AGREEMENT AND PLAN OF MERGER
Exhibit
99.1
AGREEMENT
AND PLAN OF MERGER (this “Agreement”)
made
as of this 11th day of May, 2007, by and among Kaire Holdings Incorporated,
a
Delaware corporation having its principal place of business at 0000 Xxxxxx
Xxxxxx Xxxxx Xxxxx 000, Xxxxxx, XX 00000 ("KAHI"), XxxXx.xxx, Inc., a Delaware
corporation (“YRX”), and H&H Glass, an Illinois having its principal place
of business at 0000 Xxxxxx Xxxxxx Xxxxx Xxxxx 000, Xxxxxx, XX 00000
(“H&H”).
Capitalized
terms used in this Agreement and not otherwise defined shall have the meanings
ascribed to such terms in Section 27.
WHEREAS,
YRX, a wholly owned subsidiary of KAHI, shall acquire 100% of the issued and
outstanding common stock of H&H, and upon the merger of H&H with and
into YRX, H&H will receive in exchange approximately ninety-two percent
(92%) of the issued and authorized common stock of KAIH; and
WHEREAS,
KAIH is authorized to issue H&H approximately 828,000,000 (92% of the total
outstanding) shares of its common stock, $,001 par value per share (the
"KAIH
Common Stock")
of
which 42,616,806 (4.7%) represents the current shares and 29,383,194 represents
other issuances (3.3%) ("Outstanding
KAIH Common Stock")
as of
May 11, 2007; and
WHEREAS,
YRX is a wholly owned subsidiary of KAIH and is authorized to issue 50 million
shares of common stock, par value $.001 (referred to as the “YRX
Shares”),
of
which 45 million such YRX Shares are currently issued and outstanding and owned
by KAIH; and
WHEREAS,
the respective Boards of Directors of KAIH and YRX and the Boards of Directors
of H&H deem it advisable and generally to the advantage and welfare of the
Companies, and their respective shareholders, that (i) YRX be merged with and
into H&H under the terms and conditions hereinafter set forth (the
“Merger”)
and to
be a tax free reorganization under Section 368(a)(1)(A) of the Code;
and
NOW,
THEREFORE, in consideration of the premises, covenants and conditions hereof,
the parties hereto do mutually agree as follows:
1. Vote
on Merger and Related Matters.
The
Constituent Corporations shall each, as soon as practicable but prior to
closing, and in no event later than 20 days after the execution and delivery
hereof, (i) cause a special meeting of its shareholders to be called to consider
and vote upon the Merger on the terms and conditions hereinafter set forth,
or
(ii) obtain written consent of such shareholders as is necessary to approve
the
Merger. Subject to the further conditions and provisions of this Agreement,
a
closing of the Merger shall be held (the “Closing”),
and a
certificate of merger and all other documents or instruments deemed necessary
or
appropriate by the parties hereto to effect the Merger shall be executed and
filed with the Secretary of State of Delaware as promptly as possible
thereafter. The certificate of merger for the Merger (the “Certificate
of Merger”)
so
filed shall be substantially in the forms of Exhibits
A1 and A2
annexed
hereto, with such changes therein as the Boards of Directors of the Constituent
Corporations shall mutually approve.
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2. Representations
and Warranties H&H Glass (“H&H”).
H&H
represents and warrants as follows, except to the extent set forth on the
H&H Schedule of Exceptions:
(a) H&H
is, and on the Effective Date will be, a duly organized and a validly existing
Corporation in good standing under the laws of the State of Delaware and in
such
other jurisdictions as it is qualified to do business. All Outstanding H&H
shares, on the Effective Date, will be duly authorized, validly issued, fully
paid and nonassessable. There are no, and on the Effective Date there will
be
no, issued or outstanding rights, options or warrants to purchase any equity
interest in H&H, including but not limited to any other issued or
outstanding securities of any nature convertible into or exercisable or
exchangeable for equity interests of H&H, as applicable. The Outstanding
H&H Equity Interests have all been issued pursuant to an appropriate
exemption from the registration requirements of the Securities Act and from
any
applicable registration requirements of the various states.
(b) H&H
does not have, and on the Effective Date will not have, any subsidiaries, nor
does it own any direct or indirect interest in any other business entity.
(c) H&H
has, and on the Effective Date will have, full power and authority to enter
into
this Agreement and, subject to any required shareholder or other third party
approval in accordance with the laws of the State of Illinois, to consummate
the
transactions contemplated hereby. This Agreement and the transactions
contemplated hereby have been duly approved prior to the Closing, by H&H
shareholders.
(d) H&H
is qualified or licensed as a foreign corporation in all jurisdictions where
its
business or ownership of assets so requires, except where the failure to be
qualified or licensed would not have a material adverse effect on the business
of H&H. The business of H&H does not require it to be registered as an
investment company or investment adviser; as such terms are defined under the
Investment Company Act of 1940 and the Investment Advisers Act of 1940, each
as
amended.
(e)
The
financial statements of H&H, consisting of its Balance Sheets as of
H&H’s fiscal year-end December 31, 2006 and 2005, its Statement of Income
(Loss) for the fiscal years ended December 31, 2006 and 2005, its Statement
of
Stockholder’s Equity for the two years ended December 31, 2006 and 2005, and its
Statements of Cash Flows for the fiscal years ended December 31, 2006 and 2005,
have been audited by independent public accountants and fairly present the
financial position, results of operations and other information purported to
be
shown therein, at the date and for the respective periods to which they apply.
