EXHIBIT "2" STOCK EXCHANGE AGREEMENT
This STOCK EXCHANGE AGREEMENT is entered into this 31st day of December, 1997 by
and between MIOA ACQUISITION COMPANY I, INC., a Florida corporation ("MIOA"),
GLOBAL AIR RESCUE, INC., a Delaware corporation (the "Company") and XXXXX
XXXXXXX, XXXXXX "SKIP" XXXXXXX, XXXXXX X. XXXX, XX. and XXX X. XXXXXX
("Shareholders").
RECITALS:
A. The Company is engaged in the ownership and leasing of aircraft (the
"Business").
B. Shareholders own fifteen hundred (1,500) shares of common stock, no par value
per share, of the Company (the "Global Shares"), which shares represent one
hundred percent (100%) of the issued and outstanding shares of capital stock of
the Company.
C. Subject to the terms and conditions set forth herein, MIOA desires to acquire
from the Shareholders fifteen hundred (1,500) Global Shares which will
constitute one hundred percent (100%) of all the issued and outstanding stock of
the Company in exchange solely for its restricted voting common stock.
NOW, THEREFORE, in consideration of the foregoing recitals, as well as the
mutual covenants hereinafter set forth, the parties hereto, intending to be
legally bound, hereby agree as follows:
ARTICLE I
EXCHANGE OF SHARES
1.1 EXCHANGE. Subject to the terms and conditions hereinafter set forth:
(a) The Shareholders agree to deliver to MIOA at Closing certificates
duly endorsed which evidence the Global Shares.
(b) Subject to adjustment as hereinafter set forth, MIOA agrees to
issue to the Shareholders, as designated in SCHEDULE 1.1 (b) (i) attached
hereto, at Closing, a number of shares of MIOA's parent, Medical Industries of
America, Inc., restricted voting common stock, no par value (the "MIOA Shares")
which will be equal to: the difference between the total appraised value of the
airplanes set forth in SCHEDULE 1.1(b) and the total debt encumbering such
airplanes divided by $1.50 per share.
If within 75 days of Closing, MIOA determines, in its sole and absolute
discretion, that the value of the Company does not support the value of the MIOA
Shares exchanged pursuant to this Agreement, then the parties shall in good
faith negotiate a reduced value or if they can not agree, then MIOA may by
written notice to the Shareholders rescind this transaction whereby the parties
shall return all shares of stock received hereby and the parties shall
thereafter have no further rights, duties and/or obligations relative to the
transactions contemplated by this Agreement.
(i) For purposes of determining the fair market value of the
Company, prior to the Closing Date, the Company shall, in consultation with the
MIOA, prepare and deliver to MIOA a projected statement of operations and
balance sheet of the Company as of the Effective Date which shall represent the
Company's reasonable estimate of the final closing Statement of Operations and
Balance Sheet as of the Effective Date; such estimated statement of operations
and balance sheet shall be in accordance with generally accepted accounting
principles and in a form consistent in every respect with, the Recent Statement
of Operations and Recent Balance Sheet as defined in Section 2.6 hereof and
accompanied by schedules setting forth in reasonable detail all income,
expenses, assets and liabilities included therein. Such estimated statement of
operations and balance sheet and the accompanying schedules shall contain
sufficient detail of the income, expenses, assets and liabilities of the Company
for the determination of the net income and net asset value. In the event MIOA
shall object to any of the information set forth on the estimated statement of
operations or balance sheet or accompanying schedules as presented by the
Company, the parties shall negotiate in good faith and agree on appropriate
adjustments. The estimated statement of operations as finally determined by the
parties pursuant to this subsection is herein referred to as the "Estimated
Closing Statement of Operations." The estimated balance sheet as finally
determined by the parties pursuant to this subsection is herein referred to as
the "Estimated Closing Balance Sheet." In connection with the determination of
the Estimated Closing Statement of Operations and the Estimated Closing Balance
Sheet, the Company shall provide to MIOA such information and detail as MIOA
shall reasonably request.
(ii) The final statement of operations and balance sheet of the
Company as of the Effective Date shall be prepared as follows:
(1) Within 75 days after the Closing Date, the
Shareholders, the Company and MIOA shall caused to be prepared and audited by
its auditors a final statement of operations and final balance sheet of the
Company as of the Effective Date, prepared in accordance with generally accepted
accounting principles from the books and records of the Company, on a basis
which shall fairly present the financial position of the Company as of the
Effective Date. The final statement of operations as finally determined by the
parties pursuant to this subsection is herein referred to as the "Final Closing
Statement of Operations." The final balance sheet as finally determined by the
parties pursuant to this subsection is herein referred to as the "Final Closing
Balance Sheet."
(2) Within 75 days following the delivery of the Final
Closing Balance Sheet and Final Closing Statement of Operations referred to in
(ii)(1) above, MIOA may object to any of the information contained in said Final
Balance Sheet, Final Closing Statement of Operations or accompanying schedules
which could affect the number of MIOA Shares to be paid by MIOA pursuant to this
Section. Any such objection shall be made in writing and shall state the
determination of the amount of the fair market value of the Company.
1.2 NO REGISTRATION.
(a) The Shareholders acknowledge and agree that:
(i) Except as otherwise provided herein, the MIOA Shares are
being issued to Shareholders without registration under applicable federal and
state securities laws in reliance upon certain exemptions from registration
under such securities laws;
(ii) Each certificate representing the MIOA Shares will bear a
legend restricting its transfer, sale, conveyance or hypothecation, unless such
MIOA Shares are either registered under applicable securities laws or an
exemption from such registration is applicable;
(iii) No Shareholder shall transfer all or any of the MIOA
Shares except in compliance with all applicable securities laws;
(iv) The Shareholders are acquiring the MIOA Shares for their
own account, for investment purposes only and not with a view to the sale or
distribution thereof;
(b) MIOA acknowledges and agrees that:
(i) The Global Shares are being transferred to MIOA without
registration under applicable securities laws in reliance upon certain
exemptions from registration from such securities laws;
(ii) All certificates representing the Global Shares bear
legends restricting its transfer, sale, conveyance of hypothecation, unless such
shares are either registered under the applicable securities laws, or an
exemption from such registration is applicable;
(iii) MIOA shall not transfer the Global Shares except in
compliance with all applicable securities laws;
(iv) MIOA is acquiring the Global Shares for its own account for
investment purposes only and not with a view to the sale or distribution thereof
and,
(v) The MIOA Shares shall have piggy-back registration rights.
1.3 CLOSING. Consummation of the contemplated transaction shall take place
on Tuesday, January 6, 1998 at 9:00 A.M. at the offices of MIOA at 0000 X.
Xxxxxxxx Xxx., Xxxxx 000, Xxxxxxx Xxxxx, XX 00000, or on such other date at such
other time as may be mutually agreed upon in writing by the parties hereto (the
"Closing"). Notwithstanding, the foregoing Closing date, the parties hereby
agree that unless otherwise agreed in writing that the Closing shall be
effective as of the close of business on December 31, 1997 (the "Effective
Date").
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SHAREHOLDERS
The Company and Shareholders, jointly and severally, make the following
representations and warranties to MIOA, each of which is true and correct on the
date hereof, shall remain true and correct to and including the Closing Date,
shall be unaffected by any investigation heretofore or hereafter made by MIOA,
or any knowledge of MIOA other than as specifically disclosed in the Disclosure
Schedules delivered to MIOA, and shall survive the Closing of the transactions
provided for herein.
2.1 GLOBAL SHARES. The Shareholders are the owners of the Global Shares
free and clear of any direct or indirect claims, liens, security interests,
charges, pledges or encumbrances of any nature whatsoever. All of the Global
Shares are validly issued to the Shareholders, fully paid and nonassessable.
There are no existing options, calls or commitments of any character relating to
the Global Shares or any Company securities of any kind. MIOA will receive, good
and marketable title to the Global Shares hereunder, free and clear of all Liens
(defined in 2.10(a) below).
