Exhibit 10.1 Agreement and Plan of Reorganization of Tradestar
Construction Services, Inc.
AGREEMENT AND PLAN OF REORGANIZATION
January 30, 2004
FRONTIER STAFFING, INC.
ACQUISITION OF
TRADESTAR CONSTRUCTION SERVICES, INC.
TABLE OF CONTENTS
Page
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Recitals .....................................................................1
Agreement ...................................................................1
1. Plan of Reorganization ....................................1
2. Exchange of Shares ........................................1
3. Delivery of Shares .........................................2
4. Representations of Stockholder and Acquiree ...............2
5. Representations of Acquiring Corporation ..................4
6. Closing Date ..............................................5
7. Conditions Precedent to the Obligations of Acquiree .......5
8. Conditions Precedent to the Obligations of Acquiror .......6
9. Indemnification ...........................................7
10. Nature and Survival of Representations ....................7
11. Documents at Closing ......................................7
12. Miscellaneous .............................................8
Signature Page ............................................9
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AGREEMENT AND PLAN OF REORGANIZATION
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THIS Agreement and Plan of Reorganization is entered into this 30th day of
January, 2004, to be effective from January 1, 2004, by and between FRONTIER
STAFFING, INC., a Nevada corporation, (hereinafter "Acquiror"); and TRADESTAR
CONSTRUCTION SERVICES, INC., a New Mexico corporation; (hereinafter referred to
as "Acquiree"); and the undersigned Stockholder of Acquiree, (hereinafter
referred to as "Stockholder").
RECITALS
Stockholder of Acquiree owns or controls all of the issued and outstanding
common stock of Acquiree. Acquiror desires to acquire all of the issued and
outstanding stock of Acquiree, making Acquiree a wholly-owned subsidiary of
Acquiror, and Stockholder desires to make a tax-free exchange solely of its
shares in Acquiree for shares of Acquiror's common stock to be exchanged as set
out herein with said Stockholder.
NOW, THEREFORE, for the mutual consideration set out herein, the parties
agree as follows:
AGREEMENT
1. Plan of Reorganization. Stockholder of Acquiree is the owner of all
the issued and outstanding common stock of said Acquiree, which totals
100,000 common shares. It is the intention of the parties hereto that
all of the issued and outstanding common stock of Acquiree shall be
acquired by Acquiror in exchange solely for newly issued Acquiror
voting stock. It is the intention, but not a requirement, of the
parties hereto that this transaction qualify as a tax-free
reorganization under Section 368 of the Internal Revenue Code of 1986,
as amended.
2. Exchange of Shares. Acquiror and Stockholder agree that all of the
issued and outstanding securities of Acquiree shall be exchanged with
Acquiror for a total of 6,400,000 shares, in the aggregate, of
restricted common stock of Acquiror. The Acquiror shares will, on the
date of delivery to the Stockholder, (which is defined as the date in
Paragraph 6 herein), be delivered to the Stockholder in exchange for
its shares in Acquiree. Stockholder represents and warrants that it
will hold such shares of common stock of Acquiror for investment
purposes and not for further public distribution and agree that the
shares shall be appropriately restricted. As of the Delivery Date,
Acquiror shall have no more than 2,732,400 common shares issued and
outstanding; provided, however, that Acquiror has options to issue a
total of an additional 200,000 common shares.
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3. Delivery of Shares. On the Delivery Date (which is defined as the date
in Paragraph 6 herein), Stockholder will deliver certificates or other
evidence of ownership of Acquiree duly endorsed so as to make Acquiror
the sole holder thereof free and clear of all claims and encumbrances.
On the Delivery Date, delivery of the Acquiror shares, which will be
appropriately restricted as to transfer, will be made to the
Stockholder as set forth herein. A list of the shares of Acquiree, the
owner thereof, and shares of Acquiror to be received by said
Stockholder is attached hereto as Exhibit "A" and by this reference is
incorporated herein.
Subsequent to the Closing and Delivery Date, in the event, and only in the
event, that the Acquiror does not receive the minimum proceeds of a proposed
initial public offering to be undertaken by Acquiror, either the Shareholder or
the Acquiror may elect to rescind this transaction and declare it null and void,
ab initio; provided, however, that the Shareholder must return the said
6,400,000 common shares of ......... Acquiror to Acquiror in exchange for the
return of 100,000 common shares of Acquiree.
