AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER dated this 1st day of April 1996 by and among
Xxxxxx Xxxxxx, Ltd., a New York corporation ("SML"), Diva Acquisition Corp., a
Delaware corporation (the "Purchaser"), Xxxxxx Xxxxxxxx, and Xxxx Xxxxxxxx
(collectively, the "Sellers"), and Diva International, Inc., a New York
corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the authorized capital stock of the Company consists of 200
shares of common stock, of which 100 shares are currently issued and outstanding
(the "Diva Shares"); and
WHEREAS, the Sellers own in the aggregate all of the Diva Shares; and
WHEREAS, the respective Board of Directors of the Purchaser and the
Company have determined that it is in the best interests of their respective
stockholders for the Company to merge with and into the Purchaser (the
"Merger"); and
WHEREAS, in furtherance of the foregoing, the parties hereto desire to
effect the Merger, on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and of the terms and
conditions herein contained, the parties hereto agree as follows:
ARTICLE I
THE MERGER
1.1 THE MERGER. Upon the terms and subject to the conditions hereof,
and in accordance with the relevant provisions of the New York Business
Corporation Law (the "NYBCL") and the Delaware General Corporation Law the
("DGCL"), the Company shall be merged with and into the Purchaser (the "Merger")
as soon as practicable following satisfaction of the conditions set forth in
Article III hereof. Following the Merger, the Purchaser shall continue as the
surviving corporation (the "Surviving Corporation") under the name " Xxxxx
Xxxxx, Ltd." and shall continue its existence under the laws of the State of
Delaware, and the separate corporate existence of the Company shall cease.
1.2 EFFECTIVE TIME. The Merger shall be consummated by filing with
the Secretary of State of the States of New York and Delaware a certificate of
merger or certificate of ownership and merger, in such form as is required by,
and executed in accordance with, the relevant provisions of the NYBCL and the
DGCL (the effective time of the merger in the State of Delaware being
hereinafter referred to as the "Effective Time").
1.3 CERTIFICATE OF INCORPORATION AND BY-LAWS. The Certificate of
Incorporation and By-laws of the Purchaser shall be the Certificate of
Incorporation and By-laws of the Surviving Corporation.
1.4 DIRECTORS AND OFFICERS. The directors and officers of the
Purchaser immediately prior to the Effective Time shall be the directors and
officers of the Surviving Corporation until their respective successors are duly
elected or appointed and qualified, except that (i) the Sellers shall be
officers of the Surviving Corporation in accordance with the terms of the
employment agreements between the Sellers and the Purchaser, a form of which are
attached hereto as Exhibit A (the "Employment Agreements"), and (ii) SML agrees
to elect two (2) individuals identified by the Sellers to the Board of Directors
of the Purchaser immediately following the Effective Time, such Board of
Directors to be comprised of a total of 5 directors.
1.5 CONVERSION OF COMMON STOCK OF THE COMPANY. All of the Diva
Shares immediately prior to the Effective Time, by virtue of the Merger and
without any action on the part of the holders thereof, shall be converted into
the right to receive an aggregate of (a) $875,000 in immediately available funds
(the "Initial Payment Amount") and (b) $1,400,000 (the "Subsequent Payment
Amount") on the first anniversary (the "Subsequent Payment Date") of the date of
closing (the "Closing Date"). The Initial Payment Amount and the Subsequent
Payment Amount shall be collectively referred to as the Purchase Price. On the
Subsequent Payment Date, the Purchaser may pay the Subsequent Payment Amount (i)
in cash, or (ii) by delivering a 186,667 shares of Common Stock of SML (the "SML
Shares"). SML will use its best efforts to have sufficient shares authorized in
the event the Purchaser elects to deliver the SML Shares in satisfaction of its
obligations hereunder.
1.6 EXCHANGE OF SHARES. Upon surrender to Purchaser of a certificate
representing the Diva Shares (the "Certificates"), duly executed and completed
in accordance with instructions from Purchaser, the holder of such Certificate
shall be issued in exchange therefor a percentage of the Initial Payment Amount
and the Subsequent Payment Amount equal to such holder's percentage ownership of
the Diva Shares. No fractional shares or cash payment in lieu thereof shall be
paid by Purchaser in connection with the Merger.
1.7 PURCHASE PRICE ADJUSTMENTS. (a) As soon as practicable, but in
no event later than thirty (30) days following the Closing, the Sellers shall
deliver (at their expense) to the Surviving Corporation balance sheets for each
of the Company and Design Studio dated as of the
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Closing Date prepared by Seller's accounting firm reasonably satisfactory to
Purchaser (the "Closing Date Balance Sheets"). The Closing Date Balance Sheets
shall accurately reflect the assets, liabilities and stockholders equity of the
Company and Design Studio as of the Closing Date and shall be prepared by
Seller's accountants in accordance with past practice and in conformity with
generally accepted accounting principals, except that (i) accounts receivable as
reflected on the Closing Date Balance Sheet shall not include any receivables
which were acquired more than 150 days prior to the Closing Date; and (ii)
inventory as reflected on the Closing Date Balance Sheet shall not include any
inventory which was purchased more than 180 days prior to Closing Date. The
Closing Date Balance Sheets shall be reasonably acceptable to the Purchaser and
its independent auditors. In the event of any dispute between the Sellers and
the Purchaser with respect to the Closing Date Balance Sheet, the parties shall
hire a third party independent auditor, whose fees and expenses shall be borne
equally by the Sellers and the Purchaser. If the amount of the combined net
assets of the Company and Design Studio (total assets minus total liabilites) as
reflected on the Closing Date Balance Sheets (the "Net Asset Amount") is less
than $515,000, then the Initial Payment Amount shall be reduced by an amount
(the "Initial Adjustment Amount") equal to $515,000 minus the Net Asset Amount.
Purchaser may set-off the Initial Adjustment Amount against the Subsequent
Payment Amount due to Sellers and/or the amounts due to Sellers under the
Employment Agreements.