2.2 ORGANIZATION. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
validly qualified or licensed in each jurisdiction wherein the character of the
property owned or leased by it, or the nature of its business, makes such
licensing or qualification necessary. The Company has the full power and
authority to conduct the business in which it will engage upon completion of the
transaction contemplated herein. Accurate, current and complete copies of the
Articles of Incorporation and Bylaws of the Company are attached hereto as
SCHEDULE 2.2.
2.3 CAPITALIZATION. The authorized capital stock of the Company consists
of fifteen hundred (1,500) shares of common stock, no par value per share (the
"Company Stock"), all of which are issued and outstanding. No shares of capital
stock or other equity securities of the Company are issued, reserved for
issuance or outstanding. All outstanding shares of capital stock of the Company
are duly authorized, validly issued, fully paid and nonassessable and, not
subject to preemptive rights. There are no outstanding bonds, debentures, notes
or other indebtedness or other securities of the Company have the right to vote
(or convertible into, or exchangeable for, securities having the right to vote)
on any matters on which shareholders of the Company may vote. Except as set
forth above, there are no outstanding securities, options, warrants, calls,
rights, commitments, agreements, arrangements or undertakings of any kind to
which the Company is a party or by which it is bound obligating the Company to
issue, deliver or sell, or cause to be issued, delivered or sold, additional
shares of capital stock or other equity securities of the Company or obligating
the Company to issue, grant, extend or enter into any such security, option,
warrant, call, right, commitment, agreement, arrangement or undertaking. There
are no outstanding contractual obligations, commitments, understandings or
arrangements of the Company to repurchase, redeem or otherwise acquire or make
any payment in respect of any shares of capital stock of the Company. A complete
list of security holders of the Company and their addresses is attached hereto
as SCHEDULE 2.3.
2.4 AUTHORITY AND APPROVAL OF AGREEMENT.
(a) The execution and delivery of this Agreement by the Company and
the Shareholders and the performance of all the Company's and the Shareholders'
obligations hereunder have been duly authorized and approved by all requisite
corporate action on the part of the Company and the Shareholders pursuant to
applicable law. The Company and the Shareholders have the power and authority to
execute and deliver this Agreement and to perform all their obligations
hereunder.
(b) This Agreement and any other documents, instruments and
agreements executed by the Company and the Shareholders in connection herewith
constitute the valid and legally binding agreements of the Company and the
Shareholders, enforceable against the Company and the Shareholders in accordance
with their terms, except that (i) enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application affecting the enforcement of the rights and remedies of creditors;
and (ii) the availability of equitable remedies may be limited by equitable
principles.
2.5 NO VIOLATIONS. Neither the execution, delivery nor performance of this
Agreement or any other documents, instruments or agreements executed by the
Shareholders and the Company in connection herewith, nor the consummation of the
transactions contemplated hereby: (a) will violate any statute, law, ordinance,
rule or regulation (collectively, "Laws") or any order, writ, injunction,
judgment, plan or decree (collectively, "Orders") of any court, arbitrator,
department, commission, board, bureau, agency, authority, instrumentality or
other body, whether federal, state, municipal, foreign or other (collectively,
"Government Entities"), (b) will require any authorization, consent, approval,
exemption or other action by or notice to any Government Entity; (c) subject to
obtaining the consents referred to in this Agreement, will violate or conflict
with, or constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or will result in the termination
of, or accelerate the performance required by, or result in the creation of any
Lien upon any of the assets of Company (or the Global Shares) under, any term or
provision of the Articles of Incorporation or By-Laws of Company or of any
contract, commitment, understanding, arrangement, agreement or restriction of
any kind or character to which Company or any Shareholder is a party or by which
Company or any Shareholder or any of its or their assets or properties may be
bound or affected; or (d) will or could result in the loss or adverse
modification of, or the imposition of any fine or penalty with respect to, any
license, permit or franchise granted or issued to, or otherwise held by or for
the use of, the Company.
2.6 FINANCIAL STATEMENTS. Included as Schedule 2.6 are true and complete
copies of the financial statements of the Company consisting of (i) balance
sheets of the Company as of December 31, 1996 and 1995, and the related
statements of operations and cash flows for the years then ended (including the
notes contained therein or annexed thereto), which financial statements have
been reported on, and are accompanied by, the signed, unqualified opinions of
Murrell, Hall, XxXxxxxx & Co., P.L.P., independent auditors for Company for such
years, and (ii) an unaudited balance sheet of the Company as of November 30,
1997 (the "Recent Balance Sheet"), and the related unaudited statements of
operations and cash flows for the eleven (11) months then ended (the "Recent
Statement of Operations") and for the corresponding period of the prior year
(including the notes and schedules contained therein or annexed thereto). All of
such financial statements (including all notes and schedules contained therein
or annexed thereto) are true, complete and accurate, have been prepared in
accordance with generally accepted accounting principles (except, in the case of
unaudited statements, for the absence of footnote disclosure) applied on a
consistent basis, have been prepared in accordance with the books and records of
the Company, and fairly present, in accordance with generally accepted
accounting principles, the assets, liabilities and financial position, the
results of operations and cash flows of the Company as of the dates and for the
years and periods indicated. The Estimated Closing Statement of Operations and
the Estimated Closing Balance Sheet and Final Closing Statement of Operations
and Final Closing Balance Sheet shall be in accordance with the specifications
set forth in this section; the Final Closing Statement of Operations and Final
Closing Balance Sheet shall be true, complete and accurate.
2.7 CONDUCT SINCE DATE OF BALANCE SHEET. Except for this Agreement and as
disclosed in SCHEDULE 2.7 hereto, to the best of Shareholders' knowledge and
belief none of the following has occurred since the date of the Recent Balance
Sheet:
(a) NO ADVERSE CHANGE. Any adverse change in the financial condition,
assets, liabilities, business, prospects or operations of the Company;
(b) NO DAMAGE. Any loss, damage or destruction, whether covered by
insurance or not, affecting the Company's business or properties;
(c) NO INCREASE IN COMPENSATION. Any increase in the compensation,
salaries or wages payable or to become payable to any employee or agent of the
Company (including, without limitation, any increase or change pursuant to any
bonus, pension, profit sharing, retirement or other plan or commitment), or any
bonus or other employee benefit granted, made or accrued;
(d) NO LABOR DISPUTES. Any labor dispute or disturbance, other than
routine individual grievances which are not material to the business, financial
condition or results of operations of the Company.
(e) NO COMMITMENTS. Any commitment or transaction by the Company
(including, without limitation, any borrowing or capital expenditure) other than
in the ordinary course of business consistent with past practice;
(f) NO DIVIDENDS. Any declaration, setting aside, or payment of any
dividend or any other distribution in respect of the Company's capital stock;
any redemption, purchase or other acquisition by the Company of any capital
stock of the Company, or any security relating thereto; or any other payment to
any shareholder of the Company as such a shareholder;
(g) NO DISPOSITION OF PROPERTY. Any sale, lease or other transfer or
disposition of any properties or assets of the Company, except in the ordinary
course of business;
(h) NO INDEBTEDNESS. Any indebtedness for borrowed money incurred,
assumed or guaranteed by the Company;
(i) NO LIENS. Any mortgage, pledge, lien or encumbrance made on any
of the properties or assets of the Company;
(j) NO AMENDMENT OF CONTRACTS. Any entering into, amendment or
termination by the Company of any contract, or any waiver of material rights
thereunder, other than in the ordinary course of business;
(k) LOANS AND ADVANCES. Any loan or advance (other than advances to
employees in the ordinary course of business for travel and entertainment in
accordance with past practice) to any person including, but not limited to, any
Affiliate (for purposes of this Agreement, the term "Affiliate" shall mean and
include all Shareholders, directors and officers of the Company; the spouse of
any such person; any person who would be the heir or descendant of any such
person if he or she were not living; and any entity in which any of the
foregoing has a direct or indirect interest);
(l) CREDIT. Any grant of credit to any customer or distributor on
terms or in amounts more favorable than those which have been extended to such
customer or distributor in the past, any other change in the terms of any credit
heretofore extended, or any other change of the Company's policies or practices
with respect to the granting of credit; or
(m) NO UNUSUAL EVENTS. Any other event or condition not in the
ordinary course of business of the Company.