The interim financial statements of H&H, consisting of its Balance Sheet as
of March 31, 2007 and its Statements of Income (Loss) for the three months
ended
December 31, 2007, fairly present the financial position, results of operations
and other information purported to be shown therein of H&H, at the date and
for the respective periods to which they apply. All such financial statements
have been prepared in conformity with generally accepted accounting principles
consistently applied throughout the periods involved, and have been adjusted
for
all normal and recurring accruals. All such financial statements (together,
the
“Financial
Statements”)
have
been delivered to Kaire and are incorporated herein and made a part
hereof.
2
(f)
There
has
not been, and on the Effective Date there will not have been in the aggregate,
any material adverse change in the condition, financial or otherwise, of H&H
from that set forth in the Financial Statements.
(g) Except
for transactions occurring in the ordinary course of business, there has not
been, and on the Effective Date there will not have been, any transactions
involving
H&H since December 31, 2006 in an amount in excess of $25,000.
(h)
There
are, and on the Effective Date will be, no liabilities (including, but not
limited to, tax liabilities) or claims against H&H (whether such liabilities
or claims are contingent or absolute, direct or indirect, matured or unmatured)
not appearing on the Financial Statements, other than liabilities incurred
in
the ordinary course of business or taxes incurred on earnings since December
31,
2006.
(i)
All
federal, state, county and local income, excise, property and other tax or
information returns required to be filed by H&H have been filed, and all
required taxes, fees or assessments have been paid or an adequate reserve
therefore has been established in the Financial Statements. The federal income
tax returns and state and foreign income tax returns of H&H have not been
audited by the IRS or any other taxing authority within the past five (5) years.
Neither the IRS nor any state, local or other taxing authority has proposed
any
additional taxes, interest or penalties with respect to H&H or any of their
operations or businesses. There are no pending, or to the knowledge of H&H,
threatened, tax claims or assessments, and there are no pending, or to the
knowledge of H&H, threatened, tax examinations by any taxing authorities.
H&H has not given any waivers of rights (which are currently in effect)
under applicable statutes of limitations with respect to the federal income
tax
returns of H&H, for any year.
(j)
Except as provided for in the Financial Statements, H&H, has, and on the
Effective Date will have, good and marketable title to all of its furniture,
fixtures, equipment and other assets as set forth in the Financial Statements,
and such assets are owned free and clear of all security interests, pledges,
liens, restrictions and encumbrances of every kind and nature, except as set
forth in the Financial Statements.
(k)
H&H is the owner of its inventory as set forth in the Financial Statements
and has good and marketable title thereto.
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(l)
The
accounts receivable as set forth in the Financial Statements represent amounts
due for goods sold or services rendered by H&H in the ordinary course of
business and, except as reserved for in the Financial Statements, are
collectable in the ordinary course of business.
(m)
A
copy of all agreements, contracts, arrangements, understandings and commitments,
whether written or oral, to which H&H is or on the Effective Date will be, a
party, or from which H&H will receive substantial benefits and which are
material to H&H (collectively, “Contracts”),
have
been delivered to Kaire and YRX. A list of such Contracts is set forth on the
H&H Schedule of Exceptions, which such schedule shall be amended at the
Effective Date to reflect any Contracts entered into between the date hereof
and
the Effective Date. H&H is not now, nor will be on the Effective Date, in
material default under any Contract. The validity and enforceability of, and
rights of H&H contained in, each such Contract shall not be adversely
effected by the Merger or the transactions contemplated hereby or any actions
taken in furtherance hereof.
(n)
There
are, and on the Effective Date there will be, no legal, administrative, arbitral
or other proceedings, claims, actions or governmental investigations of any
nature pending, or to H&H’s knowledge, as applicable, threatened, involving
H&H, individually or in the aggregate in which an unfavorable determination
could result in suspension or termination of H&H’s business or authority to
conduct such business in any jurisdiction or could result in the payment by
H&H of more than $25,000 individually or $100,000 in the aggregate, or
challenging the validity or propriety of the transactions contemplated by this
Agreement and, to H&H’s best knowledge, there is no reasonable basis for any
such proceeding, claim, action or governmental investigation. H&H is not a
party to any order, judgment or decree which will, or might reasonably be
expected to, materially adversely affect the business, operations, properties,
assets or financial condition of H&H.
(o) Since
December 31, 2006 there have been, and through the Effective Date there will
be
(i) no bonuses or extraordinary compensation to any of the officers of the
company, (ii) no loans made to or any other transactions with any of the
officers of the company or their families, and (iii) no dividends or other
distributions declared or paid by H&H.
(p)
H&H
has, and on the Effective Date will have, maintained casualty and liability
policies and other insurance policies with respect to its business which are
appropriate and customary for businesses similar in size, industry and risk
profile. Copies of all of the policies of insurance and bonds presently in
force
with respect to H&H, including without limitation those covering properties,
buildings, machinery, equipment, worker's compensation, officers and directors
and public liability, have been delivered to Kaire Holdings and YRX. All such
insurance is outstanding and in full force and effect, with all premiums thereon
duly paid, and H&H has not received any notice of cancellation of any such
policies.
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(q)
H&H
has, and on the Effective Date will have, no patents, patent applications,
trademarks, trademark registrations or applications, trade names, copyrights,
copyright registrations or applications, or other intellectual property. H&H
does not have knowledge of any infringements by it of any third party's
intellectual property.
(r) Since
its
inception, H&H has, and on the Effective Date will have, in all material
respects operated its business and conducted its affairs in compliance with
all
applicable laws, rules and regulations, except where the failure to so comply
did not have and would not be expected to have a material adverse effect on
its
business or
property.
(s) There
are, and on the Effective Date there will be, no loans, leases or other
Contracts outstanding between H&H and any of its officers or any person
related to
or affiliated with any such officers. .