(b) In addition, within one hundred five (105) days following the Closing,
the Purchaser shall determine the total amount collected by the Purchaser from
the accounts receivable of the Company as of the Closing Date. The Purchase
Price shall be adjusted by (i) increasing the Subsequent Payment Amount by the
amount of accounts receivables actually collected by the Purchaser during the
ninety (90) day period following the Closing which were as of the Closing 150 or
more days past due and (ii) decreasing the Subsequent Payment Amount by the
amount of accounts receivable which were as of the Closing less than 150 days
past due and were uncollected by the Purchaser during the ninety (90) day period
following the Closing. The amounts calculated in accordance with the terms of
(i) and (ii) contained in the preceding sentence, shall be netted against each
and should the result be greater than $10,000, the Subsequent Payment Amount
shall be decreased the amount by which (ii) exceeds (i), or the Subsequent
Payment Amount shall be increased the amount by (i) exceeds (ii).
1.8 REGISTRATION RIGHTS. At the Closing, the Sellers shall be
provided with certain rights to have the SML Shares registered with the
Securities and Exchange Commission for sale to the public pursuant to an
agreement among SML and the Sellers, a copy of which is attached hereto as
Exhibit A (the "Registration Rights Agreement").
1.9 ESCROW OF SML SHARES. Upon the issuance of the SML Shares, if
any, the Purchaser shall deposit with Xxxxxxxxx & Xxxxxxxxx, LLP, as escrow
agent (the "Escrow Agent"), one-half (1/2) of the SML Shares as security for
Sellers performance of their obligations under Article V of this Agreement. The
SML Shares shall be held for a period of not more than eighteen (18) months
following the Closing Date pursuant to an escrow agreement among the Escrow
Agent, the Sellers and the Purchaser dated as of the Closing Date , a copy of
which is
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attached hereto as Exhibit B (the "Escrow Agreement").
1.10 COVENANT OF SML. SML covenants that any SML Shares issued to
the Sellers hereunder shall be duly authorized, fully paid and non-assessable
shares of SML and will not be subject to preemptive or similar rights.
1.11 GUARANTEE OF SML. SML guarantees the performance of all of
obligations of the Purchaser hereunder, including but not limited to, the
payment of the Subsequent Payment Amount or delivery of the SML Shares.
ARTICLE II
CLOSING
2.1 Closing and Closing Date. (a) The closing (the "Closing") shall
take place at the offices of Xxxxxxxxx & Xxxxxxxxx, LLP, 000 Xxxxx Xxxxxx, Xxx
Xxxx, XX 00000 on the Closing Date, or at such other place, date or time as the
parties may agree in writing. The parties agree that, at or before the Closing,
they shall perform all such acts and execute and deliver all such documents as
may be required to consummate the transactions contemplated hereby.
(b) At the Closing, (i) the Purchaser shall deliver the Cash Portion to
the Sellers and (ii) the Sellers shall deliver the Diva Shares, duly endorsed in
blank, to the Purchaser.
(c) At the Closing, the appropriate parties hereto shall execute and
deliver or cause to be executed and delivered, all documents and instruments
necessary to consummate the transactions contemplated hereby, including, without
limitation:
(i) the Employment Agreements between the Purchaser and the
Sellers, Xxxxx Xxxxxxxx and Xxxxx Xxxxxx, respectively;
(ii) the Registration Rights Agreement; and
(iii) stock purchase agreement with respect to the acquisition by
Purchaser or an affiliate thereof all of the outstanding
shares of capital stock of Design Studio, S.L., a Spanish
corporation (the "Stock Purchase Agreement").
2.2 ADDITIONAL ACTIONS TO BE TAKEN ON THE CLOSING DATE.
(a) CLOSING CERTIFICATE OF SELLERS AND THE COMPANY. The Sellers and the
Company shall have delivered to the Purchaser a certificate signed by the
Sellers and the Chief Executive Officer of the Company, as requested by the
Purchaser, dated the Closing Date, stating (i) that no material adverse change
has occurred in the condition (financial or otherwise), results of operations,
business, performance or properties of the Company since December 31, 1995 and
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(ii) all of the representations, warranties and covenants of each of the Sellers
and the Company contained in this Agreement are true, complete and correct as of
the Closing Date.
(b) CLOSING CERTIFICATE OF PURCHASER. The Purchaser shall have delivered
to the Seller and the Company a certificate signed by the Chief Executive
Officer of the Purchaser, as requested by the Seller and the Company, dated the
Closing Date, stating (i) that no material adverse change has occurred in the
condition (financial or otherwise), results of operations, business, performance
or properties of the Purchaser since September 30, 1995, and (ii) all of the
representations, warranties and covenants of the Purchaser contained in this
Agreement are true, complete and correct as of the Closing Date.
(c) LEGAL OPINION. The Purchaser shall have received the legal opinions of
legal counsel to the Sellers and the Company in form and substance satisfactory
to the Purchaser.
(d) SHAREHOLDER CONSENTS. The Purchaser shall have received a consent to
the transactions contemplated by this agreement signed by all of the
shareholders of the Company. The Sellers shall have received a consent to the
transactions contemplated by this agreement signed by the sole shareholder of
the Purchaser.
(e) MINUTE AND STOCK TRANSFER BOOKS. The Company shall deliver to the
Purchaser all corporate minute and stock transfer books, bank books, financial
and bank records, bookkeeping and accounting records, copies of all federal,
state and local tax returns and amendments thereto, and all other books and
records of the Company, certified by the Secretary of the Company to be true,
correct and complete as of the Closing Date.
(f) CERTIFICATE OF INCORPORATION; GOOD STANDING. The Company shall deliver
to the Purchaser a copy of the Certificate of Incorporation of the Company and a
Certificate of Good Standing each certified by the Secretary of State of the
State of New York as of a date not more than five (5) days prior to the Closing
Date.
(g) OTHER DOCUMENTS. The Company shall deliver to the Purchaser such other
documents as shall reasonably be requested by the Purchaser in order effectively
to carry out the transactions contemplated by this Agreement, duly executed by
the Company.