2.8 SUBSIDIARIES. The Company has no subsidiaries. Except as previously
advised, it does not own or control, either directly or indirectly, any capital
stock of any corporation or interest in any partnership, trust or unincorporated
association, or any interest or investment in any other corporation, association
or other business entity.
2.9 LIABILITIES. Except as and to the extent specifically disclosed in the
Recent Balance Sheet, or in Schedule 2.9, the Company does not have any
liabilities, commitments or obligations (secured or unsecured, and whether
accrued, absolute, contingent, direct, indirect or otherwise), other than
commercial liabilities and obligations incurred since the date of the Recent
Balance Sheet in the ordinary course of business and consistent with past
practice and none of which has or will have a material adverse effect on the
business, financial condition or results of operations of the Company. Except as
and to the extent described in the Recent Balance Sheet or in Schedule 2.9,
neither the Company nor any Shareholder has knowledge of any basis for the
assertion against the Company of any liability and there are no circumstances,
conditions, happenings, events or arrangements, contractual or otherwise, which
may give rise to liabilities, except commercial liabilities and obligations
incurred in the ordinary course of the Company's business and consistent with
past practice.
2.10 TITLE TO AND CONDITION OF PROPERTIES.
a. MARKETABLE TITLE. The Company has good and marketable title to all
of the Company's assets, business and properties, including, without limitation,
all such properties (tangible and intangible) reflected in the Recent Balance
Sheet, except for items disposed of in the ordinary course of business since the
date of such Recent Balance Sheet, free and clear of all mortgages, liens,
(statutory or otherwise) security interests, claims, pledges, licenses,
equities, options, conditional sales contracts, assessments, levies, easements,
covenants, reservations, restrictions, rights-of-way, exceptions, limitations,
charges or encumbrances of any nature whatsoever (collectively, "Liens") except
those described in Schedule 2.10. None of the Company's assets, business or
properties are subject to any restrictions with respect to the transferability
thereof; and the Company's title thereto will not be affected in any way by the
transactions contemplated hereby.
b. CONDITION. All property and assets owned, leased or otherwise
utilized by the Company are in good operating condition and repair, free from
any defects (except such minor defects as do not interfere with the use thereof
in the conduct of the normal operations of the Company), have been maintained
consistent with the standards generally followed in the industry and are
sufficient to carry on the business of the Company as conducted during the
preceding 12 months. All buildings, plants and other structures owned or
otherwise utilized by the Company are in good condition and repair and have no
structural defects or defects affecting the plumbing, electrical, sewerage, or
heating, ventilating or air conditioning systems.
2.11 ACCOUNTS RECEIVABLE. All accounts receivable of the Company reflected
on the Recent Balance Sheet, and as incurred in the normal course of business
since the date thereof, represent arm's length sales actually made in the
ordinary course of business; are collectible (net of the reserve shown on the
Recent Balance Sheet for doubtful accounts) in the ordinary course of business
without the necessity of commencing legal proceedings; are subject to no
counterclaim or setoff; and are not in dispute. Schedule 2.11 contains an aged
schedule of accounts receivable included in the Recent Balance Sheet. All
accounts receivable of the Company reflected on the Final Closing Balance Sheet
will represent arm's length sales actually made in the ordinary course of
business and will be collected (net of the reserve shown on the Final Closing
Balance Sheet for doubtful accounts) in the ordinary course of business without
the necessity of commencing legal proceedings and will be subject to no
counterclaim or set-off.
2.12 CONTRACTS AND COMMITMENTS.
(a) REAL PROPERTY LEASES. Except as set forth in Schedule 2.12(a),
the Company has no leases of real property.
(b) PERSONAL PROPERTY LEASES. Except as set forth in Schedule
2.12(b), the Company has no leases of personal property involving consideration
or other expenditure in excess of $10,000.00 or involving performance over a
period of more than six (6) months.
(c) PURCHASE COMMITMENTS. The Company has no purchase commitments for
inventory items or supplies that, together with amounts on hand, constitute in
excess of two (2) months normal usage, or which are at an excessive price.
(d) SALES COMMITMENTS. The Company has no sales contracts or
commitments to customers which aggregate in excess of $10,000.00 to any one
customer (or group of affiliated customers). The Company has no sales contracts
or commitments except those made in the ordinary course of business, at arm's
length, and no such contracts or commitments are for a sales price which would
result in a loss to the Company.
(e) CONTRACTS WITH AFFILIATES AND CERTAIN OTHERS. The Company has no
agreement, understanding, contract or commitment (written or oral) with any
Affiliate or any employee, agent, consultant, distributor or dealer that is not
cancelable by the Company on notice of not longer than 30 days without
liability, penalty or premium of any nature or kind whatsoever.
(f) POWERS OF ATTORNEY. The Company has not given a power of
attorney, which is currently in effect, to any person, firm or corporation for
any purpose whatsoever.
(g) LOAN AGREEMENTS. Except as set forth in Schedule 2.12 (g), the
Company is not obligated under any loan agreement, promissory note, letter of
credit, or other evidence of indebtedness as a signatory, guarantor or
otherwise.
(h) GUARANTEES. Except as disclosed on Schedule 2.12 (h), the Company
has not guaranteed the payment or performance of any person, firm or
corporation, agreed to indemnify any person or act as a surety, or otherwise
agreed to be contingently or secondarily liable for the obligations of any
person.
(i) GOVERNMENT CONTRACTS. The Company is not a party to any contract
with any governmental body.
(j) BURDENSOME OR RESTRICTIVE AGREEMENTS. The Company is not a party
to nor is it bound by any agreement, deed, lease or other instrument which is so
burdensome as to materially affect or impair the operation of the Company.
Without limiting the generality of the foregoing, the Company is not a party to
nor is it bound by any agreement requiring the Company to assign any interest in
any trade secret or proprietary information, or prohibiting or restricting the
Company from competing in any business or geographical area or soliciting
customers or otherwise restricting it from carrying on its business anywhere in
the world.
(k) OTHER MATERIAL CONTRACTS. The Company has no lease, contract or
commitment of any nature involving consideration or other expenditure in excess
of $10,000.00, or involving performance over a period of more than six (6)
months, or which is otherwise individually material to the operations of the
Company, except as explicitly described in Schedule 2.12(k) or in any other
Schedule.
(l) NO DEFAULT. The Company is not in default under any lease,
contract or commitment, nor has any event or omission occurred which through the
passage of time or the giving of notice, or both, would constitute a default
thereunder or cause the acceleration of any of the Company's obligations or
result in the creation of any Lien on any of the assets owned, used or occupied
by the Company. No third party is in default under any lease, contract or
commitment to which the Company is a party, nor has any event or omission
occurred which, through the passage of time or the giving of notice, or both,
would constitute a default thereunder or give rise to an automatic termination,
or the right of discretionary termination, thereof.
2.13 OFFICERS, DIRECTORS, AGENTS, ETC. Set forth on SCHEDULE 2.13 attached
hereto is a complete list of all officers (with office held), directors,
contractors and agents of the Company, and the compensation and all vacation and
other benefits they are entitled to receive from the Company.
2.14 LABOR MATTERS. Except as set forth on SCHEDULE 2.14, the Company is
not and has never been a party to: (a) any profit sharing, pension, retirement,
deferred compensation, bonus, stock option, stock purchase, retainer,
consulting, health, welfare or incentive plan or agreement or other employee
benefit plan, whether legally binding or not; or other employee benefit plan,
whether legally binding or not; or (b) any plan providing for "fringe benefits"
to its employees, including, but not limited to, vacation, disability, sick
leave, medical, hospitalization and life insurance and other insurance plans, or
related benefits; or (c) any employment agreement. To the best of Shareholders'
knowledge and belief, no former employee of the Company has any claim against
the Corporation (whether under federal or state law, any employment agreement or
otherwise) on account of or for: (d) overtime pay; (e) wages or salary for any
period; (f) vacation, time-off or pay in lieu of vacation or time-off; or (g)
any violation of any statue, ordinance or regulation relating to minimum wages
or maximum hours of work. To the best of Shareholders' knowledge and belief, no
person or party (including, but not limited to, governmental agencies of any
kind) has any claim or basis for any action or proceeding against the Company
arising out of any statute, ordinance or regulation relating to discrimination
in employment or to employment practices or occupational safety and health
standards.
