EXHIBIT 2.5
AGREEMENT AND PLAN OF MERGER BETWEEN
INNOVATION PARTNERS, INC. AND INTERNET SPORTS NETWORK, INC.
AGREEMENT AND PLAN OF MERGER
This Merger Agreement ("Agreement") is made effective as of June 30, 1999
("Effective Date") by and
BETWEEN: Xxxxxxx X. Xxxxxx ("Vendor")
AND: Innovation Partners, Inc. a Wisconsin Corporation; ("Targetco")
AND: Internet Sports Network, Inc., a Florida corporation;
(the "Merger Parent")
WHEREAS the authorized share capital of Targetco consists of 9,000 common
shares par value ($1.00) of which 8,190 common shares (the "Targetco Shares")
are issued and outstanding;
The Shareholders of Targetco are the registered and beneficial owners of the
Targetco Shares as follows:
Xx. Xxxxxx as to 7,110 Targetco Shares
Xx. Xxxxxxxx as to 225 Targetco Shares
Xx. Xxxxxxxxx as to 270 Targetco Shares
Xx. Xxxxxxxx as to 180 Targetco Shares
Xx. Xxxxx as to 135 Targetco Shares
Xx. Xxxxxxxx as to 90 Targetco Shares
Xx. Xxxxxxx as to 90 Targetco Shares
Xx. Xxxxxxxx as to 90 Targetco Shares
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Total Targetco Shares: 8,190;
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The Shareholders of Targetco and the Merger Parent have agreed to merge
Targetco with ISN Wisconsin, Inc. (the "Subsidiary"), in the course of which
merger the shares of Targetco shall be automatically converted into the right
to receive shares of the Merger Parent and cash consideration as described
herein, on the terms and conditions set forth in this Agreement and the Plan
of Merger to be attached hereto as a portion of Exhibit 1.1;
NOW, THEREFORE, in consideration of the mutual covenants,
agreements, representations and warranties contained in this Agreement, the
parties hereto agree as follows:
1. MERGER AND EXCHANGE OF SHARES
1.1 Subject to the terms and conditions of this Agreement, Targetco, the
Vendor and the Merger Parent each agree to merge Targetco with and into the
Subsidiary in accordance with Articles and a Plan of Merger, copies of which
are attached hereto as Exhibit 1.1 to be filed in Wisconsin, and in
connection therewith the Merger Parent agrees to deliver to the Shareholders
of Targetco on the Closing Date consideration (the "Consideration") comprised
of one million dollars (U.S.$1,000,000) (the "Cash Portion") and six hundred
six thousand sixty shares (606,060) of common stock of Merger Parent, which,
when issued, will constitute ____% of the total outstanding shares of the
Merger Parent (the "Merger Parent's Shares").
1.2 Upon the merger of Targetco with the Subsidiary:
(a) the surviving corporation shall be the Subsidiary with
Articles of Incorporation and Bylaws in the form attached to this Agreement
as Schedule 1.2(a); and
(b) the initial directors and officers of the subsidiary shall be
as described in Schedule 1.2(b).
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1.3 The Cash Portion of the Consideration shall be delivered by the
Merger Parent to Xxxxxxx & Xxxx, S.C., as exchange agent for the shareholders
of Targetco, by wire transfer, and the Merger Parent's Shares shall be issued
to the Shareholders of Targetco in proportion to the share holdings of each
Vendor in Targetco as listed on Schedule 1.3, and, as applicable, subject to
the terms of an Escrow Agreement dated ___________. Notwithstanding the fact
that certain of the Consideration is held pursuant to the Escrow Agreement,
no Consideration under this Agreement or any other agreement delivered
hereunder including, but not limited to the Employment Agreement (as defined
in Section 2.1(a) hereof) shall be subject to any right of offset of the
Merger Parent for any reason whatsoever.
1.4 The transactions contemplated under this Agreement shall be
completed at the offices of the Merger Parent's counsel, Xxxxxxx & Beam, Two
Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxx, XX 00000, or at such other place as may be
agreed upon by the parties in writing, at 11:00 o'clock a.m. local time in
Irvine, CA (the "Time of Closing") on July 16, 1999 or on such other date as
may be determined in accordance with this Agreement or by further agreement
in writing between the parties (the "Closing Date").
1.5 On July 2, 1999, the Merger Parent deposited with its counsel US
$200,000 (the "Deposit"), Deposit is to be held in trust pending the Closing
Date. The Deposit shall be returned by the shareholders of Targetco only if
they fail to complete the transactions contemplated in this Agreement and the
Merger Parent is not in default. In order to treat the transaction as if the
closing had occurred as the Effective Date, but subject to the closing
occurring, parties agree that the Vendor's will operate the business for the
account of the Merger Parent from the period of June 30, 1999 to the Time of
Closing ("Interim Period"). Accordingly, all revenues and expenses of
Targetco for the Interim Period (including regularly scheduled payment
obligations under any Material Contracts that come due during the Interim
Period), and the assets and liabilities related thereto, will be accrued to
the Merger Parent (subject to indemnification to the extent provided in
Paragraph 5, below).
2. CONDITIONS PRECEDENT
2.1 The Merger Parent's obligation to carry out the terms of this
Agreement and to complete its transactions contemplated under this Agreement
is subject to the fulfillment of each of the following conditions that:
(a) at the Time of Closing, Merger Parent shall have entered into
a written employment and non-competition agreement with Xxxx Xxxxxx
[("XXXXXX")](the "Employment Agreement"), substantially in the form which
appears as Schedule 2.1(a) to this Agreement;
(b) at the Time of Closing, the directors of the Merger Parent
shall have approved his Agreement and all of the transactions contemplated
under this Agreement, in their absolute discretion;
(c) as of the Time of Closing, the Vendor and Targetco shall have
complied with their respective covenants and agreements contained in this
Agreement in all material respects; and
(d) as of the Time of Closing, the representations and warranties
of the Vendor contained in this Agreement or contained in any certificates or
documents delivered by them or any one of them pursuant to this Agreement
shall be, in all material respects, true as if such representations and
warranties had been made by the Vendor as of the Time of Closing;
The conditions set forth above are for the exclusive benefit of the Merger
Parent and each may be waived by the Merger Parent in whole or in part at or
before the time indicated for removal, without prejudice to any remedies that
may otherwise be available to the Merger Parent.
2.2 The Vendor's respective obligations to carry out the terms of this
Agreement and to complete their respective transactions contemplated under
this Agreement are subject to the fulfillment to their satisfaction of each
of the following conditions that:
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(a) as of the Time of Closing, the Merger Parent shall have
complied with all of its covenants and agreements contained in this
Agreement; and
(b) at the Time of Closing, the representations and warranties of
the Merger Parent contained in this Agreement or contained in any
certificates or documents delivered by it pursuant to this Agreement shall
be, in all material respects, true as if such representations and warranties
had been made by the Merger Parent as of the Time of Closing.
