent applications, trademarks,
trademark registrations, trade names, copyrights, copyright registrations or
applications therefor. Medical has no knowledge of any infringements by it of
any third party's intellectual property.
(m) Medical has no pension plan, profit sharing or similar employee
benefit plan.
(n) Except for the consent and approval of the Board of Directors of
Medical to the Merger and the consent and approval of the holders of Medical
Common Stock to the Reverse Split and the Name Change, and the filing of the
Certificate of Merger, no consents or approvals of, or
14
15
filings or registrations with, any third party or any public body or authority
are necessary in connection with (i) the execution and delivery by Medical of
this Agreement and (ii) the consummation of the Merger and the other
transactions contemplated hereby. Medical has, and on the Effective Date will
have, full power and authority to enter into this Agreement and to consummate
the transactions contemplated hereby. This Agreement and the transactions
contemplated hereby have been, or will be prior to the Effective Date, duly
approved by the Board of Directors of Medical.
(o) Medical knows of no person who rendered any service in
connection with the introduction of Medical, WCID or WCIN to each other, and
that it knows of no claim by anyone for a "finder's fee" or similar type of fee
in connection with the Merger and the other transactions contemplated hereby.
(p) Medical has no employees.
(q) None of the information supplied or to be supplied by or about
Medical to WCIN concerning the Merger contains any untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading.
(r) The execution and delivery by Medical of this Agreement, the
consummation and performance of the transactions herein contemplated, and
compliance with the terms of this Agreement by Medical will not conflict with,
result in a breach of, or constitute a default under (i) any indenture,
mortgage, deed of trust or other agreement, instrument or contract to which
Medical is now a party or by which it or any of its assets or properties is
bound; (ii) the Certificate of Incorporation, as amended, or the bylaws of
Medical, in each case as amended; or (iii) any law, order, rule or regulation,
15
16
writ, injunction, judgment or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over Medical
or any of its business or properties.
(s) There are no claims pending, or the knowledge of Medical
threatened, against Medical by any stockholder of Medical.
5. Representations to Survive Closing. All of the representations,
covenants and warranties contained in this Agreement (including all statements
contained in any certificate or other instrument delivered by or on behalf of
Medical, WCID, or WCIN pursuant hereto or in connection with the transactions
contemplated hereby) shall survive the Closing for a period of two (2) years
from the Effective Date.
6. Surviving Corporation. The surviving corporation of the Merger shall
be WCID. WCID's name, identity, certificate of incorporation, bylaws, existence,
purpose, powers, objects, franchises, rights and immunities shall be unaffected
and unimpaired by the Merger, except as described in the Certificate of Merger.
7. Treatment of Shares of WCID and WCIN. The terms and conditions of the
Merger, the mode of carrying the same into effect, and the manner and basis of
converting the securities of WCID and WCIN are as follows:
(a) The equity interests in WCIN shall be converted by virtue of the
Merger, and at the Effective Date, into 6,450,000 newly issued shares of Medical
Common Stock ("Medical Common Shares"), on the basis of 000 Xxxxxxx Xxxxxx
Shares for each one share of common stock of WCIN, without any action on the
part of the holders thereof. After the Effective Date, each holder of a
16
17
common equity interest in WCIN prior to the Merger shall be entitled upon
surrender to receive a certificate representing the number of Medical Common
Shares to which such holder shall be entitled, which certificate shall contain
any appropriate restrictive legend concerning the resale of such Medical Common
Shares. Until so surrendered, any outstanding certificates or other
documentation which, prior to the Effective Date, represented a common equity
interest in WCIN shall be deemed for all corporate purposes to evidence
ownership of Medical Common Shares into which such common equity interests shall
have been converted. Upon conversion, any fractional shares resulting from
conversion shall be rounded to the nearest whole number of Medical Common
Shares.
(b) Notwithstanding anything to the contrary contained in this
Section 7, 120,000 of the 150,000 Medical Common Shares to be issued to Sale
Service, Inc. and 120,000 of the 150,000 Medical Common Shares to be issued to
Ring World Management, LLC shall be held in escrow by Medical and shall be
subject to the same vesting requirements that apply to the WCIN Shares owned by
Sale Service, Inc. and Ring World Management, LLC.
(c) The separate existence and corporate organization of WCIN,
except insofar as it may be continued by statute, shall cease on the Effective
Date, and WCID shall remain a wholly owned subsidiary of Medical.