4. Representations of Stockholder and Acquiree. The Stockholder and
Acquiree, hereby represent and warrant that, with respect to their own
shares and as to the Acquiree, effective this date, the Closing Date
(which is defined as the date in Paragraph 6 herein), and the Delivery
Date, the representations listed below are true and correct to the
best of their knowledge, information, and belief. Said representations
are meant and intended by all parties to apply to the Acquiree:
(a) The listed Stockholder on Exhibit "A" is the sole owner of all of
the issued and outstanding shares of common stock of Acquiree;
such shares are free from claims, liens, or other encumbrances;
and Stockholder has the unqualified right to transfer and dispose
of such shares and assets.
(b) The issued shares of Acquiree constitute validly issued shares of
Acquiree, fully-paid and nonassessable.
(c) The unaudited year-end financial statements of Acquiree which
have been delivered to Acquiror, are complete, accurate and
fairly present the financial condition of Acquiree as of the
dates thereof and the results of its operations for the periods
covered. There are no liabilities, either fixed or contingent,
not reflected in such financial statements other than contracts
or obligations in the ordinary and usual course of business; and
no such contracts or obligations in the usual course of business
constitute liens or other liabilities which, if disclosed, would
alter substantially the financial condition of such Acquiree as
reflected in such financial statements.
(d) Prior to and as of the Closing Date and the Delivery Date, there
will not be any negative material changes in the financial
position of Acquiree, except changes arising in the ordinary
course of business, which changes will in no event adversely
affect the financial position of said Acquiree.
(e) Except as previously disclosed in the financial statements, to
the best of Acquiree's knowledge, information and belief, it is
not involved in, and has not received judicial notice of any
pending litigation or governmental investigation or proceeding
not reflected in such financial statement, or otherwise disclosed
in writing to Acquiror and, to the best knowledge of Acquiree and
Stockholder, no material litigation, claims, or assessments, or
governmental investigation or proceeding is threatened against
Acquiree, its principal stockholder or properties.
(f) As of the Closing Date and the Delivery Date, Acquiree will be in
good standing in its jurisdiction of incorporation, and will be
in good standing and in the process of becoming duly qualified to
do business in each jurisdiction where required to be so
qualified.
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(g) Acquiree has complied with all applicable laws in connection with
its formation, issuance of securities, organization,
capitalization and operations, and to the best of Acquiree's
knowledge, information and belief, no contingent liabilities have
been threatened or claims made, and no basis for the same exists
with respect to said operations, formation or capitalization,
including claims for violation of any US state or federal
securities laws.
(h) Acquiree has filed all governmental, tax or related returns and
reports due or required to be filed and has paid all taxes or
assessments which have or which shall become due as of the
Closing Date and the Delivery Date.
(i) Except as disclosed in this Agreement or on any Exhibit, Acquiree
has not breached any material agreement to which it individually
or collectively may be a party.
(j) Acquiree has no subsidiary.
(k) The corporate financial records, minute books, and other
documents and records of Acquiree are to be available to present
management of Acquiror prior to the Closing Date and shall be
kept at the Acquiree offices after the Delivery Date.
(l) The execution of this Agreement will not violate or breach any
agreement, contract, or commitment to which Acquiree or
Stockholder are a party and has been duly authorized by all
appropriate and necessary action.
(m) The authorized capitalization of Acquiree are as set forth in the
most recent audited balance sheet of Acquiree. All outstanding
shares have been duly authorized, validly issued and are fully
paid and nonassessable with no personal liability attaching to
the ownership thereof. There are no outstanding convertible
securities, warrants, options or commitments of any nature which
may cause authorized but unissued shares to be issued to any
person.
(n) To the best knowledge of Stockholder and Acquiree, Acquiree is
not subject to any material labor disputes or disagreements,
either actual or contingent.
(o) To the best knowledge of Stockholder and Acquiree, Acquiree's
products, materials and brochures do not infringe the patent or
copyright rights of any other person or entity.
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(p) At the date of this Agreement, Stockholder has, and at the
Closing Date and the Delivery Date, it will have to the best of
its knowledge, disclosed all events, conditions and facts
materially affecting the business and prospects of Acquiree and
its assets. Stockholder has not now and will not have, at the
Closing Date or the Delivery Date, withheld knowledge of any such
events, conditions, and facts which it knows, or has reasonable
grounds to know, may materially affect the business and prospects
of Acquiree or its assets.
5. Representations of Acquiring Corporation. Acquiror hereby represents
and warrants as follows, effective this date, the Closing Date, and
the Delivery Date, the representations listed below are true and
correct to the best of its knowledge, information, and belief:
(a) As of the Delivery Date, the Acquiror shares to be delivered to
the Stockholder will constitute valid and legally issued shares
of Acquiror, fully-paid and nonassessable, and will be legally
equivalent in all respects to the common stock of Acquiror issued
and outstanding as of the date thereof.