(c) by the Time of Closing, Targetco shall have completed its due
diligence investigation with results to its reasonable satisfaction; and
(d) at the Time of Closing, Merger Parent shall have entered into
the Employment Agreement.
The conditions set forth above are for the exclusive benefit of each of the
Vendor and may be waived by each of them in whole or in part at or before the
Time of Closing, without prejudice to any remedies that may otherwise be
available to the Vendor.
3. COVENANTS, AGREEMENTS AND ACKNOWLEDGMENTS
3.1 Vendor and Targetco jointly and severally covenant and agree with
the Merger Parent that the Shareholders of Targetco and Targetco shall:
(a) from and including the Effective Date through to and including
the Time of Closing, do all such commercially reasonable acts and things
necessary to ensure that all of the representations and warranties of Vendor
and/or Targetco contained in this Agreement or any certificates or documents
delivered by them or any one of them pursuant to this Agreement remain true
and correct;
(b) from and including the Effective Date through to and including
the Time of Closing, preserve and protect the goodwill, Assets, business and
undertaking of Targetco and, without limiting the generality of the
foregoing, carry on the business of Targetco in a reasonable and prudent
manner; and
(c) from and including the Effective Date through to and including
the Time of Closing, keep confidential all discussions and communications
(including all information communicated therein) between the parties, and all
written and printed materials of any kind whatsoever exchanged by the
parties, and, if so requested by the Merger Parent, the Vendor and Targetco
shall arrange for any director, officer, employee, authorized agent or
representative of Targetco to enter into and the Vendor shall enter into a
non-disclosure agreement with the Merger Parent in a form acceptable to the
Merger Parent acting reasonably, which form shall permit confidential
disclosure to the Vendor's consultants, accountants and attorneys to the
extent necessary for them to verify the representations and warranties
contained in this Agreement.
3.2 Vendor and Targetco jointly and severally covenant and agree with
the Merger Parent that, from and including the Effective Date through to and
including the Time of Closing, Vendor and Targetco shall not intentionally do
any such act or thing that would render any representation or warranty of
Vendor or Targetco contained in this Agreement or any certificates or
documents delivered by them or any one of them pursuant to this Agreement
untrue or incorrect.
3.3 Vendor and Targetco jointly and severally covenant and agree with
the Merger Parent that, from and including the date hereof through the Time
of Closing, unless this agreement terminates, that Vendor and Targetco shall
not negotiate with any other person in respect of a merger of any of the
Targetco Shares or any part of the Assets, other than a sale of part of the
Assets in the ordinary course of Targetco's business.
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3.4 The Merger Parent covenants and agrees with Vendor and Targetco that
the Merger Parent shall:
(a) from and including the Effective Date through to and including
the Time of Closing, do all such acts and things necessary to ensure that all
of the representations and warranties of the Merger Parent contained in this
Agreement or any certificates or documents delivered by it pursuant to this
Agreement remain true and correct;
(b) from and including the Effective Date through to and including
the Time of Closing and subject to any obligations imposed by law or as a
result of any application for listing on a stock exchange or filing required
by the Securities and Exchange Commission, keep confidential all discussions
and communications (including all information communicated therein) between
the parties, and all written and printed materials of any kind whatsoever
exchanged by the parties, and, if so requested by Vendor or by Targetco, the
Merger Parent shall arrange for any of the Merger Parent's Representatives to
enter into, and the Merger Parent itself shall enter into, a non-disclosure
agreement with Vendor and Targetco in a form acceptable to Vendor and
Targetco acting reasonably, which form shall permit confidential disclosure
to the Merger Parent's consultants, accountants and attorneys to the extent
necessary for them to verify the representations and warranties contained in
this Agreement;
(c) from and including the Effective Date through to and
including the Time of Closing, preserve and protect the goodwill, assets,
business and undertaking of Merger Parent and, without limiting the
generality of the foregoing, carry on the business of Merger Parent in a
reasonable and prudent manner; and
3.5 The Merger Parent covenants and agrees with the Vendor and with
Targetco that, from and including the Effective Date through to and including
the Time of Closing, the Merger Parent shall not do any such act or thing
that would render any representation or warranty of the Merger Parent
contained in this Agreement or any certificates or documents delivered by it
pursuant to this Agreement untrue or incorrect.
4. REPRESENTATIONS AND WARRANTIES
4.1 In order to induce the Merger Parent to enter into this Agreement
and complete its transactions contemplated hereunder, Vendor represents and
warrants to the Merger Parent that:
(a) Targetco was and remains duly incorporated under the laws
of the State of Wisconsin.
