Exhibit 2.1
PLAN OF REORGANIZATION, PLAN OF MERGER AND MERGER AGREEMENT
This Plan of Reorganization, Plan of Merger and Merger Agreement (the
"Agreement") is entered into as of the 14th day of October, 1999, by and between
Union Financial Services, Inc., a Nevada corporation ("UFS") and National
Education Loan Network, Inc., a Nevada corporation (the "Corporation").
WHEREAS, UFS is the sole owner of all of the capital stock ("Company
Stock") of the Corporation; and
WHEREAS, the Corporation is the sole shareholder of NHELP, Inc., a
Nevada corporation, NEBHELP, INC., a Nebraska corporation, NHELP-I, Inc., a
Nevada corporation, NHELP-II, Inc., a Nevada corporation, NHELP-III, a Nevada
corporation, National Higher Education Loan Program, Inc., a Nebraska
corporation, and Maine Higher Education Loan Program, Inc. (collectively, the
"Subsidiaries"); and
WHEREAS, the Corporation and the Subsidiaries (collectively, the
"Companies") are in the business of acquiring, holding beneficial interests in
and financing guaranteed student loans under the Federal Family Educational Loan
Program; and
WHEREAS, the Corporation is desirous of merging with UFS on the terms
and conditions set forth herein, with UFS being the surviving corporation of the
merger (the "Merger").
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements contained herein, the parties hereto covenant and agree
as follows:
1. THE MERGER.
(a) Merger of the Corporation into UFS. In accordance
with Chapter 92A of the Nevada Revised Statutes, and subject to the terms and
conditions set forth herein, on the Effective Date (defined below), the
Corporation shall be merged with and into UFS, which shall be the surviving
corporation and whose name shall continue to be "Union Financial Services, Inc."
(b) Intention of the Parties.
(i) It is the intention of the parties that the
ownership of the Corporation and its business as a going concern, its
good will and all properties, assets and rights wheresoever located,
including those reflected in the Corporation's Financial Statements (as
defined below), shall be transferred, as part of the merger described
herein, to UFS as provided herein as of the Closing Date and remain the
business, goodwill, properties, assets and rights of UFS as of and
after the Closing Date.
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(ii) It is the intention of the parties that this
transaction qualify as a tax free reorganization within the meaning of
the Internal Revenue Code of 1986, as amended. The parties hereto agree
to amend or modify this Agreement in any reasonable manner necessary or
appropriate to accomplish such tax free reorganization.
2. CONVERSION AND EXCHANGE OF SHARES. As of the Effective Date,
by virtue of the Merger and without any action on the part of UFS, the
Corporation, or any holder of the outstanding shares of the corporations
participating in the Merger:
(a) Conversion of Company Stock. Each outstanding share
of the Company Stock issued and outstanding immediately prior to the Effective
Date (defined below) shall be canceled and extinguished, and shall cease to
exist by virtue of the Merger and without any action on the part of the holders
thereof.
(b) Surrender of Share Certificates. On the Effective
Date, the Corporation's shareholders shall surrender any and all outstanding
certificates theretofor representing shares of the Company Stock to UFS together
with any and all documents required by Section 4.
(c) Articles of Incorporation and Bylaws. On the
Effective Date (as hereinafter defined), the Articles of Incorporation of UFS,
as in effect immediately prior to the Effective Date, shall not be amended by
this Agreement, and until further amended shall be and remain the Articles of
Incorporation of UFS. At the Effective Date, the Bylaws of the Corporation shall
be and remain the Bylaws of UFS until altered, amended or repealed.
(d) Directors and Officers. From and after the Effective
Date, until successors are duly elected or appointed in accordance with the
applicable law and the bylaws, the directors and officers of UFS on the
Effective Date shall continue to be the directors and officers of UFS.
(e) UFS. On the Effective Date, the separate existence of
the Corporation shall cease and the Corporation shall be merged with and into
UFS. UFS shall, from and after the Effective Date, possess all the rights,
privileges, powers and franchises of whatsoever nature and description, as well
of a public as of a private nature, and subject to all of the restrictions,
disabilities and duties of each of UFS and the Corporation (the "Constituent
Corporations"), and all rights, privileges, powers and franchises of each of the
Constituent Corporations on whatever account as well as for stock subscription
as all other things in action or belonging to each of the Constituent
Corporations shall be vested in UFS; and all property, rights, privileges,
powers and franchises and all and every other interest shall be thereafter as
effectually the property of UFS as they were of the several and respective
Constituent Corporations shall not revert or be in any way or impaired by reason
of such merger. All rights of creditors and all liens upon property of the
Constituent Corporations shall be preserved unimpaired, and all debts,
liabilities, and duties of the Constituent Corporations shall thenceforth attach
to UFS, and may be enforced against it to the same extent as if such said debts,
liabilities, and duties have been incurred or contracted by it. Any claim
existing or action or proceeding, whether civil, criminal, or administrative,
pending by or against either Constituent Corporation may be prosecuted to
judgment or decree as if such merger had not taken place or UFS may
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be substituted in such action or proceeding. In addition, any reference to
either UFS or to the Corporation in any agreement or document, whether executed
or taking effect before or after the Effective Date, shall be considered a
reference to UFS if not inconsistent with the other provisions of the agreement
or document.
