AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, (this "Agreement") dated as of
September 12, 1995 by and among Xxxxxxx Medical Corp., a New Jersey corporation
("Xxxxxxx"), Xxxxxxx Medical Acquisition Corporation, a Delaware corporation
("Acquisition") and MDJB, Inc., a Colorado corporation ("MDJB").
RECITALS
WHEREAS, the Boards of Directors of MDJB, Xxxxxxx and Acquisition deem
it advisable and in the best interests of the shareholders of such corporations
to effect the merger of MDJB with and into Acquisition (the "Merger") pursuant
to this Agreement;
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants and promises
contained herein and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
THE MERGER AND RELATED TRANSACTIONS
1.1 Effective Time of the Merger. Subject to the provisions of this
Agreement, certificates of merger (the "Certificates of Merger"), shall be duly
prepared, executed and acknowledged by Acquisition and such other parties as may
be appropriate and thereafter simultaneously delivered to the Secretary of State
of the State of Colorado for filing, as provided in the Colorado Business
Corporation Act (the "CBCA") and the Secretary of State of the State of Delaware
for filing, as provided in the Delaware General Corporation Law ("DGCL"),
respectively, as soon as practicable on or after the Closing Date. The Merger
shall become effective upon the filing of the Certificates of Merger with the
Secretary of State of the State of Colorado and the Secretary of State of the
State of Delaware, respectively, or at such time thereafter as is provided in
the Certificates of Merger (the "Effective Time").
1.2 Closing. The closing of the Merger (the "Closing") will take
place at 10:00 a.m., as soon as practicable after the closing conditions set
forth in Articles VIII, IX and X have been met or waived, at the offices of
Xxxxxxxx, St. Xxxx & Xxxxx, Two Penn Plaza East, Newark, New Jersey, unless
another time, date or place is agreed to in writing by the parties hereto.
1.3 Effects of the Merger.
(a) At the Effective Time, (i) the separate existence of
MDJB shall cease and MDJB shall be merged with and into Acquisition and
Acquisition, as the surviving corporation in the Merger under the name "Xxxxxxx
Medical Acquisition Corporation" shall continue its corporate existence under
the laws of the State of Delaware, (ii) the Certificate of Incorporation of
Acquisition as in effect immediately prior to the Effective Time shall be the
Certificate of Incorporation after the Effective Time and thereafter may be
amended or repealed as provided by law (provided that by virtue of the Merger,
Article III of such Certificate of Incorporation shall be amended to change the
name of Acquisition to a name selected by Xxxxxxx following the Effective Time
and (iii) the By-laws of Acquisition as in effect immediately prior to the
Effective Time shall be the By-laws after the Effective Time and thereafter may
be amended or repealed in accordance with its terms, the Certificate of
Incorporation of Acquisition and as provided by law.
(b) At and after the Effective Time, the Merger will have
the effects set forth in Section 106 of the CBCA and Section 259 of the DGCL.
1.4 Absence of Control. Subject to any specific provisions of this
Agreement, it is the intent of the parties that Acquisition and Xxxxxxx by
reason of this Agreement shall not (until consummation of the transactions
contemplated hereby) control, and shall not be deemed to control, directly or
indirectly, MDJB or any of its Subsidiaries and shall not exercise, or be deemed
to exercise, directly or indirectly, a controlling influence over the management
or policies of MDJB or any of its Subsidiaries.
ARTICLE II
DEFINITIONS
2.1 Defined Terms. As used herein, the terms below shall have the
following meanings. Any of these terms, unless the context otherwise requires,
may be used in the singular or plural depending upon the reference.
"Accounts" shall mean all accounts, account receivable, other
receivables, contract rights, chattel paper, insurance claims and proceeds and
notes receivable of MDJB.
"Accreditations" shall mean accreditations, licenses, permits,
certifications, approvals, and other governmental and regulatory authorizations
required under all laws, rules and regulations applicable to or affecting MDJB
or the Institution as described in Schedule 5.31 exclusive of the Certification.
"Acquisition" is defined in the introduction to this Agreement.
"Application" shall mean the U.S. Department of Education application
for Institutional Participation, ED Form: E40-34P, [Expiration Date _/9_.]
"Books and Records" shall mean all records pertaining to the assets,
liabilities, customers, or suppliers of MDJB (including the corporate minute
book, corporate tax returns, stock ledger and related items).
"Certification" shall mean certification by the U.S. Department of
Education for institutional participation in the programs of student financial
assistance pursuant to Title IV of the Higher Education Act of 1965, as amended.
"Claims" shall mean with respect to MDJB and any Subsidiary, all claims,
causes of action, chooses in action, rights of recovery and rights of set-off of
whatever kind or description.
"Closing Date Balance Sheet" shall mean the consolidated balance sheet
of MDJB as of the closing date to be delivered to Acquisition within thirty (30)
days of the Closing Date.
"Code" shall mean the Internal Revenue Code of 1986, as the same may be
amended from time to time.
"Colorado Tech" shall mean Colorado Technical University, Inc., a
Colorado corporation and wholly-owned Subsidiary of MDJB.
"Condition Subsequent" shall have the meaning set forth in Section 7A.4
hereof.
"Contract" shall mean with respect to MDJB or any Subsidiary any of the
agreements, contracts, leases, notes, loans, evidence of indebtedness, purchase
orders, letters of credit, franchise agreements, undertakings, covenants not to
compete, employment agreements, licenses, instruments, obligations, commitments
to which MDJB or any Subsidiary is a party or to which any of its assets are
subject, whether oral or written express or implied.
"Contract Rights" shall mean with respect to MDJB or any Subsidiary all
of MDJB's or any Subsidiary's rights and obligations under the Contracts.
"ED" shall mean the U.S. Department of Education.
"ED Certification Period" shall have the meaning set forth in Section
7A.4 hereof.
"Encumbrances" shall mean any claim, lien, pledge, option, charge,
easement, security interest, right-of-way, encumbrance or other right of third
parties.
"Escrow Portion" shall have the meaning set forth in Section 3.2 hereof.
"Facilities" shall have the meaning set forth in Section 5.20.
"Facility Leases" shall mean all of the Leases of Facilities listed on
Schedule 5.20.
"Financial Statements" shall have the meaning ascribed thereto in
Section 5.08 hereof.
"Fixtures and Equipment" shall mean all of the furniture, fixtures,
furnishings, machinery and equipment, spare parts, supplies, vehicles and other
tangible personal property owned by MDJB as of the Balance Sheet Date plus all
additions, replacements or deletions since the Balance Sheet Date in the
ordinary course of MDJB's or any Subsidiary's business.
"Fractional Share Consideration" shall have a meaning ascribed thereto
in Section 3.1(d) hereof.
"GAAP" shall mean generally accepted accounting principles in the United
States of America, as in effect from time to time.
"Guaranty Agency" shall mean a state or private nonprofit organization
that has an agreement with the Secretary under which it administers a loan
program under Title IV, and including, without limitation, the Colorado Student
Loan Program, United Student Aid Fund, and Higher Education Assistance Agency.
"HEA" shall mean the Higher Education Act of 1965, as amended, 20 U.S.C.
1001 et seq.
"Institutional Accrediting Agency" shall mean the accrediting agency
that grants the Colorado Tech institutional accreditation and that Acquisition
has declared prior to Closing will be the Colorado Tech institutional
accreditor.
"Institution" shall mean the educational institution operated by
Colorado Tech located in Colorado Springs, Colorado.
"Insurance Policies" shall mean with respect to MDJB the insurance
policies set forth on Schedule 5.33 hereto.
"Interim Financial Statements" shall have the meaning ascribed thereto
in Section 5.08 hereof.
"Intellectual Property" shall have the meaning ascribed thereto in
Section 5.19 hereof.
"Inventory" shall mean all of MDJB's and any Subsidiary's inventory and
supplies and all other materials utilized in connection with the conduct of its
business operation.
"Leasehold Estates" shall mean all of MDJB's and any Subsidiary's rights
and obligations as lessee under the Leases and all leasehold improvements.
"Leases" shall mean all of the leases of MDJB and any Subsidiary's
listed on the Schedules hereto and all other leases relating to the Purchased
Assets which are not required to be scheduled pursuant to this Agreement.
"Material Adverse Effect" shall mean with respect to MDJB or Xxxxxxx, as
appropriate in the context, a material adverse effect on (i) its assets, the
business or the condition (financial or otherwise), properties, liabilities,
reserves, working capital, earnings, technology, Prospects or relations with
customers, suppliers, distributors, employees or regulators of such entity or
any Subsidiary or (ii) the right or ability of such entity to consummate the
transactions contemplated hereby.
"Merger Consideration" shall have the meaning set forth in Section 3.2
hereof.
"MDJB Common Stock" shall mean the common stock, no par value per share
of MDJB.
"MDJB Shareholders' Meeting" shall mean the special meeting of
Shareholders of MDJB to consider and vote upon the Merger contemplated by this
Agreement.
"Other Rights" shall mean all assignable or conveyable rights under
licenses, permits, approvals, qualifications or the like relating directly or
indirectly to the business of MDJB issued or to be issued prior to the Closing
by any government or by any governmental unit, agency, body or instrumentality
whether Federal, State, local, foreign or other.
"Per Share Stock Consideration" shall have the meaning ascribed thereto
in Section 3.2 hereto.
"Permits" shall mean all licenses, permits and other governmental
authorizations necessary to carry on the business MDJB and any Subsidiary as
presently conducted and as proposed to be conducted.
"Prospects" shall mean, with respect to MDJB or Xxxxxxx, as appropriate
in the context, and any Subsidiary taken as a whole, the future of MDJB's or
Xxxxxxx'x business based upon MDJB's or Xxxxxxx'x business plans or other
projections and shall not mean the expectations of the other party.
"Rescission Right" shall have the meaning set forth in Section 7A.4
hereof.
"Registration Statement" or "S-4" shall mean the registration statement
to be filed with the U.S. Securities and Exchange Commission on Form S-4 to
register 1,250,000 Shares of Xxxxxxx Common Stock for distribution in accordance
with Articles III and IV hereof.
"Stockholders" shall mean the stockholders of MDJB.
"Subsidiary" means any corporation, association or other entity in which
MDJB or Xxxxxxx, as appropriate in the context, controls, directly or indirectly
50% or more of the outstanding securities or 50% or more of the total equity
interest of such entity.
"Tax" or "Taxes" shall mean all federal, state, local, foreign and other
taxes, assessments or other government charges, including, without limitation,
income, estimated income, business, occupation, franchise, property, sales,
transfer, use, employment, commercial rent or withholding taxes, including
interest, penalties and additions in connection therewith for which MDJB or any
Subsidiary may be liable.
"Title IV Programs" shall mean the programs of student financial
assistance in effect under Title IV of the Higher Education Act of 1965, as
amended.
"Vehicles" shall mean all automobiles and other vehicles listed on
Schedule 5.24 attached hereto.
"Xxxxxxx Common Stock" shall mean the registered common stock, no par
value per share, of Xxxxxxx.
"Xxxxxxx Shareholders' Meeting" shall mean the special meeting of the
Shareholders of Xxxxxxx to consider and vote upon the Merger contemplated by
this Agreement.
ARTICLE III
MANNER OF CONVERTING SHARES
3.1 Conversion.
(a) Subject to the provisions of this Article III and of Article I,
at the Effective Time, by virtue of the Merger and without any action on the
part of the holders thereof, the shares of each of Acquisition and MDJB shall be
converted as follows:
(i) Each of the shares of capital stock of Acquisition
issued and outstanding immediately prior to the Effective Time shall remain
outstanding;
(ii) Subject to the provisions of Section 3.3, each share of
MDJB Common Stock, no par value per share (collectively, the "Shares") issued
and outstanding immediately prior to the Effective Time shall be converted into
the right to receive the Per Share Stock Consideration; and
(iii) Each outstanding share of MDJB Common Stock as to which
a written notice of election to dissent is filed in accordance with Title 7-113
of the CBCA at or prior to the Stockholders' Meeting and not withdrawn at or
prior to the Stockholders' Meeting and which is not voted in favor of the Merger
shall not be converted into or represent a right to receive Xxxxxxx Common Stock
hereunder unless and until the holder shall have failed to perfect, or shall
have effectively withdrawn or lost his or her right to appraisal of and payment
for his or her MDJB Common Stock under such Title, at which time his or her
shares shall be converted into Xxxxxxx Common Stock as set forth in Section
3.1(a) (ii). All such shares of MDJB Common Stock as to which such a written
demand for appraisal is so filed and not withdrawn at or prior to the time of
such vote and which are not voted in favor of the Merger are herein called
"Dissenting Stock." MDJB shall give Xxxxxxx prompt notice upon receipt by MDJB
of any written demands for appraisal rights or withdrawal of such demands, and
MDJB shall give Xxxxxxx the opportunity to direct all negotiations and
proceedings with respect to such demands. MDJB shall not voluntarily make any
payment with respect to any demands for appraisal rights and shall not, except
with the prior written consent of Xxxxxxx, settle or offer to settle any such
demands. Each holder of MDJB Common Stock who becomes entitled, pursuant to
provisions of said Title 7-113, to payment for his or her shares of MDJB Common
Stock under the provisions of said title shall receive the fair market value (as
determined pursuant to Title 7-113) for each share of Dissenting Stock in
payment therefor from Xxxxxxx and such shares of MDJB Common Stock shall be
canceled.
(b) The calculations of the computations required by this Article
III shall be prepared by Xxxxxxx prior to the Closing date and shall be set
forth in a statement furnished to MDJB not later than one day prior to Closing
showing in reasonable detail the manner of calculation.
(c) Each of the shares of MDJB capital stock held by Xxxxxxx or any
of its wholly owned Subsidiaries or MDJB or any of its wholly owned Subsidiaries
shall be canceled and retired at the Effective Time and no consideration shall
be issued in exchange therefor.
(d) Subject to the terms of Section 3.2 hereof, each holder of
shares of MDJB Common Stock exchanged pursuant to the Merger who would otherwise
have been entitled to receive a fraction of a share of Xxxxxxx Common Stock
(after taking into account all certificates delivered by such holder) shall
receive, in lieu thereof, cash (without interest) in an amount equal to such
fractional part of a share of Xxxxxxx Common Stock multiplied by the closing
price of the Xxxxxxx Common Stock on the trading day immediately preceding the
Closing as reported by the American Stock Exchange (the "Fractional Share
Consideration"). No such holder will be entitled to dividends, voting rights or
any other rights as a stockholder in respect of any fractional share.