(b) Targetco:
(i) is a "private issuer" as that term is defined in
any applicable securities legislation (the "Securities Act");
(ii) does not maintain an office or mailing address, or
have any employees, agents or equipment (including any computer server
equipment) in any jurisdiction other than its jurisdiction of incorporation;
and
(iii) is in good standing with respect to the filing of
annual reports and taxes in the jurisdiction of its incorporation and in each
jurisdiction in which it carries on business except where the failure to be
so qualified would not have a material adverse effect on Targetco;
(c) the authorized and issued share capital of Targetco is as
set forth in paragraphs A and B of the Recitals to this Agreement;
(d) the Targetco Shares are validly issued and outstanding
fully paid and non-assessable common shares of Targetco registered in the
names of, and beneficially owned by, the Shareholders of Targetco as set
forth in paragraph B of the Recitals to this Agreement free and clear of all
voting restrictions, trade restrictions, liens, charges or encumbrances of
any kind whatsoever;
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(e) except for the Targetco Shares, there are no shares,
options, convertible debentures, documents, instruments or other writings of
any kind whatsoever which may constitute a "security" of Targetco as that
term is defined in the Securities Act or any other applicable legislation
and, except as is provided for by operation of this Agreement, there are no
options, agreements or rights of any kind whatsoever to acquire all or any
part of the Targetco Shares or any interest in them or in any other share
capital of Targetco;
(f) the articles of incorporation and bylaws of Targetco
produced to Merger Parent have not been altered, amended or modified except
as set forth therein;
(g) to the best of Vendor's knowledge, all of the material
transactions of Targetco have been promptly and properly recorded or filed in
or with the books or records of Targetco, and the minute books of Targetco
contain all records of the meetings and proceedings of shareholders and
directors of Targetco since its date of incorporation;
(h) to the best of Vendor's knowledge, information and belief,
Targetco holds only a license, now expired pending renewal, issued by the
National Football League Players Association;
(i) Targetco is the registered and beneficial owner of all of
the properties and assets (collectively the "Assets") listed on Schedule
4.1(i) to this Agreement, and such Assets represent all of the property and
assets used by Targetco and which are necessary or useful in the conduct of
its business;
(j) Targetco has the corporate power to own the Assets owned by
it and carry on the business carried on by it and Targetco is duly qualified
to carry on business in all jurisdictions in which it carries on business
except where the failure to be so qualified would not have a material adverse
effect on the assets or business of Targetco;
(k) to the best of Vendor's knowledge, Targetco has good and
marketable title to the Assets, to the best of Vendor's knowledge, free and
clear of all liens, charges and encumbrances of any kind whatsoever save and
except those specified as "Permitted Encumbrances" on Schedule 4.1(k) to this
Agreement;
(l) to the best of Vendor's knowledge, information and belief,
no third party privacy or intellectual property rights, including without
limitation, copyright, trade secret or patent rights, were violated in the
creation, compilation or acquisition of the Assets by Targetco or by any
party through whom Targetco acquired title;
(m) to the best of Vendor's knowledge, all machinery and
equipment of any kind whatsoever comprised in the Assets are in reasonable
operating condition and in a state of reasonable maintenance and repair
taking into account their age and use;
(n) all of the bank accounts and safety deposit boxes of
Targetco are listed on Schedule 4.1(n) to this Agreement;
(o) to the best of Vendor's knowledge, all of the insurance
policies insuring against the loss of, or damage to, the Assets or public
liability are listed in Schedule 4.1(o) to this Agreement;
(p) the unaudited financial statements of Targetco for its
fiscal year ended 31 December 1998 (collectively the "Targetco Financial
Statements"), copies of which appear as Schedule 4.1(p) to this Agreement,
taken as a whole, are true and correct in all material respects and present
accurately the financial position and results of the operations of Targetco
for the periods then ended;
(q) to the best of Vendor's knowledge, the books and records of
Targetco disclose all material financial transactions of Targetco arising
subsequent to the preparation of the Targetco Financial Statements and such
transactions have been accurately recorded;
(r) since 31 December 1998:
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(i) no dividends or other distributions of any kind
whatsoever on any shares in the capital of Targetco have been made, declared
or authorized, except as disclosed in the Targetco Financial Statements and
except for amounts distributed to the shareholders of Targetco as a result of
Targetco's S corporation status;
(ii) to the best of his knowledge, Targetco has not become
indebted to the Shareholders of Targetco or any one of them, except for
current employment compensation as described in Schedule 4.1(4)(ii);
(iii) to the best of Vendor's knowledge, none of the
Shareholders of Targetco or any other officer, director or employee of
Targetco has become indebted or under obligation to Targetco on any account
whatsoever; and
(iv) to the best of Vendor's knowledge, Targetco has not
guaranteed or agreed to guarantee any debt, liability or other obligation of
any kind whatsoever of any person, firm or corporation of any kind whatsoever;
(s) to the best of Vendor's knowledge, there are no material
liabilities of Targetco, whether direct, indirect, absolute, contingent or
otherwise which are not disclosed or reflected in the Targetco Financial
Statements except those incurred in the ordinary course of business since the
date the Targetco Financial Statements were prepared, all of which are
recorded in the books and records of Targetco;
(t) the accounts receivable of Targetco shown on the Targetco
Financial Statements or recorded in the books and records of Targetco are
bona fide, good and, to the best knowledge of Vendor, collectible without
set-off or counterclaim;
(u) except as set forth on Schedule 4.1(v) since 31 December 1998:
(i) there has not been any material adverse change of any
kind whatsoever in the financial position or condition of Targetco or any
damage, loss or other change of any kind whatsoever in circumstances
materially affecting the business or Assets or the right or capacity of
Targetco to carry on its business;
(ii) Targetco has not waived or surrendered any right of
any kind whatsoever of material value;
(iii) Targetco has not discharged, satisfied or paid any
lien, charge or encumbrance of any kind whatsoever or obligation or liability
of any kind whatsoever other than current liabilities in the ordinary course
of its business or as expressly permitted under this Agreement;
(iv) the business of Targetco has been carried on in the
ordinary course;
(v) except as set forth in Schedule 4.1(u)(v), no new
machinery or equipment of any kind whatsoever has been ordered by, or
installed or assembled on the premises of, Targetco; and
(vi) except as set forth in Schedule (4.1(u)(vi), no
capital expenditures exceeding in the aggregate $10,000 have been authorized
or made by Targetco;
(v) the directors, officers, employees, contractors and
consultants of Targetco and all of their compensation arrangements with
Targetco, whether as directors, officers or employees of, or as independent
contractors or consultants to, Targetco, are as listed on Schedule 4.1(v) to
this Agreement;
(w) no payments of any kind whatsoever have been made or
authorized by Targetco to or on behalf of the Shareholders of Targetco or any
one of them or to or on behalf of any of the directors, officers, employees
contractors or consultants of Targetco except in accordance with those
compensation arrangements specified on Schedule 4.1(w) to this Agreement or
except as contemplated by this Agreement;
(x) there are no pensions, profit sharing, group insurance or
similar plans or other deferred compensation plans of any kind whatsoever
affecting Targetco other than those specified on Schedule 4.1(x) to this
Agreement;
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(y) Targetco is not now, and has never been, a party to any
collective agreement with any labor union or other association of employees
of any kind whatsoever;
(z) the contracts and agreements included on Schedules ___ and ___
to this Agreement and those additional contracts and agreements specified on
Schedule 4.1(z) to this Agreement (collectively the "Material Contracts")
constitute all of the material contracts and agreements of Targetco. In
particular, Targetco does not maintain insurance of any kind;
(aa) Targetco has not licensed, leased, transferred, disposed of or
encumbered any of the Assets in any way, or permitted any third party access
to any of the Assets, including in particular the source code to the computer