2.15 COMPLIANCE WITH LAWS AND ORDERS.
(a) COMPLIANCE. Except as set forth in Schedule 2.15 (a), the Company
(including each and all of its operations, practices, properties and assets) is
in compliance with all applicable Laws and Orders, including, without
limitation, those applicable to discrimination in employment, occupational
safety and health, trade practices, competition and pricing, zoning, building
and sanitation, employment, retirement and labor relations, product advertising
and the Environmental Laws as hereinafter defined. Except as set forth in
Schedule 2.15 (a), the Company has not received notice of any violation or
alleged violation of, and is subject to no Liability for past or continuing
violation of, any Laws or Orders. All reports and returns required to be filed
by the Company with any Government Entity have been filed, and were accurate and
complete when filed. Without limiting the generality of the foregoing:
(i) The operation of the Company's business as it is now
conducted does not, nor does any condition existing at any of its facilities, in
any manner constitute a nuisance or other tortious interference with the rights
of any person or persons in such a manner as to give rise to or constitute the
grounds for a suit, action, claim or demand by any such person or persons
seeking compensation or damages or seeking to restrain, enjoin or otherwise
prohibit any aspect of the conduct of such business or the manner in which it is
now conducted.
(ii) The Company has made all required payments to its
unemployment compensation reserve accounts with the appropriate governmental
departments of the states where it is required to maintain such accounts, and
each of such accounts has a positive balance.
(b) LICENSES AND PERMITS. The Company has all licenses, permits,
approvals, authorizations and consents of all Government Entities and all
certification organizations required for the conduct of the business (as
presently conducted and as proposed to be conducted) and operation of its
facilities, including without limitation those required by the Federal Aviation
Association and Health and Rehabilitative Services. All such licenses, permits,
approvals, authorizations and consents are described in Schedule 2.15 (b), are
in full force and effect and will not be affected or made subject to loss,
limitation or any obligation to reapply as a result of the transactions
contemplated hereby. Except as set forth in Schedule 2.15 (b), the Company
(including its operations, properties and assets) is and has been in compliance
with all such permits and licenses, approvals, authorizations and consents.
(c) ENVIRONMENTAL MATTERS. The applicable Laws relating to pollution
or protection of the environment, including Laws relating to emissions,
discharges, generation, storage, releases or threatened releases of pollutants,
contaminants, chemicals or industrial, toxic, hazardous or petroleum or
petroleum-based substances or wastes ("Waste") into the environment (including,
without limitation, ambient air, surface water, ground water, land surface or
subsurface strata) or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Waste
including, without limitation, the Clean Water Act, the Clean Air Act, the
Resource Conservation and Recovery Act, the Toxic Substances Control Act and the
Comprehensive Environmental Response Compensation Liability Act ("CERCLA"), as
amended, and their state and local counterparts are herein collectively referred
to as the "Environmental Laws". Without limiting the generality of the foregoing
provisions of this Section 2.15, the Company is in full compliance with all
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in the Environmental Laws or
contained in any regulations, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder.
Except as set forth in Schedule 2.15 (c), there is no Litigation nor any demand,
claim, hearing or notice of violation pending or threatened against the Company
relating in any way to the Environmental Laws or any Order issued, entered,
promulgated or approved thereunder. Except as set forth in Schedule 2.15 (c),
there are no past or present (or, to the best of the Company's and the
Shareholders' knowledge, future) events, conditions, circumstances, activities,
practices, incidents, actions, omissions or plans which may interfere with or
prevent compliance or continued compliance with the Environmental Laws or with
any Order issued, entered, promulgated or approved thereunder, or which may give
rise to any liability, including, without limitation, liability under CERCLA or
similar state or local Laws, or otherwise form the basis of any Litigation,
hearing, notice of violation, study or investigation, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling, or the emission, discharge, release or threatened release
into the environment, of any Waste.
2.16 BOOKS AND RECORDS. With respect to all material matters occurring
since the inception of the Company, the minute books and other records of the
Company contain complete and accurate records of all such material matters,
meetings and other corporate actions of its shareholders and board of directors.
2.17 TAX MATTERS.
(a) PROVISION FOR TAXES. The provision made for taxes on the Recent
Balance Sheet and the Estimated Closing Balance Sheet is and will be sufficient
for the payment of all federal, state, foreign, county, local and other income,
ad valorem, excise, profits, franchise, occupation, property, payroll, sales,
use, gross receipts and other taxes (and any interest and penalties) and
assessments, whether or not disputed, at the date of the Recent Balance Sheet
and for all years and periods prior thereto. Since the date of the Recent
Balance Sheet, the Company has not incurred any taxes other than taxes incurred
in the ordinary course of business consistent in type and amount with past
practices of the Company.
(b) TAX RETURNS FILED. Except as set forth on Schedule 2.17(b), all
federal, state, foreign, county, local and other tax returns required to be
filed by or on behalf of the Company have been timely filed and when filed were
true and correct in all material respects, and the taxes shown as due thereon
were paid or adequately accrued. True and complete copies of all tax returns or
reports filed by the Company for each of its three (3) most recent fiscal years
have been delivered to MIOA. The Company has duly withheld and paid all taxes
which it is required to withhold and pay relating to salaries and other
compensation heretofore paid to the employees of the Company.
(c) TAX AUDITS. The Company has not received from the Internal
Revenue Service or from the tax authorities of any state, county, local or other
jurisdiction any notice of underpayment of taxes or other deficiency which has
not been paid nor any objection to any return or report filed by the Company.
There are outstanding no agreements or waivers extending the statutory period of
limitations applicable to any tax return or report.
(d) OTHER. Except as set forth in Schedule 2.17 (d), the Company has
not (i) filed any consent or agreement under Section 341(f) of the Internal
Revenue Code of 1986, as amended (the "Code"), (ii) applied for any tax ruling,
(iii) entered into a closing agreement with any taxing authority, (iv) filed an
election under Section 338(g) or Section 338(h)(10) of the Code (nor has a
deemed election under Section 338(e) of the Code occurred), (v) made any
payments, or been a party to an agreement (including this Agreement) that under
any circumstances could obligate it to make payments that will not be deductible
because of Section 280G of the Code, or (vi) been a party to any tax allocation
or tax sharing agreement. The Company is not a "United States real property
holding company" within the meaning of Section 897 of the Code.
2.18 REAL ESTATE. The Company owns no real estate and has not committed to
purchase any real estate. To the best of Shareholders' knowledge and belief, the
Company has good and marketable title to each of the leaseholds described in
SCHEDULE 2.18 attached hereto, free and clear of all mortgages, liens,
encumbrances, leases, equities, claims, shares, easements, rights-of-way,
covenants, conditions and restrictions except as otherwise described in the
leasehold agreements. Except as stated on SCHEDULE 2.18, no officer, director,
shareholder or employee of the Company, or any spouse, child or other relative
thereof, owns directly or indirectly, in whole or in part, any of the leaseholds
described on SCHEDULE 2.18. To the best of Shareholders' knowledge and belief,
each of the leases described on SCHEDULE 2.18 is a valid and binding obligation
of the Company and enforceable in accordance with its terms and conditions, and
to the best knowledge and belief of the Shareholders, each of the leases
described on SCHEDULE 2.18 is a valid and binding obligation of each of the
other parties thereto. To the best of Shareholders' knowledge and belief,
neither the Company nor any other party to any such lease is in default with
respect to any material term or condition thereof, nor to the best knowledge of
the Shareholders, has any event occurred which through the passage of time or
the giving of notice, or both, would constitute a default thereunder, or would
cause the acceleration of any obligation of any party thereto or the creation of
a lien or encumbrance upon any of the assets of the Company. So far as the
Shareholders are aware, the operation of the buildings, fixtures and other
improvements described in SCHEDULE 2.18 as presently conducted is not in
violation of any applicable building code, zoning ordinance or other law or
regulation.