(b) The officers of Acquiror are duly authorized to execute this
Agreement and have taken all actions required by law and
agreements, charters, and bylaws, to properly and legally execute
this Agreement.
(c) Acquiror has made available to Acquiree combined audited
financial statements for the past two fiscal years, which shall
be true, complete and accurate; there are and shall be no
substantial liabilities, either fixed or contingent, not
reflected in such financial statements and records or to which
the Acquiree has not been made aware. Said financial statements
fairly and accurately reflect the financial condition of the
Acquiror as of the date thereof and the results of operations for
the period reflected therein. Such statements shall have been
prepared in accordance with US Generally Accepted Accounting
Principles, consistently applied.
(d) Prior to and as of the Closing Date and the Delivery Date, there
will not be any material changes in the financial position of
Acquiror, except changes arising in the ordinary course of
business, which changes will in no event adversely affect the
financial condition of the Acquiror; provided, however, that
Acquiror will have sold or transferred all of its operations as
of the Delivery Date.
(e) Except as previously disclosed, Acquiror is not involved in any
pending litigation, claims, or governmental investigation or
proceeding not reflected in such financial statements or
otherwise disclosed in writing to the Stockholder, and there are
otherwise no lawsuits, claims, assessments, investigations, or
similar matters, to the best knowledge of management, threatened
or contemplated against Acquiror, its management or properties.
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(f) As of the Closing Date and the Delivery Date, Acquiror is duly
organized, validly existing and in good standing under the laws
of the State of Nevada; it has the corporate power to own its
property and to carry on its business as now being conducted and
is duly qualified to do business in any jurisdiction where so
required.
(g) Except as previously disclosed, Acquiror has not breached, nor is
there any pending or threatened claims or any legal basis for a
claim that Acquiror has breached, any of the terms or conditions
of any agreements, contracts or commitments to which it is a
party or is bound and the execution and performance hereof will
not violate any provisions of applicable law of any agreement to
which Acquiror is subject.
(h) The present capitalization of Acquiror is as outlined in its most
recent financial statement. All outstanding shares have been duly
authorized, validly issued, and fully paid. There are not
outstanding or presently authorized securities, warrants, options
or related commitments of any nature.
(i) Acquiror has no subsidiary corporations.
(j) The shares of restricted common stock of Acquiror to be issued to
Stockholder as of the Delivery Date, will be validly issued,
nonassessable and fully-paid under Nevada corporation law and
will be issued in a non-public offering and exempted transaction
under federal and state securities laws.
(k) At the date of this Agreement, Acquiror has, and at the Closing
Date, and as of the Delivery Date it will have, disclosed all
events, conditions and facts materially affecting the business
and prospects of Acquiror. Acquiror has not now and will not
have, at the Closing Date, or at the Delivery Date, withheld
disclosure of any such events, conditions, and facts which it,
through management has knowledge of, or has reasonable grounds to
know, may materially affect the business and prospects of
Acquiror.
(l) Acquiror represents that, except as previously disclosed, it has
no existing or threatened liabilities, claims, lawsuits, or basis
for the same with respect to its shareholders, the public,
brokers, the U.S. Securities and Exchange Commission, state
agencies or other persons. This includes matters relating to
state or federal securities laws as well as general common law or
state corporation law principles.
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6. Closing and Delivery Date. The Closing Date herein referred to shall
be upon such date as the parties hereto may mutually agree for the
execution of this Agreement and is January 1, 2004. This Agreement is
executed by the parties as of the Closing Date and effective as of the
Deliver Date hereof. The date of delivery of all of the documentation
shall be known as the Delivery Date. Certain exhibits, etc. may be
delivered subsequent to the Delivery Date upon the mutual agreement of
the parties hereto. The Stockholder will be deemed to have accepted,
as of the Delivery Date, delivery of the certificates of stock to be
issued in its name, and in connection therewith will make delivery of
its stock in Acquiree to Acquiror.
7. Conditions Precedent to the Obligations of Acquiree. All obligations
of Acquiree and Stockholder under this Agreement are subject to the
fulfillment, prior to, as of the Closing Date, or at the Delivery
Date, of each of the following conditions:
(a) The representations and warranties by or on behalf of Acquiror
contained in this Agreement or in any certificate or document
delivered to Acquiree pursuant to the provisions hereof shall be
true in all material respects at and as of the Closing Date and
the Delivery Date as though such representations and warranties
were made at and as of such time.
(b) Acquiror shall have performed and complied with all covenants,
agreements, and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing Date,
subject only to the conditions required on the Delivery Date.