ARTICLE III
CONDITIONS TO CLOSING
3.1 OBLIGATIONS OF THE PURCHASER. The Purchaser's obligation to
close shall be subject to the satisfaction of all of the following terms and
conditions on or prior to the Closing Date:
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(a) The Purchaser shall have received the resolution of the Board of
Directors of the Company certified by the Secretary thereof dated as
of the date of the Closing, authorizing such party to enter into
this Agreement and to effect all of the transactions contemplated
hereby;
(b) The Purchser shall have received a long-form Certificate of Good
Standing dated within five (5) business days prior to the date of
Closing from the Secretary of State of the State of New York
certifying that the Company is in good standing in such State.
(c) All representations and warranties made in this Agreement by the
Sellers and the Company shall be true as of the Closing Date as
though such representations and warranties had been made on and as
of the Closing Date, and, as of the Closing Date, neither the
Sellers nor the Company shall have violated or shall have failed to
perform in accordance with any covenant contained in this Agreement.
(d) There shall have been no material adverse change in the
business, operations condition (financial and otherwise) or
prospects of the Company prior to the Closing Date.
(e) The Company and the Sellers shall have furnished Purchaser with
opinion of counsel for the Company and the Sellers in form and
substance reasonably satisfactory to Purchaser.
3.2 OBLIGATIONS OF THE SELLERS. The Seller's obligation to close shall be
subject to the satisfaction of all of the following terms and conditions on or
prior to the Closing Date:
(a) All representations and warranties made in this Agreement by the
Purchser and SML shall be true as of the Closing Date as though such
representations and warranties had been made on and as of the
Closing Date, and, as of the Closing Date, neither the Purchaser nor
SML shall have not violated or shall have failed to perform in
accordance with any covenant contained in this Agreement.
(b) There shall have been no material adverse change in the
business, operations, condition (financial and otherwise) or
prospects of the Company prior to the Closing Date.
(c) The Seller shall have received the resolutions of the Board of
Directors of the Purchaser and SML certified by the respective
Secretary thereof dated as of the date of the Closing, authorizing
such parties to enter into this Agreement and to effect all of the
transactions contemplated hereby.
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(d) The Seller shall have received a long-form Certificate of Good
Standing dated within five (5) business days prior to the date of
Closing from the Secretary of State of the State of Delaware
certifying that the Purchaser is in good standing in such State.
3.3 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER. The
obligations of each party to effect the Merger are subject to the satisfaction
or waiver, if permissible, at or prior to the Effective Time, of the following
conditions:
(a) this Agreement shall have been approved and adopted by the
requisite affirmative vote of the stockholders of the Company in accordance with
the NYBCL and the Purchaser in accordance with the DGCL; and
(b) no statute, rule, regulation, order, decree, ruling or
injunction shall have been promulgated, enacted, or issued by any court or
governmental authority of competent jurisdiction which is in effect and has the
effect of prohibiting or restraining the consummation of the Merger.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLERS.
Each of the Company and the Sellers jointly and severally represent and warrant
to the Purchaser and SML as follows:
(a) ORGANIZATION AND QUALIFICATION. The Company is a corporation
validly existing and in good standing under the laws of the State of New York,
and has all requisite corporate power and authority to own, lease and operate
its properties and assets as are presently owned, leased and operated, and carry
on its business as it is now presently conducted and is proposed to be
conducted. The Company is duly qualified to do business in each jurisdiction in
which the nature of its business or properties make such qualification necessary
or desirable, except to the extent where the failure to do so would not have a
material adverse effect on the business or affairs of any one of the Company.
(b) CAPITALIZATION; SUBSIDIARIES AND AFFILIATES. For each of the
Company and its subsidiaries, if any, the name, par value, number of authorized
shares and number of issued and outstanding shares of each class of its capital
stock is set forth on Schedule 4.1(b). All of the issued and outstanding shares
of each of the Company and its subsidiaries are duly authorized, validly issued,
fully paid and non-assessable. All of the Diva Shares are owned beneficially and
of record by the Shareholders as set forth on Schedule 4.1(b) free and clear of
any liens or encumbrances. There are no securities outstanding which are
exchangeable or
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exercisable for, or convertible into shares of capital stock of the Company.
Except as set forth on Schedule 4.1(b), each of the Company has no subsidiaries
nor does any affiliate thereof own any equity interest in any other corporation,
partnership, joint venture or other entity. As used herein, the term "affiliate"
shall have the same meaning as ascribed to it in Rule 12b-2 of the Securities
Exchange Act of 1934, as amended.
(c) DUE AUTHORIZATION. The Company has the full legal right,
capacity, authority and power and all requisite corporate authority and approval
required to enter into, execute and deliver this Agreement, and any other
agreement or instrument contemplated or required hereunder or thereunder. Each
of the Board of Directors and all of the stockholders of the Company has
approved of the entering into of this Agreement, and the transactions herein and
therein contemplated. Assuming the due authorization, execution and delivery by
the other parties to this Agreement, this Agreement and all other agreements and
instruments when duly executed and delivered by each of the Company and the
Sellers, shall constitute a valid and binding obligation of the Company and the
Sellers enforceable against them in accordance with its and their terms, subject
to the qualifications that enforcement of the rights and remedies created hereby
is subject to (i) bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting the rights and remedies of creditors, and
(ii) general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(d) NO CONFLICT. Except as set forth on Schedule 4.1(d), neither the
execution or delivery of this Agreement, nor the performance by the Company of
the transactions contemplated herein or therein shall:
(i) violate or conflict with any of the provisions of the Certificate of
Incorporation or By-laws or other organization documents of the Company;
(ii) violate, conflict, result in acceleration of, or entitle any party to
accelerate the maturity or the cancellation of the performance of any obligation
under, or result in the creation or imposition of any lien in or upon the assets
or any of the properties or assets of the Company or constitute a default (or
give rise to an event which might, with the passage of time or the giving of
notice or other rise, constitute a default) under, any mortgage, indenture, deed
of trust, lease, contract, agreement, loan or credit arrangement or agreement,
license or other instrument or any order, judgment, regulation or ruling of any
governmental or regulatory body to which the Company is a party or by which any
of its property or Assets may be effected or is bound; and
(iii) violate any judgment, order, writ, injunction, decree, statute, rule
or regulation applicable to the Company or any of its assets.