2.19 INSURANCE. SCHEDULE 2.19 attached hereto sets forth a true and
complete list of all insurance policies of the Company. The Company has not
received any notice or other communication from any insurance company canceling
or materially amending any of said insurance policies and no such cancellation
or amendment is threatened.
2.20 PERSONNEL. SCHEDULE 2.20 attached hereto contains accurate and
complete information as to names and rates of compensation (whether in the form
of salaries, bonuses, commissions or other supplemental compensation now or
hereafter payable) of all personnel of the Company, together with information as
to any contracts with any such personnel. The Company has no pension,
profit-sharing, bonus, incentive, insurance or other employee benefit plans
(including without limitation any such plans within the meaning of Section 3 (3)
of the Employee Retirement Income Security Act of 1974, as amended) in which any
employees of the Company participate, except as set forth on the SCHEDULE 2.20.
2.21 LITIGATION. Other than as set forth in SCHEDULE 2.21, the Company is
not a party to, the subject of, or threatened with any litigation nor to the
best knowledge and belief of the Shareholders, is there any basis for any
litigation. The Company is not contemplating the institution of any litigation.
2.22 OTHER LIABILITIES. To the best of Shareholders' knowledge and belief
no claim of breach of contract, tort, product liability or other claim,
contingent or otherwise, has been asserted or threatened against the Company nor
is capable of being asserted by any employee, creditor, claimant or other person
against the Company. No state of facts exists or has existed, nor has any event
occurred, which could give rise to the assertion of any such claim by any
person.
2.23 CONSENTS. The execution, delivery and performance by the Shareholders
of this Agreement and the consummation by the Shareholders of the transactions
contemplated hereby do not require any consent that has not been received prior
to the date hereof.
2.24 JUDGMENTS. There are no outstanding judgements against the Company.
There are no open workers compensation claims against the Company, or any other
obligation, fact or circumstance which would give rise to any right of
indemnification on the part of any current or former shareholder, director,
officer, employee or agent of the Company, or any heir or personal
representative thereof, against the Company, or any successor to the businesses
of the Company.
2.25 BROKERS. Except as previously disclosed in writing, neither the
Shareholders or the Company has any liability or obligation to pay any fees or
commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which MIOA could become liable or obligated.
2.26 TRADE RIGHTS. The Company neither owns nor has any rights to any
Trade Rights (as defined below). In order to conduct the business of the
Company, as such is currently being conducted or proposed to be conducted, the
Company does not require any Trade Rights. The Company is not infringing and has
not infringed any Trade Rights of another in the operation of the business of
the Company. The Company has not granted any license or made any assignment of
any Trade Right, nor does the Company pay any royalties or other consideration
for the right to use any Trade Rights of others. There is no Litigation pending
or threatened to challenge the Company's right, title and interest with respect
to its continued use and right to preclude others from using any Trade Rights.
As used herein, the term "Trade Rights" shall mean and include: (i) all
trademark rights, business identifiers, trade dress, service marks, trade names
and brand names, all registrations thereof and applications therefor and all
goodwill associated with the foregoing; (ii) all copyrights, copyright
registrations and copyright applications, and all other rights associated with
the foregoing and the underlying works of authorship; (iii) all patents and
patent applications, and all international proprietary rights associated
therewith; (iv) all contracts or agreements granting any right, title, license
or privilege under the intellectual property rights of any third party; (v) all
inventions, mask works and mask work registrations, know-how, discoveries,
improvements, designs, trade secrets, shop and royalty rights, employee
covenants and agreements respecting intellectual property and non-competition
and all other types of intellectual property; and (vi) all claims for
infringement or breach of any of the foregoing.
2.27 BANK ACCOUNTS. Schedule 2.27 sets forth the names and locations of
all banks, trust companies, savings and loan associations and other financial
institutions at which the Company maintains a safe deposit box, lock box or
checking, savings, custodial or other account of any nature, the type and number
of each such account and the signatories therefore, a description of any
compensating balance arrangements, and the names of all persons authorized to
draw thereon, make withdrawals therefrom or have access thereto.
2.28 DISCLOSURE. No representation or warranty by the Company and/or the
Shareholders in this Agreement, nor any statement, certificate, schedule,
document or exhibit hereto furnished or to be furnished by or on behalf of the
Company or Shareholders pursuant to this Agreement or in connection with
transactions contemplated hereby, contains or shall contain any untrue statement
of material fact or omits or shall omit a material fact necessary to make the
statements contained therein not misleading. All statements and information
contained in any certificate, instrument, Disclosure Schedule or document
delivered by or on behalf of the Company and/or Shareholders shall be deemed
representations and warranties by the Company and the Shareholders.
ARTICLE III
MIOA'S REPRESENTATIONS AND WARRANTIES
MIOA hereby makes the following representations and warranties to the
Shareholders, each of which MIOA represents to be true and correct on the date
hereof and (except as MIOA may notify the Shareholders in writing prior to the
Closing) shall be deemed made again as of the Closing and represented by MIOA to
be true and correct at the time of the Closing.
3.1 ORGANIZATION. MIOA is a corporation duly organized, validly existing
and in good standing under the laws of the State of Florida and is not required
to be qualified or licensed as a foreign corporation in any other jurisdiction.
MIOA has the full power and authority to own all its assets and to conduct its
business as and where its business is presently conducted.
3.2 AUTHORITY AND APPROVAL OF AGREEMENT.
(a) The execution and delivery of this Agreement by MIOA and the
performance of all MIOA's obligations hereunder have been duly authorized and
approved by all requisite corporate action on the part of MIOA pursuant to
applicable law. MIOA has the power and authority to execute and deliver this
Agreement and to perform all its obligations hereunder.
(b) This Agreement and each of the other documents, instruments and
agreements executed by MIOA in connection herewith constitute the valid and
legally binding agreements of MIOA, enforceable against MIOA in accordance with
their terms, except that: (i) enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application affecting the enforcement of the rights and remedies of creditors;
and (ii) the availability of equitable remedies as may be limited by equitable
principles.
3.3 NO VIOLATIONS. Neither the execution, delivery nor performance of this
Agreement or any other documents, instruments or agreements executed by the MIOA
in connection herewith, nor the consummation of the transactions contemplated
hereby: (a) constitutes a violation of or default under (either immediately,
upon notice or upon lapse of time) the Articles of Incorporation or Bylaws of
MIOA, any provision of any contract to which MIOA or its assets may be bound,
any judgment to which MIOA is bound or any law applicable to MIOA; or (b) result
in the creation or imposition of any encumbrance upon, or give any third person
any interest in or right to, any or all of the MIOA Shares or any other capital
stock of MIOA or any of the assets of MIOA; or (c) result in the loss or adverse
modification of, or the imposition of any fine or penalty with respect to, any
license, permit or franchise granted or issued to, or otherwise held by or for
the use of, MIOA.
3.5 CONSENTS. The execution, delivery and performance by MIOA of this
Agreement and the consummation by MIOA of the transactions contemplated hereby
do not require any consent that has not been received prior to the date hereof.
3.6 S.E.C. DOCUMENTS. MIOA has delivered or made available to the
Shareholders with respect to its parent all required reports, schedules, forms,
statements and other documents filed or to be filed with the Securities and
Exchange Commission (the "SEC") since January 1, 1996 (collectively, the "SEC
Documents"). The financial statements included in the SEC Documents comply as to
form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, have been
prepared in accordance with generally accepted accounting principles (except, in
the case of the unaudited statements, as permitted by Form 10-Q of the SEC)
applied on a consistent basis during the periods involved (except as may be
indicated therein or in the notes thereto).