(f) Method of Effecting Merger and Effective Date. On the
Closing Date, the parties hereto will cause the Merger to be consummated by
delivering to the Secretary of State of the State of Nevada, for filing,
Articles of Merger in such form as required by, and executed and acknowledged in
accordance with, the relevant provisions of Chapter 92A of the Nevada Revised
Statutes. The Merger shall be effective (the "Effective Date") upon the filing
of the Articles of Merger with the Secretary of State of the State of Nevada.
(g) Additional Actions. If, at any time after the
Effective Date, UFS shall consider or be advised that any further deeds,
assignments, or assurances in law or any other acts are necessary or desirable
to (i) vest, perfect, or confirm, of record or otherwise, in UFS its right,
title, or interest in, to or under any of the rights, properties, or assets of
the Corporation and the Subsidiaries, or (ii) otherwise carry out the purposes
of this Agreement, the Corporation and its officers and directors shall be
deemed to have granted to UFS an irrevocable power of attorney to execute and
deliver all such deeds, assignments, or assurances in law and to do all acts
necessary or proper to vest, perfect, or confirm title to and possession of such
rights, properties, or assets in UFS and otherwise to carry out the purposes of
this Agreement, and the officers and directors of UFS are authorized in the name
of the Corporation or otherwise to take any and all such action.
3. CLOSING. Unless otherwise agreed to by written agreement of
the parties to this Agreement, the closing of the transactions contemplated by
this Agreement (the "Closing") shall take place on October 14, 1999 (the
"Closing Date").
4. EXECUTION AND DELIVERY OF CLOSING DOCUMENTS. At the Closing,
the parties shall execute and deliver each agreement and instrument required by
this Agreement to be executed and delivered and not then previously
accomplished. At the Effective Date, the Corporation shall execute and deliver,
or cause to be executed and delivered, the following:
(i) the certificate or certificates representing all
issued and outstanding shares of Company Stock as may be in the
Corporation's possession together with such endorsements, letters of
tender and transmittal, stock powers and other documents as UFS shall
reasonably request;
(ii) the certificate or certificates representing the
stock of the Subsidiaries and the corporate minute book for each of the
Subsidiaries; and
(iii) such other instruments and documents as may, in the
opinion of counsel for UFS, be reasonably necessary to fully consummate
the Merger and the other transactions contemplated by this Agreement.
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5. FURTHER ASSURANCES. At and after the Closing, the parties
hereto shall execute and deliver such additional documents and take such
additional actions as may be reasonably necessary or advisable in order to
consummate the transactions contemplated by this Agreement and to vest more
fully in UFS complete ownership of the Corporation.
6. REPRESENTATION AND WARRANTIES OF THE CORPORATION. The
Corporation represents and warrants to UFS with regard to the Companies, as
follows:
(a) Organization and Good Standing of the Companies.
(i) The Corporation is duly organized, validly
existing and in good standing under the laws of the State of Nevada.
(ii) The Subsidiaries are corporations which are
duly organized, validly existing and in good standing under the laws of
their respective states of incorporation.
(b) Subsidiaries and Other Investments. None of the
Companies owns, directly or indirectly, any of the capital stock of any other
corporation or any equity, participation, or other interest in any corporation,
partnership, joint venture or other noncorporate entity, except that the
Corporation is the owner of all of the capital stock of each of the
Subsidiaries, and except for NEBHELP, INC.'s interest in the NEBHELP Trust and
NHELP-II, Inc.'s membership in NHELP-II, LLC.
(c) Power and Authority. The Corporation has the
corporate power and authority, and possesses all licenses and permits required
by governmental authorities, to own, lease and operate its properties and assets
and to carry on its business as currently being conducted, and all the licenses
and permits of the Corporation are presently valid and in good standing and no
other licenses, permits or certificates are required for the operation of any of
the Corporation's assets used in connection with the Corporation's business.