(e) FINANCIAL STATEMENTS; CLOSING DATE BALANCE SHEET. The Company
has heretofore delivered to the Purchaser audited financial statements, which
are accountants compilations, relating to the period ending December 31, 1995
(the "Financial Statements"). The
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Financial Statements fairly present the financial position and results of
operations of the Company for the periods presented. The Closing Date Balance
Sheet shall be prepared in accordance with generally accepted accounting
principles ("GAAP") and shall not reflect any changes in the financial
condition, results of operations, business, prospects, assets or liabilities of
the Company from those reflected on the Financial Statements, except for (i) any
such changes in the ordinary course, none of which, individually or in the
aggregate, would have a material adverse effect on the Company or its prospects,
and (ii) the Closing Date Adjustments.
(f) LIABILITIES. Except as disclosed on Schedule 4.1(f), or as
reflected on the Financial Statements delivered by the Company to the Purchaser,
the Company does not have any direct or indirect indebtedness, liability, claim,
loss, damage, deficiency, obligation or responsibility, fixed or unfixed, xxxxxx
or inchoate, liquidated or unliquidated, secured or unsecured, accrued,
absolute, contingent or otherwise (collectively herein referred to as the
"Liabilities"), that is not fully or accurately reflected or reserved against on
the Financial Statements. Except as disclosed on Schedule 4.1(f), the Company
does not have any Liability whether or not the kind required by generally
accepted accounting principles to be set forth on financial statements, other
than Liabilities incurred since December 31, 1995, in the ordinary course of
business, none of which is a Liability resulting from a breach of contract,
breach of warranty, tort or infringement claim.
(g) OUTSTANDING CLAIMS. Except as set forth on Schedule 4.1(g),
there are no outstanding orders, judgments, injunctions, investigations, awards
or decrees of any court, governmental or regulatory body or arbitration tribunal
by which the Company, or any of its securities, assets, properties or businesses
is bound. Except as set forth on Schedule 4.1(g), there are no actions, suits,
claims, investigations, legal, administrative or arbitrational proceedings
pending or, to the best of the Company's knowledge, threatened (whether or not
the defense thereof or liabilities with respect thereof are covered by
insurance) against or effecting the Company, or any of its assets or properties
that, individually or in the aggregate, could, if determined adversely to the
Company would have a material adverse effect on the Company or its business or
to the best of any of the Company's knowledge, there are no facts which are
likely to give rise to any action, suit, claim, investigation or legal,
administration or arbitrational proceeding.
(h) INTELLECTUAL PROPERTY. Schedule 4.1(h) set forth all patents,
trademarks, service marks, tradenames, copyrights, logos and the like, and all
applications for any of the foregoing, and all permits, grants and licenses, or
other rights held or owned by or running to or from the Company or the Sellers
relating to any of the foregoing that are necessary in connection with the
business of the Company (collectively herein referred to "Intellectual
Property"), correct and complete copies of which have heretofore been delivered
or made available to the Purchaser and/or its counsel. Except as otherwise set
forth on Schedule 4.1(h), the Company is the sole and exclusive owner of all
rights to such Intellectual Property and no patent, invention, trademark,
service xxxx or tradename under any person or entity infringes upon, or is
infringed upon by, any of the Company's Intellectual Property and the Company
has not received any notice of any
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claim of infringement of any other person or entity with respect to the
Company's Intellectual Property or in the process of confidential information of
the Company and the Company does not know of any basis for any such charge or
claim after undergoing diligent investigation with respect thereto. Except for
the Intellectual Property set forth on Schedule 4.1(h), no other tangible
property or Intellectual Property rights are required for the Company to conduct
its business in the ordinary course as it is currently contemplated. The
Company's continued use of its Intellectual Property shall not infringe upon or
violate the proprietary rights of any third party or entity and the Company has
not received any notice or inquiry indicated or claiming the manufacture, sale
or use of any product which incorporates the Intellectual Property infringes
upon the patent or other intellectual or intangible property rights of any other
third person or entity. No approval or consent of any person or entity is needed
in connection with the Company's exploitation of its Intellectual Property and
all such Intellectual Property shall continue to be in full force and effect
following of the consummation of the transactions contemplated by this
Agreement.
(i) CONTRACTS AND AGREEMENTS. Schedule 4.1(i) sets forth all written
contracts and other written agreements (and, to the best knowledge of the
Company, any oral agreement) and arrangements to which either the Company is a
party or by or to which the Company or any of its assets or properties is bound
or subject (collectively, the "Material Agreements"). True and complete copies
of all of the Material Agreements have been delivered to the Purchaser. Except
as disclosed on Schedule 4.1(i), all of the Material Agreements are valid,
subsisting, in full force and effect and binding upon the parties thereto in
accordance with their terms, subject to the qualifications that enforcement of
the rights and remedies created thereby is subject to: (x) bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the rights and remedies of creditors and (y) general principles of
equity (regardless of whether such enforcement is considered in a proceeding in
equity or at law) and the Company has satisfied in full or provided for all of
its liabilities and obligations thereunder requiring performance prior to the
date hereof in all material respects, is not in default under any of them, which
default singly or with other such defaults could have a material adverse effect
on the business or financial condition of the Company, nor does any condition
exist that with notice or lapse of time or both would constitute such a default.
To the best knowledge of the Company and the Sellers, no other party to any such
contract or other agreement is in default thereunder, which default singly or
with other such defaults could have a material adverse effect on the business or
financial condition of the Company. Except as identified on Schedule 4.1(i), no
approval or consent of any person is needed for all of the Material Agreements
to continue to be in full force and effect following the consummation of the
transactions contemplated by this Agreement.
(j) EMPLOYEES. Except as set forth on Schedule 4.1(j), the Company
is not a party to, and there does not otherwise exist, any agreements with any
labor organization, collective bargaining or similar agreement with respect to
employees of the Company. Schedule 4.1(j) sets forth the name and current annual
salary, including any bonus, if applicable, of all present officers and
employees of the Company whose current annual salary, including any
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promised, expected or customary bonus, equals or exceeds $50,000. The Company is
in compliance in all material respects with its obligations under all Federal,
state, local and foreign statutes and ordinances, executive orders, regulations
and common law governing its employment practices with respect to the Company.