3.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as disclosed in the SEC
Documents, since the date of the most recent financial statements included in
the SEC Documents, MIOA and its parent have conducted their business only in the
ordinary course consistent with past practice in light of its current business
circumstances, and there is not and has not been: (a) any material adverse
change with respect to MIOA, its parent or their capital stock; (b) any
condition, event or occurrence which, individually or in the aggregate, could
reasonably be expected to have a material adverse effect or give rise to a
material adverse change with respect to MIOA, its parent or their capital stock;
or (c) any condition, event or occurrence which could reasonably be expected to
prevent, hinder or materially delay the ability of MIOA to consummate the
transactions contemplated by this Agreement.
3.8 BROKERS. MIOA has no liability or obligation to pay any fees or
commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which the Shareholder or the Company could
become liable or obligated.
3.9 FULL DISCLOSURE. All the representations and warranties made by MIOA
herein or in any Schedule hereto, and all of the statements, documents or other
information pertaining to the transaction contemplated herein made or given by
MIOA, its agents or representatives are complete and accurate, and do not omit
any information required to make the statements and information provided, in
light of the transaction contemplated herein, non-misleading, accurate and
meaningful.
3.10 NO ENCUMBRANCES ON MIOA SHARES. The MIOA Shares being transferred by
MIOA to the Shareholders are free and clear of any liens, claims, encumbrances
or restrictions of any kind, and none of those shares is subject to options,
rights, warrants, or other agreements or commitments other than set forth in
this Agreement.
ARTICLE IV
INTERPRETATION; SURVIVAL OF
REPRESENTATIONS AND WARRANTIES; AND INDEMNIFICATION
4.1 INTERPRETATION.Each warranty and representation made by a party in
this Agreement or pursuant hereto is independent of all other warranties and
representations made by the same party in this Agreement or pursuant hereto
(whether or not covering identical, related or similar matters) and must be
independently and separately satisfied. Exceptions or qualifications to any such
warranty or representation shall not be construed as exceptions or qualification
to any other warranty or representation.
4.2 SURVIVAL. All representations and warranties made in this Agreement or
pursuant hereto shall survive the date hereof, the Closing, the consummation of
the transaction contemplated hereby and any investigation.
4.3 INDEMNIFICATION. The Shareholders and MIOA, respectively, shall
indemnify and hold each other harmless against and in respect of all damages, as
hereinafter defined, in excess of ten thousand dollars ($10,000). Damages, as
used herein, shall include any claim, action, demand, loss, cost, expense,
liability, whether joint or several, penalty and other damage, including,
without limitation, attorneys' fees and other costs and expenses reasonably
incurred in opposing the imposition thereof resulting to such party from any
inaccurate representation made by or on behalf of the other party hereto in or
pursuant to this Agreement, or the breach or default in the performance by such
other party hereunder. Each party shall reimburse the party entitled thereto
pursuant to these indemnification provisions on demand for any payment made by
such party at any time after the Closing, based upon the judgment of any court
of competent jurisdiction or pursuant to a bona fide compromise or settlement of
any claims, demands or actions in respect of any damages to which the foregoing
indemnity relates. In addition, MIOA hereby agrees to indemnify and hold the
Shareholders harmless against any Damages they personally incur which are
directly related to any personal guarantees which they have given for the
benefit of the Company and for which MIOA has been advised in writing.
ARTICLE V
OTHER COVENANTS
5.1 NONCOMPETITION; CONFIDENTIALITY. Subject to the Closing, and as an
inducement to MIOA to execute this Agreement and complete the transactions
contemplated hereby, and in order to preserve the goodwill associated with the
business of the Company being acquired pursuant to this Agreement, and in
addition to and not in limitation of any covenants contained in any agreement
executed and delivered herewith, each Shareholder hereby covenants and agrees as
follows:
a. COVENANT NOT TO COMPETE. For a period of four (4) years (except in
the case of Xxxxxx X. Xxxx and Xxx X. Xxxxxx which shall be excluded from this
covenant) from the Closing Date, no Shareholder will directly or indirectly:
(1) be employed by, engage in, continue in or carry on any
business which competes with the Business or is substantially similar thereto,
including owning or controlling any financial interest in any corporation,
partnership, firm or other form of business organization which is so engaged;
(2) be employed by, consult with, advise or assist in any way,
whether or not for consideration, any corporation, partnership, firm or other
business organization which is now or becomes a competitor of the Company or
MIOA in any aspect with respect to the Business, including, but not limited to,
advertising or otherwise endorsing the products of any such competitor;
soliciting customers or otherwise serving as an intermediary for any such
competitor; loaning money or rendering any other form of financial assistance to
or engaging in any form of business transaction on other than an arm's length
basis with any such competitor;
(3) offer employment to an employee of the Company, without the
prior written consent of MIOA; or
(4) engage in any practice the purpose of which is to evade the
provisions of this covenant not to compete or to commit any act which adversely
affects the Company or the Business;
provided, however, that the foregoing shall not prohibit the
ownership of securities of corporations which are listed on a national
securities exchange or traded in the national over-the-counter market in an
amount which shall not exceed 5% of the outstanding shares of any such
corporation. The parties agree that the geographic scope of this covenant not to
compete shall extend worldwide due to the nature of the Business. The parties
agree that MIOA may sell, assign or otherwise transfer this covenant not to
compete, in whole or in part, to any person, corporation, firm or entity that
purchases all or part of the Business. In the event a court of competent
jurisdiction determines that the provisions of this covenant not to compete are
excessively broad as to duration, geographical scope or activity, it is
expressly agreed that this covenant not to compete shall be construed so that
the remaining provisions shall not be affected, but shall remain in full force
and effect, and any such over broad provisions shall be deemed, without further
action on the part of any person, to be modified, amended and/or limited, but
only to the extent necessary to render the same valid and enforceable in such
jurisdiction.
b. COVENANT OF CONFIDENTIALITY. No Shareholder shall at any time
subsequent to the Closing, except as explicitly requested by MIOA, (i) use for
any purpose, (ii) disclose to any person, or (iii) keep or make copies of
documents, tapes, discs or programs containing, any confidential information
concerning the Business or the Company. For purposes hereof, "confidential
information" shall mean and include, without limitation, all Trade Rights in
which Company has an interest, all customer lists and customer information, and
all other information concerning Company's processes, apparatus, equipment,
packaging, services, products, marketing and other Business methods, not
previously disclosed to the public directly by Company.
c. EQUITABLE RELIEF FOR VIOLATIONS. Each Shareholder agrees that the
provisions and restrictions contained in this Section 5.1 are necessary to
protect the legitimate continuing interests of MIOA in acquiring the Global
Shares, and that any violation or breach of these provisions will result in
irreparable injury to MIOA for which a remedy at law would be inadequate and
that, in addition to any relief at law which may be available to MIOA for such
violation or breach and regardless of any other provision contained in this
Agreement, MIOA shall be entitled to injunctive and other equitable relief as a
court may grant after considering the intent of this Section 5.1.
5.2 GENERAL RELEASES . At the Closing, each Shareholder shall deliver
general releases to MIOA, in form and substance satisfactory to MIOA and its
counsel, releasing Company and the directors, officers, agents and employees of
the Company from all claims through the Closing Date, except (i) as may be
described in written contracts disclosed in the Disclosure Schedules and
expressly described and excepted from such releases, and (ii) in the case of
persons who are employees of the Company, compensation for current periods
expressly described and excepted from such releases. Such releases shall also
contain waivers of any right of contribution or other recourse against the
Company with respect to representations, warranties or covenants made herein by
the Company.
5.3 ACCESS TO INFORMATION AND RECORDS . During the period prior to the
Closing, Shareholders shall cause the Company to give MIOA, its counsel,
accountants and other representatives (i) access during normal business hours to
all of the properties, books, records, contracts and documents of the Company
for the purpose of such inspection, investigation and testing as XXXX xxxxx
appropriate (and the Company shall furnish or cause to be furnished to MIOA and
its representatives all information with respect to the business and affairs of
the Company as MIOA may request); (ii) access to employees, agents and
representatives for the purposes of such meetings and communications as MIOA
reasonably desires; and (iii) with the prior consent of the Company in each
instance (which consent shall not be unreasonably withheld), access to vendors,
customers, manufacturers of its machinery and equipment, and others having
business dealings with the Company.