(e) At the Effective Time, the stock transfer books of MDJB shall
be closed as to holders of MDJB Common Stock and no transfer of MDJB Common
Stock by any such holder shall thereafter be made or recognized. If, after the
Effective Time, certificates are properly presented in accordance with Article
IV of this Agreement to Xxxxxxx'x stock transfer agent or such other agent as
the parties may agree (the "Exchange Agent"), such certificates shall be
canceled and, subject to the terms of Section 3.2 and Article 7A hereof,
exchanged for certificates representing the number of whole shares of Xxxxxxx
and a check representing the amount of cash for fractional shares, if any, into
which the MDJB Common Stock represented thereby was converted in the Merger.
3.2 Conversion of MDJB Common Stock. A. Subject to Section 3.3,
each share of MDJB Common Stock outstanding at the Effective Time shall be
converted into the right to receive the product of (i) 1,250,000 shares of
Xxxxxxx Common Stock multiplied by (ii) the number of shares owned by a MDJB
Stockholder divided by the total number of MDJB shares outstanding ("Per Share
Stock Consideration"). Schedule 3.2 hereto sets forth the allocation of the
Per Share Stock Consideration to each of the MDJB Stockholders including the
cash payments to such Stockholders representing the Fractional Share
Consideration to each Stockholder.
B. On the Closing Date, the Per Share Stock
Consideration and the Fractional Share Consideration shall be deemed issued to
the Stockholders of MDJB in accordance with the allocations set forth in
Schedule 3.2 and in the manner provided in Article IV hereof (collectively, the
"Merger Consideration"). Each of Xxxxxxx, Acquisition, MDJB and the
Stockholders hereby acknowledge and agree that notwithstanding the terms of
Article IV hereof, pending the satisfaction of the Condition Subsequent (as
defined in Section 7A.1 hereof), the Merger Consideration shall be held in
escrow by Xxxxxxx. Upon satisfaction of the Condition Subsequent, the Merger
Consideration, exclusive of the Escrow Portion which shall be retained in
accordance with Article XII hereof, will be delivered to the Stockholders of
MDJB as provided in Article IV and Xxxxxxx'x Rescission Right, as defined and
set forth in Article VIIA hereof, shall lapse. In the event the Condition
Subsequent to the Merger is not satisfied within the time period and in
accordance with the requirements specified in Section 7A.4 hereof, Xxxxxxx shall
be deemed to have exercised its Rescission Right and shall (i) deliver to the
Stockholders of MDJB all the capital stock of Acquisition in proportion to each
Stockholder's interest in MDJB immediately prior to the Merger (as shown on
Schedule 3.2 hereof), (ii) cancel the shares of Xxxxxxx Common Stock comprising
a portion of the Merger Consideration and (iii) transfer the Fractional Share
Consideration comprising a portion of the Merger Consideration to a general
operating account of Xxxxxxx for its benefit, all as more particularly described
in Section 7A.4 hereof.
C. Eighty seven thousand five hundred (87,500)
shares of Xxxxxxx Common Stock comprising a portion of the Merger Consideration
shall be held in escrow in accordance with the terms and provisions of Section
12.01 hereof (the "Escrow Portion"). Schedule 3.2 hereto sets forth the
relative contributions of each MDJB Stockholder to the Escrow Portion. Subject
to the provisions of Article XII hereof, the Escrow Portion shall be released to
the MDJB Stockholders in accordance with the allocation set forth on Schedule
3.2 hereof on the Escrow Release Date (as defined in Section 12.06).
3.3 Transmittal Procedures. Appropriate and customary transmittal
materials (which shall specify that delivery shall be effected, and risk of loss
and title to the certificates theretofore representing shares of MDJB Common
Stock shall pass, only upon proper delivery of such certificates to the Exchange
Agent) in such form as Xxxxxxx and MDJB shall mutually agree ("Transmittal
Form") shall be mailed on such date as MDJB and Xxxxxxx shall mutually agree
("Mailing Date") to each holder of record of MDJB Common Stock as of five
business days prior to the Mailing Date ("Transmittal Form Record Date").
ARTICLE IV
EXCHANGE OF SHARES
4.1 Exchange Procedures. Upon the Effective Time, Xxxxxxx shall
issue to the Exchange Agent the number of shares of Xxxxxxx Common Stock
issuable in the Merger (after reduction for the Escrow Portion) and the amount
of cash payable in the Merger for fractional Shares; provided that
notwithstanding any other provision of this Agreement, Xxxxxxx shall not issue
to the Exchange Agent Xxxxxxx Common Stock or cash payable with respect to
shares of MDJB Common Stock unless and until share certificates and the required
transmittal materials pursuant to Article III and Article IV have been received
in proper form by the Exchange Agent. The Exchange Agent shall not be entitled
to vote or exercise any rights of ownership with respect to Xxxxxxx Common Stock
held by it from time to time hereunder, except that it shall receive and hold
all dividends or other distributions paid or distributed with respect to such
shares for the account of the persons entitled thereto. Notwithstanding the
foregoing, the Merger Consideration shall be retained by the Exchange Agent or
Xxxxxxx in escrow pending the satisfaction, or failure to satisfy, the Condition
Subsequent, as provided in Section 3.2 and Section 7A.4 hereof.
Each holder of a certificate formerly representing MDJB Common Stock who
surrenders or has surrendered such certificate (or customary affidavits and
indemnification regarding the loss or destruction of such certificate), together
with duly executed transmittal materials included in the Transmittal Form, to
the Exchange Agent shall, upon acceptance thereof, be entitled to a certificate
representing the Xxxxxxx Common Stock into which the shares of MDJB Common Stock
shall have been converted pursuant hereto after deduction to give effect to the
Escrow Portion. Xxxxxxx shall cause the Exchange Agent to accept such
certificate upon compliance with such reasonable and customary terms and
conditions as the Exchange Agent may impose to effect an orderly exchange
thereof in accordance with normal practices. Until surrendered as contemplated
by this Section 4.1, each certificate representing MDJB Common Stock shall be
deemed at any time after the Effective Time to evidence only the right to
receive upon such surrender the Xxxxxxx Common Stock (or cash for fractional
shares thereof) into which the MDJB Common Stock are convertible.
To the extent provided by Section 3.1(d) of this Agreement, each holder
of shares of MDJB Common Stock issued and outstanding at the Effective Time also
shall receive, upon surrender of the certificate or certificates representing
such shares, cash in lieu of any fractional shares of Xxxxxxx Common Stock to
which such holder would otherwise be entitled. Xxxxxxx shall not be obligated
to deliver the Per Share Stock Consideration to which any former holder of MDJB
Common Stock is entitled as a result of the Merger until such holder surrenders
his or her certificate or certificates (or customary affidavits and
indemnification regarding the loss or destruction of such certificate)
representing shares of MDJB Common Stock for exchange as provided in this
Article IV. In addition, certificates surrendered for exchange by any person
constituting an "Affiliate" of MDJB for purposes of Rule 144(a) under the
Securities Act of 1933, as amended (the "Securities Act"), shall not be
exchanged for certificates representing whole shares of Xxxxxxx Common Stock
until Xxxxxxx has received a written agreement from such person as provided in
Section 7.12. If any certificate for shares of Xxxxxxx Common Stock, or any
check representing cash is to be issued in a name other than that in which a
certificate surrendered for exchange is issued, the certificate so surrendered
shall be properly endorsed and otherwise in proper form for transfer and the
person requesting such exchange shall affix any requisite stock transfer tax
stamps to the certificate surrendered or provide funds for their purchase or
establish to the satisfaction of the Exchange Agent that such taxes are not
payable.
4.2 Voting and Dividends. Former stockholders of record of MDJB
shall not be entitled to vote after the Effective Time at any meeting of Xxxxxxx
stockholders, unless such holders have exchanged their certificates (or
customary affidavits and indemnification regarding the loss or destruction of
such certificates) representing MDJB Common Stock for certificates representing
Xxxxxxx Common Stock, and/or cash, in accordance with the provisions of this
Agreement. Upon such exchange, notwithstanding the escrow of the Merger
Consideration in accordance with Section 3.2 and 7A.4 hereof, each MDJB
Stockholder shall be deemed the record owner of the Xxxxxxx Common Stock as
provided in Schedule 3.2 hereto. No dividends or other distribution declared
or made after the Effective Time with respect to Xxxxxxx Common Stock with a
record date after the Effective Time shall be paid to the holder of any
unsurrendered certificate of MDJB Common Stock with respect to the shares of
Xxxxxxx Common Stock represented thereby, and no cash payment in lieu of
fractional shares shall be paid to any such holder until the holder of such
certificate of MDJB Common Stock shall surrender such certificate (or customary
affidavits and indemnification regarding the loss or destruction of such
certificates). Subject to the effect of applicable laws and the satisfaction of
the Condition Subsequent provided in Article VIIA hereof, following surrender of
any such certificate of MDJB Common Stock (or customary affidavits and
indemnification regarding the loss or destruction of such certificates), there
shall be paid to the holder of the certificates representing whole shares of
Xxxxxxx Common Stock issued in exchange therefor (after deduction for the Escrow
Portion), without interest, the amount of any cash payable with respect to a
fractional share of Xxxxxxx Common Stock to which such holder is entitled
pursuant to Section 3.1.
4.3 No Liability. Any other provision of this Agreement
notwithstanding, neither Acquisition, Xxxxxxx, MDJB nor the Exchange Agent shall
be liable to a holder of MDJB Common Stock for any amount paid or property
delivered in good faith to a public official pursuant to any applicable
abandoned property, escheat or similar law.
4.4 Withholding Rights. Xxxxxxx or the Exchange Agent shall be
entitled to deduct and withhold from the Per Share Stock Consideration and the
Fractional Share Consideration otherwise payable pursuant to this Agreement to
any holder of shares of MDJB Common Stock such amounts as Xxxxxxx or the
Exchange Agent is required to deduct and withhold with respect to the making of
such payment under the Code, or any provision of state, local or foreign tax
law. To the extent that amounts are so withheld by Xxxxxxx or the Exchange
Agent, such withheld amounts shall be treated for all purposes of this Agreement
as having been paid to the holder of the shares of MDJB Common Stock in respect
of which such deduction and withholding was made by Xxxxxxx or the Exchange
Agent.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF MDJB AND COLORADO TECH
The following representations and warranties are made by each of
MDJB and Colorado Tech, on a joint and several basis, and by each of the
Shareholders of MDJB (the "Shareholders"), on a several basis, to Acquisition
and Xxxxxxx, and shall continue in full force and effect after the date hereof
and, subject to the survival provisions hereinbelow, after the Closing Date.
Unless the context indicates to the contrary, each of MDJB and Colorado Tech
shall be referred to collectively in this Article V as ("MDJB").
Section 5.01. Organization and Capitalization. MDJB is a
corporation duly organized, validly existing and in good standing under the laws
of the state of its incorporation, with an authorized capital stock consisting
of 10,000,000 shares of common stock, no par value per share, of which 1,074,847
shares of common stock are issued and outstanding. All of the aforesaid issued
and outstanding shares are duly authorized, have been validly issued, and are
fully paid and non-assessable. Except as set forth on Schedule 5.01, there are
no outstanding preemptive, conversion or other rights, options, warrants, or
agreements granted or issued by or binding upon MDJB for the purchase or
acquisition of any shares of its capital stock. The Stockholders listed on
Schedule 3.2 hereto are the record owners of all of the issued and outstanding
shares of MDJB Common Stock. Except as set forth in Schedule 5.01 , no
Shareholder has been granted options or other rights to purchase any shares of
Common Stock from any other Shareholder. Except as set forth on Schedule 5.01,
there are no voting trusts or other agreements or understanding with respect to
the voting of any shares of MDJB Common Stock. Except as set forth on Schedule
5.01 MDJB does not own, directly or indirectly any outstanding stock or
securities convertible into capital stock of any other corporation or
participating interest in any partnership, joint venture or other business
enterprise.
Section 5.02. Power and Authority. MDJB has all requisite
corporate power and authority to own, lease and operate its properties and to
conduct its business as presently conducted and as proposed to be conducted and
is duly qualified or licensed as a foreign corporation in good standing in each
jurisdiction in which the character of its properties or the nature of its
business activities requires such qualification. All such jurisdictions are
listed on Schedule 5.02.
Section 5.03. Certificate of Incorporation and By-Laws of MDJB.
Copies of the Certificate of Incorporation of MDJB and Colorado Tech, each (and
all amendments thereto), certified as of a recent date by their respective
Secretary of State of the state of incorporation of MDJB and Colorado Tech, each
and the by-laws of MDJB, each certified by its corporate secretary, are attached
hereto as Schedule 5.03 and are true, complete and correct.
Section 5.04. Authority for Agreement. The Board of Directors
of each of MDJB, and Colorado Tech has approved this Agreement, and have
authorized the execution and delivery and performance hereof. MDJB has full
corporate power, authority and legal right to enter into this Agreement and to
consummate the transactions contemplated hereby subject to shareholder approval.
This Agreement is a legal, valid and binding obligation of MDJB enforceable
against it in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights in general.
Section 5.05. Registration Statement. When the Registration
Statement shall be filed with the United States Securities and Exchange
Commission ("SEC") and subsequently declared effective by the SEC (the
"Registration Statement Effective Date"), the information with respect to MDJB
set forth in the Registration Statement will be true and correct, except that no
representation is hereby made as to any statements or omissions as described in
this clause with respect to which, prior to the Registration Statement Effective
Date, MDJB shall have requested in writing any addition or modification to the
Registration Statement, which shall be necessary in order to make the
Registration Statement not untrue or misleading in any material respect, unless
such addition or modification shall have been made by Xxxxxxx prior to the
Effective Date. Xxxxxxx agrees to timely provide prior to filing drafts of and
amendments to the Registration Statement to MDJB so that MDJB may comply with
the representation in this Section 5.05. If MDJB does not object to a draft or
amendment within five (5) business days after receipt, it shall be deemed an
acceptance by MDJB of the information with respect to MDJB contained therein.
Section 5.06. No Violation to Result. Except as set forth on
Schedule 5.06, the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby:
(a) are not in violation or breach of, do not conflict with or
constitute a default under, and will not accelerate or permit the acceleration
of the performance required by, any of the terms of the charter documents or by-
laws of MDJB or any Contract, note, debt instrument, security agreement or
mortgage, or any other contract or agreement, written or oral, to which MDJB is
a party or by which any of their respective properties or assets are bound;
(b) will not be an event which, after notice or lapse of time
or both, will result in any such violation, breach, conflict, default, or
acceleration;
(c) will not result in a violation under any law, judgment,
decree, order, rule, regulation or other legal requirement of any governmental
authority, court or arbitration tribunal whether federal, state, provincial,
municipal or local (within the U.S. or otherwise) at law or in equity, and
applicable to MDJB; and
(d) will not result in the creation or imposition of any lien,
possibility of lien, encumbrance, security agreement, equity, option, claim,
charge, pledge or restriction in favor of any third person upon the properties
or assets of any of MDJB.