software and the contestant and subscriber information included in the
Assets, except in accordance with the terms of the Material Contracts;
(bb) except as is noted on Schedule 4.1(bb) to this Agreement, the
Material Contracts are in good standing in all respects and that Targetco is
not in default in any respect;
(cc) except as is noted on Schedule 4.1(cc) to this Agreement,
Targetco can terminate all of its obligations under each of the Material
Contracts without liability on not more than one month's notice;
(dd) to the best of Vendor's knowledge, all tax returns and reports
of Targetco required by law to be filed have been filed and are substantially
true, complete and correct and all taxes and other government charges of any
kind whatsoever of Targetco have been paid or accrued in the Targetco
Financial Statements;
(ee) to the best of Vendor's knowledge, Targetco has been assessed
for all applicable income and other tax remittances for all of its full or
partial fiscal years to and including its fiscal year ended 31 December, 1998;
(ff) Targetco has not:
(i) acquired any property from a person, otherwise than at
arm's length, for proceeds greater than the fair market value thereof; or
(ii) disposed of anything to a person, otherwise than at
arm's length, for proceeds less than the fair market value thereof;
(gg) Targetco has made all elections required to have been made
under all applicable tax legislation in connection with any distributions
made by it and all such elections were true and correct and made in the
prescribed form and within the prescribed time period;
(hh) to the best of Vendor's knowledge, adequate provision has been
made for taxes payable by Targetco for the current period for which tax
returns are not yet required to be filed and there are no agreements, waivers
or other arrangements of any kind whatsoever providing for an extension of
time with respect to the filing of any tax return by, or payment of, any tax
or governmental charge of any kind whatsoever by Targetco;
(ii) Vendor is not aware of any contingent tax liabilities of
Targetco of any kind whatsoever or any grounds which would prompt a
reassessment of Targetco including aggressive treatment of income and
expenses in earlier tax returns filed;
(jj) there are no amounts outstanding and unpaid for which Targetco
has previously claimed a deduction under any applicable tax legislation;
(kk) Targetco has made all collections, deductions, remittances and
payments of any kind whatsoever and filed all reports and returns required by
it to be made or filed under the provisions of all applicable statutes
requiring the making of collections, deductions, remittances or payments of
any kind whatsoever in those jurisdictions in which
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it carries on business;
(ll) to the best of his knowledge and except as disclosed on Schedule
4.1(ll), there are no actions, suits, judgments, investigations or proceedings
of any kind whatsoever outstanding, pending or threatened against or affecting
Targetco at law or in equity or before or by any federal, provincial, state,
municipal or other governmental department, commission, board, bureau or agency
of any kind whatsoever and there is no basis therefor;
(mm) to the best of his knowledge, Targetco is not in breach of
any law, ordinance, statute, regulation, bylaw, order or decree of any kind
whatsoever;
(nn) Vendor and Targetco have good and sufficient right and authority
to enter into this Agreement and complete their respective transactions
contemplated under this Agreement on the terms and conditions set forth herein;
(oo) to the best of Vendor's knowledge, the execution and delivery of
this Agreement, the performance of their respective obligations under this
Agreement and the completion of their respective transactions contemplated under
this Agreement will not:
(i) conflict with, or result in the breach of or the
acceleration of any indebtedness under, or constitute default under, the
incorporation documents of Targetco or any indenture, mortgage, agreement,
lease, license or other instrument of any kind whatsoever to which Targetco, or
Vendor is a party or by which any one of them is bound, or any judgment or order
of any kind whatsoever of any court or administrative body of any kind
whatsoever by which any one of them is bound; and
(ii) result in the violation of any law or regulation of any
kind whatsoever by any of the Shareholders of Targetco or by Targetco;
(pp) neither Targetco nor the Shareholders of Targetco nor any of them
has incurred any liability for brokers' or finder's fees of any kind whatsoever
with respect to this Agreement or any transaction contemplated under this
Agreement; and
4.2 The representations and warranties of the Vendor contained in this
Agreement shall be true at the Time of Closing as though they were made at
the Time of Closing and they shall survive the completion of the transactions
contemplated under this Agreement and remain in full force and effect
thereafter for the benefit of the Merger Parent for a period of five (5)
years after the Time of Closing in respect of representations and warranties
relating to tax matters, and for a period of two (2) years after the Time of
Closing in respect of all other representations and warranties.
4.3 In order to induce the Vendor to enter into this Agreement and complete
his respective transactions contemplated hereunder, the Merger Parent
represents and warrants to the Vendor that:
(a) the Merger Parent was and remains duly incorporated under the laws
of Florida and the Merger Parent is in good standing with respect to the filing
of annual reports in that jurisdiction;
(b) the Subsidiary is duly incorporated under the laws of Wisconsin and
is in good standing with respect to the filing of annual reports in that
jurisdiction;
(c) as of the Effective Date, the authorized share capital of the
Merger Parent consists of 50,000,000 common shares with a par value of $0.001
per share;
(d) the authorized share capital of the Subsidiary consists of 9,000
shares, of which 9,000 shares will be issued and outstanding in the name of the
Merger Parent;
(e) on the Closing Date, the Merger Parent's Shares shall be validly
issued and outstanding fully paid and non-assessable common shares of the Merger
Parent registered in the names of, and beneficially owned by, the
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Shareholders of Targetco as set forth in paragraph 1.2 of this Agreement, and
all of the Effective Date Issued Capital shall be validly issued and
outstanding fully paid and non-assessable common shares of the Merger Parent;
(f) the books and records of the Merger Parent disclose all material
financial transactions of the Merger Parent arising subsequent to the
preparation of the Merger Parent Financial Statements and such transactions
have been fairly and accurately recorded;
(g) except as disclosed to the Vendor in the Schedules to this
Agreement, there are no material liabilities of the Merger Parent, whether
direct, indirect, absolute, contingent or otherwise which are not disclosed
or reflected in the Merger Parent Financial Statements except those incurred
in the ordinary course of business since the date the Merger Parent Financial
Statements were prepared, all of which are recorded in the books and records
of the Merger Parent;
(h) to the best of its knowledge, there are no actions, suits,
judgments, investigations or proceedings of any kind whatsoever outstanding,
pending or threatened against or affecting the Merger Parent at law or in
equity or before or by any federal, provincial, state, municipal or other
governmental department, commission, board, bureau or agency of any kind
whatsoever;
(i) to the best of its knowledge, the Merger Parent is not in breach
of any law, ordinance, statute, regulation, bylaw, order or decree of any
kind whatsoever;
(j) the Merger Parent has good and sufficient right and authority to
enter into this Agreement and complete the transactions contemplated under
this Agreement on the terms and conditions set forth herein;
(k) to the best of its knowledge, the execution and delivery of this
Agreement, the performance of their respective obligations under this Agreement
and the completion of their respective transactions contemplated under this
Agreement will not:
(i) conflict with, or result in the breach of or the
acceleration of any indebtedness under, or constitute default under, the
incorporation documents of the Merger Parent or any indenture, mortgage,
agreement, lease, license or other instrument of any kind whatsoever to which
the Merger Parent is a party to or by which it is bound, or any judgment or
order of any kind whatsoever of any court or administrative body of any kind
whatsoever by which the Merger Parent is bound; and
(ii) result in the violation of any law or regulation
of any kind whatsoever by the Merger Parent; and
(iii) the representations and warranties of the Merger
Parent contained in this Agreement disclose all material facts specifically
relating to the transactions involving the Merger Parent contemplated under
this Agreement which materially and adversely affect, or in the future may
materially and adversely affect, the Merger Parent's ability to perform its
obligations under this Agreement.