5.4 CONDUCT OF BUSINESS PENDING THE CLOSING . From the date hereof until
the Closing, except as otherwise approved in writing by MIOA, the Company
covenants as follows, and Shareholders shall cause each of the following to
occur:
a. NO CHANGES. The Company will carry on its business diligently and
in the same manner as heretofore and will not make or institute any changes in
its methods of purchase, sale, management, accounting or operation.
b. MAINTAIN ORGANIZATION. The Company will take such action as may be
necessary to maintain, preserve, renew and keep in favor and effect the
existence, rights and franchises of the Company and will use its best efforts to
preserve the business organization of the Company intact, to keep available to
the Company the present officers and employees, and to preserve for the Company
its present relationships with suppliers and customers and others having
business relationships with the Company.
c. NO BREACH. The Company and Shareholders will not do or omit any
act, or permit any omission to act, which may cause a breach of any material
contract, commitment or obligation, or any breach of any representation,
warranty, covenant or agreement made by the Company and/or the Shareholders
herein, or which would have required disclosure herein had it occurred after the
date of the Recent Balance Sheet and prior to the date of this Agreement.
d. NO MATERIAL CONTRACTS. No contract or commitment will be entered
into, and no purchase of equipment, parts or supplies and no sale of goods or
services (real, personal, or mixed, tangible or intangible) will be made, by or
on behalf of Company, except contracts, commitments, purchases or sales which
are in the ordinary course of business and consistent with past practice, are
not material to the Company (individually or in the aggregate) and would not
have been required to be disclosed in the Disclosure Schedules had they been in
existence on the date of this Agreement.
e. NO CORPORATE CHANGES. The Company shall not amend its Articles of
Incorporation or By-Laws or make any changes in authorized or issued capital
stock.
f. MAINTENANCE OF INSURANCE. The Company shall maintain all of the
insurance in effect as of the date hereof and shall procure such additional
insurance as shall be reasonably requested by MIOA.
g. MAINTENANCE OF PROPERTY. The Company shall use, operate, maintain
and repair all property of Company in a normal business manner.
h. INTERIM FINANCIALS. The Company will provide MIOA with interim
monthly financial statements and other management reports as and when they are
available.
i. NO NEGOTIATIONS. Neither the Company nor any Shareholder will
directly or indirectly (through a representative or otherwise) solicit or
furnish any information to any prospective buyer, commence, or conduct presently
ongoing, negotiations with any other party or enter into any agreement with any
other party concerning the sale of the Company, Company's assets or business or
any part thereof or any equity securities of the Company (an "acquisition
proposal"), and the Company and Shareholders shall immediately advise MIOA of
the receipt of any acquisition proposal.
j. NO TRANSFER OF SHARES. No Shareholder shall transfer or attempt to
transfer any of the Global Shares except to MIOA pursuant hereto; and the
Company shall refuse to accept any certificates for the Global Shares to be
transferred or otherwise to allow such transfers to occur upon its books.
5.5 CONSENTS. The Company and Shareholders will use their best efforts
prior to Closing to obtain all consents necessary for the consummation of the
transactions contemplated hereby.
5.6 OTHER ACTION. The Company and Shareholders shall use their best
efforts to cause the fulfillment at the earliest practicable date of all of the
conditions to the parties' obligations to consummate the transactions
contemplated in this Agreement.
5.7 DISCLOSURE SCHEDULE. The Shareholders and the Company shall have a
continuing obligation to promptly notify MIOA in writing with respect to any
matter hereafter arising or discovered which, if existing or known at the date
of this Agreement, would have been required to be set forth or described in the
Disclosure Schedules, but no such disclosure shall cure any breach of any
representation or warranty which is inaccurate.
ARTICLE VI
CONDITIONS PRECEDENT TO THE SHAREHOLDERS' OBLIGATIONS
Notwithstanding the execution and delivery of this Agreement or the performance
of any part hereof, the Shareholders' obligations to consummate the transaction
contemplated by this Agreement shall be subject to the satisfaction of each of
the conditions set forth in this Article VI, except to the extent that such
satisfaction is waived in writing by the Shareholders.
6.1 REPRESENTATIONS AND WARRANTIES OF MIOA. All representations and
warranties made by MIOA in this Agreement and the Schedules hereto shall be true
and correct in all material respects on the date hereof, and shall be true and
correct in all material respects at the time of the Closing as though such
representations were again made, without exception or deviation, at the time of
the Closing.
6.2 PERFORMANCE OF THIS AGREEMENT. MIOA shall have duly performed or
complied with all the obligations under this Agreement to be performed or
complied with by MIOA on or prior to the Closing.
6.3 ABSENCE OF LITIGATION. No litigation shall have been instituted on or
before the time of the Closing by any person, the result of which did or could
prevent or make illegal the consummation of the transaction contemplated by this
Agreement, or which had or could have a material adverse effect on MIOA.
6.4 DELIVERIES AT CLOSING. At or prior to Closing, in addition to all
other deliveries to be made by MIOA, MIOA shall deliver or cause to be delivered
to the Shareholders a certificate signed by an officer of MIOA, dated the
Closing, certifying that: (a) all of the terms and conditions of this Agreement
to be satisfied or performed by MIOA on or before the time of the Closing have
been satisfied or performed; and (b) no litigation has been instituted or, to
the best of said president's knowledge, threatened on or before the time of the
Closing by any person, the result of which did or could prevent or make illegal
the consummation of the transaction contemplated by this Agreement.
ARTICLE VII
CONDITIONS PRECEDENT TO MIOA OBLIGATIONS
Notwithstanding the execution and delivery of this Agreement or the performance
of any part hereof, MIOA's obligations to consummate the transaction
contemplated by this Agreement shall be subject to the satisfaction of each of
the conditions set forth in this Article VII, except to the extent that such
satisfaction is waived by MIOA in writing.
7.1 REPRESENTATIONS AND WARRANTIES OF THE Shareholders. All
representations and warranties made by the Company and the Shareholders
contained in this Agreement and the Disclosure Schedules hereto shall be true
and correct in all material respects on the date hereof, and shall be true and
correct in all material respects at the time of the Closing as though such
representations were again made, without exception or deviation, at the time of
the Closing.
7.2 PERFORMANCE OF THIS AGREEMENT. The Company and the Shareholders shall
have duly performed or complied with all of the covenants and obligations under
this Agreement to be performed or complied with by them on or prior to the
Closing.
7.3 ABSENCE OF LITIGATION. No litigation shall have been instituted on or
before the time of the Closing by any person, the result of which did or could
prevent or make illegal the consummation of the transaction contemplated by the
Agreement, or which had or could have a material adverse effect on the Company
or its Business.
7.4 DELIVERIES AT CLOSING. At Closing, in addition to all other deliveries
to be made by the Shareholders hereunder, the Shareholders shall deliver or
cause to be delivered a certificate signed by the Shareholders, dated as of the
Closing, certifying that: (a) all of the terms and conditions of this Agreement
to be satisfied or performed by the Company and the Shareholders on or before
the time of the Closing have been satisfied or performed; (b) no litigation has
been instituted or, to the best of their knowledge, threatened on or before the
time of the Closing by any person, the result of which did or could prevent or
make illegal the consummation of the transaction contemplated by this Agreement;
or which had or could have a material adverse effect on the Company or its
Business; and (c) there has not been any material adverse change in or affecting
the Company or its Business between the date of this Agreement and the time of
the Closing.
ARTICLE VIII
OBLIGATIONS AT CLOSING
8.1 OBLIGATIONS OF MIOA TO THE SHAREHOLDERS AT Closing. MIOA hereby
covenants and agrees to deliver or cause to be delivered to the Shareholders at
the Closing or as soon thereafter as reasonably possible the following:
(a) Duly issued certificates (legended as provided in Section 1.2 (a)
hereof) representing the MIOA Shares, together with any documentary stamps
required in connection with such transfer and such other appropriate documents
and instruments of transfer as the Shareholders may reasonably request;
(b) A certification by an officer of MIOA that MIOA is authorized to
execute, deliver and perform this Agreement and consummate the transactions
contemplated hereby; and
(c) Such other documents and instruments as the Shareholders may
reasonably request in order to effectuate the terms of this Agreement.