8. Rights and Liabilities of Surviving Corporation. On and after the
Effective Date, WCID as the surviving corporation, shall succeed to and possess,
without further act or deed, all of the estate, rights, privileges, powers and
franchises, both public and private, and all of the property, real, personal,
and mixed, of WCIN; all debts due to WCIN on whatever account shall be vested in
WCID; all
17
18
claims, demands, property, rights, privileges, powers, franchises and every
other interest of WCIN shall be as effectively the property of WCID as they were
of WCIN; all rights of creditors and all liens upon any property of WCIN shall
be preserved unimpaired, limited in lien to the property affected by such lien
at the Effective Date; all debts, liabilities, and duties of WCIN shall
thenceforth attach to WCID and may be enforced against it to the same extent as
if such debts, liabilities, and duties had been incurred or contracted by it;
and WCID shall indemnify and hold harmless Medical and the officers and
directors of WCIN against all such debts, liabilities, and duties, and against
all claims and demands arising out of the Merger.
9. Further Assurances of Title. As and when requested by WCID or by any
of it successors or assigns, WCIN shall execute and deliver, or cause to be
executed and delivered, all such deeds and instruments and will take or cause to
be taken all such further action as WCID may deem necessary or desirable in
order to vest in and confirm to WCID title to and possession of the property
acquired by it by reason or as a result of the Merger, and otherwise to carry
out the intent and purposes hereof.
10. Conditions of Obligations of WCID and Medical. The obligation of
WCID and Medical to consummate the Merger is subject to the following conditions
prior to the Effective Date:
(a) WCIN shall be in compliance with its respective representations,
warranties and covenants contained herein, and that WCID and Medical shall each
receive from WCIN a certificate to such effect from the President of WCIN as of
the Effective Date.
18
19
(b) WCIN shall not have suffered an uninsured loss on account of
fire, flood, accident, or other calamity of such a character as to interfere
materially with the continuous operation of its businesses or materially affect
adversely its conditions, financial or otherwise, regardless of whether or not
such loss shall have been insured.
(c) No material transactions shall have been entered into by WCIN
other than transactions in the ordinary course of business between the date
hereof and the Effective Date, other than as referred to in this Agreement,
except with the prior written consent of Medical.
(d) That no material adverse change in the aggregate shall have
occurred in the financial condition of WCIN.
(e) That none of the properties or assets of WCIN shall have been
sold or otherwise disposed of other than in the ordinary course of business
during such period, except with the written consent of Medical.
(f) That WCIN shall have performed and complied with the provisions
and conditions of this Agreement on its part to be performed and that the
representations and warranties made by WCIN in this Agreement are true and
correct when made and as of the Effective Date.
(g) That all applicable filings and regulatory approvals required to
be made or obtained by WCIN have been made or obtained.
(h) That this Agreement and the transactions contemplated hereby
shall have been approved by appropriate corporate action of WCIN and that
corporate votes and resolutions to that
19
20
effect in form and substance reasonably satisfactory to Medical and its counsel
have been delivered to Medical.
(i) That there shall have been full compliance with the applicable
securities or "blue sky" laws and regulations of any state or other governmental
body having jurisdiction over the Merger.
(j) The Merger shall have been consummated and the Certificate of
Merger filed.
11. Conditions and Obligations of WCIN. The obligations of WCIN to
consummate the Merger are subject to the following conditions prior to the
Effective Date:
(a) That WCID and Medical are in compliance with their respective
representations, warranties and covenants contained herein, and that WCIN shall
receive from each of WCID and Medical a certificate to such effect from the
President of each of WCID and Medical as of the Effective Date.
(b) That WCID and Medical shall not have suffered any loss on
account of fire, flood, accident, or other calamity of such a character as to
interfere materially with the continuous operation of its business or materially
affect adversely its condition, financial or otherwise, regardless of whether or
not such loss shall have been insured.
(c) That no material transactions shall have been entered into by
WCID or Medical other than transactions in the ordinary course of business other
than as referred to in this Agreement, except with the prior written consent of
WCIN.
(d) That no material adverse change shall have occurred in the
financial condition of WCID or Medical since the date hereof, other than as
referred to in this Agreement.
20
21
(e) That none of the properties or assets of WCID or Medical shall
have been sold or otherwise disposed of other than in the ordinary course of
business, except with the prior written consent of WCIN.
(f) That WCID and Medical shall each have performed and complied
with the provisions and conditions of this Agreement on its part to be performed
and complied with, and that the representations and warranties made by WCID and
Medical herein are true and correct.