4.5 The representations and warranties of the Merger Parent contained in
this Agreement shall be true at the Time of Closing as though they were made
at the Time of Closing and shall survive the completion of the transactions
contemplated under this Agreement and remain in full force and effect
thereafter for the benefit of the Vendors for a period of Two (2) years after
the Time of Closing.
5. INDEMNITY
5.1 Notwithstanding the completion of the transactions contemplated under
this Agreement or the Merger Parent's Investigation, the representations,
warranties and acknowledgments of the Vendor contained in this Agreement or
any certificates or documents delivered by him pursuant to this Agreement
shall survive the completion of the transactions contemplated by this
Agreement and shall continue in full force and effect thereafter for the
benefit of the Merger Parent
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for a period of five (5) years after the Time of Closing in respect of
representations, warranties and acknowledgments relating to tax matters, and
for a period of two (2) years after the Time of Closing in respect of all
other representations, warranties and acknowledgments. If any of the
representations, warranties or acknowledgments given by the Vendor in this
Agreement are found to be untrue or there is a breach of any covenant or
agreement in this Agreement on the part of the Vendor, the Vendor shall
indemnify and save harmless the Merger Parent from and against any and all
liability, claims, debts, demands, suits, actions, penalties, fines, losses,
costs (including legal fees and disbursements as charged by a lawyer to his
own client), damages and expenses of any kind whatsoever which may be brought
or made against the Merger Parent by any person, firm or corporation of any
kind whatsoever or which may be suffered or incurred by the Merger Parent,
directly or indirectly, arising out of or as a consequence of any such
misrepresentation or breach of warranty, acknowledgment, covenant or
agreement. Without in any way limiting the generality of the foregoing, this
shall include any loss of any kind whatsoever which may be suffered or
incurred by the Merger Parent, directly or indirectly, arising out of any
material assessment or reassessment levied upon Targetco for tax, interest
and/or penalties for any period up to and including the Closing Date and all
claims, demands, costs (including legal fees and disbursements as charged by
a lawyer to his own client) and expenses of any kind whatsoever in respect of
the foregoing.
5.2 Notwithstanding the completion of the transactions contemplated under
this Agreement, the representations, warranties and acknowledgments of the
Merger Parent contained in this Agreement or any certificates or documents
delivered by the Merger Parent pursuant to this Agreement shall survive the
completion of the transactions contemplated by this Agreement and shall
continue in full force and effect thereafter for the benefit of the Vendor
for a period of two (2) years after the Time of Closing. If any of the
representations, warranties or acknowledgments given by the Merger Parent in
this Agreement are found to be untrue or there is a breach of any covenant or
agreement in this Agreement on the part of the Merger Parent, the Merger
Parent shall indemnify and save harmless the Vendor from and against any and
all liability, claims, debts, demands, suits, actions, penalties, fines,
losses, costs (including legal fees and disbursements as charged by a lawyer
to his own client), damages and expenses of any kind whatsoever which may be
brought or made against the Vendor by any person, firm or corporation of any
kind whatsoever or which may be suffered or incurred by the Vendor, directly
or indirectly, arising out of or as a consequence of any such
misrepresentation or breach of warranty, acknowledgment, covenant or
agreement.
5.3 The determination of any liability claim, lien, encumbrance, charge, fine
or penalty for which indemnification may be claimed under this Section 5
shall be net of any tax (or other) benefit derived in insurance or other
proceeds received (but adjusted for any tax incurred as a result of the
receipt of such insurance proceeds or indemnification) by the party bearing
such liability claim, lien, encumbrance, charge, fine or penalty as a result
thereof.
5.4 Neither the Vendor nor the Merger Parent shall be required to provide
indemnification under Section 5.1, above, with respect to the warranties and
representations set forth in Section 4, unless the amount of damages incurred
by Merger Parent or the Vendor (net of taxes and insurance proceeds received
as provided in Paragraph 5.3, above) shall exceed in the aggregate $50,000
(the "Basket Amount") and then only for amounts in excess of the Basket
Amount. Notwithstanding the foregoing and in no event shall the aggregate
liability with respect to all claims of indemnification made by either the
Vendor or the Merger Parent exceed an aggregate amount of $250,000 (the "Cap
Amount"). Neither party shall indemnify the other from and any punitive,
consequential or indirect damages, or any asserted or established claim for
any damages which provides for recovery based on any multiple of losses, lost
profits or anticipated profits.
5.5 Any party (a "Claiming Party") requesting indemnity under this Section
shall provide demand and notice of such request to the party from whom the
Claiming Party requests indemnity (the "Indemnifying Party") in writing,
within 20 days of receipt of notice (constructive or actual) of the claim for
which indemnity is requested. The Indemnifying Party shall then have 10 days
within which to acknowledge and accept responsibility for such indemnity. If
within 10 days of notice the Claiming Party accepts responsibility for
indemnity under this provision, the Claiming Party shall cooperate with the
Indemnifying Party, who shall take primary responsibility for defense of such
claim, including choice of counsel. The Claiming Party may retain additional
counsel of their own choosing, but at the Indemnified Party's expense. Any
Claiming Party for whose claim the Indemnifying Party has accepted
responsibility under this provision shall not negotiate, compromise or settle
any claim against the Claiming Party without the Indemnifying Party's written
consent.
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5.6 Notwithstanding any of the provisions set forth in this Section 5, in
the event that the Indemnifying Party can establish that the Claiming Party
had knowledge on or before the Time of Closing, of a breach of any warranty
or representation, then the Indemnifying Party shall not be liable under this
Section 5 for any loss resulting from or arising out of any such breach.
5.7 The sole remedy of the Merger Parent for any and all claims of the
nature described in Paragraph 5.1, above, shall be the indemnity set forth in
Paragraph 5.1 and the sole remedy of the Vendor for any and all claims of the
nature described in Paragraph 5.2, above, shall be the indemnity set forth in
Paragraph 5.2, in each case as limited by the provisions set forth in this
Section 5. The parties' indemnification obligations pursuant to Paragraphs
5.1 and 5.2, above, shall terminate upon the expiration of the applicable
time limits listed in this Section 5 (the "Survival Time"). Any claims for
indemnification not submitted in writing by the Claiming Party prior to the
Survival Time shall be deemed to have been waived. Any claims for
indemnification made in good faith by the Claiming Party in writing prior to
the Survival Time and the right of indemnity with respect thereto shall
survive such termination until resolved or judicially determined.