(t)
During
the past five year period neither H&H, nor any of its officers or Directors,
nor any person intended upon consummation of the Merger to become an officer
or
director of either H&H or Kaire Holdings or any successor entity or
subsidiary, has been the subject of:
(i) a
petition under the Federal bankruptcy laws or any other insolvency or moratorium
law or has a receiver, fiscal agent or similar officer been appointed by a
court
for the business or property of H&H or such person, or any partnership in
which H&H or any such person was a general partner at or within two years
before the time of such filing, or any corporation or business association
of
which H&H or any such person was an executive officer at or within two years
before the time of such filing;
(ii) a
conviction in a criminal proceeding or a named subject of a pending criminal
proceeding (excluding traffic violations which do not relate to driving while
intoxicated or driving under the influence);
(iii) any
order, judgment or decree, not subsequently reversed, suspended or vacated,
of
any court of competent jurisdiction, permanently or temporarily enjoining
H&H or any such person from, or otherwise limiting, the following
activities:
(A)
acting as a futures commission merchant, introducing broker, commodity trading
advisor, commodity pool operator, floor broker, leverage transaction merchant,
any other person regulated by the United States Commodity Futures Trading
Commission (“CFTC”)
or an
associated person of any of the foregoing, or as an investment adviser,
underwriter, broker or dealer in securities, or as an affiliated person,
director or employee of any investment company, bank, savings and loan
association or insurance company, or engaging in or continuing any conduct
or
practice in connection with such activity;
5
(B) engaging
in any type of business practice; or
(C) engaging
in any activity in connection with the purchase or sale of any security or
commodity or in connection with any violation of Federal, state or other
securities laws or commodities laws;
(iv) any
order, judgment or decree, not subsequently reversed, suspended or vacated,
of
any Federal, state or local authority barring, suspending or otherwise limiting
for more than 60 days the right of H&H or any such person to engage in any
activity described in the preceding sub-paragraph, or to be associated with
persons engaged in any such activity;
(v)
a
finding
by a court of competent jurisdiction in a civil action or by the Commission
to
have violated any securities law, regulation or decree and the judgment in
such
civil action or finding by the Commission has not been subsequently reversed,
suspended or vacated; or
(vi)
a
finding
by a court of competent jurisdiction in a civil action or by the CFTC to have
violated any federal commodities law, and the judgment in such civil action
or
finding by the CFTC has not been subsequently reversed, suspended or vacated.
(u) H&H
does not have any pension plan, profit sharing or similar employee benefit
plan.
(v) Except
for the consent and approval of the Members and the filing of the Certificate
of
Merger, no consents or approvals of, or filings or registrations with, any
third
party or any public body or authority are necessary in connection with (i)
the
execution and delivery by H&H of this Agreement and (ii) the consummation by
H&H of the Merger and by H&H of all other transactions contemplated
hereby. This Agreement has been duly executed and delivered by H&H and
constitutes the legal, valid and binding obligation of H&H, enforceable
against it in accordance with the terms hereof, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application relating to or affecting the enforcement of rights hereunder or
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(w)
H&H
knows of no person who rendered any service in connection with the introduction
of Kaire, YRX or H&H to any of the other companies, and they know of no
claim by anyone for a “finder's fee” or similar type of fee in connection with
the Merger and the other transactions contemplated hereby.
(x)
No
employees of H&H are on strike or to the best of their knowledge threatening
any strike or work stoppage. H&H does not have any obligations under any
collective bargaining or labor union agreements nor is H&H involved in any
material controversy with any of its employees or any organization representing
any of its employees.
6
(y) None
of
the information supplied or to be supplied by or about H&H for inclusion or
incorporation by reference in any information supplied to holders of Kaire
Common
Stock
concerning the Merger, contains any untrue statement of a material fact or
omits
to state any material fact required to be stated therein or necessary in order
to
make
the
statements
therein, in light of the circumstances under which they are made, not
misleading.
(z) The
execution and delivery by H&H of this Agreement, the consummation and
performance of the transactions herein contemplated, and compliance with the
terms
of
this
Agreement
by H&H will not conflict with, result in a breach 000000of or constitute or
give rise to a default under (i) any indenture, mortgage, deed of trust or
other
agreement,
instrument
or Contract to which H&H is now a party or by which it or any of its assets
or properties are bound; (ii) the Articles of Organization or the Operating
Agreement
of H&H,
in each case as amended; or (iii) any law, order, rule, regulation, writ,
injunction, judgment or decree of any government, governmental instrumentality
or
court,
domestic or
foreign, having jurisdiction over H&H or any of its business or properties
wherein such breach could have a material adverse effect on H&H or any of
its
business
or properties.
(aa)
To
the
best of its knowledge, H&H is not in violation of any federal, state or
local environmental law or regulation.
3.
Representations
and Warranties of XxxXx.xxx (“YRX”).
YRX
represents and warrants as follows:
(a)
YRX
is,
and on the Effective Date will be, a duly organized and validly existing
corporation in good standing under the laws of the State of Delaware, authorized
to issue only the YRX Shares. On the Effective Date there will be issued and
outstanding all of the YRX Shares, which shall be fully paid and nonassessable
and all of which shall be owned by Kaire. There are no, and on the Effective
Date there will be no issued or outstanding options or warrants to purchase
YRX
Shares or any issued or outstanding securities of any nature convertible into
YRX Shares, or any agreements or understandings to issue any YRX Shares, options
or warrants.
(b)
YRX
has
been organized solely for the purpose of consummating the Merger and, since
its
inception, has had no business activity of any nature other than those related
to its organization or as contemplated by this Agreement.
(c) YRX
has,
and on the Effective Date will have, full power and authority to enter into
this
Agreement and to consummate the transactions contemplated hereby. This Agreement
and the transactions contemplated hereby have been duly approved by the Board
of
Directors of YRX.