Section 5.07. No Existing Defaults. Except as set forth in
Schedule 5.07, MDJB is not in default:
(a) under any of the material terms of any Contract, note, debt
instrument, security agreement or mortgage or under any other commitment,
contract, agreement, license, lease or other instrument, whether written or
oral, to which it is a party or by which any of its properties or assets are
bound;
(b) under any material law, judgment, decree, order, rule
regulation or other legal requirement or any governmental authority, court or
arbitration tribunal whether federal, state, provincial, municipal or local
(within the U.S. or otherwise), at law or in equity, and applicable to it or to
any of its properties or assets; or
(c) in the payment of any material monetary obligations or
debts.
There exists no condition or event which, after notice or lapse of time or both,
would constitute a default in connection with any of the foregoing.
Section 5.08. Financial Statements. (a) The audited financial
statements of MDJB as of and for the fiscal years ended December 31, 1994, 1993
and 1992, respectively (which financial statements, including, without
limitation, any notes thereto and reports thereon are hereinafter collectively
called the "Financial Statements"), and the unaudited financial statements of
MDJB as of and for the six (6) months ended June 30, 1995 (the "Interim
Financial Statements"), all of which are attached hereto as Schedule 5.08, are
complete and correct in all material respects, fairly present the financial
position of MDJB and the results of operations as of the respective dates and
for the periods indicated thereon in all material respects and have been
prepared in accordance with GAAP applied on a consistent basis. MDJB has no
material liability or obligation, fixed, contingent, known, unknown or
otherwise, not reflected in the December 31, 1994 balance sheet included in the
Financial Statements or not reflected in the Interim Financial Statements, and
all provisions, reserves and allowances provided for therein are adequate,
except for liabilities or obligations incurred between July 1, 1995 and the date
of this Agreement in the ordinary and usual course of business consistent with
past practices and with the representations and warranties set forth herein,
except for expenses incurred in connection with the transactions contemplated by
this Agreement.
Section 5.09. No Adverse Changes. From December 31, 1994 to
the date of this Agreement, except as disclosed on Schedule 5.09 hereto and
except as otherwise permitted herein:
(a) MDJB has not sustained any damage, destruction or loss, by
reason of fire, explosion, earthquake, casualty, labor trouble, requisition or
taking of property by any government or agency thereof, windstorm, embargo,
riot, act of God or the public enemy, flood, volcanic eruption, accident, other
calamity or other similar event (whether or not covered by insurance) materially
and adversely affecting the business, properties, financial condition or
operations of MDJB;
(b) there have been no changes in the condition (financial or
otherwise), business, net worth, assets, properties, Prospects, liabilities or
obligations (fixed, contingent, known, unknown or otherwise) of MDJB which have
had or is likely to have a Material Adverse Effect on the business, properties,
Prospects, financial condition or operations of MDJB, and there has been no
occurrence, circumstance or combination thereof which might reasonably be
expected to result in any such Material Adverse Effect before or after the
Closing Date; and
(c) MDJB has taken all necessary action so that MDJB has
performed all of the acts specified in Sections 7.02(a), (c) and (o) hereof and
has refrained from performing any of the acts specified in Sections 7.02(a),
(b), (d), (e), (f), (g), (h), (i), (j), (k), (l), (m) and (n) hereof.
Section 5.10. Employee Plans and Agreements. Schedule 5.10
contains an accurate and complete list of all plans, contracts, programs and
arrangements, whether written or oral, including, but not limited to, employment
agreements, union contracts, pensions, welfare benefits, deferred compensation,
supplemental retirement, severance, salary continuation, and other employee
benefit plans, programs, policies or arrangements of every kind, maintained by
MDJB and providing benefits to any employee or former employee (or dependents of
such employee) of MDJB, whether or not any of the foregoing is funded, (i) to
which MDJB has any obligations or (ii) with respect to which MDJB has made any
payments or contributions or may otherwise have any liability (including any
such plan or arrangement formerly maintained by MDJB (the "Plans")). MDJB has
delivered to Acquisition, with respect to each Plan, accurate and complete
copies of all current plan documents, including amendments and related trusts,
the most recent annual actuarial valuation report (including a copy of the
census forwarded to the actuary for such report), if any, the last filed Form
5500 or 5500-C and Schedules A and B thereto, the most recent completed annual
and periodic accounting of related plan assets, if any, all rulings, if any, of
the Internal Revenue Service (the "IRS"), the documents relating to the most
recent request for an IRS determination letter, and the most recent IRS
determination letter.
Except as set forth on Schedule 5.10 hereto:
(a) all of the Plans which are "employee pension benefit
plans," within the meaning of Section 3(2) of the Employee Retirement Income
Security Act ("ERISA"), which plans are identified as such on Schedule 5.10
hereto, and the trusts, if any, forming a part thereof (each a "Pension Plan and
Trust") now meet, and since the date of the most recent IRS determination letter
have met, the requirements for the qualification under Section 401(a) or 403 of
the Code in all respects and are now, and since the date of the most recent IRS
determination letter have been, exempt from taxation under Section 501(a) of the
Code;
(b) the IRS has issued a favorable determination letter, on the
dates identified on Schedule 5.10, with respect to the qualification of each
Pension Plan and Trust, if any, relating thereto, and has not taken any action
to revoke such letter;
(c) to the best of MDJB's and the Shareholders' knowledge, MDJB
has performed in all respects all obligations required to be performed by it
under, (including, but not limited to, the making of all contributions required
by any collective bargaining agreement), is not in default under or in violation
of, and MDJB has no knowledge of any such default or violation by any other
party to, any and all of the Plans;
(d) MDJB is not a "disqualified person" or "party in interest"
(as defined in Section 4975 of the Code and Section 3 of ERISA, respectively)
and has not engaged in any "prohibited transactions," as such term is defined in
Section 4975 of the Code and Section 406 of ERISA, which could subject any Plan
(or its related trust) or MDJB or any plan fiduciary to any tax or penalty
imposed under Section 4975(a) of the Code or the 5% penalty under Section 502(i)
of ERISA;
(e) there are no actions, suits or claims pending (other than
routine claims for benefits) or threatened against any Plan or against the
assets of any Plan;
(f) no Plan which is subject to Part III of Subtitle B of Title
I of ERISA or Section 412 of the Code has incurred any "accumulated funding
deficiency" (as defined in ERISA), whether or not waived;
(g) each "fiduciary" and every "plan official" (as defined in
Section 412 of ERISA) of each Plan is bonded to the extent required by such
Section 412;
(h) no proceeding has been initiated to terminate any Plan and
no "reportable event" within the meaning of Section 4043(b)(1)-(9), 4062(e),
4063(a) or 4041(f) of ERISA has occurred with respect to any Plan (other than
those which may result from the transactions contemplated hereby);
(i) no Plan is a "multiple employer plan" within the meaning of
the Code or ERISA or the regulations promulgated thereunder or a "multi-employer
plan" as defined in Section 3(37) of ERISA;
(j) to the best of MDJB's and the Shareholders' knowledge, MDJB
is in compliance with, and each Plan has been operated in all respects in
accordance with, its provisions and in compliance with the rules and regulations
governing each such employee benefit plan, including without limitation, the
rules and regulations promulgated by the Department of Labor, the Pension
Benefit Guaranty Corporation (the "PBGC") and the Department of the Treasury
pursuant to the provisions of ERISA and the Code;
(k) assuming Acquisition assumes MDJB's existing 401(k) Plan,
the execution and performance of this Agreement will not constitute a stated
triggering event under any Plan that will result in any payment (whether of
severance pay or otherwise) becoming due from MDJB to any employee or former
employee (or dependents of such employee) of MDJB;
(l) there are no severance payments which are or could become
payable by MDJB to any director, officer or other employee of MDJB under the
terms of any oral or written agreement or commitment, custom, trade or practice;
and
(m) each Plan has been amended to comply with the Tax Equity
and Fiscal Responsibility Act, the Deficit Reduction Act, Tax Reform Act of 1986
and the Retirement Equity Act and, in each case, such amendments have been filed
with the IRS before the end of the applicable remedial amendment period.
Acquisition is aware of MDJB's plans to change the Trustee and
service provider of its 401(k) Plan as in effect on the date hereof.
Section 5.11. Full Disclosure. The written information
furnished by MDJB or by any of the directors, officers, employees, agents,
accountants or representatives of MDJB to Acquisition pursuant to this
Agreement, the information contained in the schedules referred to in this
Agreement, and the other information furnished to Acquisition by MDJB or by any
of the directors, officers, employees, agents, accountants or representatives of
MDJB and at any time prior to the Closing Date (pursuant to the request of
Acquisition or otherwise), does not and will not contain any untrue statement of
a material fact and does not and will not omit to state any material fact
necessary to make all such information not misleading.
Section 5.12. Taxes. (a) Except as set forth on Schedule 5.12
MDJB has prepared (or caused to be prepared) and timely and properly filed (or
caused to be timely and properly filed) with the appropriate federal, state,
provincial, municipal or local authorities (within the U.S. or otherwise) all
material tax returns, information returns and other reports required to be filed
and has paid or accrued (or caused to be so paid or accrued) in full all
material taxes, interest, penalties, assessments or deficiencies, if any, due
to, or claimed to be due by, any taxing authority. The balance sheets included
in the Financial Statements and the Interim Financial Statements include
appropriate provisions for all taxes, interest, penalties, assessments or
deficiencies, if any, for the periods indicated thereon to the extent not
theretofore paid. MDJB has not executed or filed with any taxing authority any
agreement extending the period for assessment or collection of any taxes. MDJB
is not a party to any pending action or proceeding, nor is any such action or
proceeding threatened, by any governmental authority for the assessment or
collection of taxes, and no claim for assessment or collection of taxes has been
asserted against MDJB, and during the course of any audit currently in process
or not completed, no issues have been suggested by any representative of any
such governmental authority that, if asserted, would result in a proposed
assessment of taxes, interest or penalties, against MDJB.
(b) Neither MDJB nor the Shareholders has taken or agreed to
take any action or has any knowledge of any fact or circumstance that would
prevent the Merger from qualifying as a tax-free reorganization within the
meaning of Section 368 of the Code.
Section 5.13. Accounts Receivable. All of the Accounts
receivable of MDJB as reported on the Financial Statements and the Interim
Financial Statements represent bona fide claims against debtors for sales made
or services performed in the ordinary and usual course of business and in
accordance with applicable orders, contracts, standards or requirements. Such
receivables are, and shall be, subject to no defenses, counter-claims or rights
of setoff and, other than collected amounts of such receivables as of the date
of this Agreement, will be fully collectible in the ordinary and usual course of
business without unreasonable cost to Acquisition in collection efforts, except
to the extent of any reserve with respect thereto expressly set forth in said
financial statements.
Section 5.14 . [Intentionally Omitted.]
Section 5.15. Condition of Assets. The December 31, 1994
balance sheet of MDJB included in the Financial Statements reflects all of the
properties and assets of MDJB except for (i) property and assets disposed of or
acquired by MDJB since December 31, 1994 in the ordinary and usual course of
business and consistent with the representations and warranties of MDJB
contained herein, and (ii) leased properties and assets. All of the properties
and assets of MDJB are in good operating condition, free from any defect,
ordinary wear and tear excepted.
Section 5.16. Title to Assets. Except as otherwise set forth
on Schedule 5.16 hereto, MDJB has good and marketable title to the assets that
are material to the operation or conduct of its business, free and clear of any
and all liens, encumbrances, security agreements, equities, options, claims,
charges, pledges, and defects in title. As of the Closing Date, MDJB will have
good and marketable title to such properties and assets, free and clear of any
and all liens, encumbrances, security agreements, equities, options, claims,
charges, pledges, restrictions, encroachments, defects in title and easements
except as otherwise set forth on Schedule 5.16 hereto.
Section 5.17. Inventory. The inventory of MDJB as reported on
the Financial Statements and Interim Financial Statements will consist solely of
items of a quality and quantity usable or saleable in the normal course of
business, subject to normal obsolescence in accordance with MDJB's historical
operations.
Section 5.18. Prepaid Items, etc. The prepaid items recorded
on MDJB's balance sheet included in the Financial Statements and Interim
Financial Statements constitute a full and complete presentation of each and
every prepaid item which MDJB is entitled to list, in accordance with GAAP on
the asset side of its balance sheet.
Section 5.19. Intellectual Property. Schedule 5.19 hereto,
constitutes a true and complete list of all trademarks, certification marks,
trade names, service marks, copyrights, patents, patent applications and product
composition formulae owned or used by MDJB including without limitation the
trade name "Colorado Tech College" (collectively, "Intellectual Property").
MDJB owns or possesses adequate licenses or other rights to use all trademarks,
certification marks, trade names, service marks, copyrights, patents, patent
applications, trade secrets, product composition formulae, computer programs,
product development records and other proprietary processes and information used
in its business, and the same are sufficient in all respects to conduct the
business as currently conducted. Except as described in Schedule 5.19 hereto,
MDJB is not required to pay any royalty, license fee or similar type of
compensation in connection with the conduct of its business as it is now or
heretofore has been conducted or as proposed to be conducted. All patents,
patent applications and rights to inventions or discoveries (whether or not
patentable) owned or held by any officer, director, stockholder, employee,
consultant or agent of MDJB relating to the business of MDJB have been duly and
effectively transferred to MDJB and, except as described on Schedule 5.19
hereto, to the best of our knowledge, none of the operations of MDJB infringe,
and no one has asserted to MDJB that such operations do infringe, the patents,
patent applications, trademarks, certifications marks, trade names, service
marks, trade secrets or other intellectual property rights of anyone.
Section 5.20. Real Property. Schedule 5.20 constitutes a true
and complete list of all leaseholds of real property leased by MDJB or to which
MDJB may have any leaseholds rights (the "Premises"). Acquisition is aware of
MDJB's Plans to acquire an additional 3,700 square feet of space by subleasing
from an existing Tenant such space in the building currently occupied by MDJB.