During the past three (3) years, the Company has not suffered or sustained any
labor dispute resulting in any work stoppage and no such work stoppage is, to
the best knowledge of the Company, threatened. To the best knowledge of the
Company, there are no attempts being made to organize any employees presently
employed by the Company.
(k) ERISA; HEALTH BENEFIT PLANS. Except as set forth on Schedule
4.1(k), the Company does not sponsor, maintain or have any obligation to
contribute to, or have any liability under, or is otherwise a party to any plan,
fund, program, understanding, policy, arrangement, contract or commitment
whether qualified or not qualified for federal income tax purposes, whether
formal or informal, whether for the benefit of a single individual or more than
one individual, which is the nature of any employee benefit plan of any type
whatsoever, including but not limited to any such plan under the Employer
Retirement Income Security Act of 1974, as amended. All health and health
related employee benefits and other costs have been paid or adequately reserved
for on the Financial Statements.
(l) INSURANCE. Schedule 4.1(l) sets forth a list and brief
description (specifying the insurer, the policy number or covering note number
with respect to binders and the amount of any deductible, describing the pending
claims if such claims exceed applicable policy limits, setting forth the
aggregate amount paid out under each such policy through the date hereof and the
aggregate limit, if any, of the insurer's liability thereunder) of all policies
or binders of fire, liability, product liability, workmen's compensation,
vehicular, unemployment and other insurance held by or on behalf of the Company.
Such policies and binders are valid and enforceable in accordance with their
terms in all material risks and liabilities to the extent and in respect of
amount, types and risks insured, as are customary in the industries in which the
Company operates. The Company is not in default with respect to any material
provision contained in any such policy or binder or has failed to give any
notice or present any claim under any such policy or binder in due and timely
fashion. Except for claims disclosed on Schedule 4.1(l), there are no
outstanding unpaid claims under any such policy or binder which have gone unpaid
for more than forty-five (45) days or as to which the carrier has disclaimed
liability.
(m) TAX MATTERS. Except as disclosed on Schedule 4.1(m):
(i) all tax returns required to be filed with respect to the
Company have been duly filed. All such tax returns were in all material respects
true, complete and correct and filed on a timely basis. The Company (i) has paid
all taxes that are due, or claimed or asserted by the IRS or any domestic or
foreign taxing authority (each constituting a "Taxing Authority") to be due,
from the Company for the periods covered by such tax returns or (ii) has duly
and fully provided reserves adequate to pay all taxes in accordance with
generally accepted accounting principles;
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(ii) The Company has complied in all material respects with all
applicable laws relating to withholding of taxes (including withholding taxes
pursuant to Sections 1441 and 1442 of the Internal Revenue Service Code of 1986,
as amended (the "Code") and similar provisions under any other applicable laws)
and the payment thereof over to the Taxing Authorities, and have, within the
time and in the manner prescribed by law, withheld from employee wages and paid
over to the proper governmental or regulatory authorities all amounts required;
(iii) the income tax returns of the Company have not been audited or
examined by any Taxing Authority (including the IRS) for any period for which
the applicable statute of limitations period has not yet expired and no statute
of limitations for any such period has been extended. There are no outstanding
agreements, waiver or arrangements extending the statutory period of limitation
applicable to any claim for, or the period for the collection or assessment of,
taxes of the Company for any taxable period;
(iv) prior to the execution of this Agreement, the Company has
delivered to the Purchaser true and complete copies of each of (i) the most
recent audit report by any Taxing Authority, including but not limited to the
IRS, relating to any taxes of the Company and (ii) the tax returns with respect
to any tax filed by or on behalf of the Company for any period which the
applicable statute of limitations period has not yet expired;
(v) to the knowledge of the Company, no assessment of tax is proposed
against the Company or any of its respective assets and properties;
(vi) no election under Section 338 of the Code (or any predecessor
provision) has been made by or with respect to the Company or any of its
respective assets or properties;
(vii) no power of attorney currently in force has been granted by the
Company concerning any tax matter; and
(viii) all transactions that could give rise to an understatement of
federal or state income Tax (within the meaning of Section 6662 of the Code and
applicable provisions of state law) have been adequately disclosed on the tax
returns filed by or on behalf of the Company.
(n) REAL PROPERTY AND LEASES. The Company does not own real property
in connection with the conduct of its business. Set forth hereto on Schedule
4.1(n) is a complete schedule of all leases constituting all of the leased real
property used in the conduct of its business. All such leases are valid,
subsisting and in full force and effect and in accordance with terms and no
default has occurred and no condition or event exists which, after notice or
lapse of time or both, will constitute a default or event of default under any
such lease. All payments with respect to all leased property due or accrued have
been paid by the Company.
(o) INVENTORY, MATERIAL ASSETS AND LEASED PROPERTY. Schedule 4.1(o)
sets forth all inventory, material assets and leased property (other than real
property) of the Company
12
as of December 31, 1995. All inventory and material assets are in good condition
and can be used for their intended purpose or sold in the ordinary course of
business at normal and customary gross profit margins. All leases for leased
property are valid, subsisting and in full force and effect and in accordance
with their terms and no default or event of default has occurred and no
condition or event exists which, after notice or lapse of time or both, will
constitute a default or event of default under any such lease. All payments with
respect to leased property due or accrued have been paid by the Company.
(p) NO PENDING TRANSACTIONS. Except for this Agreement, the Company
is not a party to or bound by any agreement, negotiations, discussions, or
undertaking with respect to the sale of any of its securities or all or a potion
of any of its assets to any other person or entity.
(q) ACCURACY OF INFORMATION. Neither this Agreement, nor any
Schedule or Exhibit, nor the Financial Statements to this Agreement contains an
untrue statement of a material fact or omits a material fact necessary to make
the statements contained herein or therein not misleading. All statements,
documents, certificates or other items prepared or supplied by the Company with
respect to the transactions contemplated hereby are true, correct and complete
and contain no untrue statement of a material fact or omit a material fact
necessary to make the statements contained therein not misleading.
(r) COMPLIANCE WITH ALL LAWS. The Company has complied in all
respects with all applicable federal, state, local and foreign laws, regulations
and ordinances or any requirement of any governmental or regulatory body, court
or arbitrator affecting its business or assets, the failure to comply with which
could have a material adverse effect on the business or the assets of the
Company. None of the Company nor any of its representatives, agents, employees
or affiliates has made or agreed to make any payment to any person which would
be unlawful.