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(d)
Since
its
inception, YRX has not issued or committed itself to issue, and to the Effective
Date will not issue or commit to issue, any YRX Shares or any options, rights,
warrants, or other securities convertible into YRX Shares, except for the
issuance of the YRX Shares to Kaire.
(e) Except
for the consent and approval of the shareholders of YRX, and the filing of
the
Certificate of Merger, no consents or approvals of, or filings or
registrations
with, any third party or any public body or authority are necessary in
connection with (i) the execution and delivery by YRX of this Agreement and
(ii)
the
onsummation
by YRX of the Merger and the other transactions contemplated
hereby.
(f) The
execution and delivery by YRX of this Agreement, the consummation and
performance of the transactions herein contemplated, and compliance with the
terms of this Agreement by YRX will not conflict with, result in a breach of
or
constitute or give rise to a default under any indenture, mortgage, deed of
trust or other agreement, instrument or contract to which YRX is now a party
or
by which it or any of its assets or properties are bound or its Certificate
of
Incorporation or the bylaws of YRX as amended, or any law, order, rule or
regulation, writ, injunction, judgment or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over YRX
or
any of its businesses or properties.
(g)
YRX
is,
and on the Effective Date will be duly authorized, qualified, and licensed
under
any and all applicable laws, regulations, ordinances, or orders of public
authorities to carry on its business in the places and in the manner as
presently conducted or as contemplated in this Agreement. The business of YRX
does not require it to be registered as an investment company or investment
adviser as such terms are defined under the Investment Company Act and the
Investment Advisers Act of 1940, each as amended.
(h)
YRX
has,
and on the Effective Date will have no subsidiaries.
(i)
Except
for (i) the incurring of expenses of its organization, (ii) the issuance of
the
YRX Shares to Kaire, (iii) the incurring of expenses relating to this Agreement
and the consummation of the transactions contemplated by this Agreement, and
(iv) the consummation of the Merger, YRX has had, and on the Effective Date
will
have had no business and no financial or other transactions of any nature
whatsoever.
(j)
YRX
has,
and on the Effective Date will have no liabilities (including, but not limited
to, tax liabilities) nor are there, or on the Effective Date will there be,
any
claims against YRX (whether such liabilities or claims are contingent or
absolute, direct or indirect, and matured or unmatured) except for liabilities
for its organization expenses or expenses incurred in connection with the
Merger.
(k)
YRX
has, and on the Effective Date will have no fixtures, furniture, equipment,
inventory or accounts receivable.
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(l)
YRX
has, and on the Effective Date will have no contracts and commitments to which
it is, or on the Effective Date will be a party, except for this Agreement
and
other documents and instruments contemplated hereby in connection with the
Merger.
(m)
There
are, and on the Effective Date there will be no legal, administrative, arbitral
or other proceedings, claims, actions or governmental investigations of any
nature against YRX, or challenging the validity or propriety of the transactions
contemplated by this Agreement and, to YRX's best knowledge, there is no
reasonable basis for any other proceeding, claim, action or governmental
investigation against YRX. YRX is not a party to any order, judgment or decree
which will, or might reasonably be expected to, materially adversely affect
the
business, operations, properties, assets or financial condition of
YRX.
(n)
Since
the inception of YRX there have been, and to the Effective Date there will
be
(i) no salaried or otherwise compensated employees and no bonuses paid to any
officer or director of YRX; (ii) no loans made to or any transactions with
any
officer or director of YRX; (iii) no dividends or other distributions declared
or paid by YRX; and (iv) no purchase by YRX of any YRX Shares.
(o)
Since
its
inception, YRX has not issued or committed itself to issue, and to the Effective
Date will not issue or commit itself to issue any YRX shares or any options,
rights, warrants, or other securities convertible into YRX Shares except for
the
issuance of the YRX Shares to Kaire.
(p)
YRX
has no patents, patent applications, trademarks, trademark registrations,
tradenames, copyrights, copyright registrations or applications
therefore.
(q)
Since
its
inception, YRX has, and on the Effective Date will have in all material respects
conducted its affairs in compliance with all applicable laws, rules and
regulations.
(r)
During
the past five year period, no officer or director of YRX has been the subject
of
any Bad Event.
(s)
YRX
has
no pension plan, profit sharing or similar employee benefit plan.
(t)
YRX
knows
of no person who rendered any service in connection with the introduction of
Kaire, YRX or H&H to any of the other Companies and they know of no claim by
anyone for a “finder's fee” or similar type of fee in connection with the Merger
and the other transactions contemplated hereby.
(u)
YRX
has
no employees.
4.
Representations
and Warranties of Kaire.
Kaire
represents, warrants and covenants, except to the extent set forth on the Kaire
Schedule of Exceptions or except as set forth
in
the
reports required to be filed by Kaire under the Securities Act and the Exchange
Act of 1934, as amended, including pursuant to Section 13(a) or 15(d) thereof
(“SEC
Reports”),
as
follows:
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(a) Kaire
is
a duly organized and validly existing corporation in good standing under the
laws of the State of Delaware, authorized to issue an aggregate of 900,000,000
shares of Kaire Common Stock. On the Effective Date, there will be issued and
outstanding no more than 42,616,000 shares of Kaire Common Stock, all of which
such issued and outstanding shares will be validly issued, fully paid and
nonassessable. The fully diluted number of shares will be not more than
72,000,000 shares of common stock. Except as contemplated by this Agreement,
on
the Effective Date there will be no issued or outstanding options, warrants
or
other rights, or commitments or agreements of any kind, contingent or otherwise,
to purchase or otherwise acquire shares of Kaire Common Stock or any issued
or
outstanding securities of any nature convertible into shares of Kaire Common
Stock (see Exhibit B). There is no proxy or any other agreement, arrangement
or
understanding of any kind authorized or outstanding which restricts, limits
or
otherwise affects the right to vote any shares of Kaire Common
Stock.