6. CLOSING DOCUMENTS
6.1 At the Time of Closing, the Shareholders of Targetco shall deliver to
the counsel for the Merger Parent:
(a) a certified true copy of the resolutions of the directors of
Targetco and the Subsidiary evidencing that the directors of the Targetco and
the Subsidiary have approved this Agreement and all of the transactions of
Targetco contemplated hereunder and the resolutions shall include specific
reference to:
(i) the cancellation of the share certificates (the "Old Share
Certificates") representing the Targetco Shares held as set forth in paragraph B
of the recitals to this Agreement; and
(ii) approval of the Articles of Merger whereby Targetco is
merged with the Subsidiary;
(b) the Old Share Certificates;
(c) duly executed Articles of Merger in form for filing in the
State of Wisconsin;
(d) the Employment Agreement referred to in subparagraph 2.1
(b) of this Agreement;
(e) all the minute books and corporate seals of Targetco; and
(f) a release in the form of Schedule "G" to this Agreement
(the "Release") from each of the Shareholders of Targetco of all claims
against Targetco for any outstanding amounts owing by Targetco to any of the
Shareholders of Targetco on account of any loans, bonuses, reimbursements,
compensation, fees, royalties, dividends or other consideration whatsoever,
except only as provided in the Employment Agreements.
6.2 At the Time of Closing, the Merger Parent shall deliver to the counsel
for the Vendor:
(a) certified true copies of the resolutions of the directors
of the Merger Parent and the Subsidiary, evidencing that the directors of the
Merger Parent and the Subsidiary have approved this Agreement and all of the
transactions of the Merger Parent and the Subsidiary contemplated hereunder;
(b) the balance of the Cash Portion after payment of the
Deposit as provided for in subparagraph 1.6 of this Agreement, as set forth
on Schedule 1.3, which balance is to be paid by wire transfer to Xxxxxxx &
Xxxx, S.C. as exchange agent for the Shareholders of Targetco;
(c) share certificates representing the Merger Parent's Shares
registered in the individual names of the Shareholders of Targetco as
provided for in subparagraph 1.3 of this Agreement;
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(d) a certificate of confirmation signed by an officer or
director of the Merger Parent in the form attached as Schedule ____ to this
Agreement.
7. GENERAL
7.1 Time and each of the terms and conditions of this Agreement shall be of
the essence of this Agreement and any waiver by the parties of this paragraph
7.1 or any failure by them to exercise any of their rights under this
Agreement shall be limited to the particular instance and shall not extend to
any other instance or matter in this Agreement or otherwise affect any of
their rights or remedies under this Agreement.
7.2 The Schedules to this Agreement incorporated by reference and the
recitals to this Agreement constitute a part of this Agreement.
7.3 This Agreement constitutes the entire Agreement between the parties
hereto in respect of the matters referred to herein and there are no
representations, warranties, covenants or agreements, expressed or implied,
collateral hereto other than as expressly set forth or referred to herein.
7.4 The headings in this Agreement are for reference only and do not
constitute terms of the Agreement.
7.5 The provisions contained in this Agreement which, by their terms,
require performance by a party to this Agreement subsequent to the Closing
Date of this Agreement, shall survive the Closing Date of this Agreement.
7.6 No alteration, amendment, modification or interpretation of this
Agreement or any provision of this Agreement shall be valid and binding upon
the parties hereto unless such alteration, amendment, modification or
interpretation is in written form executed by the parties directly affected
by such alteration, amendment, modification or interpretation.
7.7 Whenever the singular or masculine is used in this Agreement the same
shall be deemed to include the plural or the feminine or the body corporate
as the context may require.
7.8 The parties hereto shall execute and deliver all such further documents
and instruments and do all such acts and things as any party may, either
before or after the Closing Date, reasonably require in order to carry out
the full intent and meaning of this Agreement.
7.9 Any notice, request, demand and other communication to be given under
this Agreement shall be in writing and shall be delivered by hand or by
telecopier to the parties at the addresses indicated in the signature block
to this Agreement or to such other addresses as may be given in writing by
the parties hereto in the manner provided for in this paragraph, and shall be
deemed to have been received, if delivered by hand, on the date of delivery,
or if delivered by telecopier, on the date that it is sent.
7.10 This Agreement or any rights hereunder may be assigned by the Merger
Parent, but any such assignment shall not release the Merger Parent from its
obligations hereunder.
7.11 This Agreement shall be subject to, governed by, and construed in
accordance with the laws of the State of Wisconsin, and all disputes arising
under this Agreement shall be resolved in, and the parties hereto submit to
the jurisdiction of, the State or Federal Courts of Wisconsin.
7.12 This Agreement may be signed by the parties in as many counterparts as
may be deemed necessary, each of which so signed shall be deemed to be an
original, and all such counterparts together shall constitute one and the
same instrument.
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IN WITNESS WHEREOF the parties have hereunto set their hands and seals as of
the Effective Date first above written.
MERGER PARENT TARGETCO
INTERNET SPORTS NETWORK, INC. INNOVATION PARTNERS, INC.
By: /s/ XXX XXXXX By: /s/ XXXXXXX X. XXXXXX
--------------------------- --------------------------
Its: Chief Executive Officer Its: President
VENDORS
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SCHEDULE "A"
Employment Agreement
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made, entered into, and
effective as of July __, 1999 (the "Effective Date"), by and between Internet
Sports Network, Inc., a Florida corporation ("Company"), and Xxxx Xxxxxx, an
individual ("Employee").
RECITALS
A. Company desires to have an employment agreement with Employee and
Employee desires to enter into an employment agreement with Company for the
position set forth in Schedule A subject to the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
conditions contained herein, the parties hereto hereby agree as follows:
AGREEMENT
1. Term and Duties. Company hereby employs Employee in the position set out
on Schedule A to this Agreement, and Employee agrees to fulfil the duties and
responsibilities set out on Schedule A to this Agreement, subject to changes
consistent with the usual duties and responsibilities of that position as may
be reasonably prescribed by the Board of Directors of the Company (the
"Board") from time to time. Employee shall devote his full time and attention
to the business of Company as shall be required to perform the required
services and duties. Employee at all times during the employment term shall
strictly adhere to and obey all policies, rules and regulations established
from time to time governing the conduct of employees of Company.
2. Duties of Employee.
2.1 Employee agrees to perform Employee's services efficiently and
to the best of Employee's ability. Employee agrees throughout the term of
this Agreement to devote his full time, energy and skill to the business of
the Company and to the promotion of the best interests of the Company.
2.2 Employee agrees that he shall not at any time, either during or
subsequent to his employment term, unless expressly consented to in writing
by Company, either directly or indirectly use or disclose to any person or
entity any confidential information of any kind, nature or description
concerning any matters affecting or relating to the business of Company,
including, but not limited to, information concerning the customers of
Company, Company's marketing methods, compensation paid to employees,
independent contractors or suppliers and other terms of their employment or
contractual relationships, financial and business records, know-how, or any
other information concerning the business of Company, its manner of
operations, or other data of any kind, nature or description. Employee agrees
that the above information and items are important, material and confidential
trade secrets and these affect the successful conduct of Company's business
and its goodwill. This non-disclosure obligation does not apply to any
information which is presently in the public domain, or any information that
subsequently becomes part of the public domain through no fault of Employee.