With respect to each and every parcel of land described in Schedule 5.20 hereto
and the portion of the buildings, structures and improvements thereon leased by
MDJB (collectively, the "Facilities"):
(a) except as otherwise disclosed on Schedule 5.20 there are no
outstanding written or oral leases or tenancies of any kind (including tenancies
by sufferance and/or holdover tenancies arising under expired written or oral
leases) covering or in any way affecting the Facilities or any part or parts
thereof;
(b) except as a matter of record, no person, firm or
corporation other than MDJB has any rights (including rights arising under an
installment contract, option to purchase, easement, right-of-way, or otherwise)
with respect to the Facilities or any part or parts thereof;
(c) there have been no improvements to, construction on, work
done at, and/or services or material supplied to, the Facilities or any part or
parts thereof since January 1, 1995;
(d) MDJB is not in violation of or in default under the terms of
any oral or written lease or other agreement covering or in any way affecting
the Facility;
(e) the Facilities are subject to a valid certificate of
occupancy and are sufficient and adequate for the conduct and the operation of
the business of MDJB;
(f) MDJB has not granted to any person, firm or corporation any
right or rights in and to the Facilities or any part or parts thereof which
would prevent or interfere with Acquisition's occupancy and possession of the
Facilities; and
(g) to the best of MDJB's and the Shareholders' knowledge, MDJB
has performed all obligations imposed by any governmental authority in
connection with the improvement of the Facilities.
Section 5.21. Buildings. Each of the Facilities constituting
part of the Premises is of sound structural integrity, ordinary wear and tear
excepted and is usable and adequate for its intended purpose and to conduct the
business of MDJB as such business is now being conducted.
Section 5.22. Utilities. There are no restraints respecting
availability of public utilities, including, but not limited to, adequate
amounts of water, sewer, gas and electricity and the Facilities are adequately
serviced by all such utilities; all payments, assessments, deposits and other
charges relating to such utilities and any other existing on-site improvements
or off-site improvements (including public or quasi-public utilities or
services) have been paid in full to the extent that they are due.
Section 5.23. Machinery and Equipment. MDJB owns or has
adequate rights to all machinery and equipment (including, without limitation,
machinery and equipment under development or construction) used or necessary for
use in its trade or business, and all such machinery and equipment is in
operating condition and free from any defect, ordinary wear and tear excepted.
Section 5.24. Vehicles. MDJB owns all cars, trucks, and other
motor vehicles used or necessary for use in its trade or business and each such
car, truck, aircraft or motor vehicle is in good operating condition and free
from any defect and is identified and listed on Schedule 5.24 hereto.
Section 5.25. Brokers. MDJB has not engaged any broker, finder
or agent with respect to this Agreement or any transaction contemplated hereby.
Section 5.26. Contracts. Schedule 5.26 hereto constitutes a
true and complete list of each Contract or agreement requiring aggregate
payments by MDJB or receipt by MDJB, of in excess of $10,000 and to which MDJB
is a party, or by which any MDJB or its assets is bound, in any respect,
including, but not limited to, each such contract which is:
(a) a license or a lease;
(b) a contract, agreement or commitment for the purchase, sale
or lease of materials, equipment, real or personal property, capital assets or
supplies;
(c) a contract, agreement or commitment for the sale by MDJB of
products or the performance of any services;
(d) a management, advisory or collective bargaining agreement
or a non-competition or nondisclosure agreement;
(e) a pension, profit sharing, bonus, retirement, deferred
compensation, stock option, employee stock purchase, insurance or other employee
benefit plan or arrangement;
(f) a contract or agreement with an agent, dealer or sales
representative or franchisee;
(g) a contract or agreement with employees, consultants,
stockholders, directors or officers, or any agreement relating to a power of
attorney;
(h) a loan or guaranty agreement, credit agreement, note or
other evidence of indebtedness, forward contract, consignment agreement, custody
agreement, or indenture or instrument evidencing liens or secured transactions
(exclusive of the contracts, agreements and the like referred to in subsection
(k) below);
(i) a contract, license or other agreement relating to a
patent, invention or discovery (whether or not patentable), trade secret,
trademark, service xxxx, certification xxxx, trade name or copyright or
application for any of the foregoing;
(j) a contract of insurance; or
(k) notwithstanding the foregoing $10,000 threshold, Schedule
5.26 includes a copy of each form of agreement between MDJB and its students and
an accounts receivable listing relating to the rendering of services to students
and/or to the receipt of payment by MDJB for such services from any student,
governmental entity or other source.
Each of the contracts or agreements listed in Schedule 5.26 hereto is in full
force and effect, is a valid, binding and enforceable obligation by or against
MDJB and no event has occurred which constitutes or, with the giving of notice
or passage of time, or both, would constitute, a default or breach thereunder of
MDJB. MDJB has delivered or caused to be delivered or made available to
Acquisition correct and complete copies of each contract or agreement listed in
Schedule 5.26 hereto and all modifications or amendments thereto, and every oral
contract or agreement is listed on Schedule 5.26, and all modifications or
amendments thereto, are correctly and completely summarized in all material
respects on Schedule 5.26 hereto.
Section 5.27. Assets Sufficient. The assets owned or leased by
MDJB constitute all the property, real and personal, tangible and intangible,
and are sufficient for the conduct of MDJB's business as currently conducted.
Except as set forth on Schedule 5.27 no such asset is subject to or held under
any lease, mortgage, security agreement, conditional sales contract or other
title retention agreement, or is other than in the sole possession and control
of MDJB.
Section 5.28. Litigation. Except as set forth in Schedule 5.28
hereto, there is no litigation, suit, proceeding, action, claim or
investigation, at law or in equity, pending or to the best of MDJB's and the
Shareholders' knowledge threatened against or affecting MDJB or involving any of
its property or assets, before any court, agency, authority or arbitration
tribunal, including, without limitation, any product liability, workers'
compensation or wrongful dismissal claims, or claims, actions, suits or
proceedings relating to toxic materials, hazardous substances, pollution or the
environment. To the best of MDJB's and the Shareholders' knowledge there are no
facts that would likely result in any such litigation, suit, proceeding, action,
claim or investigation. MDJB is not subject to or in default with respect to
any notice, order, writ, injunction or decree of any court, agency, authority or
arbitration tribunal.
Section 5.29. Compliance with Laws. To the best of MDJB's and
the Shareholders' knowledge, MDJB has complied with all laws, municipal by-laws,
regulations, rules, orders, judgments, decrees and other requirements and
policies imposed by any governmental authority applicable to it, its properties
or the operation of its business. Without limiting the generality of the
foregoing, MDJB is in compliance in all material respects with:
(a) all applicable laws relating to the protection of human
health and safety, including, without limitation, the Occupational Safety and
Health Act of 1970, as amended, and all regulations and standards issued
thereunder by the Secretary of Labor or the Occupational Safety and Health
Administrator or other governmental agency or authority acting at any time
thereunder;
(b) all applicable laws relating to protection of the
environment, including, without limitation, the Resource Conservation and
Recovery Act ("RCRA") and the Comprehensive Environmental Response, Compensation
and Liability Act ("CERCLA");
(c) all applicable laws administered by the Department of
Education or by any state or local governmental entity with jurisdiction over
education matters including, without limitation, all government programs for
grants or financial aid to students and accreditation of educational
institutions;
(d) all applicable laws relating to equal employment
opportunity; and
(e) all zoning, building and other laws, ordinances, rules,
regulations, plans and directives of governmental authorities, Boards of Fire
Underwriters and other entities having jurisdiction, as well as all private
restrictions and covenants (whether or not registered or of record), in each
case without reliance on non-conforming use or similar rule.
Except as set forth in Schedule 5.29 hereto, MDJB has not
received any notice or citation for noncompliance with any of the foregoing, and
to the best of MDJB's and the Shareholders' knowledge, there exists no
condition, situation or circumstance, nor has there existed such a condition,
situation or circumstance, which, after notice or lapse of time, or both, would
constitute noncompliance with or give rise to future liability with regard to
any of the foregoing.
Section 5.30. Compliance with Title IV Programs.
(a) Schedule 5.30 hereto lists all agreements between MDJB and
ED or any other governmental unit, agency, body or instrumentality relating to
any federal program for the funding of student loans or other forms of financial
aid for education under the Title IV Programs (the "Financial Aid"). Each of
such agreements listed in Schedule 5.30 hereto is in full force and effect, is a
valid, binding and enforceable obligation by or against MDJB and to the best of
MDJB's and the Shareholders' knowledge, no event has occurred which constitutes
or, with the giving of notice or the passage of time, or both, would constitute,
a default or breach thereunder. MDJB has delivered or caused to be delivered to
Acquisition correct and complete copies of each contract or agreement listed in
Schedule 5.30 hereto and all modifications and amendments thereto.
(b) Schedule 5.30 hereto also lists each program pursuant to
which Financial Aid is provided to or on behalf of MDJB including a description
of whether such Financial Aid is provided pursuant to the Pell Grant Program, 20
U.S.C. 1070(a), et seq., the Guaranteed Student Loan Program, including the
Xxxxxxxx Loan Program, 20 U.S.C. 1071, et seq., the Plus Program, 20 U.S.C.
1078-2 and the Supplemental Loans for Students Program, 20 U.S.C. 1078-1, the
Xxxxxxx Loan Program, 20 U.S.C. 1087(aa), et seq., the Supplemental Educational
Opportunity Grant Program, 20 U.S.C. 1070(b) et seq. and the College Work-Study
Program, or otherwise.
(c) Except as set forth on Schedule 5.30 hereto, to the best
knowledge of MDJB and the Shareholders, there exists no set of facts which
could have an adverse effect on the ability of Acquisition to enter into a
program participation agreement with ED.
(d) MDJB has, for the fiscal years 1991 and 1992, a published
cohort default rate of 12.1%, 16.8% respectively, and for fiscal year 1993, a
pre-published cohort default rate of 11.9%.
(e) MDJB has previously delivered to Acquisition true and
complete copies of all correspondence received or sent by or on behalf of MDJB
during the past three (3) years from or to the U.S. Department of Education or
any other governmental or regulatory authority having jurisdiction over the
provision, funding or approval of the Financial Aid. This shall include,
without limitation (i) any documentation relating to the agreements described in
Section 5.30(a) above; (ii) any reports relating to any audits, program reviews
or examinations conducted by ED or others; (iii) notices or correspondence
concerning the qualification of any of MDJB for the receipt of the Financial
Aid; and (iv) notices or correspondence indicating an intention to withdraw,
suspend or terminate the provision of Financial Aid to MDJB.
(f) Except as set forth on Schedule 5.30 hereto, MDJB is and
during the past five (5) years has been in compliance in all material respects
with any and all applicable statutes pursuant to which it receives Financial
Aid, including, without limitation, those described in Section 5.30(b) hereof,
and all regulations promulgated thereunder. Without limiting the generality of
the foregoing, except as otherwise described in Schedule 5.30 hereto MDJB (i)
maintains cash balances in the Title IV federal funds account not in excess of
its three-business day requirements and (ii) to the best of MDJB's and the
Shareholders' knowledge, is in compliance with applicable Federal statutes and
regulations governing record keeping and student file maintenance and
information disclosure requirements to students and others in connection with
the provision of its Financial Aid.
(g) To the best knowledge of MDJB and the Shareholders,
from 1989 to present no principal, affiliates (as those terms are defined in 34
C.F.R. part 85) owners, stockholders, trustees, or any other individual or
entity holding an ownership interest in MDJB, whether legal or equitable, is or
has been a principal, affiliate, owner, stockholder or trustee or holds an
ownership interest, whether legal or equitable in any other Title IV
participating institutions other than as disclosed in Schedule 5.30. No Title
IV participating institution is, or has been, administered commonly, jointly or
in conjunction with MDJB.
Section 5.31. Institutional Approval and Accreditation.
Schedule 5.31 hereto lists each state and governmental department and/or agency
and independent accrediting commission that has authorized, licensed and
accredited the Institution operated by MDJB, including, without limitation, the
NCA and the department of education, or other similar state agency, in Colorado
("State Authorization"). Except as otherwise set forth on Schedule 5.31 hereto,
the Institution operated by MDJB, as described on Schedule 5.31 hereto, has
received all necessary licenses, permits, approvals and accreditation necessary
for its existing operation and receipt of Financial Aid, including, without
limitation, State Authorization and accreditation by the NCA, and to the best of
MDJB's and the Shareholders' knowledge, is in compliance with the terms of all
such licenses, permits, approvals and accreditations.
Section 5.32. Environmental Matters. Except as set forth on
Schedule 5.32 hereto, MDJB has not stored, nor is storing, any hazardous wastes,
as defined by RCRA, for ninety days or more, and:
(a) MDJB has not generated, stored, transported, recycled,
disposed of or otherwise handled in any way any waste material or hazardous
substance for itself or for any other person or entity, nor has any other person
or entity stored, transported, recycled, disposed of or otherwise handled in any
way any waste material or hazardous substances;
(b) there are no locations where any waste material or hazardous
substances from the operation of MDJB have been stored, treated, recycled or
disposed of;
(c) to the best of MDJB's knowledge, there are no Contaminants
(as defined hereinbelow) located on or within the Premises;
(d) there is no ongoing release and there has been no past
release of Contaminants into the environment from the operation of the business
of MDJB;
(e) there are no PCBs nor any asbestos contained in or
otherwise parts of the Premises or the Facilities and no product compositions
used in the business of MDJB contain more than five percent of the element
beryllium;
(f) MDJB has not been required by any governmental authority to
make any expenditure to achieve or maintain compliance with any environmental
standard;
(g) MDJB has no knowledge of any information indicating that
any person, including any employee, may have impaired health or that the
environment may have been damaged as the result of the operation of the business
of MDJB or as the result of the release of Contaminants from the Premises or the
Facilities; and
For the purposes of Section 5.32(c), (d) and (g), the term
"Contaminants" includes any pollutant, waste materials, petroleum and petroleum
products and hazardous substances, as defined by CERCLA.
Section 5.33. Insurance. MDJB has in full force and effect
(with no overdue premiums) the policies of insurance, or renewals thereof, in
the amounts and for the periods set forth in Schedule 5.33 hereto, which
Schedule constitutes a true and complete list of all policies of insurance to
which MDJB is a party that relate to its assets or operations. To the best of
MDJB's and the Shareholders' knowledge, such policies adequately cover all
risks reasonably foreseeable in the operation and conduct of MDJB's business.
MDJB has not received any notices of, or been threatened with, cancellation with
regard to its policies of insurance. The policies listed on Schedule 5.33 will
remain in full force and effect through the Closing Date and the consummation of
the transactions contemplated herein.