(g) That all applicable filings and regulatory approvals required to
be made or obtained by Medical have been made or obtained.
(h) That Medical and WCID shall each have held a meeting of its
Board of Directors at which meetings all of their directors shall have resigned
seriatim and the persons designated by WCIN shall have been elected as directors
of Medical and WCID, all subject to the consummation of the Merger.
12. Closing or Termination. In the event the Closing of this Agreement
shall not take place by July 31, 2000, due to failure of any condition of
closing required herein, then any party shall have the right to terminate this
Agreement, in which event no party shall have any further right or obligation as
against any other. If WCIN shall fail to close for any reason other than solely
as a result of the failure of any condition of closing required herein to be
performed on the part of WCID or Medical, then WCIN shall pay to Medical the
reasonable costs for legal fees incurred in connection with the proposed Merger,
such sum not to exceed $75,000, plus reasonable disbursements.
21
22
13. Delivery of Corporate Proceedings of Medical and WCID. At the
Closing, Medical and WCID shall deliver to counsel for WCIN, the originals of
all of the corporate proceedings of Medical and WCID, duly certified by their
respective Secretaries, relating to this Agreement.
14. Delivery of Corporate Proceedings of WCIN. At the Closing, WCIN
shall deliver to counsel for Medical and WCID the originals of all of the
corporate proceedings of WCIN, duly certified by their respective Secretaries,
relating to this Agreement.
15. Limitation of Liability. The representations and warranties made by
any party to this Agreement are intended to be relied upon only by the other
parties to this Agreement and by no other person. Nothing contained in this
Agreement shall be deemed to confer upon any person not a party to this
Agreement any third party beneficiary rights or any other rights of any nature
whatsoever.
16. Further Instruments and Actions. Each party shall deliver such
further instruments and take such further action as may be reasonably requested
by any other in order to carry out the intent and purposes of this Agreement.
17. Governing Law. This Agreement is being delivered and is intended to
be performed in the State of Delaware, and shall be construed and enforced in
accordance with the laws of such State without regard to conflicts of laws
thereof.
18. Notices. All notices or other communications to be sent by any party
to this Agreement to any other party to this Agreement shall be sent by
certified mail, nationwide overnight delivery service or by personal delivery to
the addresses hereinbefore designated, or such other addresses as may hereafter
be designated in writing by a party. Such notice or communication shall be
deemed given
22
23
five business days following deposit in the U.S. mails with respect to
communication by certified mail, the next business day if by overnight delivery
service, and upon personal delivery against receipt therefor if by personal
delivery.
19. Binding and Sole Agreement. This Agreement represents the sole and
entire agreement among the parties hereto with respect to the matters described
herein and is binding upon and shall inure to the benefit of the parties hereto
and their legal representatives, successors and permitted assigns. This
Agreement supersedes that certain Merger Agreement and Plan of Reorganization
entered into among the parties hereto and which is dated May 16, 2000, which
such other agreement is hereby terminated and is of no further force or effect.
This Agreement may not be assigned and, except as stated herein, may not be
altered or amended except in writing executed by the party to be charged.
20. Counterparts. This Agreement may be executed in counterparts, all of
which, when taken together, shall constitute the entire Agreement.
21. Severability. The provisions of this Agreement shall be severable,
so that the unenforceability, validity or legality of any one provision shall
not affect the enforceability, validity or legality of the remaining provisions
hereof.
22. Joint Drafting. This Agreement shall be deemed to have been drafted
jointly by the parties hereto, and no inference or interpretation against any
party shall be made solely by virtue of such party allegedly having been the
draftsperson of this Agreement.
23. Public Announcements. All parties hereto agree that any public
announcement, press release or other public disclosure of the signing of this
Agreement shall be made jointly and only after all parties hereto have reviewed
and approved the language and timing of such disclosure, except as such
23
24
disclosure may be required pursuant to any legal obligation or order of any
court having proper jurisdiction over any of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have made and executed this
Agreement as of the day and year first above written.
MEDICAL MONITORS, INC.,
a Delaware corporation
By: _______________________________
Xxxxxxx Xxxxxxx, President
WORLD COLLECTIBLES HOLDINGS, INC.,
a Delaware corporation
By: _______________________________
Xxxxxxx Xxxxxxx, President
WORLD COLLECTIBLES, INC.,
a Nevada corporation
By: _______________________________
Xxxx Xxxxx, President
24