(s) LICENSES AND PERMITS. Schedule 4.1(s) sets forth a list of the
governmental permits, licenses, registrations and other governmental consents
(federal, state, local and foreign) which the Company has obtained and which are
necessary in connection with its operations and properties, and no others are
required. All such permits, licenses, registrations and consents are in full
force and effect and in good standing, and except as separately identified on
Schedule 4.1(s), shall continue to be in full force and effect and in good
standing following the consummation of the transactions contemplated by this
Agreement. The Company has not received any notice of any claim of revocation or
has knowledge of any event which might give rise to such a claim.
(t) ACCOUNTS RECEIVABLE. All of the accounts and notes receivable of
the Company represent amounts receivable for merchandise actually delivered or
services actually provided (or, in the case of non-trade accounts or notes
representing amounts receivable in respect of other bona-fide business
transactions), have arisen in the ordinary course of business,
13
are not subject to any written counterclaims, discounts or offsets and have been
billed and are generally due within thirty (30) days after such billing. All
such receivable are fully collectible in the amount and ordinary course of
businesses. Schedule 4.1(t) sets forth all accounts receivables which have not
been collected within 150 days of the date of invoice with respect thereto.
(u) ENVIRONMENTAL MATTERS. Except as set forth on Schedule 4.1(u):
(i) the Company is not in violation of, or delinquent in respect to, any
environmental law existing on the date hereof, which violation or delinquency
would have a material adverse effect on the business or financial condition of
the Company, (ii) the Company has not received any written communication,
whether from a governmental or regulatory body, citizens group, employee or
otherwise, that alleges that the Company is not in full compliance with the
environmental laws, and (iii) the Company has obtained all permits, licenses and
other authorizations required under the environmental laws, the absence of which
would have a material adverse effect on the Company or its financial condition,
and Schedule 4.1(u) includes a list of all such permits, licenses and other
authorizations. Except as set forth on Schedule 4.1(u), the Company has not
received any written notice by any person alleging the Company has or may have
liability, with respect to environmental matters either directly or indirectly,
by contract or by operation of law. There are no present and have been no past
release of any material of environmental concern that could form the basis of
any claim of liability against the Company under environmental laws or the
common law, which, if decided adversely to the Company, would have a material
adverse effect in the business or financial condition of the Company.
(v) NO BROKERS. The Company has conducted all negotiations relating
to this Agreement and has carried on the transactions contemplated hereby
without intervention of any person acting on behalf of the Company and such
matter as to give rise to any valid claim against the Purchaser or SML for any
brokers', investment banking, or finders' fee in connection with the execution
of this Agreement or the transactions contemplated hereby. The Company agrees to
indemnify and hold harmless the Purchaser and SML in connection with the
foregoing.
(w) TRANSACTIONS WITH AFFILIATES. Except as set forth on Schedule
4.1(w), no affiliate of the Company has: (i) borrowed money from or loaned money
to the Company which remains outstanding; (ii) any contractual or other claim,
express or implied, of any kind whatsoever against or by any affiliate; (iii)
any interest in any property or Assets used by any affiliate in their respective
businesses; or (iv) engaged in any other transaction with any affiliate.
(x) INVENTORY. All of the inventory of the Company and its
subsidiaries, including, without limitation, finished goods, work-in-process,
materials and parts and supplies reflected on the Financial Statements, and all
inventory acquired since December 31, 1995 are valued at the lower of cost or
market, the cost thereof being determined on a first-in, first-out basis. The
value of all absolute materials and materials of below standard quality has been
written down in accordance with generally accepted accounting principals. The
Company is not under any material liability or obligation with respect to the
turn of inventory or merchandise in
14
possession of wholesalers, distributors, retailers or other customers. Schedule
4.1(x) sets forth all of the Company's inventory purchased more than 180 days
prior to the date hereof.
4.2 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER. Upon
the execution hereof, the Purchaser and SML represent and warrant to the Company
and Sellers as follows:
(a) Organization and Qualification. The Purchaser and SML are
corporations validly existing and in good standing under the laws of the States
of Delaware and New York, respectively, and each has all requisite corporate
power and authority to (a) own, lease and operate its properties and assets as
they are now owned, leased and operated and (b) carry on its business as now
presently conducted and is duly qualified to do business in each jurisdiction in
which the nature of its business of properties makes such qualification
necessary. Purchaser is a wholly owned subsidiary of SML.
(b) Validity and Execution of Agreement. The Purchaser and SML have
the full legal right, capacity and power and all requisite corporate authority
and approval required to enter into, execute and deliver this Agreement and any
other agreement or instrument contemplated hereby, and to perform fully its
obligations hereunder and thereunder. The Board of Directors of each Company has
approved the transactions contemplated by this Agreement. This Agreement has
been duly executed and delivered by the Purchaser and SML and assuming the due
authorization and execution by the other parties hereto, it constitutes the
valid and binding obligation of the Purchaser and SML enforceable against them
in accordance with its terms.
(c) No Conflict. The execution and delivery of this Agreement will
not (a) violate or conflict with any of the provisions of the Purchaser's or
SML's Certificate of Incorporation or By-Laws or other organizational documents;
or (b) violate or conflict with any provision of any domestic or foreign law,
rule, regulation, order, judgment, decree or ruling of any court or federal,
state, local or foreign governmental or regulatory body applicable to the
Purchaser.
4.3 REPRESENTATIONS AND WARRANTIES OF THE SELLERS. Upon the
execution hereof, the Sellers represent and warrant to the parties hereto as
follows:
(a) Authorization. Each of the Sellers warrant and represent that
he/she has the full legal right, power and all authority and approval required
to enter into, execute and deliver this Agreement and to perform fully his/or
obligations hereunder.
(b) Binding Obligation. Assuming the due execution and delivery of
this Agreement by the other parties hereto, this Agreement constitutes the valid
and binding obligation of the Sellers, enforceable against the Sellers in
accordance with its terms, subject as to enforcement, (i) to bankruptcy,
insolvency, reorganization, arrangement, moratorium and other
15
laws of general applicability relating to or affecting creditors' rights and
(ii) to general principles of equity, whether such enforceability is considered
in a proceeding in equity or at law.