(b) Kaire
is,
and on the Effective Date will be, duly authorized, qualified and licensed
under
any and all applicable laws, regulations, ordinances or orders of public
authorities to carry on its business in the places and in the manner as
presently conducted. The business of Kaire does not require it to be registered
as an investment company or investment advisor, as such terms are defined under
the Investment Company Act and the Investment Advisors Act of 1940.
(c) Kaire
has, and on the Effective Date the following subsidiaries:
1.
XxxXx.xxx, Delaware - Incorporated March 28, 2000.
2.
Effective Health Inc., California - Incorporated May 25, 1990
3. Classic Care Inc. - California, acquired in 2000, voluntarily shut down
in
2002.
(d)
The
financial statements of Kaire, consisting of its Balance Sheets as at December
31, 2006 and 2005, and its Statement of Operations for the fiscal years ended
December 31, 2006 and 2005, its Statement of Stockholders' Equity as of December
31, 2006 and 2005, and its Statement of Cash Flows for the fiscal years ended
December 31, 2006 and 2005, all together with accompanying notes, have been
audited by independent public accountants, are complete and correct in all
material respects, present fairly the financial position of Kaire and the
results of operations and changes in financial position for the respective
periods ended on such dates, and were prepared in accordance with generally
accepted accounting principles consistently applied during the periods. The
interim financial statements of Kaire, consisting of its Balance Sheet as of
March 31, 2007 and its Statement of Operations, Statement of Stockholders'
Equity and Statement of Cash Flows for the nine-month period ending March 31,
2007 will not be available until around May 20th,
2007
and will be prepared in accordance with generally accepted accounting principles
and have been adjusted for all normal and recurring accruals and present fairly
the financial position of Kaire and the results of operations and changes in
financial position for the respective periods ended on such dates, and were
prepared in accordance with generally accepted accounting principles
consistently applied during the periods. All the financial statements referenced
herein regarding Kaire are collectively referred to as the “Kaire
Financial Statements”,
all of
which are set forth in the SEC Reports publicly filed with the
Commission.
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(e) There
has
not been, and on the Effective Date there will not have been, any material
change in the financial condition of Kaire from that set forth in the Kaire
Financial Statements except for (i) transactions in the ordinary course of
business, (ii) transactions relating to this Agreement, and (iii) the incurring
of expenses and liabilities relating to this Agreement.
(f) There
are, and on the Effective Date will be, no liabilities (including, but not
limited to, tax liabilities) or claims against Kaire (whether such liabilities
or claims are contingent or absolute, direct or indirect, accrued or unaccrued
and matured or unmatured) not appearing on the Kaire Financial Statements,
except for (i) liabilities for expenses incurred relating to this Agreement
and
the consummation of the transactions contemplated hereby and (ii) liabilities
and commitments incurred or made in the ordinary course of Kaire’s business or
taxes incurred on earnings since December 31, 2006.
(g) All
federal, state, county and local income, excise, property or other tax returns
required to be filed by Kaire have been filed and all required taxes, fees
or
assessments have been paid or an adequate reserve therefore has been set up
in
the Kaire Financial Statements.
(h) Kaire
has, and on the Effective Date will have, no fixtures, furniture, equipment,
inventory or accounts receivable.
(i) Kaire
has, and on the Effective Date will have, no material contracts to which it
is,
or on the Effective Date will be, a party.
(j) There
are, and on the Effective Date there will be, no legal, administrative, arbitral
or other proceedings, claims, actions or governmental investigations of any
nature pending or to Kaire's knowledge threatened in writing, against Kaire,
including, but not limited to any shareholder claims or derivative actions,
or
challenging the validity or propriety of the transactions contemplated by this
Agreement, and, to Kaire’s best knowledge, there is no reasonable basis for any
proceeding, claim, action or governmental investigation against Kaire. Kaire
is
not a party to any order, judgment or decree which will, or might reasonably
be
expected to, materially adversely affect the business, operations, properties,
assets or financial condition of Kaire.
(k) Kaire
has
no salaried or otherwise compensated employees.
(l) Kaire
has
not issued or committed itself to issue, and to the Effective Date will not
issue or commit itself to issue, any additional common shares or any options,
rights, warrants, or other securities convertible into common shares, except
as
contemplated by this Agreement.
11
(m) Kaire
has
no patents, no patent applications, trademarks, trademark registrations, trade
names, copyrights, copyright registrations or applications therefor. Kaire
has
no knowledge of any infringements by it of any third party's intellectual
property.
(n) Kaire
has, and on the Effective Date will have, in all material respects operated
its
business and conducted its affairs in compliance with all applicable laws,
rules
and regulations.
(o) On
the
Effective Date there will be no loans, leases, commitments, arrangements or
other contracts of any kind or nature outstanding between (i) Kaire and (ii)
any
officer or director of Kaire or any person related to or affiliated with any
officer or director of Kaire accept otherwise disclosed.
(p) During
the past five year period, no officer or director of Kaire has been the subject
of any undisclosed Bad Event.
(q) Kaire
has
no pension plan, profit sharing or similar employee benefit plan.