2.3 Employee will not, during his employment with the Company,
engage in any business, enterprise or activity that is contrary to or
detracts from the business of the Company or the proper fulfillment of his
duties and responsibilities to the Company.
2.4 Employee acknowledges that as this Agreement is entered into in
connection with the sale of the controlling interest of the Company by
Employee to Parent Company, he will comply with all the restrictions set
forth below at all times during his employment and for a period of twenty
four (24) months after the termination of his employment:
a. Employee will not, either individually or in
conjunction with any person, as principal, agent,
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director, officer, employee, investor or in any other manner whatsoever,
directly or indirectly engage in or become financially interested in any
competitive business within the State of Wisconsin, except as a passive
investor holding not more than one percent of the publicly traded stock of a
corporation in which Employee is not involved in management;
b. Employee will not, either directly or indirectly, on
its own behalf of on behalf of others, solicit, divert or appropriate or
attempt to solicit, divert or appropriate to any competitive business, any
business or actively sought prospective business of the Company or any
customers with whom the Company or any affiliate of the Company has current
agreements relating to the business of the Company, or with whom Employee has
dealt, or with whom Employee has supervised negotiations or business
relations, or about whom Employee has acquired confidential information in
the course of Employee's employment;
c. Employee will not, either directly or indirectly, on
Employee's behalf or on behalf of others, solicit, divert or hire away, or
attempt to solicit, divert, or hire away, any independent contractor or any
person employed by the Company or any affiliate of the Company or persuade or
attempt to persuade any such individual to terminate his or her employment
with the Company; and,
d. Employee will not directly or indirectly impair or seek
to impair the reputation of the Company or any affiliate of the Company, nor
any relationship that the Company or any affiliate of the Company has with
its employees, customers, suppliers, agents or other parties with which the
Company or any other affiliate of the Company does business or has
contractual relations;
e. Employee will not receive or accept for its own
benefit, either directly or indirectly, any commission, rebate, discount,
gratuity or profit from any person having or proposing to have one or more
business transactions with the Company or any affiliate of the Company,
without the prior approval of the Board, which may be withheld; and,
f. Employee will, during the term of this employment with
the Company, communicate and channel to the Company all knowledge, business
and customer contacts and any other information that could concern or be in
any way beneficial to the business of the Company. Any such information
communicated to the Company as aforesaid will be and remain the property of
the Company notwithstanding any subsequent termination of Employee's
employment.
3. Compensation.
3.1 Subject to the termination of this Agreement as provided
herein, Company shall compensate Employee for his services hereunder at an
annual salary set forth in Schedule A, subject to changes by mutual
agreement, payable in accordance with the Company's standard salary payment
schedule. Payment of Employee's Salary will be subject to income tax source
deductions and other deductions required by applicable law.
3.2 Employee is also eligible to receive such additional
compensation as the Board of Directors of Company determines is proper in
recognition of Employee's contributions and services to Company. Such
additional compensation shall be paid to Employee on the anniversary date of
this Agreement during the Employment Term, and at such other times as may be
determined by the Board of Directors.
3.3 In addition to the compensation set forth above, Employee shall
be entitled to participate in or to receive benefits under all of Company's
employee benefit plans made available by Company now or in the future to
similarly situated employees, subject to the terms, conditions and overall
administration of such plans. Employee shall be entitled to participate in or
to receive benefits under all of Company's employee benefit plans made
available by Company or in the future to similarly situated employees,
subject to the terms, conditions and overall administration of such plans.
Including but not limited to 401(k) plans, XXX plans, E.R.I.S.A Plans, any
other retirement or benefit plans that the Company has made available to
similarly situated employees.
4. Expenses. Company shall reimburse Employee for all pre-approved
reasonable business related expenses incurred by Employee in the course of
his normal duties on behalf of the Company. In compensating Employee for
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expenses, the ordinary and usual business guidelines and documentation
requirements shall be adhered to by Company and Employee.
(a) Employee will be required to incur travel, meals, entertainment
and other business expenses on behalf of the Company in the performance of
Employee's duties hereunder. Company will reimburse Employee for all such
reasonable business expenses incurred by Employee in connection with
Company's business upon presentation of receipts or other acceptable
documentation of the expenditures.
5. Assignment of Intellectual Property Rights. As consideration for
your employment with Company, Employee covenants and agrees as follows:
(a) Employee will make prompt and full disclosure to the Company of
any discovery, processes, inventions, patents, computer software, copyrights,
trademarks and other intangible rights (collectively referred to as
"Intellectual Property") that may be conceived, made, improved upon,
developed, or participated by Employee, solely or jointly, in the course of,
arising from or relating to any Intellectual Property Rights of the Company,
or his employment with the Company or any affiliate of the Company (the "Work
Products").
(b) The Company will hold all Intellectual Property Rights in
respect of the Work Products for the exclusive benefit of the Company and
Employee agrees not to claim or apply for registration or challenge the
Company's registration of, any such Intellectual Property Rights. Employee's
acceptance of the terms of this Agreement constitutes an absolute,
unconditional and irrevocable assignment, transfer and conveyance of all
past, present and future right, title, benefit and interest in and to all
Intellectual Property Rights in respect of the Work Products. Employee hereby
waives, in favor of the Company, all claims of any nature whatsoever that
Employee now or hereafter may have for infringement of any Intellectual
Property Rights for the Work Products so assigned to the Company. To the
extent that copyright may subsist in the Work Products, Employee hereby
waives all past, present and future moral rights he may have.
(c) The Work Products and all related Intellectual Property Rights
will be the absolute and exclusive property of the Company. The Company may
apply for patent, copyright or other intellectual property protection in the
Company's name or, where such procedure is proper, in Employee's name,
anywhere in the world. Employee will, at the Company's request, execute all
documents and do all such acts and things considered necessary by the Company
to obtain, confirm or enforce any Intellectual Property Rights in respect of
the Inventions. In case the Company requires, but is unable to secure
Employee's signature for any such purpose in a timely manner, Employee hereby
irrevocably designate and appoint the Company and any duly authorized officer
or agent of the Company as Employee's agent and attorney, to act for Employee
and in Employee's behalf an stead to execute any such documents and to do all
other lawfully permitted acts to carry out the intent of this provision, with
the same legal force and effect as if executed or done by Employee. This
power of attorney is coupled with an interest.