(d) Authority and Validity. The Corporation has the legal
capacity and authority to execute, deliver and perform its obligations under
this Agreement and the other documents executed or required to be executed by
the Corporation in connection with this Agreement.
(e) Binding Effect. This Agreement and the other
documents executed or required to be executed by the Corporation in connection
with this Agreement are, or will be when executed and delivered, the legal,
valid and binding obligations of the Corporation, enforceable in accordance with
their respective terms.
(f) Compliance with Laws. The Corporation and the
Subsidiaries are in compliance with all laws applicable to its business and
assets, except where such would not have a material adverse effect on such
business or assets.
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(g) Financial Statements. The Corporation has delivered
to UFS true, correct and complete copies of financial statements of the
Corporation (the "Financial Statements"). The Financial Statements present
fairly in all material respects the assets, liabilities, and financial
position of the Corporation as of the date thereof and the results from
operations for the period then ended in conformity with generally accepted
accounting principles applied on a consistent basis.
(h) No Material Undisclosed Liabilities. There is no
material liability as defined by generally accepted accounting practices, loss,
contingency, contractual liability or obligation of the Corporation of any
nature, whether absolute, accrued, contingent or otherwise, other than the
liabilities and obligations that are fully reflected, accrued or reserved
against the Financial Statements, for which the reserves are appropriate and
reasonable.
(i) Survival of Representations. The representations and
warranties made within this Agreement will be correct in all material respects
on and as of the Closing Date with the same force and effect as though such
representations and warranties had been made on the Closing Date, and said
representations and warranties shall survive the Closing and not merge into the
closing documents but shall be in addition to these documents.
7. REPRESENTATIONS AND WARRANTIES OF UFS. UFS represents and
warrants to the Corporation as follows:
(a) Organization and Good Standing of UFS. UFS is a
corporation duly organized, validly existing and in good standing under the laws
of the state of Nevada.
(b) Power and Authority. UFS has the corporate power and
authority to merge with the Corporation and to assume the obligations to be
performed by it hereunder, to own, lease and operate its properties and assets
and to carry on its business as currently being conducted, and to consummate the
transaction herein contemplated.
(c) Binding Effect. This Agreement and the other
documents executed or required to be executed by UFS in connection with this
Agreement are, or will be when executed and delivered, the legal, valid and
binding obligations of UFS, enforceable in accordance with their respective
terms. The execution of this Agreement and the performance by UFS of the various
terms and provisions hereof will not violate the Articles of Incorporation or
Bylaws of UFS or any material indenture contract or other instrument to which
UFS is bound or require the consent of any third party or that such consent will
be obtained within a reasonable time after Closing.
8. ENTIRE AGREEMENT. This Agreement and any Exhibits attached
hereto contain the complete agreement among the parties with respect to the
transactions contemplated hereby and supersede all prior agreements and
understandings among the parties with respect to such transactions.
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9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and such counterparts together shall constitute only one original.
10. NOTICES. All notices, demands, requests, or other
communications that may be or are required to be given, served or sent by any
party to any other party pursuant to this Agreement shall be in writing and
shall be mailed by certified mail, return receipt requested, or by verifiable
overnight delivery postage prepaid, or by facsimile transmission with receipt
acknowledged, or transmitted by hand delivery, addressed as follows:
If to UFS:
Union Financial Services, Inc.
Attention: Xxxxxx X. Page
1801 California Ste 3920
Xxxxxx XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the Corporation:
National Education Loan Network, Inc.
Attention: Xxx Xxxx
000 X. 00xx Xxxxxx, Xxx. 000
Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to which any
communication may thereafter be so given, served or sent. Each notice or
communication that is mailed or delivered in the manner described above shall be
deemed given at such time as it is delivered to the addressee (with the return
receipt, the delivery receipt or the affidavit of messenger being deemed
conclusive evidence of such delivery) or at such time as delivery is refused by
the addressee upon presentation.
11. SUCCESSORS AND ASSIGNS. This Agreement and the rights,
interest, and obligations hereunder shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns,
including but not limited to successors and assigns by merger, purchase,
liquidation or other acquisition or disposition.
12. WAIVER OF MAILING REQUIREMENT. UFS, as the sole shareholder of
the Company Stock, hereby waives the requirement of mailing the Articles of
Merger pursuant to Section 92A.180 Nevada Revised Statutes.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Union Financial Services, Inc.
/s/ Xxxxxxx Xxxxxxxxxxx
By: ________________________________
President
Title: ________________________________
National Education Loan Network, Inc.
/s/ Xxx Xxxx
By: ________________________________
Xxx Xxxx, President
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