(c) The Directors of Acquiror shall have approved and ratified this
transaction, respectively, shall have approved a change of the
name of the Acquiror to such name as may be reasonably selected
by Stockholder, and such other reasonable matters as requested by
Acquiree as pertaining to this transaction.
(d) The management of Acquiror shall have resigned and shall have
been replaced by management selected by the Shareholder
8. Conditions Precedent to the Obligations of Acquiror. All obligations
of the Acquiror under this Agreement are subject to the fulfillment,
prior to, as of the Closing Date, or at the Delivery Date, of each of
the following conditions:
(a) The representations and warranties by Acquiree and Stockholder
contained in this Agreement or in any certificate or document
delivered to Acquiror pursuant to the provisions hereof shall be
true at and as of the Closing Date and the Delivery Date as
though such representations and warranties were made at and as of
such time.
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(b) Acquiree and Stockholder shall have performed and complied with
all covenants, agreements, and conditions required by this
Agreement to be performed or complied with by it prior to or at
the Closing Date, subject only to the conditions on the Delivery
Date.
(c) Stockholder shall deliver to Acquiror a letter commonly known as
an "investment letter" agreeing that the shares of stock in
Acquiror are being acquired for investment purposes, and not with
a view to resale.
(d) Stockholder shall state, and reaffirm as of the Delivery Date,
that the materials, including, current financial statements,
prepared and delivered by Acquiror to Stockholder, have been read
and understood by Stockholder, that it is familiar with the
business of Acquiror, that it is acquiring the Acquiror shares
under Section 4(2), commonly known as the private offering
exemption of the Securities Act of 1933 and that the shares are
restricted and may not be resold, except in reliance on an
exemption under the Act.
(e) The Directors and Shareholder of Acquiror shall have approved and
ratified this transaction, respectively, and such other
reasonable matters as requested by Acquiree as pertaining to this
transaction.
9. Indemnification. Within the period provided in paragraph 10 herein and
in accordance with the terms of that paragraph, each party to this
Agreement, shall indemnify and hold harmless each other party at all
times after the date of this Agreement against and in respect of any
liability, damage or deficiency, all actions, suits, proceedings,
demands, assessments, judgments, costs and expenses including
attorney's fees incident to any of the foregoing, resulting from any
misrepresentations, breach of covenant or warranty or non-fulfillment
of any agreement on the part of such party under this Agreement or
from any misrepresentation in or omission from any certificate
furnished or to be furnished to a party hereunder. Subject to the
terms of this Agreement, the defaulting party shall reimburse the
other party or parties on demand, for any reasonable payment made by
said parties at any time after the Closing, in respect of any
liability or claim to which the foregoing indemnity relates, if such
payment is made after reasonable notice to the other party to defend
or satisfy the same and such party failed to defend or satisfy the
same.
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10. Nature and Survival of Representations. All representations,
warranties and covenants made by any party in this Agreement shall
survive the Closing hereunder and the consummation of the transactions
contemplated hereby for three years from the date hereof. All of the
parties hereto are executing and carrying out the provisions of this
Agreement in reliance solely on the representations, warranties and
covenants and agreements contained in this Agreement and not upon any
investigation upon which it might have made or any representations,
warranty, agreement, promise or information, written or oral, made by
the other party or any other person other than as specifically set
forth herein.
11. Documents at Closing. Between the date hereof and the Delivery Date,
the following transactions shall occur, all of such transactions being
deemed to occur simultaneously:
(a) Stockholder will deliver, or cause to be delivered, to Acquiror
the following:
(1) stock certificates for the stock of Acquiree being tendered
hereunder, duly endorsed in blank,
(2) all corporate records of Acquiree, including without
limitation corporate minute books (which shall contain
copies of the Articles of Incorporation and Bylaws, as
amended to the Delivery Date), stock books, stock transfer
books, corporate seals, and such other corporate books and
records as may reasonably requested for review by Acquiror
and its counsel;
(3) a certificate of the President of Acquiree to the effect
that all representations and warranties of Acquiree made
under this Agreement are reaffirmed on the Closing Date and
the Delivery Date, the same as though originally given on
said date;
(4) executed lock up agreements for common stock to be issued
hereunder in such form as may be acceptable to all parties
hereto.
(5) such other instruments, documents and certificates, if any,
as are required to be delivered pursuant to the provisions
of this Agreement or which may be reasonably requested in
furtherance of the provisions of this Agreement;
(b) Acquiror will deliver or cause to be delivered to Stockholder and
Acquiree:
(1) stock certificates for Common Stock to be issued as a part
of the exchange as listed on Exhibit "A" after the date of
approval of this transaction by the Acquiror shareholders;
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(2) a certificate of the President of Acquiror to the effect
that all representations and warranties of Acquiror made
under this Agreement are reaffirmed on the Closing Date and
the Delivery Date, the same as though originally given on
said date;
(3) certified copies of resolutions by Acquiror's Board of
Directors and shareholders authorizing this transaction;
(4) such other instruments and documents as are required to be
delivered pursuant to the provisions of this Agreement.