(r) Except
for the consent and approval of the Boards of Directors of YRX and Kaire and
H&H the filing of a Certificate of Merger, and the filing of a Form 8-K
within 25 days of the Effective Date, no consents or approvals of, or filings
or
registrations with, any third party or any public body or authority are
necessary in connection with (i) the execution and delivery by Kaire of this
Agreement and (ii) the consummation of the Merger and the other transactions
contemplated hereby. Kaire has, and on the Effective Date will have, full power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement and the transactions contemplated hereby
have been, or will be prior to the Effective Date, duly approved by the Board
of
Directors of Kaire. This Agreement has been duly executed and delivered by
Kaire
and constitutes the legal, valid and binding obligation of Kaire enforceable
against it in accordance with the terms hereof except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application relating to or affecting the enforcement of rights hereunder or
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(s) Kaire
knows of no person who rendered any service in connection with the introduction
of Kaire, YRX or H&H to any of the other companies and they know of no claim
by anyone for a “finder's fee” or similar type of fee in connection with the
Merger and the other transactions contemplated hereby.
(t) Kaire
has
no employees.
(u) None
of
the information supplied or to be supplied by or about Kaire to H&H
concerning the Merger contains any untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
are made, not misleading.
12
(v) The
execution and delivery by Kaire of this Agreement, the consummation and
performance of the transactions herein contemplated, and compliance with the
terms of this Agreement by Kaire will not conflict with, result in a breach
of
or constitute a default under (i) any indenture, mortgage, deed of trust or
other agreement, instrument or contract to which Kaire is now a party or by
which it or any of its assets or properties is bound; (ii) the Certificate
of
Incorporation, as amended, or the bylaws of Kaire, in each case as amended;
or
(iii) any law, order, rule or regulation, writ, injunction, judgment or decree
of any government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over Kaire or any of its business or
properties.
(w) To
the
best of its knowledge, Kaire is not in violation of any federal, state or local
environmental law or regulation.
5.
Representations
to Survive Closing.
All of
the representations, covenants and warranties contained in this Agreement
(including all statements contained in any certificate or other instrument
delivered by or on behalf of Kaire, YRX or H&H pursuant hereto or in
connection with the transactions contemplated hereby) shall survive the Closing
for a period of three (3) years from the Effective Date.
7.
Surviving
Corporation.
The
surviving entity shall be H&H. Its name, identities, articles of
organization, operating agreement, existence, purposes, powers, objects,
franchises, rights and immunities shall be unaffected and unimpaired by the
Merger, except as described in the Certificate of Merger.
8.
Treatment
of Shares of Constituent Corporations.
The
terms and conditions of the Merger, the mode of carrying the same into effect,
and the manner and basis of converting the securities of each of the Constituent
Corporations are as follows:
(a) All
of
the Outstanding H&H shares shall be exchanged by virtue of the Merger at the
Effective Date into approximately 92% of Kaire’s outstanding shares as of the
Effective Date or approximately 828,000,000 (see Exhibit C) of Kaire Common
Stock.
(b) YRX
shall
acquire 100% of H&H outstanding shares as of the effective date.
(c) The
separate existence and corporate organization of YRX, except insofar as it
may
be continued by statute, shall cease on Effective Date and H&H shall become
a wholly owned subsidiary of Kaire.
13
9. Rights
and Liabilities of Surviving Corporation.
(a) On
and after the Effective Date, H&H, as the surviving entity of the Merger,
shall succeed to and possess, without further act or deed, all of the estate,
rights, privileges, powers and franchises, both public and private and all
of
the property, real, personal and mixed, of YRX; all debts due to YRX on whatever
account shall be vested in H&H; all claims, demands, property, rights,
privileges, powers, franchises and every other interest of YRX shall be as
effectively the property of H&H as they were of YRX; the title to any real
estate by deed or otherwise in YRX shall not revert or be in any way impaired
by
reason of the Merger, but shall be vested in H&H; all rights of creditors
and all liens upon any property of YRX shall be preserved unimpaired, limited
in
lien to the property affected by such lien at the Effective Date; all debts,
liabilities and duties of YRX shall thenceforth attach to H&H and may be
enforced against it to the same extent as if such debts, liabilities and duties
had been incurred or contracted by it; and H&H shall indemnify and hold
harmless Kaire and the officers and directors of YRX against all such debts,
liabilities and duties and against all claims and demands arising out of the
Merger.
10.
Further
Assurances of Title.
As and
when requested by H&H, or by any of its successors or assigns, YRX shall
execute and deliver, or cause to be executed and delivered, all such deeds
and
instruments and will take or cause to be taken all such further action as
H&H may deem necessary or desirable in order to vest in and confirm to
H&H title to and possession of the property acquired by H&H by reason or
as a result of the Merger and otherwise to carry out the intent and purposes
hereof, and the officers and directors of H&H and Kaire are fully authorized
in the name of H&H or Kaire or otherwise to take any and all such
action.
11.
Conditions
of Obligations of YRX and Kaire.
The
obligation of YRX and Kaire to consummate the Merger is subject to the following
conditions prior to the Effective Date:
(a)
H&H
has not suffered an uninsured loss on account of fire, flood, accident, or
other
calamity of such a character as to interfere materially with the continuous
operation of its business or materially affect adversely its condition,
financial or otherwise, regardless of whether or not such loss shall have been
insured.
(b)
That
no
material transactions shall have been entered into by H&H other than
transactions in the ordinary course of business between December 31, 2006 and
the Effective Date, other than as referred to in this Agreement or in the
schedules annexed, except with the prior written consent of Kaire.
(c)
Except
as
disclosed in this Agreement or in the schedules annexed hereto, that no material
adverse change in the aggregate shall have occurred in the financial condition
of H&H since December 31, 2006.
(d)
That
none
of the properties or assets of H&H shall have been sold or otherwise
disposed of other than in the ordinary course of business during such period,
except with the prior written consent of Kaire.
(e)
That
H&H shall have performed and complied with the provisions and conditions of
this Agreement on its part to be performed and complied with, and that the
representations and warranties made by H&H in this Agreement are true and
correct, both when made and as of the Effective Date.