Section 5.34. Licenses, Permits and Approvals. To the best of
MDJB's and the Shareholders' knowledge, MDJB has all licenses, permits,
approvals, qualifications or the like, issued or to be issued to MDJB by any
government or any governmental unit, agency, body or instrumentality, whether
federal, state, provincial, municipal or local (within the U.S. or otherwise) or
any third party necessary for the conduct of such MDJB's trade or business and
all such items are in full force and effect. Except as set forth on Schedule
5.34 hereto, no registration with, approval by, consent or clearance or other
action from or prenotification to any governmental agency or any third party is
required in connection with the execution and performance of this Agreement by
of MDJB.
Section 5.35. Employee Compensation and Agreements with
Affiliates. Schedule 5.35 hereto constitutes a true and complete list of all
the stockholders, directors and officers of MDJB and all employees of MDJB
earning or receiving more than $60,000 annually from MDJB. Except as set forth
and described on such Schedule, to the best of MDJB's and the Shareholders'
knowledge, no stockholder, directors or officers and no employees listed thereon
nor any affiliate of any such person has, either directly or indirectly:
(a) an interest in any corporation, partnership,
proprietorship, association or other person or entity which furnishes or sells
those services or products which are furnished to or sold by MDJB; or
(b) a beneficial interest in any contract or agreement to which
MDJB is a party or by which MDJB or its properties are bound.
For the purpose of this Agreement, the term "affiliate" means
any person that directly or indirectly, through one or more intermediaries,
controls or is controlled by, or is under common control with, any such person
or, directly or indirectly, is related to or otherwise associated with any such
person.
Section 5.36. Labor Relations. In general, MDJB has good and
amicable relations with its employees, and does not have any reason to believe
that this situation will change or that any collective representation of the
employees has been or is being considered by such employees.
Section 5.37. True Copies. All documents furnished or caused
to be furnished to Acquisition by MDJB are true and correct copies, and there
are no amendments or modifications thereto except as set forth in such
documents.
Section 5.38 Access to Data. MDJB, each of the Shareholders
or their representative(s), if any, has been afforded the opportunity to obtain
any information in connection with any representations or information supplied
to MDJB and has had all of his/her/its inquiries to Acquisition answered in
full, and has been furnished all requested materials relating to Acquisition.
He/She/It acknowledges receipt of Xxxxxxx'x report on Form 10-K for the year
ended March 31, 1995, reports on Form 10-Q for the quarters ended June 30, 1994,
September 30, 1994 and December 31, 1994, and proxy statement dated September
24, 1994 respecting the annual meeting held on October 20, 1994.
Section 5.39. Survival of Representations and Warranties of
MDJB and the Shareholders. The representations and warranties made in Article
V of this Agreement are correct, true and complete as of the date hereof and
will be correct, true and complete as at the Effective time with the same force
and effect as though such representations and warranties had been made at the
Effective Time, and shall survive the Effective Time until the issuance of the
first independent audit report (following the completion of the Merger) on the
combined results of Acquisition and MDJB.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF XXXXXXX AND ACQUISITION
The following representations and warranties are made by
Acquisition and Xxxxxxx to MDJB:
Section 6.01. Organization and Capitalization. Each of
Xxxxxxx and Acquisition is a corporation duly organized, validly existing and in
good standing under the laws of the State of New Jersey as to Xxxxxxx, and
Delaware as to Acquisition and authorized to do business in all jurisdictions
where the conduct of their business makes such authorization necessary.
Section 6.02. Authority for Agreement. The Board of Directors
of each of Xxxxxxx and Acquisition has approved this Agreement and has
authorized the execution and delivery hereof. Each of Xxxxxxx and Acquisition
has full power, authority and legal right to enter into this Agreement and, to
consummate the transactions contemplated hereby subject to the approval of the
Shareholders of Xxxxxxx. This Agreement has been duly executed and delivered by
each of Xxxxxxx and Acquisition and is a legal, valid and binding obligation of
each of Xxxxxxx and Acquisition, enforceable against them in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights in general.
Section 6.03. No Violation to Result. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby:
(a) are not in violation or breach of, do not conflict with or
constitute a default under, and will not accelerate or permit the acceleration
of the performance required by, any of the terms of the charter documents or by-
laws of Acquisition or Xxxxxxx or any note, debt instrument, security agreement
or mortgage, or any other contract or agreement, written or oral, to which
Acquisition or Xxxxxxx is a party or by which Acquisition or Xxxxxxx or any of
their respective properties or assets are bound;
(b) will not be an event which, after notice or lapse of time
or both, will result in any such violation, breach, conflict, default, or
acceleration;
(c) will not result in violation under any law, judgment,
decree, order, rule, regulation or other legal requirement of any governmental
authority, court or arbitration tribunal whether federal, state, provincial,
municipal or local (within the U.S. or otherwise) at law or in equity, and
applicable to either Acquisition or Xxxxxxx; and
(d) will not result in the creation or imposition of any lien,
possibility of lien, encumbrance, security agreement, equity, option, claim,
charge, pledge or restriction in favor of any third person upon the properties
or assets of either Acquisition or Xxxxxxx.
Section 6.04. SEC Filings. Neither Xxxxxxx'x report on Form
10-K for the year ended March 31, 1995 nor reports on Form 10-Q for the quarters
ended June 30, 1994, September 30, 1994 and December 31, 1994 (each such
document having been delivered to MDJB) contained, as of their respective dates,
any untrue statement of a material fact, or omitted to state any material fact
necessary to make the statements or facts contained thereon, in light of the
circumstances under which they were made, not misleading. Xxxxxxx is in
material compliance with all applicable SEC rules and regulations.
Section 6.05. No Adverse Changes. After March 31, 1995 to the
date of this Agreement, except as disclosed in Schedule 6.05 hereto there has
not been any:
(a) actions which have resulted in or, to the best of
Xxxxxxx'x knowledge, may result in a Material Adverse Effect on the assets,
liabilities, business, condition (financial or otherwise), operations or results
of Xxxxxxx and its Subsidiaries taken as a whole;
(b) failure to operate the business of Xxxxxxx or its
Subsidiaries in the ordinary course consistent with past practice; or
(c) revaluation by Xxxxxxx of any material assets of Xxxxxxx
or its Subsidiaries including, without limitation, writing off notes or accounts
receivable other than in the ordinary course of business consistent with past
practice; or
(d) issuance by Xxxxxxx of any shares of stock or other
equity securities (other than pursuant to any stock option plans, employee
benefit plans, or obligations to employee or directors).
Section 6.06. Xxxxxxx Common Stock. As and when required by
the provisions of this Agreement and subject to the terms and conditions hereof,
Xxxxxxx will reserve for issuance and issue shares of Xxxxxxx Common Stock to
the shareholders of MDJB. The shares of Xxxxxxx Common Stock to be issued in
accordance with this Agreement will have been duly authorized and upon such
issuance will be validly issued, fully paid and nonassessable and will be
registered under the Securities Act of 1933, as amended pursuant to the
Registration Statement.
Section 6.07 Ownership of Acquisition. All of the outstanding
shares of capital stock of, and all other ownership interest in, Acquisition (i)
are validly issued, fully paid and non- assessable and free of any preemptive
rights, and (ii) are owned by Xxxxxxx, free and clear of all liens, claims,
pledges, agreements or encumbrances, such that Xxxxxxx directly owns the entire
equity interest in Acquisition.
Section 6.08 Tax Matters. Neither Xxxxxxx nor Acquisition has
taken or agreed to take any action or has any knowledge of any fact or
circumstance that would prevent the Merger from qualifying as a tax-free
reorganization within the meaning of Section 368 of the Code.
Section 6.09 Litigation. Except as set forth on Schedule 6.09
hereto, there is no litigation, suit, proceeding, action, claim or
investigation, at law or in equity, pending or to the best of Xxxxxxx'x
knowledge, threatened against or effecting Xxxxxxx or its Subsidiaries or
involving any of their respective property or assets, pursuant to which an
adverse determination in such matter would have a Material Adverse Effect on
Xxxxxxx and its Subsidiaries taken as a whole.
Section 6.10 Full Disclosure. The Annual Reports on Form 10-K
and Quarterly Reports on Form 10-Q furnished by Xxxxxxx to MDJB pursuant to this
Agreement, the information contained in the Schedules referred to in this
Agreement and the disclosure relating to Xxxxxxx and its Subsidiaries to be
included in the Registration Statement does not and will not contain any untrue
statement of a material fact and does not and will not omit to state any
material fact necessary to make such information not misleading.
Section 6.11 Access to Data. Xxxxxxx, Acquisition and their
representatives, if any, have been afforded the opportunity to ask questions of
representatives of MDJB in connection with the representations and information
supplied by MDJB and have been furnished all requested materials relating to
MDJB.
Section 6.12. True Copies. All documents furnished or caused
to be furnished to MDJB by Acquisition or Xxxxxxx are true and correct copies,
and there are no amendments or modifications thereto except as set forth in such
documents.
Section 6.13. Survival of Representations and Warranties of
Xxxxxxx and Acquisition. The representations and warranties of Acquisition and
Xxxxxxx made in this Agreement are correct, true and complete as of the date
hereof and will be correct, true and complete as at the Effective Time with the
same force and effect as though such representations and warranties had been
made at the Closing Date, and shall survive the Effective Time until the
issuance of the first independent audit report (following the completion of the
Merger) on the combined results of Acquisition and MDJB.
ARTICLE VII
MDJB'S CONDUCT
AND TRANSACTIONS PRIOR TO CLOSING DATE
AND CERTAIN AGREEMENTS; CERTAIN COVENANTS
Section 7.01. Access to Properties and Records. (a) MDJB
(which shall be deemed to include Colorado Tech for purposes of this Article VII
unless the context clearly provides otherwise) shall afford to the officers,
employees, attorneys, accountants and other authorized representatives of
Acquisition, free and full access to all of MDJB's assets, properties, Books and
Records, and employees in order to afford Acquisition as full an opportunity of
review, examination and investigation as Acquisition shall desire to make of the
affairs of MDJB, and Acquisition shall be permitted to make extracts from, or
take copies of, such books, records (including the stock record and minute
books) or other documentation or to obtain temporary possession of any thereof
as may be reasonably necessary; and MDJB shall furnish or cause to be furnished
to Acquisition such reasonable financial and operating data and other
information about MDJB's business, properties and assets which any of
Acquisition's respective officers, employees, attorneys, accountants or other
authorized representatives may request provided that Acquisition and its agents
shall give advance notice to MDJB of any intended visit to any Facility or
meeting with MDJB's employees and shall not unreasonably interfere with the
operations of MDJB's business.
(b) Until the Merger has been consummated (and if the Merger is
not consummated, at all times hereafter), MDJB, Xxxxxxx and Acquisition will not
disclose or use any information obtained in the course of their respective
investigations. If the proposed Merger is not consummated, Xxxxxxx and
Acquisition and its representatives will return all documents, worksheets and
data to MDJB and MDJB and its representatives will return all documents,
worksheets and data to Xxxxxxx and Acquisition and, except as required by law
neither party shall discuss or release information to any third person (except
the attorneys, accountants and representatives of the parties) with respect to
such unconsummated Merger. Such obligation of confidentiality shall not extend
to any information which is shown to have been previously known by MDJB, Xxxxxxx
or Acquisition, as the case may be, or generally known to others engaged in the
same trade or business as MDJB, Xxxxxxx or Acquisition or made known to MDJB,
Xxxxxxx or Acquisition or the public by a third party.
Section 7.02. Interim Covenants of MDJB. From the date of this
Agreement until the Closing Date, except to the extent expressly permitted by
this Agreement or otherwise consented to by an instrument in writing signed by
Acquisition or as otherwise set forth in Schedule 7.02 hereto, MDJB shall take
all necessary action so that:
(a) MDJB shall keep its business and organization intact and
shall not take or permit to be taken or do or suffer to be done anything other
than in the ordinary course of its business as the same is presently being
conducted, and shall use its good faith efforts to keep available the services
of its directors, officers, employees and agents and to maintain the goodwill
and reputation associated with its business. Acquisition acknowledges that
Xxxxxxx Xxxxxxxx intends to resign as an employee of Colorado Tech and from the
Board of Directors of MDJB and Colorado Tech;
(b) MDJB shall not make any change in its constituent
documents, i.e., Certificate of Incorporation or by-laws;
(c) MDJB shall exercise its good faith efforts to maintain all
of its properties and assets that are material to the operation or conduct of
its business, tangible or intangible, in good operating condition and repair,
and take all reasonable steps necessary to keep its operations functioning
properly, ordinary wear and tear excepted;
(d) MDJB shall not purchase, sell, lease or dispose of or make
any contract for the purchase, sale, lease or disposition of or subject to lien
or security interest or any other encumbrance properties or assets other than in
the ordinary and usual course of its business consistent with past practices and
with the representations and warranties contained herein and not in breach of
any of the provisions of this Article VIII; and in the case of assets having a
replacement value of $1,000 or more, for a consideration at least equal to the
fair value of such property or asset;
(e) MDJB shall not, other than in the ordinary and usual course
of its business consistent with past practices, grant any salary increase to, or
increase the draw of, any of its officers or directors, or enter into any new,
or amend or alter any existing, bonus, incentive compensation, deferred
compensation, profit sharing, retirement, pension, stock option, group
insurance, death benefit or other fringe benefit plan, trust agreement or other
similar or dissimilar arrangement, any employment agreement with any officer or
any consulting agreement;
(f) MDJB shall not incur any bank indebtedness or make any
borrowings, or issue any commercial paper other than in the ordinary and usual
course of its business consistent with past practices;
(g) MDJB shall not pay any obligation or liability (fixed or
contingent) or discharge or satisfy any lien or encumbrance, or settle any
claim, liability or suit pending or threatened against it or any of its
properties, except for current liabilities included in the Financial Statements
or Interim Financial Statements and current liabilities incurred between the
date of this Agreement and the Closing Date in the ordinary and usual course of
its business consistent with past practices and with its representations and
warranties contained herein and not in breach of any of the provisions of this
Article VII;
(h) MDJB shall not enter into any leases of real property or
equipment and machinery other than in the ordinary and usual course of its
business consistent with past practices and except for an additional 3,700
square feet of leased space;
(i) MDJB shall not, without first obtaining the written consent
of Acquisition, enter into any contract, agreement or commitment, including
without limiting the generality of the foregoing, any contract, agreement or
commitment (A) for the purchase of any materials or supplies, if such contract,
agreement or commitment exceeds $50,000 individually and is outside the ordinary
course of MDJB's business, except for the acquisition and installation of its
planned Student Information System which is described on Schedule 7.02 hereto
and is hereby approved by Xxxxxxx and Acquisition; or (B) in which any person
listed on Schedule 5.35, any affiliate of such person or any Shareholder of MDJB
has any beneficial interest;
(j) MDJB shall not, other than in the ordinary course of its
business consistent with past practices, further encumber or permit to be
further encumbered any of its properties or assets;
(k) MDJB shall not form any subsidiary and, except as otherwise
set forth in Schedule 7.02(k) hereof, it shall not issue, grant, sell, redeem,
combine, change or purchase any shares, notes or other securities or make any
commitments to do so;
(l) MDJB shall not effect any subdivision of its outstanding
capital stock, purchase or, except as otherwise set forth in Schedule 7.02 (k)
hereof, redeem any capital stock, or declare, make or pay any dividend,
distribution or payment in respect of its capital stock;
(m) MDJB shall not, other than in the ordinary course of its
business consistent with past practices, grant or issue any options, warrants or
other rights to acquire any capital stock or other of its equity securities,
whether by conversion or otherwise, or make any commitment to do so;
(n) MDJB shall not, other than in the ordinary and usual course
of its business consistent with past practices, curtail purchases or accelerate
shipments beyond customer requirements, or modify, amend, cancel or terminate
any existing contracts or agreements; and
(o) MDJB shall maintain in full force and effect each of the
policies of insurance listed on Schedule 5.33 hereto.