(c) The Diva Shares. Each of the Sellers warrants and represents
that he/she holds the Diva Shares free and clear of all liens, pledges,
hypothecations, options, contracts and other encumbrances ("Encumbrances").
4.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties, affirmative and negative covenants and
agreements of the Company, the Purchaser and the Sellers, set forth herein shall
survive the date hereof until the date upon which any liability to which any
claim relating to any such representation or warranty, agreement or covenant is
barred by all applicable statutes of limitations.
ARTICLE V
INDEMNIFICATION
5.1 INDEMNIFICATION.
(a) The Company and the Sellers agree to jointly and severally
indemnify, defend and hold harmless SML and the Purchaser and their respective
directors, officers, employees, and any affiliates of the foregoing, and their
successors and assigns from and against any and all breaches, losses,
liabilities (including punitive or exemplary damages and fines or penalties and
any interest thereon), expenses (including reasonable fees and disbursements of
counsel and expenses of investigation and defense), claims, liens or other
obligations of any nature whatsoever (hereinafter individually, a "Loss" and
collectively, "Losses") which, directly or indirectly, arise out of, result from
or relate to, any inaccuracy in or any breach of any representation, warranty,
covenant or agreement of the Company and the Sellers contained in this Agreement
or in any other document contemplated by this Agreement.
(b) The Purchaser and SML agrees to jointly and severally indemnify,
defend and hold harmless the Company and the Sellers and its directors,
officers, employees, and any affiliates of the foregoing, and their successors
and assigns from and against any and all Losses which, directly or indirectly,
arise out of, result from or relate to any breach of any representation,
warranty, covenant or agreement of SML or the Purchaser contained in this
Agreement or in any other document contemplated by this Agreement.
5.2 METHOD OF ASSERTING CLAIMS. The party making a claim under this
Article V is referred to as the "Indemnified Party" and the party against whom
such claims are asserted under this Article V is referred to as the
"Indemnifying Party." All claims by any Indemnified Party under this Article V
shall be asserted and resolved as follows:
(a) In the event that any claim or demand for which an Indemnifying
16
Party would be liable to an Indemnified Party hereunder is asserted
against or sought to be collected from such Indemnified Party by a
third party, said Indemnified Party shall with reasonable promptness
notify in writing the Indemnifying Party of such claim or demand,
specifying the nature of the specific basis for such claim or
demand, and the amount or the estimated amount thereof to the extent
then feasible (which estimate shall not be conclusive of the final
amount of such claim and demand; any such notice, together with any
notice given pursuant to Section 5.2(b) hereof, collectively being
the "Claim Notice"); provided, however, that any failure to give
such Claim Notice will not be deemed a waiver of any rights of the
Indemnified Party except to the extent the rights of the
Indemnifying Party are actually prejudiced. The Indemnifying Party,
upon request of the Indemnified Party, shall retain counsel (who
shall be reasonably acceptable to the Indemnified Party) to
represent the Indemnified Party, and shall pay the fees and
disbursements of such counsel with regard thereto, provided,
further, that any Indemnified Party is hereby authorized prior to
the date on which it receives written notice from the Indemnifying
Party designating such counsel, to retain counsel, whose fees and
expenses shall be at the expense of the Indemnifying Party, to file
any motion, answer or other pleading and take such other action
which it reasonably shall deem necessary to protect its interests or
those of the Indemnifying Party until the date on which the
Indemnified Party receives such notice from the Indemnifying Party.
After the Indemnifying Party shall retain such counsel, the
Indemnified Party shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of
such counsel or (ii) the named parties of any such proceeding
(including any impleaded parties) include both the Indemnifying
Party and the Indemnified Party and representation of both parties
by the same counsel would be inappropriate due to actual or
potential differing interests between them. The Indemnifying Party
shall not, in connection with any proceedings or related proceedings
in the same jurisdiction, be liable for the fees and expenses of
more than one such firm for the Indemnified Party (except to the
extent the Indemnified Party retained counsel to protect its (or the
Indemnifying Party's) rights prior to the selection of counsel by
the Indemnifying Party). If requested by the Indemnifying Party, the
Indemnified Party agrees to cooperate with the Indemnifying Party
and its counsel in contesting any claim or demand which the
Indemnifying Party defends. No claim or demand may be settled by an
Indemnifying Party or, where permitted pursuant to this Agreement,
by an Indemnified Party without the consent of the Indemnified Party
in the first case or the consent of the Indemnifying Party in the
second case, which
17
consent shall not be unreasonably withheld, unless such settlement
shall be accompanied by a complete release of the Indemnified Party
in the first case or the Indemnifying Party in the second case.
Whether or not such release is obtained, the person whose consent is
required may reasonably withhold consent if the proposed settlement
would have a material adverse effect on its business or properties.
(b) In the event any Indemnified Party shall have a claim against
any Indemnifying Party hereunder which does not involve a claim or
demand being asserted against or sought to be collected from it by a
third party, the Indemnified Party shall send a Claim Notice with
respect to such claim to the Indemnifying Party. If the Indemnifying
Party does not notify the Indemnified Party within twenty (20) days
of receipt of the Claim Notice that it disputes such claim, the
amount of such claim shall be conclusively deemed a liability of the
Indemnifying Party hereunder.
(c) So long as any right to indemnification exists pursuant to this
Article V, the affected parties each agree to retain all books,
records, accounts, instruments and documents reasonably related to
the Claim Notice. In each instance, the Indemnified Party shall have
the right to be kept informed by the Indemnifying Party and its
legal counsel with respect to all significant matters relating to
any legal proceedings. Any information or documents made available
to any party hereunder, which information is designated as
confidential by the party providing such information and which is
not otherwise generally available to the public, or which
information is not otherwise lawfully obtained from third parties or
not already within the knowledge of the party to whom the
information is provided (unless otherwise covered by the
confidentiality provisions of any other agreement among the parties
hereto, or any of them), and except as may be required by applicable
law or requested by third party lenders to such party, shall not be
disclosed to any third person (except for the representatives of the
party being provided with the information, in which event the party
being provided with the information shall request its
representatives not to disclose any such information which it
otherwise required hereunder to be kept confidential).