6. Disability of Employee.
6.1 Employee shall be considered disabled if, due to illness or
injury, either physical or mental, Employee is unable to perform Employee's
customary duties as an employee of Company for more than thirty (30) days in
the aggregate out of a period of twelve (12) consecutive months. The
disability shall be determined by a certification from a physician.
6.2 If Employee is determined to be disabled, Company shall
continue to pay Employee's base salary for the initial ninety (90) days of
"disability." The continuation of the salary compensation after the initial
ninety (90) days shall be determined by the Board of Directors of the Company.
7. Termination By Company.
7.1 Unless terminated earlier as provided in this Agreement,
Employee shall be employed for a term set forth in Schedule A. Thereafter,
the employment term shall continue on an at will basis until terminated at
the option of Company or Employee upon thirty (30) days prior written notice.
This Agreement may be terminated at any time by
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written agreement between the parties, or as provided in Section 8.2 below.
This Agreement will terminate immediately upon Employee's death.
7.2 Company may terminate this Agreement for cause at any time
without notice. For purposes of this Agreement, the term "cause" shall
include, but not be limited to, the following: a material breach of or
failure to perform any covenant or obligation in this Agreement, disloyalty,
dishonesty, neglect of duties, unprofessional conduct, acts of moral
turpitude, disappearance, felonious conduct or fraud, the use of illegal
drugs or the habitual and disabling use of alcohol and drugs, embezzlement or
similar conduct.
8. Termination By Employee. Employee may terminate this Agreement without
cause upon thirty (30) days prior written notice to Company. All obligations
of Employee to Company under section 2.4 and 6 shall survive the termination
of this Agreement.
9. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto their respective devisees, legatees, heirs,
legal representatives, successors, and permitted assigns. The preceding
sentence shall not affect any restriction on assignment set forth elsewhere
in this Agreement.
10. Effect of Combination or Dissolution. This Agreement shall not be
terminated by the voluntary or involuntary dissolution of Company, or by any
merger or consolidation in which Company is not the surviving or resulting
corporation, or upon any transfer of all or substantially all of the
outstanding shares or assets of Company. Instead, the provisions of this
Agreement shall be binding on and inure to the benefit of Company's
creditors, the surviving business entity or the business entity to which such
shares or assets shall be transferred.
11. Arbitration. If a dispute or claim shall arise with respect to any of the
terms or provisions of this Agreement, or with respect to the performance by
either of the parties under this Agreement, other than a dispute with respect
to Section 2 of this Agreement, then either party may, with notice as herein
provided, require that the dispute be submitted under the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"). Each party
shall bear one-half (1/2) of the cost of appointing the arbitrator and of
paying such arbitrator's fees. The written decision of the arbitrator(s)
ultimately appointed by or for both parties shall be binding and conclusive
on the parties. Judgment may be entered on such written decision of the
single arbitrator in any court having jurisdiction. Any arbitration
undertaken pursuant to the terms of this section shall occur in the county of
the Company's office in Santa Xxxxx County, California, or in the county of
such other state that the Company has an office at the time of the
arbitration as is designated by the Company.
12. Assignment. Subject to all other provisions of this Agreement, any
attempt to assign or transfer this Agreement or any of the rights conferred
hereby, by judicial process or otherwise, to any person, firm, Company, or
corporation without the prior written consent of the other party, shall be
invalid, and may, at the option of such other party, result in an incurable
event of default resulting in termination of this Agreement and all rights
hereby conferred.
13. Choice of Law. This Agreement and the rights of the parties hereunder
shall be governed by and construed in accordance with the laws of the State
of Florida including all matters of construction, validity, performance, and
enforcement and without giving effect to the principles of conflict of laws.
14. Indemnification. Company shall indemnify, defend and hold Employee
harmless, to the fullest extent permitted by law, for all claims, demands,
losses, costs, expenses, obligations, liabilities, damages, recoveries and
deficiencies, including interest, penalties and reasonable attorney's fees
that Employee shall incur or suffer that arise from, result from or relate to
the discharge of Employee's duties under this Agreement. Company shall
maintain adequate insurance for this purpose or shall advance Employee any
expenses incurred in defending any such proceeding or claim to the maximum
extent permitted by law.
15. Entire Agreement. Except as provided herein, this Agreement, including
exhibits, contains the entire agreement of the parties, and supersedes all
existing negotiations, representations, or agreements and all other oral,
written, or other communications between them concerning the subject matter
of this Agreement. There are no representations, agreements, arrangements, or
understandings, oral or written, between and among the parties hereto
relating to the
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subject matter of this Agreement that are not fully expressed herein.
16. Severability. If any provision of this Agreement is unenforceable,
invalid, or violates applicable law, such provision, or unenforceable portion
of such provision, shall be deemed stricken and shall not affect the
enforceability of any other provisions of this Agreement.
17. Captions. The captions in this Agreement are inserted only as a matter of
convenience and for reference and shall not be deemed to define, limit,
enlarge, or describe the scope of this Agreement or the relationship of the
parties, and shall not affect this Agreement or the construction of any
provisions herein.
18. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which shall together
constitute one and the same instrument.
19. Modification. No change, modification, addition, or amendment to this
Agreement shall be valid unless in writing and signed by all parties hereto.
20. Attorneys' Fees. Except as otherwise provided herein, if a dispute should
arise between the parties including, but not limited to arbitration, the
prevailing party shall be reimbursed by the non- prevailing party for all
reasonable expenses incurred in resolving such dispute, including reasonable
attorneys' fees exclusive of such amount of attorneys' fees as shall be a
premium for result or for risk of loss under a contingency fee arrangement.
21. Taxes. Any income taxes required to be paid in connection with the
payments due hereunder, shall be borne by the party required to make such
payment. Any withholding taxes in the nature of a tax on income shall be
deducted from payments due, and the party required to withhold such tax shall
furnish to the party receiving such payment all documentation necessary to
prove the proper amount to withhold of such taxes and to prove payment to the
tax authority of such required withholding.
22. NOT FOR THE BENEFIT OF CREDITORS OR THIRD PARTIES. The provisions of this
Agreement are intended only for the regulation of relations among the
parties. This Agreement is not intended for the benefit of creditors of the
parties or other third parties and no rights are granted to creditors of the
parties or other third parties under this Agreement. Under no circumstances
shall any third party, who is a minor, be deemed to have accepted, adopted,
or acted in reliance upon this Agreement.
23. FACSIMILE SIGNATURES. Facsimile signatures shall be acceptable and
binding as originals.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the Effective Date.
INTERNET SPORTS NETWORK, INC. EMPLOYEE
By: /s/ XXX XXXXX By: /s/ XXXXXXX X. XXXXXX
---------------------------- ------------------------------
Its: Chief Executive Officer
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