Section 7.03. Information. MDJB shall furnish Acquisition,
upon request, with all information concerning MDJB reasonably required for
inclusion in the Registration Statement or any application made by Acquisition
to the SEC or any governmental or regulatory body in connection with the
transactions contemplated by this Merger, including, without limitation, the
consolidated financial statements of MDJB, including the required accountant's
reports and consents, necessary for the preparation of the Registration
Statement.
Section 7.04. Interim Financial Statements of MDJB. As soon as
practicable but in any event within 30 days after the end of each month after
the date of this Agreement, MDJB will deliver to Acquisition unaudited balance
sheets of MDJB as at the end of such month and as at the end of the
comparative month of the preceding year, together with the related unaudited
statements of income for the month then ended (including changes in
stockholders' equity and cash flows on a quarterly basis). All such financial
statements shall fairly present the financial position, results of operations
and cash flows of MDJB as at or for the periods indicated, in accordance with
GAAP except as otherwise indicated in such statements, and such financial
statements shall be accompanied by an opinion of the chief financial officer of
MDJB to such effect.
Section 7.05. Public Announcements. Acquisition and MDJB will
consult with each other with respect to any announcement to the public or any
statement to their employees generally concerning or relating to the Merger.
Prior to the Closing Date neither Acquisition nor MDJB will make any
announcement to the public without the prior written consent of the other,
except for announcements which Acquisition believes on the written advice of its
counsel to be required by applicable securities laws or stock exchange rules.
MDJB shall be provided with a copy of such announcement.
Section 7.06. Notice of Breach. (a) Xxxxxxx and Acquisition
will promptly give notice to MDJB of the occurrence of any event or the failure
of any event to occur that results in a breach of any representation or warranty
by Acquisition or a failure by Acquisition to comply with any covenant,
condition or agreement contained herein.
(b) MDJB will promptly give notice to Acquisition of the
occurrence of any event or the failure of any event to occur that results in a
breach of any representation or warranty by MDJB or a failure by MDJB to comply
with any covenant, condition or agreement contained herein.
(c) MDJB shall promptly notify Xxxxxxx and Acquisition of (i)
any material change in its condition, (ii) any complaints, investigations or
hearings (or communications indicating that the same may be contemplated) of any
Governmental Entity, (iii) the institution or the threat of material litigation
involving MDJB or any Subsidiary or (iv) any event or condition that might
reasonably be expected to cause any of its representations, warranties or
covenants set forth herein not to be true and correct in all material respects
as of the Effective Time. As used in the preceding sentence, "material
litigation" means any case, arbitration or other adversary proceeding or other
matter which would have been required to be disclosed pursuant to Section 5.28
if in existence on the date hereof. MDJB shall also promptly notify Xxxxxxx and
Acquisition of any adverse development involving any matter disclosed on an
exhibit hereto in response to Section 5.28 which shall occur after the date
hereof and in any event MDJB shall regularly advise Xxxxxxx and Acquisition of
significant changes in the status of any such matters.
(d) Xxxxxxx shall promptly notify MDJB of any event or condition
that might reasonably be expected to cause any of its representations,
warranties or covenants set forth herein not to be true and correct in all
material respects as of the Effective Time.
Section 7.07. Representations. Xxxxxxx, Acquisition and MDJB
(a) will take all reasonable action necessary to render accurate as of the
Closing Date their respective representations and warranties contained herein,
(b) will refrain from taking any action which would render any such
representation or warranty inaccurate in any material respect as of such time,
and (c) will use their good faith efforts to perform or cause to be satisfied
each covenant or condition to be performed or satisfied by them.
Section 7.08. Negotiations with Third Parties. Neither MDJB
nor the Shareholders will furnish any information to, or initiate or participate
in discussions or negotiations with, third parties relating to, or otherwise
cause or seek to cause or permit to occur any merger, sale or other disposition
of any substantial part of the assets or stock of MDJB.
Section 7.09. S-4; Regulatory Matters.
(a) Xxxxxxx, Acquisition and MDJB shall promptly prepare and
file with the SEC the Proxy Statement and Xxxxxxx and Acquisition shall prepare
and file with the SEC the Registration Statement, in which the Proxy Statement
shall be included. Each of Xxxxxxx and Acquisition shall provide reasonable
opportunity for the other to review and comment upon the contents of the Proxy
Statement and the Registration Statement and shall not include therein or omit
therefrom any information to which counsel to the other shall reasonably object.
After the date of the mailing of the Proxy Statement, each of Xxxxxxx,
Acquisition and MDJB agrees promptly to notify the other of and to correct any
information which either of them shall have furnished for inclusion in the Proxy
Statement that shall have become false or misleading in any material respect.
Each of Xxxxxxx, Acquisition and MDJB shall use best efforts to have the
Registration Statement declared effective under the Securities Act as promptly
as practicable after such filing, except that Xxxxxxx shall have the right to
delay the declaration of effectiveness of the Registration Statement for a
period of up to twenty-five business days to permit the disclosure of material
information concerning Xxxxxxx or its Affiliates. Xxxxxxx shall also take any
action (other than qualifying to do business in any jurisdiction in which it is
now not so qualified) required to be taken under any applicable state securities
laws in connection with the issuance of Xxxxxxx Common Stock in the Merger.
(b) Xxxxxxx, Acquisition and MDJB shall cooperate and use
their respective best efforts (i) to prepare all documentation, to effect all
filings and to obtain the requisite regulatory approvals and (ii) to cause the
Merger to be consummated as expeditiously as reasonably practicable following
MDJB's Stockholders' Meeting.
Section 7.10. Miscellaneous Agreements and Consents. Subject to
the terms and conditions of this Agreement, each of the parties hereto agrees to
use its best efforts to take, or cause to be taken, all action, and to do, or
cause to be done, all things necessary, proper or advisable under applicable
laws and regulations to consummate and make effective the transactions
contemplated by this Agreement as expeditiously as reasonably practicable,
including, without limitation, using their respective best efforts to lift or
rescind any injunction or restraining order or other order adversely affecting
the ability of the parties to consummate the transactions contemplated hereby
and to cause any of the conditions to the Closing hereunder which are to be
satisfied by such party to be satisfied. Xxxxxxx shall, and shall cause its
Subsidiaries, as it relates to their contracts, agreements, regulations, rules,
etc., to use their best efforts to obtain consents of all third parties and
Governmental Entities necessary or, in the reasonable opinion of MDJB, desirable
for the consummation of the transactions contemplated by this Agreement. MDJB
shall, and shall cause its Subsidiaries, as it relates their contracts,
agreements, regulations, rules, etc., to use their best efforts to obtain
consents of all third parties and Governmental Entities necessary or, in the
reasonable opinion of Xxxxxxx, desirable for the consummation of the
transactions contemplated by this Agreement. In case at any time after the
Effective Time any further action is necessary or desirable to carry out the
purposes of this Agreement, the proper officers and directors of Xxxxxxx shall
be deemed to have been granted authority in the name of MDJB to take all such
necessary or desirable action. MDJB, Xxxxxxx and MDJB, as the case may be, upon
request, shall deliver to the other party hereto such appropriate certifications
or opinions by such party's officers or counsel as such other party shall
reasonably request under the circumstances.
Section 7.11. Xxxxxxx'x Notice of Breach. Xxxxxxx shall
promptly notify MDJB of (i) any material change in its condition, (ii) any
complaints, investigations or hearings (or communications indicating that the
same may be contemplated) of any governmental entity or (iii) institution or
threat of material litigation involving Xxxxxxx or any Subsidiary with respect
to Xxxxxxx and its Subsidiaries or (iv) any event or condition that might
reasonably expected to cause any of its representations, warranties or covenants
set forth herein not to be true and correct in all material respects as of the
Effective Time. "Material Litigation" shall have the meaning ascribed in
Section 7.06 hereof with respect to Xxxxxxx and its Subsidiaries
Section 7.12. Affiliates. At least forty days prior to the
Closing Date, MDJB shall deliver to Xxxxxxx and Acquisition a letter identifying
all persons who are, at the time this Agreement is submitted for approval to the
stockholders of MDJB, "Affiliates" of MDJB for purposes of Rule 145 under the
Securities Act. MDJB shall use all reasonable efforts to cause each person
named in the letter delivered by it to deliver to Xxxxxxx and Acquisition prior
to the Closing Date a written "Affiliates" agreement, in customary form,
providing that such person shall dispose of the Xxxxxxx Common Stock to be
received by such person in the Merger only in accordance with applicable law
and, in addition, in such agreement, such Affiliate shall represent that they
have no present plan or intention to dispose of any such shares of Xxxxxxx
capital stock.
Section 7.13 Xxxxxxx'x Quarterly Reports on Form 10-Q.
Commencing upon the date of execution of this Agreement and continuing to the
earlier to occur of (i) the Effective Time and (ii) the termination of this
Agreement, Xxxxxxx shall provide to MDJB a copy of its quarterly reports on Form
10-Q as filed with the Securities and Exchange Commission promptly upon the
filing of such reports with the Commission.
ARTICLE VIIA
PERFORMANCE BY THE PARTIES SUBSEQUENT TO CLOSING
Section 7A.1. Covenants of Xxxxxxx and Acquisition Pending
Expiration of the Condition Subsequent. Xxxxxxx and Acquisition covenant and
agree with MDJB and its Stockholders that from and after the Closing and until
the satisfaction of the condition subsequent described in Section 7A.4 hereof
(the "Condition Subsequent") or the exercise of Xxxxxxx'x Rescission Right (as
provided herein), unless otherwise agreed in writing by a majority in interest
of the Stockholders, Xxxxxxx and Acquisition (i) shall not mortgage, pledge,
assign, sell or otherwise transfer any of the assets of MDJB or Colorado Tech
other than in the ordinary course of Xxxxxxx'x and Acquisition's business, (ii)
shall conduct the business, operations, activities and practices of the
Institution and Xxxxxxx'x and Acquisition's business acquired pursuant to the
Merger in the usual and ordinary course, consistent with past practices, (iii)
shall use its best efforts to preserve the business organization of Colorado
Tech intact, continue the present services of MDJB's and Colorado Tech's
employees at the Closing (which efforts shall include maintaining in all
material respects existing employee benefit plans and 401(k) plans), and
preserve the goodwill of the suppliers, students and others with whom MDJB or
Colorado Tech has a business relationship, (iv) shall use reasonable efforts to
maintain the tangible property of MDJB and Colorado Tech in the same condition
as it now exists, ordinary usage, wear and tear excepted, (v) shall not breach
any agreements necessary for Colorado Tech's operations including the operations
of the Institution, (vii) shall not enter into any contract or commitment the
performance of which may extend beyond the expiration of the Condition
Subsequent, except those made in the ordinary course of its business, the terms
of which are consistent with past practice and reasonable in light of current
conditions, (viii) shall not sell, transfer, lease or otherwise dispose of any
of the assets of MDJB or Colorado Tech other than sales of inventory in the
ordinary course of business and consistent with past practice, (ix) shall not
fail to pay prior to delinquency taxes and similar charges that might become a
lien or charge upon any of the assets of MDJB or Colorado Tech, or (x) shall not
waive or permit the loss of any substantial right.
Section 7A.2. Financial Condition. Until the satisfaction of
the Condition Subsequent or Xxxxxxx'x exercise of the Rescission Right,
Acquisition shall maintain sufficient, unimpaired equity capital as shall be
acceptable to the ED and other governmental, quasi-governmental, or accrediting
agency authorities including satisfaction of all applicable financial
responsibility regulations and standards, so as to provide reasonable assurances
that Acquisition shall be financially capable of obtaining Acquisition's
Accreditations and Certifications and performing its obligations hereunder.
Section 7A.3. Administration in Accordance with Accreditations
and Certifications. Until the satisfaction of the Condition Subsequent or
Xxxxxxx'x exercise of the Rescission Right, Xxxxxxx and Acquisition shall
administer and operate the Institution in accordance with all material federal
and state laws, statutes, rules and regulations and in accordance with all
permits, accreditations, authorizations and agreements issued by or entered into
with any federal, state or local government, quasi-governmental or accrediting
agency in any way regulating or otherwise relating to the administration and
operation of the Institution. Subject to the terms and provisions of this
Agreement, Xxxxxxx and Acquisition shall work in good faith to obtain any and
all approvals from the ED, any state education regulatory authority and any
other governmental, quasi-governmental or accrediting agency that may be
necessary or appropriate to vest in Acquisition the right and authority to
administer and operate the Institution and to certify Acquisition for
participation in Title IV Programs in the same manner and to the same extent as
Colorado Tech prior to the Merger.