12. Miscellaneous.
(a) Further Assurances. At any time, and from time to time, after the
effective date, each party will execute such additional
instruments and take such action as may be reasonably requested
by the other party to confirm or perfect title to any property
transferred hereunder or otherwise to carry out the intent and
purposes of this Agreement.
(b) Waiver. Any failure on the part of any party hereto to comply
with any of its obligations, agreements or conditions hereunder
may be waived in writing by the party to whom such compliance is
owed.
(c) Brokers. Neither party has employed any brokers or finders with
regard to this Agreement unless otherwise described in writing to
all parties hereto.
(d) Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given if delivered in
person or sent by prepaid first class registered or certified
mail, return receipt requested.
(e) Headings. The section and subsection headings in this Agreement
are inserted for convenience only and shall not affect in any way
the meaning or interpretation of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument.
(g) Governing Law. This Agreement was negotiated and is being
contracted for in the State of Nevada, and shall be governed by
the laws of the State of Nevada, and the securities being issued
herein are being issued and delivered in accordance with the
isolated transaction and non-public offering exemption.
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(h) Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
heirs, administrators, executors, successors and assigns.
(i) Entire Agreement. This Agreement is the entire agreement of the
parties covering everything agreed upon or understood in the
transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any
kind of condition or inducements to the execution hereof.
(j) Time. Time is of the essence.
(k) Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full
force and effect.
(l) Default Costs. In the event any party hereto has to resort to
legal action to enforce any of the terms hereof, such party shall
be entitled to collect attorneys fees and other costs from the
party in default.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written. FRONTIER STAFFING, INC. a Nevada Corporation
By: /s/
-------------------------------------------------
President
TRADESTAR CONSTRUCTION SERVICES, INC.
a New Mexico Corporation
By: /s/
-------------------------------------------------
President
SHAREHOLDER OF ACQUIREE:
/s/ Xxxxxxxx Xxxxx
----------------------------------------------------
Xxxxxxxx Xxxxx
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FRONTIER STAFFING, INC.
OFFICER'S CERTIFICATE
The undersigned, President of FRONTIER STAFFING, INC. ("Acquiror"), does
hereby certify that he is a duly elected, qualified and acting officer of
Acquiror, a Nevada corporation, and as such is familiar with the business
affairs of said corporation, and is familiar with and has read that certain
Agreement and Plan of Reorganization between Acquiror and Acquiree, dated
January 30, 2004.
The undersigned does hereby state that the representations and warranties
made by Acquiror contained in said Agreement, to the best of his knowledge, are
true and correct at and as of the time of closing and the date of delivery of
Acquiror's shares. In addition, the undersigned hereby states that to the best
of his knowledge, Acquiror has performed and complied with all covenants,
agreements and conditions required by the Agreement to be performed or complied
with by Acquiror prior to or at the Closing Date or the Delivery Date.
IN WITNESS WHEREOF, the undersigned, has hereunto duly executed this
Certificate this 30th day of January, 2004.
FRONTIER STAFFING, INC.
By: /s/
-------------------------------------------------
President
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TRADESTAR CONSTRUCTION SERVICES, INC.
OFFICER'S CERTIFICATE
The undersigned, President of TRADESTAR CONSTRUCTION SERVICES, INC.
("Acquiree"), does hereby certify that he is a duly elected, qualified and
acting officer of Acquiree, a New Mexico corporation, and as such is familiar
with the business affairs of said corporation, and is familiar with and has read
that certain Agreement and Plan of Reorganization between Acquiror and Acquiree,
dated January 30, 2004.
The undersigned does hereby state that the representations and warranties
made by Acquiree contained in said Agreement, to the best of his knowledge, are
true and correct at and as of the time of closing and the date of delivery of
the Acquiror's shares. In addition, the undersigned hereby states that to the
best of his knowledge, Acquiree has performed and complied with all covenants,
agreements and conditions required by the Agreement to be performed or complied
with by Acquiree prior to or at the Closing Date or the Delivery Date.
IN WITNESS WHEREOF, the undersigned, has hereunto duly executed this
Certificate this 30th day of January, 2004.
TRADESTAR CONSTRUCTION
SERVICES, INC.
By: /s/
-------------------------------------------------
President
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EXHIBIT A
Name Number of Shares
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Xxxxxxxx Xxxxx 6,400,000
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