(d) Notwithstanding the foregoing, the Purchaser may reduce the
Subsequent Payment Amount by the amounts owed to the Purchaser by
the Sellers under this Article V.
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ARTICLE VI
MISCELLANEOUS
6.1 POST-CLOSING FURTHER ASSURANCES. At any time and from time
to time after the Closing at the request of any party hereto, the other parties
shall, without further consideration, execute and deliver, or cause the
execution and delivery of, such other instruments of sale, transfer, conveyance,
assignment and confirmation and take or cause to be taken such other action as
such requesting party may reasonably deem necessary or desirable in order to
effect the transactions herein contemplated.
6.2 NOTICES. Except as otherwise specified herein to the
contrary, all notices, requests, demands and other communications required or
permitted to be given hereunder shall only be in writing and shall only be
effective if given by certified or registered mail, return receipt requested, or
by U.S. express mail service, or by private overnight mail service (e.g.,
Federal Express). Any such notice shall be deemed to have been given (a) on the
business day immediately subsequent to mailing if sent by U.S. express mail
service or private overnight mail service, or (b) three (3) business days
following the mailing thereof, if mailed by certified first class mail, postage
prepaid, return receipt requested, all such notices to be sent to the following
address (or to such other address or addresses as a party may have advised the
other in the manner provided in this Section 6.2):
If to Xxxxxx Xxxxxx, Ltd. and the Purchaser to:
Xxxxxx Xxxxxx, President
Xxxxxx Xxxxxx, Ltd.
00-00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx Xxxx, XX 00000
with copies simultaneously by like means to:
Xxxxxxxxx & Xxxxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
If to the Company or the Sellers to:
Xxxx Xxxxxxxx
0000 X. 00xx Xxxxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxxx
0000 Xxxx Xxxxxx
Xxx Xxxx, XX
19
with copies simultaneously by like means to:
Xxxxxxx & Xxxxx, PC
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
6.3 PUBLICITY. No press release or announcement concerning this
Agreement or the transactions contemplated hereby shall be made without the
prior approval of SML, the Sellers and the Company, which approval shall not be
unreasonably withheld or delayed.
6.4 ENTIRE AGREEMENT. This Agreement (including the Exhibits and
Schedules) and the agreements, certificates and other documents delivered
pursuant to this Agreement contain the entire agreement among the parties with
respect to the transactions described herein, and supersede all prior
agreements, written or oral, with respect thereto.
6.5 WAIVERS AND AMENDMENTS. This Agreement may be amended,
superseded, canceled, renewed or extended, and the terms hereof may be waived,
only by a written instrument signed by the parties hereto or, in the case of a
waiver, by the party waiving compliance. Not delay on the part of any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof.
6.6 GOVERNING LAW; JURISDICTION AND VENUE. Regardless of the place
of execution or performance, this Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to
such State's conflicts of laws provisions. All of the parties hereto irrevocably
consent to the exclusive jurisdiction and venue of the federal and state courts
located in the State of New York, County of New York.
6.7 BINDING EFFECT; NO ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
legal representatives. This Agreement is not assignable except by operation of
law and any other purported assignment shall be null and void.
6.8 COUNTERPARTS. This Agreement may be executed by the parties
hereto in separate facsimile counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute one and the same instrument. Each counterpart may consist of a number
of copies hereof each signed by less than all, but together signed by all of the
parties hereto.
6.9 EXHIBITS AND SCHEDULES. The Exhibits and Schedules are a part of
this Agreement as if fully set forth herein. All references herein to Sections,
subsections, clauses, Exhibits and Schedules shall be deemed references to such
parts of this Agreement, unless the
20
context shall otherwise require.
6.10 HEADINGS. The headings in this Agreement are for reference
only, and shall not affect the interpretation of this Agreement.
6.11 SEVERABILITY OF PROVISIONS. If any provision or any portion of
any provision of this Agreement or the application of such provision or any
portion thereof to any person or circumstance shall be held invalid or
unenforceable, the remaining portion of such provision and the remaining
provisions of this Agreement, or the application of such provision or portion to
other persons or circumstances, shall not be affected thereby and shall remain
in full force and effect.
6.12 TERMINATION. This Agreement may be terminated by delivering
written notice thereof to the other parties to the Agreement if the Effective
Time shall not have occurred on or before July 1, 1996; provided, however, that
the right to terminate this Agreement will not be available to any party whose
failure to fulfill any obligation under this Agreement has been the cause of, or
resulted in, the failure of the Effective Time to occur on or before such date.
In the event of the termination and abandonment of this Agreement, shall
forthwith become void and have no effect, without any liability on the part of
any party hereto or its directors, officers, employees, agents or stockholders.
Nothing herein shall relieve any party hereto of any liability for a breach of
this Agreement.
6.13 RIGHT OF FIRST REFUSAL. If at any time within three (3) years
following the Effective Date, SML receives a bona fide offer (the "Offer") to
purchase all of the outstanding shares of common stock of the Purchaser, SML
shall notify the Sellers (the "Notice") in writing as to the Offer and provide
them with the opportunity to purchase such shares at the same purchase price and
on the same terms as contained in the Offer. In the event that the Sellers (i)
do not notify SML in writing that they are exercising their rights under this
Section 6.13 within five (5) days following the date of the Notice, or (ii) do
not deliver the appropriate purchase price within fifteen (15) days following
the date of Notice, Sellers shall have conclusively waived their rights under
this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
/s/ Xxxxxx Xxxxxxxx XXXXXX XXXXXX, LTD.
---------------------------------
Xxxxxx Xxxxxxxx
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Chief Executive Officer
/s/ Xxxx Xxxxxxxx
----------------------------------
Xxxx Xxxxxxxx
DIVA ACQUISITION CORP.
By:
-----------------------------------
Name:
Title:
DIVA INTERNATIONAL, INC.
By: /s/ Xxxx Xxxxxxxx
-----------------------------------
Name: Xxxx Xxxxxxxx
Title: President
22