Section 7A.4. Condition Subsequent to Obligations of Xxxxxxx
and Acquisition. (a) If within 120 calendar days after the Closing Date (the
"ED Certification Period"), the ED has advised Xxxxxxx or Acquisition in writing
that it does not intend to certify, whether absolutely or provisionally,
Acquisition for participation in Title IV Programs, and after diligently
pursuing an appeal of such decision for an additional 30 days, Xxxxxxx has been
unsuccessful in securing the Certification, whether absolutely or provisionally,
of Acquisition for participation in the Title IV Programs, Xxxxxxx shall (unless
the ED Certification Period is extended as provided in subparagraph (c) hereof)
rescind the Merger by giving written notice to each of the Stockholders to such
effect (the "Rescission Right"). Within ten (10) days of the date of Xxxxxxx'x
Rescission Right notice, Xxxxxxx shall (i) deliver to the former MDJB
Stockholders all of the outstanding capital stock (including the corporate
minute book, resolutions, etc.) of Acquisition so that each Stockholder receives
such number of shares of Acquisition capital stock as equals his/her percentage
interest in MDJB immediately prior to the Merger, (ii) cancel each share of
Xxxxxxx Common Stock comprising a portion of the Merger Consideration then held
in escrow by Xxxxxxx or the Exchange Agent, (iii) transfer the aggregate
Fractional Share Consideration comprising a portion of the Merger Consideration
to a general operating account of Xxxxxxx for its benefit, and (iv) deliver the
resignations of any officers and directors of Acquisition appointed by Xxxxxxx
before or after the Merger. Upon satisfaction of Xxxxxxx'x obligations in
connection with its exercise of the Rescission Right, the Merger of Acquisition
and MDJB shall be deemed rescinded. After giving effect to the exercise of the
Rescission Right, Acquisition will be a corporation having identity of share
ownership (both as to individual shareholders and as to ownership percentage) as
that of MDJB preceding the Merger. Xxxxxxx shall neither be a shareholder of
Acquisition following the exercise of the Rescission Right nor will any officer
or director of Xxxxxxx have a similar position in Acquisition following the
rescission. Each of Xxxxxxx, Acquisition, MDJB and the Stockholders acknowledge
and agree that the sole purpose of the Rescission Right is to revert the parties
to the position each occupied prior to the Effective Time of the Merger and
treat each party as if the Merger had never been consummated.
(b) Each of Xxxxxxx, Acquisition, MDJB and the Stockholders
acknowledge and agree that during the ED Certification Period, Xxxxxxx will
provide Acquisition with advances up to the amount of the funding that Colorado
Tech would have received under Title IV Programs in the absence of Colorado
Tech's termination from eligibility for funding under Title IV Programs as a
result of the Merger (the "Advances"). In the event the Condition Subsequent is
not satisfied, Xxxxxxx will continue to provide the Advances (on terms
substantially similar to that provided by Xxxxxxx during the ED Certification
Period) for a period of 120 days following the date of Xxxxxxx'x notice of
exercise of the Rescission Right (the "Post- Rescission Funding Period"). All
Advances made by Xxxxxxx during the ED Certification Period and the Post-
Rescission Funding Period shall be repaid by Acquisition as follows:
(i) all accounts receivable of Acquisition or
Colorado Tech received by virtue of Title IV Program funding that would have
been collected by Colorado Tech in the absence of the change of control
resulting from the Merger and that are collected following Xxxxxxx'x exercise of
the Rescission Right, shall upon collection be dedicated and applied in full to
the repayment of the Advances; and
(ii) the balance of the Advances remaining unpaid
following the application of the accounts receivable as provided in subparagraph
(a) above, solely as a result of such accounts receivable being uncollectable by
reason of the change of control of Colorado Tech (exclusive of any bad debts for
which reserves are provided in its financial statements), shall be converted to
a term loan payable by Acquisition to Xxxxxxx, which term loan shall (i) have a
term of (3) years, (ii) provide for monthly payments of principal in an amount
necessary to amortize the loan in equal installments over its term and (iii)
bear interest at a fixed rate equal to the prime rate of Citibank, N.A. in
effect as of the date of Xxxxxxx'x Rescission Right notice.
(c) Xxxxxxx and Acquisition may agree in writing to extend
the ED Certification Period by an additional period not to exceed 120 days.
Section 7A.5. Disbursement of Title IV Funds. Each of MDJB and
Colorado Tech agrees that they will continue to disburse Title IV funds in
accordance with 34 C.F.R. Section 668.26.
Section 7A.6. Best Efforts to Satisfy Condition Subsequent.
Xxxxxxx and Acquisition (with the cooperation and assistance of Colorado Tech
and its employees) shall diligently pursue Certification, through timely and
complete filings of the requisite documents and properly responding to inquiries
of the ED. Prior to and after the Closing, Xxxxxxx, Acquisition, MDJB and
Colorado Tech shall provide to the ED and to all state regulatory agencies and
accrediting bodies all information reasonably required or reasonably requested
by any of such agencies or bodies, and each of Xxxxxxx, Acquisition, MDJB and
Colorado Tech shall use their best efforts to satisfy promptly all requirements
and demands of the ED or of any such agency or body requisite to obtaining
Certification , whether absolute or provisional, within the time period
specified in Section 7A.4 hereof.
ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF THE PARTIES
Section 8.01 Conditions to Each Party's Obligation to Effect
the Merger. The respective obligations of each of Xxxxxxx, Acquisition and
MDJB to effect the Merger shall be subject to the fulfillment or waiver at or
prior to the Effective Time of the following conditions:
(a) The stockholders of MDJB shall have approved all matters
relating to the Merger required to be approved by such stockholders by the vote
required under the CBCA at the MDJB Stockholders' Meeting.
(b) The stockholders of Xxxxxxx shall have approved all
matters relating to the Merger required to be approved by such stockholders by
the vote required under the New Jersey Business Corporation Act at the Xxxxxxx
Shareholders' Meeting.
(c) The Registration Statement shall have been declared
effective and shall not be subject to a stop order or any threatened stop order.
(d) Neither Xxxxxxx, Acquisition nor MDJB shall be subject
to any order, decree or injunction of a court or agency of competent
jurisdiction which enjoins or prohibits the consummation of the Merger and no
proceeding shall have been initiated by any Governmental Entity and be
continuing seeking such an injunction. There shall not be any action taken, or
any statute, rule, regulation or order enacted, entered, enforced or deemed
applicable to the Merger which makes the consummation thereof illegal.
(e) Xxxxxxx and Acquisition shall have received all state
securities and "blue sky" permits and other authorizations necessary to
consummate the transactions contemplated hereby.
(f) The shares of Xxxxxxx Common Stock which shall be issued
to the holders of the Common Stock of MDJB upon consummation of the Merger shall
have been authorized for trading on the American Stock Exchange subject to
official notice of issuance.
Section 8.02. Best Efforts to Satisfy Conditions. Acquisition
shall diligently pursue certification, through timely and complete filing of the
requisite documents and in promptly responding to inquires. Prior to the
Closing, MDJB and Acquisition shall provide to the ED and to all state
regulatory agencies and accrediting bodies all information required or
reasonably requested by any of them, and Acquisition and MDJB shall use their
best efforts to satisfy promptly all requirements and demands of the ED or any
such agency or body requisite to obtaining certification or provisional
certification as soon as practicable.
ARTICLE IX
CONDITIONS TO XXXXXXX'X AND ACQUISITION'S OBLIGATIONS
All obligations of Xxxxxxx and Acquisition under this Agreement
are subject to the fulfillment and satisfaction, prior to or at the time at
which the Closing Date is scheduled to occur, of each of the following
conditions, any one or more of which may be waived by Acquisition in writing.
Section 9.01. Representations and Warranties True at the
Closing Date. At the Closing Date, the representations and warranties of MDJB
and Colorado Tech contained in this Agreement will be true and correct in all
material respects at and as of such time, except to the extent affected by the
transactions contemplated hereby and by the operations of MDJB and Colorado Tech
as permitted by the provisions of Section 9.02 from the date hereof to the
Closing Date, and at the Closing Date each of MDJB and Colorado Tech has
delivered to Acquisition a certificate to such effect signed by the President
and the Chief Financial Officer.
Section 9.02. MDJB's Performance. Each of the obligations of
MDJB and Colorado Tech to be performed by it on or before the Closing Date
pursuant to the terms of this Agreement shall have been duly performed in all
material respects at the Closing Date, and at the Closing Date each of MDJB and
Colorado Tech shall have delivered to Acquisition a certificate to such effect
signed by the President and the Chief Financial Officer.
Section 9.03. Authority. All action required to be taken by,
or on the part of, MDJB and Colorado Tech to authorize the execution, delivery
and performance of this Agreement by MDJB and Colorado Tech and the consummation
of the transactions contemplated hereby shall have been duly and validly taken
by the Board of Directors and stockholders of each such entity. This Agreement
and the Merger shall have been approved and adopted by a majority of the shares
of the MDJB Common Stock entitled to vote of the MDJB Shareholders' Meeting in
accordance with the CGCL.
Section 9.04. Opinion of MDJB's Counsel. Acquisition shall
have been furnished an opinion or opinions of Xxxxxx X. Xxxxxxx, Esq., counsel
to MDJB and Colorado Tech, dated the date of the Closing Date, in form
substantially as set forth on Schedule 9.04 hereto.
Section 9.05. No Material Adverse Change. There shall have
been, between the date hereof and the Closing Date, (i) no material adverse
change in the condition, financial or otherwise, of MDJB or Colorado Tech, (ii)
no resignations or terminations of, or indications of an intention or plan to
resign, employment by a large number of employees such that the continued
operations of MDJB's or Colorado Tech's business would be materially and
adversely affected, and (iii) no terminations of, or indications of an intention
or plan to terminate, the use to a material extent of the services of MDJB or
Colorado Tech; and at the Closing Date each MDJB and Colorado Tech shall have
delivered to Acquisition a certificate to such effect signed by its President
and the Chief Financial Officer.
Section 9.06. Assignment of Contracts. MDJB shall have
received consents under all Contracts, agreements, commitments, understandings
and instruments to which MDJB or Colorado Tech is a party or by which either or
both is bound which require the consent of any other party or person to the
assignment thereof either by the terms thereof or as a matter of law for their
assumption or performance by Acquisition.
Section 9.07 Certificates. MDJB and Colorado Tech shall have
furnished Acquisition with such certificates of the officers to evidence
compliance with the conditions set forth in this Article IX as may be reasonably
requested by Acquisition, which shall include, but not be limited to:
(a) A certificate executed by the Secretary or an Assistant
Secretary of MDJB and Colorado Tech certifying as of the Closing Date (a) a
true and complete copy of the Articles of Incorporation of each entity; (b) a
true and complete copy of the bylaws of each entity; (c) a true and complete
copy of the resolutions of the board of directors of each entity authorizing the
execution, delivery and performance of this Agreement by each entity and the
consummation of the transactions contemplated hereby; (d) incumbency matters;
and (e) approval and adoption of this Agreement and Plan of Merger by the
consent of the requisite number of stockholders of MDJB and Colorado Tech;
(b) A certificate executed by the President and the Chief
Financial Officer of each of MDJB and Colorado Tech certifying that, as of the
Closing Date, the conditions set forth in Article IX with respect to MDJB and
Colorado Tech have been satisfied;
(c) A copy of the articles of incorporation of MDJB and
Colorado Tech and all amendments thereto, certified as of a recent date by the
Secretary of State of their respective state of incorporation;
(d) A certificate of the appropriate Secretary of State
certifying the good standing of each of MDJB and Colorado Tech in its state of
incorporation and all states where each is qualified to do business;
(e) Evidence reasonably satisfactory to Acquisition that
after the Closing Date, Acquisition may lawfully occupy the Premises and the
Facilities;
(f) Any and all forms, certificates and/or other instruments
required to pay the transfer and recording taxes and charges arising from the
transactions contemplated by this Agreement, together with evidence reasonably
satisfactory to Acquisition that such transfer taxes and charges have been paid
or provided for; and
(g) A certificate executed by each of MDJB and Colorado Tech
certifying as of the Closing Date that the certificates delivered to Acquisition
pursuant to this Section 9.07 are true and correct in all material respects.
Section 9.08. Employment. Xxxxx X'Xxxxxxx shall have entered
into an employment agreement with Acquisition or an affiliate on or before the
Closing Date in substantially the form of Exhibit A hereto.
Section 9.09. Audited Financial Statements. Acquisition shall
have received audited financial statements with respect to MDJB as of and for
the year ended December 31, 1994, and reviewed financial statements for the
period ending with the most recently completed calendar month preceding the
Closing Date.
Section 9.10 Acquisition's Review. There shall not have come
to the attention of Acquisition, as a result of its review described in Section
7.01 hereof or otherwise, any material information, (i) not previously disclosed
to Acquisition despite inquiry of MDJB by Acquisition; or (ii) indicating the
occurrence of an event since the date of the execution of this Agreement that is
likely to have a Material Adverse Effect.
Section 9.11. Assignment and Assumption of Leases. MDJB shall
have delivered Assignment, Assumption and Consent agreements with respect to
each Facility, duly executed by each landlord providing for terms and conditions
no less favorable than those contained in the existing leases.
Section 9.12. MDJB's Equity. MDJB shall demonstrate, represent
and warrant that MDJB's stockholders equity as of December 31, 1994 and June 30,
1995 is $924,492.00 and $994,692, respectively, and that there has been no
material decrease in such net equity between June 30, 1995 and the Closing Date.
Section 9.13. Acid Test and Tangible Net Equity. At the
Closing, MDJB shall demonstrate, represent and warrant that (i) MDJB meets or
exceeds, or is not required to maintain, an acid test of 1 to 1 as required by
and determined in accordance with 34 C.F.R., 668.15 and (ii) MDJB has a positive
Tangible Net Equity as required by and determined in accordance with 34 C.F.R.
668.15.
Section 9.14. Dissenter' Rights of Appraisal. Holders of MDJB
Common Stock shall not have exercised appraisal rights under the CBCA in respect
of more than 3% of shares of MDJB Common Stock outstanding prior to the Closing
Date.
Section 9.15. Pooling Accounting Treatment. Xxxxxxx will
receive a letter from Ernst & Young LLP, its independent auditors, regarding
that firm's concurrence with Xxxxxxx management's conclusions as to the
appropriateness of pooling of interest accounting for the merger under
Accounting Principles Board Opinion No. 16 if closed and consummated in
accordance with this agreement.
Section 9.16. Tax Representation Letter. Each of the
Shareholders owning ten percent (10%) or more of the MDJB Common Stock shall
have executed and delivered to Xxxxxxx the Tax Representation Letter in the form
attached hereto as Exhibit B.
Section 9.17. Affiliates Agreement. Each officer, director and
shareholder owning beneficially 10% or more of the MDJB Common Stock (after
giving effect to the issuance of shares underlying stock options, warrants or
other securities or agreements that are convertible into MDJB Common Stock
within 60 days of the Closing Date) shall have executed and delivered to Xxxxxxx
the Affiliate Letter Agreement in the form attached hereto as Exhibit C.
ARTICLE X
CONDITIONS TO MDJB'S
OBLIGATIONS
All obligations of MDJB under this Agreement are subject to the
fulfillment and satisfaction, prior to or at the time at which the Closing Date
is scheduled to occur, of each of the following conditions, any one or more of
which may be waived in writing by MDJB.