8.2 OBLIGATIONS OF THE SHAREHOLDERS TO MIOA AT Closing. The Shareholders
hereby covenant and agree to deliver or cause to be delivered to MIOA at the
Closing the following:
(a) The Company stock certificates representing the Global Shares,
free and clear of all encumbrances, together with all certificates evidencing
same and stock powers therefor, in a form acceptable to the Corporation, duly
executed in blank;
(b) A Good Standing Certificate for the Company from the State of
Florida;
(c) A copy of the By-Laws of Company certified by the secretary of
Company, and a copy of the Articles of Incorporation of the Company certified by
the Secretary of State of the state of incorporation of the Company.
(d) Incumbency certificates relating to each person executing (as a
corporate officer or otherwise on behalf of another person) any document
executed and delivered to MIOA pursuant to the terms hereof.
(e) The General Releases referred to in Section 5.2, duly executed by
the persons referred to in such Section.
(f) Such other documents and instruments as MIOA may reasonably
request in order to effectuate the terms of this Agreement.
ARTICLE IX
TERMINATION
9.1 TERMINATION ON DEFAULT. If, prior to the Closing, a party hereto shall
materially breach or default in the full and timely performance and satisfaction
of any of its representations and warranties or obligations under this
Agreement, and such breach or default is not cured on or before the fifth (5th)
day (or such reasonably longer period if five (5) days is an unreasonable period
to cure such breach or default) after the date notice is given by the
non-defaulting party to the defaulting party specifying the nature of such
breach or default, then the non-defaulting party may terminate this Agreement at
anytime following the period for curing such breach or default. The Closing will
be extended for such reasonable period necessary to allow the defaulting party
to cure the breach or default.
9.2 TERMINATION AT CLOSING. If any of the conditions set forth in Article
VI hereof are not satisfied at or before the time of the Closing, then the
Shareholders may terminate this Agreement by notifying MIOA at the Closing. If
any of the conditions set forth in Article VII hereof are not satisfied at or
before the time of the Closing, then MIOA may terminate this Agreement by
notifying the Shareholders at the Closing.
ARTICLE X
MISCELLANEOUS
10.1 NOTICES. All notices, requests, demands and other communications
hereunder shall be deemed to have been duly given if the same shall be in
writing and shall be delivered personally or sent by registered or certified
mail, postage prepaid, and addressed as set forth below:
If to the Shareholders: 00000 Xxxxxxxxx Xxxxx
Xxxxxx 0
Xxxxxxxxxx, XX 00000
To Company: 00000 Xxxxxxxxx Xxxxx
Xxxxxx 0
Xxxxxxxxxx, XX 00000
If to MIOA: Medical Industries of
America, Inc.
0000 X. Xxxxxxxx Xxx., #000
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxx X. Xxxxxxx, President
With a copy to: PRN of North Carolina, Inc.
000 X. Xxxxxxxx Xxxxxx, #000
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
11.2 ENTIRE AGREEMENT. This Agreement, including the Disclosure Schedules
attached hereto and the documents delivered pursuant hereto, sets forth all the
promises, covenants, agreements, conditions and understandings among the parties
hereto with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements or conditions, expressed
or implied, oral or written, except as herein contained. No changes of or
modifications or additions to this Agreement shall be valid unless same shall be
in writing and signed by the parties hereto.
11.3 BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon the
parties hereto, their beneficiaries, heirs and administrators. No party may
assign or transfer its interests herein, or delegate its duties hereunder,
without the written consent of the other parties.
11.4 AMENDMENT. The parties hereby irrevocably agree that no attempted
amendment, modification or change (collectively, "Amendment") of this Agreement
shall be valid and effective, unless the parties shall unanimously agree in
writing to such Amendment.
11.5 NO WAIVER. No waiver of any provision of this Agreement shall be
effective unless it is in writing and signed by the party against whom it is
asserted, and any such written waiver shall only be applicable to the specific
instance to which it relates and shall not be deemed to be a continuing or
future waiver.
11.6 GENDER AND USE OF SINGULAR AND PLURAL. All pronouns shall be deemed
to refer to the masculine, feminine, neuter, singular or plural, as the identity
of the party or parties or their personal representatives, successors and
assigns may require.
11.7 COUNTERPARTS. This Agreement and any amendments may be executed in
one or more counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.
11.8 HEADINGS. The article and section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of the Agreement.
11.9 GOVERNING LAW. This Agreement shall be construed in accordance with
the laws of the State of Florida, and any litigation pertaining or related to
this Agreement shall, to the extent permitted by law, be held in Palm Beach
County, Florida.
11.10 FURTHER ASSURANCES. The parties hereto shall execute and deliver
such further instruments and do such further acts and things as may be
reasonably required to carry out the intent and purposes of this Agreement.
11.11 LITIGATION. If any party hereto is required to engage in litigation
or arbitration against any other party hereto, either as plaintiff or as
defendant, in order to enforce or defend any of its or his rights under this
Agreement, and such litigation results in a final judgment in favor of such
party (the "Prevailing Party"), then the party or parties against whom said
final judgment is obtained shall reimburse the Prevailing Party for all direct,
indirect or incidental expenses incurred by the Prevailing Party in so enforcing
or defending its or his rights hereunder, including, but not limited to, all
attorneys' fees, paralegal' fees, court costs and other expenses incurred
throughout all negotiations, trials or appeals undertaken in order to enforce
the Prevailing Party's rights hereunder.
11.12 CONFIDENTIALITY. Except for discussions of the transactions
contemplated by this Agreement among the parties hereto and their
representatives and counsel participating in this transaction, and except as may
required of the Corporation pursuant to federal securities laws, each party
hereto shall, unless all other parties hereto shall otherwise agree, keep
confidential and not, directly or indirectly, disclose to any person the
existence of this Agreement, the transaction contemplated by this Agreement or
any of the terms thereof, and each party hereto shall use its good faith efforts
to cause its employees, agents, officers, directors and representatives to abide
by the foregoing restrictions on disclosure.
11.13 ENFORCEMENT. Notwithstanding anything herein to the contrary, all
claims and disputes relating to this Agreement shall be subject to confidential
binding arbitration in accordance with the National Health Lawyers Association
Alternative Dispute Resolution Rules of Procedure for Arbitration then in force
and with individuals knowledgeable of the medical industry serving as
arbitrators. Written notice of demand for arbitration shall be filed with the
other party to the Agreement and with the National Health Lawyers Association in
Washington, D.C., within a reasonable time after the dispute has arisen. In the
event either party resorts to legal action to enforce the arbitration results or
any other provision of this Agreement, the prevailing party shall be entitled to
recover the costs of such action so incurred, including, without limitation,
reasonable attorneys' fees.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date and year set forth above.
WITNESSES: MIOA ACQUISITION COMPANY I, INC.
/s/ XXXXXX XXXXXX By: /s/ XXXXX XXXXXXXX
Xxxxx Xxxxxxxx, CEO
SHAREHOLDERS:
/s/ XXXXXX XXXXXX /s/ XXXXXX X. XXXX
Xxxxxx X. Xxxx
/s/ XXXXXX XXXXXX /s/ XXXXX XXXXXXX
Xxxxx Xxxxxxx
/s/ XXXXXX XXXXXX /s/ XXXXXX XXXXXXX
Xxxxxx "Skip" Xxxxxxx
/s/ XXXXXX XXXXXX XXX XXXXXX BY XXXXXX XXXXXXX
Xxx X. Xxxxxx by Xxxxxx Xxxxxxx
as his attorney-in-fact
GLOBAL AIR RESCUE, INC.
/s/ XXXXXX XXXXXX By: /s/ XXXXXX XXXX
Xxxxxx Xxxx, President