14
(f)
That
all applicable filings and regulatory approvals required to be made or obtained
by H&H have been made or obtained.
(g) That
this
Agreement and the transactions contemplated hereby shall have been approved
by
appropriate action of H&H, the Managing Member and the Members.
(h) That
there shall have been full compliance with the applicable securities or “blue
sky” laws and regulations of any state or other governmental body having
jurisdiction over the Merger.
(i) That
Kaire shall have received from H&H the following documents:
(i)
|
Good
Standing Certificate of H&H
|
(ii)
|
Certificate
of Incorporation of H&H;
|
(iii)
|
Good
Standing Certificate of H&H;
|
(iv)
|
Organizational
minutes of H&H and any other documents required by Section 16 of this
agreement;
|
(v)
|
By-Laws
of H&H;
|
(vi)
|
Written
consent of shareholders of H&H authorizing the
Merger;
|
(vii) |
Written
consent of the Board of Directors of ROXA authorizing the Merger;
and
|
(viii) |
Officer’s
Certificate of ROXA evidencing compliance with the provisions of this
Section 11
|
12. Conditions
of Obligations of H&H.
The
obligations of H&H to consummate the Merger are subject to the following
conditions prior to the Effective Date:
(a) That
YRX
and Kaire are in compliance with their respective representations, warranties
and covenants contained herein, and that H&H shall receive from each of YRX
and Kaire a certificate to such effect from the President of YRX and Kaire
as of
the Effective Date.
(b) That
YRX
and Kaire shall not have suffered any loss on account of fire, flood, accident
or other calamity of such a character as to interfere materially with the
continuous operation of its business or materially affect adversely its
condition, financial or otherwise, regardless of whether or not such loss shall
have been insured.
(c) That
no
material transactions shall have been entered into by YRX or Kaire other than
transactions in the ordinary course of business since December 31, 2006, other
than as referred to in this Agreement, except with the prior written consent
of
H&H.
(d) That
no
material adverse change shall have occurred in the financial condition of YRX
or
Kaire since December 31, 2006 other than as referred to in this Agreement.
15
(e)
That
none
of the properties or assets of YRX or Kaire shall have been sold or otherwise
disposed of other than in the ordinary course of business September 30, 2002,
except with the written consent of H&H.
(f)
That
YRX
and Kaire shall each have performed and complied with the provisions and
conditions of this Agreement on its part to be performed and complied with,
and
that the representations and warranties made by Kaire herein are true and
correct.
(g)
That
all
applicable filings and regulatory approvals required to be made or obtained
by
Kaire have been made or obtained.
(h) That
Kaire shall have held a meeting of its Board of Directors at which meeting
all
of its directors shall have resigned seriatim with the exception of Xxxxx Xx
and
the persons designated by H&H shall have been appointed as directors of
Kaire, all subject to the consummation of the Merger.
(i) That
H&H shall have received from Kaire and YRX the following
documents:
(i)
|
Original
signature page of this Agreement duly executed by Kaire and
YRX;
|
(ii)
|
Good
Standing Certificate of Kaire;
|
(iii)
|
Good
Standing Certificate of YRX;
|
(iv)
|
Certificate
of Incorporation of Kaire;
|
(v)
|
Certificate
of Incorporation of YRX;
|
(vi)
|
Organizational
minutes of Kaire and any other documents required by Section 15 of
this
agreement;
|
(vii)
|
Organizational
minutes of YRX and any other documents required by Section 15 of
this
agreement;
|
(viii)
|
By-Laws
of Kaire;
|
(ix)
|
By-Laws
of YRX;
|
(x)
|
Written
consent of shareholders of YRX authorizing the
Merger;
|
(xi)
|
Written
consent of the Board of Directors of Kaire authorizing the
Merger;
|
(xii)
|
Officer’s
Certificate of Kaire evidencing compliance with the provisions of
this
Section 12; and
|
(xiii) Officer’s
Certificate of YRX evidencing compliance with the
provisions
of this Section 12 of this agreement.
13.
Abandonment.
This
Agreement and the Merger may be abandoned (a) by any of the Companies, acting
by
its Board of Directors, at any time prior to its adoption by the shareholders
of
such Company, as provided by law, (b) by any of the Companies, acting by its
Board of Directors by written notice to the other parties hereto, at any time
in
the event of the failure of any condition in favor of such entity as to which
the consummation of the Merger is subject, or (c) by the consent of all the
Companies, acting each by its Board of Directors, at any time after such
adoption by such shareholders and prior to the Effective Date. In the event
of
abandonment of this Agreement, the same shall become wholly void and of no
effect, and there shall be no further liability or obligation hereunder on
the
part of any of the Companies, their respective Boards of Directors or any other
party to this Agreement.
16
14.
Closing
or Termination.
In the
event the Closing of this Agreement shall not take place by May 31, 2007, due
to
failure of any condition of closing required herein, any party shall have the
right to terminate this Agreement, in which event no party shall have any
further right or obligation as against any other.
15.
Delivery
of Corporate Proceedings of Kaire and YRX.
At the
Closing, Kaire and YRX shall deliver to counsel for H&H the originals of all
of the corporate proceedings of Kaire and YRX, duly certified by their
respective Secretaries, relating to this Agreement.
16.
Delivery
of Corporate Proceedings of H&H.
At the
Closing, H&H shall deliver to counsel for Kaire and YRX the originals of all
of the corporate proceedings of H&H, duly certified by its Secretary,
relating to this Agreement and a draft of the language proposed to be included
the Form 8-K to be filed within 15 days of the Effective Day, which draft shall
be substantially in compliance with the requirements of Form 8-K.
17. Limitation
of Liability.
The
representations and warranties made by any party to this Agreement are intended
to be relied upon only by the other parties to this Agreement and by no other
person. Nothing contained in this Agreement shall be deemed to confer upon
any
person not a party to this Agreement any third party beneficiary rights or
any
other rights of any nature whatsoever.
18. Further
Instruments and Actions.
Each
party shall deliver such further instruments and take such further action as
may
be reasonably requested by any other in order to carry out the intent and
purposes of this Agreement.
19. Governing
Law.
This
Agreement is being delivered and is intended to be performed in the State of
Delaware and shall be construed and enforced in accordance with the laws of
such
State without regard to conflicts of laws thereof.
20. Notices.
All
notices or other communications to be sent by any party to this Agreement to
any
other party to this Agreement shall be sent by certified mail, nationwide
overnight delivery service or by personal delivery or nationwide overnight
courier to the addresses hereinbefore designated, or such other addresses as
may
hereafter be designated in writing by a party.
21. Binding
Agreement.
This
Agreement represents the entire agreement among the parties hereto with respect
to the matters described herein and is binding upon and shall inure to the
benefit of the parties hereto and their legal representatives, successors and
permitted assigns. This Agreement may not be assigned and, except as stated
herein, may not be altered or amended except in writing executed by the party
to
be charged.
17
22. Counterparts.
This
Agreement may be executed in counterparts, all of which, when taken together,
shall constitute the entire Agreement.
23. Severability.
The
provisions of this Agreement shall be severable, so that the unenforceability,
validity or legality of any one provision shall not affect the enforceability,
validity or legality of the remaining provisions hereof.
24. Joint
Drafting.
This
Agreement shall be deemed to have been drafted jointly by the parties hereto,
and no inference or interpretation against any party shall be made solely by
virtue of such party allegedly having been the draftsperson of this Agreement.
25. Reliance
on Certificates.
In
rendering any opinion referred to herein, counsel for the parties hereto may
rely, as to any factual matters involved in their respective opinions, on
certificates of public officials and of corporate and company officers, and
on
such other evidence as such counsel may reasonably deem appropriate and, as
to
the matters governed by the laws of jurisdictions other than the United States
or the States of Delaware and California, an opinion of local counsel in such
other jurisdiction(s), which counsel shall be satisfactory to the other parties
in the exercise of their reasonable discretion.
26. Public
Announcements.
All
parties hereto agree that any public announcement, press release or other public
disclosure of the signing of this Agreement shall be made jointly and only
after
all parties hereto have reviewed and approved the language and timing of such
disclosure, except as such disclosure may be required pursuant to any legal
obligation or order of any court having proper jurisdiction over any of the
parties hereto.
27. Definitions.
In
addition to the terms defined elsewhere in this Agreement, the following terms
have the meanings indicated in this Section 27:
“Bad
Events”
shall
mean, collectively, the events described in clauses (i) through (vi) of Section
2(t).
“Certificate
of Merger”
shall
have the meaning set forth in Section 1.
“CFTC”
shall
have the meaning set forth in Section 2(t)(iii)(A).
“Closing”
shall
have the meaning set forth in Section 1.
“Code”
shall
mean the Internal Revenue Code of 1986, as amended.
“Commission”
shall
mean the Securities and Exchange Commission.
“Commission
Reports”
shall
have the meaning set forth in the opening paragraph of Section 4
18
“Companies”
shall
mean, collectively, Kaire, YRX and H&H.
“Contracts”
shall
have the meaning set forth in Section 2(m).
“Constituent
Corporations”
shall
mean, collectively, H&H and YRX.
“Effective
Date”
shall
mean the date the Certificate of Merger is filed with the appropriate
State.
“Kaire”
shall
mean Kaire Inc., a Delaware corporation.
“Kaire
Common Stock”
shall
have the meaning set forth in the second recital to this Agreement.
“Kaire
Financial Statements”
shall
have the meaning set forth in Section 4(d).
“Kaire
Schedule of Exceptions”
shall
mean the schedule of exceptions to the representations, warranties and covenants
of Kaire annexed hereto and made a part hereof.
“Financial
Statements”
shall
have the meaning set forth in Section 2(e).
“YRX”
shall
mean XxxXx.xxx, Inc., a Delaware corporation and wholly owned subsidiary of
Kaire.
“YRX
Shares”
shall
have the meaning set forth in the third recital to this Agreement.
“IRS”
shall
mean the Internal Revenue Service.
“Merger”
shall
have the meaning set forth in the fourth recital to this Agreement.
“Outstanding
Kaire Common Stock”
shall
have the meaning set forth in the second recital to this Agreement.
“Securities
Act”
shall
mean the Securities Act of 1933, as amended, and the rules and regulation
promulgated thereunder.
“H&H”
shall
mean Rx for Africa, Inc., a Delaware Corporation
“H&H
Schedule of Exceptions”
shall
mean the schedule of exceptions to the representations, warranties and covenants
of H&H annexed hereto and made a part hereof.
[SIGNATURE
PAGE FOLLOWS]
19
IN
WITNESS WHEREOF, the parties hereto have made and executed this Agreement as
of
the day and year first above written.
KAIRE
HOLDINGS INCORPORATED
/s/
Xxxxx
Wesylund
By:
_____________________
Name:
Xxxxx Xxxxxxxx
Title:
CEO
H&H
GLASS
/s/
Xxxxx
Xxx
By: _____________________
Name: Xxxxx Xxx
Title:
CEO
XXXXX.XXX
INC.
/s/
Xxxxx
Xxxxxxxx
By:
_____________________
Name:
Xxxxx Xxxxxxxx
Title:
CEO
20