Section 10.01. Representations and Warranties True at the
Closing Date. At the Closing Date, the representations and warranties of
Xxxxxxx and Acquisition contained in this Agreement will be true and correct in
all material respects at and as of such time, except to the extent affected by
the transactions contemplated hereby, and at the Closing Date, each of Xxxxxxx
and Acquisition shall have delivered to MDJB a certificate to such effect signed
by the President and the Chief Financial Officer of Acquisition.
Section 10.02. Acquisition's Performance. Each of the
obligations of Xxxxxxx and Acquisition to be performed by it on or before the
Closing Date pursuant to the terms of this Agreement shall have been duly
performed in all material respects at the Closing Date, and at the Closing Date
Acquisition shall have delivered to MDJB a certificate to such effect signed by
its President and the Chief Financial Officer.
Section 10.03. Authority. All action required to be taken by,
or on the part of Xxxxxxx and Acquisition to authorize the execution, delivery
and performance of this Agreement by Xxxxxxx and Acquisition and the
consummation of the transactions contemplated hereby shall have been duly and
validly taken by the Board of Directors and stockholders of each such entity.
This Agreement and the Merger shall have been approved and adopted by a majority
of the shares of Xxxxxxx Common Stock entitled to vote at the Xxxxxxx
Shareholders' Meeting in accordance with the New Jersey Business Corporation
Act.
Section 10.04. Opinion of Counsel of Acquisition. MDJB shall
have been furnished an opinion of Xxxxxxxx, St. Xxxx & Xxxxx, counsel to
Acquisition and Xxxxxxx, dated the Closing Date, in form substantially as set
forth in Schedule 10.04 hereto.
Section 10.05. No Material Adverse Change. There shall have
been, between the date hereof and the Closing Date no material adverse change in
the condition, financial or otherwise, of Acquisition, and at the Closing Date
Acquisition and Xxxxxxx shall have delivered to MDJB a certificate to such
effect signed by the President and the Chief Financial Officer of Acquisition.
Section 10.06. Employment. Xxxxx X'Xxxxxxx shall have been
offered an employment agreement with Acquisition or an affiliate on or before
the Closing Date in substantially the form of Exhibit A hereto.
Section 10.07. Certificates. Acquisition and Xxxxxxx shall
have furnished to MDJB with such certificates of the officers of Acquisition and
Xxxxxxx and others to evidence compliance with the conditions set forth in this
Article X as may be reasonably requested by MDJB, which shall include, but not
be limited to:
(a) A certificate executed by the Secretary or an Assistant
Secretary of Acquisition and Xxxxxxx certifying as of the Closing Date (a) a
true and complete copy of the resolutions of the board or directors of
Acquisition and Xxxxxxx authorizing the execution, delivery and performance of
this Agreement by Acquisition and Xxxxxxx and the consummation of the
transactions contemplated hereby; (b) incumbency matters; and (c) if applicable,
approval and adoption of this Agreement and Acquisition by the stockholders of
Acquisition;
(b) A certificate executed by the President and the Chief
Financial Officer of Acquisition and Xxxxxxx certifying that, as of the Closing
Date, the conditions set forth in Article X with respect to Acquisition have
been satisfied;
(c) Any and all forms, certificates and/or other instruments
required to pay the transfer and recording taxes and charges arising from the
transactions contemplated by this Agreement, together with evidence reasonably
satisfactory to MDJB that such transfer taxes and charges have been paid; and
(d) A certificate executed by Acquisition and Xxxxxxx certifying
as of the Closing Date that the certificates delivered to MDJB pursuant to this
Section 10.07 are true and correct in all material respects.
Section 10.08. MDJB's Review. There shall not have come to the
attention of MDJB, any material information (i) not previously disclosed to MDJB
despite the inquiry of Acquisition or Xxxxxxx by MDJB; or (ii) indicating the
occurrence of events since the date of execution of this Agreement that is
likely to have a Material Adverse Effect.
ARTICLE XI
TERMINATION
Section 11.01. Termination. Notwithstanding anything herein or
elsewhere to the contrary, this Agreement may be terminated and the Merger
abandoned:
(a) by the Board of Directors of MDJB or Acquisition if
the Closing Date shall not have taken place on or prior to January 31, 1996;
(b) by the Board of Directors of Acquisition at any
time prior to the Closing Date if:
(i) a material condition to Acquisition's performance under
this Agreement or a covenant of MDJB or Colorado Tech contained herein shall not
be fulfilled on or before the Closing Date or on such other date specified for
the fulfillment of such covenant or condition; or
(ii) a material default or breach of this Agreement shall be
made by MDJB or Colorado Tech; or
(iii) since December 31, 1994, there shall be a material
adverse change in the results of operations of MDJB or Colorado Tech or any
adverse change in the business, income before income taxes (as compared with the
same period in the preceding year), Prospects, manner of conducting the
business, financial condition or any asset of MDJB or Colorado Tech, which
change is material; or
(iv) the Board of Directors of Acquisition shall have determined
in its reasonable opinion that the transactions contemplated by this Agreement
have become inadvisable or impracticable by reason of the institution or threat
by state, local or federal governmental authorities or by any other person of:
(A) litigation or proceedings to restrain or prohibit the consummation of the
transactions contemplated by this Agreement or which seeks substantial damages
in connection with this Agreement or the transactions contemplated hereby; or
(B) other litigation or proceedings the outcome of which in the reasonable
opinion of Acquisition would have a material adverse effect on the business,
results of operations, prospects, manner of conducting the business, financial
condition or any material asset of MDJB, Colorado Tech or Acquisition; or
(v) the Board of Directors of Acquisition shall have determined
in its reasonable opinion that the results of the due diligence investigation of
MDJB is unsatisfactory.
(c) by the Board of Directors of MDJB at any time prior
to the Closing Date if:
(i) a material condition to MDJB's performance under this
Agreement shall not be fulfilled on or before the Closing Date or on such other
date specified for the fulfillment of such condition; or
(ii) a material default or breach of this Agreement shall be
made by Xxxxxxx or Acquisition; or
(iii) since March 31, 1995 there shall be a material adverse
change in the results of operations of Acquisition or Xxxxxxx, or any material
adverse change in the business, results of operations (as compared with the same
period in the preceding year), prospects, manner of conducting the business,
financial condition or any asset of Acquisition or Xxxxxxx, except as disclosed
to MDJB in writing on or prior to the date hereof.
Section 11.02. Additional Right of Acquisition to Terminate.
As soon as practicable after execution of this Agreement, Acquisition and/or
Acquisition's representative and MDJB and/or MDJB's representative shall
together meet with officials from ED's Institutional Participation Division
("IPD") to inform IPD of this Agreement and determine whether IPD reasonably
anticipates that Acquisition will be able to obtain Certification for the
Colorado Tech subsequent to the proposed Merger. If, on the basis of the above-
described meeting, Acquisition reasonably believes that IPD will not certify the
Institutions at any time or in a timely manner, then notwithstanding any other
provision of this Agreement to the contrary, Acquisition may elect to terminate
this Agreement by notice to MDJB given not less than five (5) business days
prior to the Closing Date, including in such notice the basis for the belief
upon which the election is taken. Acquisition may withdraw its election if,
subsequent to the giving of notice, it is satisfied that the basis cited in the
notice has been satisfactorily resolved, the determination of Acquisition to be
dispositive.
ARTICLE XII
INDEMNIFICATION
Section 12.01. Indemnification of Acquisition and Xxxxxxx. (a)
The Shareholders shall, on a several basis, indemnify and hold Acquisition and
Xxxxxxx harmless in respect of each and all of the following, provided that a
claim in writing is made against Acquisition or Xxxxxxx within the survival
periods specified hereinabove:
(i) Any and all damage or deficiency resulting from any
misrepresentation, breach of warranty, non-fulfillment of any agreement or
obligation on the part of MDJB or Colorado Tech contained in this Agreement (or
any exhibits or schedules hereto) and from any misrepresentation in or omission
from any certificate, exhibit, schedule, instrument or other information
furnished to Acquisition or Xxxxxxx by MDJB, Colorado Tech or by any of their
respective officers; and
(ii) All demands, assessments, judgments, costs and legal and
other expenses, including, without limitation, reasonable attorneys' fees,
arising from or in connection with any action, suit, proceeding or settlement or
claim incident to the foregoing Section 12.01(a) or involving a third-party
action against Xxxxxxx or Acquisition.
(b) The Shareholders shall have no liability with respect to
the inaccuracy or breach of representations and warranties of MDJB or Colorado
Tech or for any other liability provided in this Section 12.01 unless (i)
written notice of any claim, loss, damage or cost is given within the survived
period specified in Section 5.39 hereof, and (ii) all such aggregate losses,
costs, damages and expenses actually paid or suffered by Acquisition or Xxxxxxx
by reason of subparagraph (a) (i) and/or (ii) above, exceed Twenty Five Thousand
and 00/100 ($25,000) (the "Deductible"), in which case the Shareholders will be
liable for such aggregate losses, costs, damages and expenses to the extent they
exceed the Deductable and not to exceed the Escrow Portion.
(c) Any claim for indemnification under this Section 12.01
in excess of the Deductible shall be satisfied from the Escrow Portion allocated
to each Shareholder, on a pro rata basis, based upon the Closing Date Fair
Market Value of Xxxxxxx Common Stock. For purposes of this Section 12.01,
"Closing Date Fair Market Value" shall mean the closing sales price of Xxxxxxx'x
Common Stock as reported by the American Stock Exchange on the trading day
immediately prior to the Closing Date as accurately reported in The Wall Street
Journal (or if The Wall Street Journal no longer reports such price, any
newspaper, trade journal or stock reporting service selected by Xxxxxxx). No
Shareholder shall have any liability for indemnification under this Section
12.01 for claims which in the aggregate exceed the Closing Date Fair Market
Value of the Escrow Portion allocated to such Shareholder as shown on Schedule
3.2. If as of the Escrow Release Date (as defined in Section 12.06 hereof) the
aggregate claims for indemnification under this Section 12.01 (and Xxxxxxx'x
exercise of the set-off rights provided hereunder) are less than the Closing
Date Fair Market Value of the Escrow Portion for each such claim, the remaining
Escrow Portion shall be released to the Shareholders, on a pro rata basis, with
cash payments made to any Shareholder that would otherwise be entitled to a
fractional share from the Escrow Portion then remaining (based on the Closing
Date Fair Market Value.
The provisions of this Section 12.01 (c) may be illustrated by
the following example:
If the aggregate claims subject to indemnification prior to the
Escrow Release Date total $250,000 (after giving effect to the $25,000
Deductible) and the Closing Date Fair Market Value of the Xxxxxxx Stock is $2.00
per share, the entire Escrow Portion would be subject to set-off by Xxxxxxx
hereunder and the Shareholders would have no further liability for
indemnification under this Section 12.01. If, however, the Closing Date Fair
Market Value of the Xxxxxxx Common Stock is $10.00 per share, only 25,000 shares
of the Escrow Portion would be subject to set-off by Xxxxxxx. Assuming no other
claims for indemnification were made by Xxxxxxx or Acquisition prior to the
Escrow Release Date, the remaining 62,500 shares comprising the Escrow Portion
would be distributed on the Escrow Release Date by Xxxxxxx to the Shareholders
on a pro rata basis.
(d) Xxxxxxx shall have the right to set-off against the
Escrow Portion the amount of any loss, cost, damage or expense actually paid,
suffered or incurred by Acquisition or Xxxxxxx by reason of Section 12.01(a)(i)
and/or (ii). Xxxxxxx'x right of set-off with respect to non-third party claims
may be exercised upon the relevant determination date. Xxxxxxx shall provide
the Shareholders with written notice of a set-off for any indemnity loss under
this Section 12.01 shall be limited to the Escrow Portion. Xxxxxxx'x exercise
of its set-off rights with respect to third-party claims shall be deemed to have
occurred upon the final resolution of such third-party claim in accordance with
Section 12.03 hereof. Xxxxxxx, Acquisition, MDJB and the Shareholders hereby
acknowledge and agree that Xxxxxxx'x and Acquisition's sole remedy for indemnity
under this Section 12.01 shall be limited to the Escrow Portion. If Xxxxxxx is
determined by a court of competent jurisdiction to have wrongfully set-off
claims against the Escrow Portion, Xxxxxxx'x liability to the Shareholders shall
be limited to the number of shares wrongfully set off from the Escrow Portion.
Section 12.02. Indemnification of MDJB and Shareholders. (a)
Acquisition and Xxxxxxx shall indemnify and hold MDJB harmless in respect of
each and all of the following, provided that a claim in writing is made against
MDJB within the survival periods specified hereinabove:
(i) Any and all damage or deficiency resulting from any
misrepresentation, breach of warranty, non-fulfillment of any agreement or
obligation on the part of Acquisition or Xxxxxxx contained in this Agreement (or
any exhibits or schedules hereto) and from any misrepresentation in or omission
from any certificate, exhibit, schedule, instrument or other information
furnished to MDJB in connection with this Agreement by Acquisition, Xxxxxxx or
any of their respective officers.
(ii) All demands, assessments, judgments, costs and legal and
other expenses, including, without limitation, reasonable attorneys' fees,
arising from or in connection with any action, suit, proceeding or settlement of
claim incident to the foregoing Section 12.02(a) or involving a third-party
action against MDJB.
(b) Neither Xxxxxxx nor Acquisition shall have any liability
with respect to the inaccuracy or breach of representations and warranties of
Acquisition or Xxxxxxx or for such other liability provided in this Section
12.02 unless (i) written notice of any claim, loss, damage or cost is given
within the survival period specified in Section 6.13 hereof, and (ii) all such
aggregate losses, costs, damages and expenses actually paid and suffered by MDJB
by reason of subparagraphs (a) (i) and (ii) above, exceed Twenty Five Thousand
Dollars ($25,000) (the "Deductible"), in which case the Xxxxxxx will be liable
for such aggregate losses, costs, damages and expenses to the extent they exceed
the Deductible. The sole remedy for a post-closing claim shall be for losses,
costs, damages and expenses actually paid or suffered by MDJB. No claim may be
made for rescission of the purchase and sale or for punitive, special,
consequential or indirect damages.
Section 12.03. Notices, Participation, and Settlement.
Promptly after receipt by any party hereto of notice of a claim or commencement
of any action (legal or administrative) which, if successful, might require
another party hereto to indemnify such other party, the indemnified party will
give written notice thereof to the indemnifying party of such claim or the
commencement of such action, provided that the failure of any indemnified party
to give such written notice shall not relieve the indemnifying party of its
obligations hereunder except to the extent that the indemnified party is
actually prejudiced by such failure. If a claim is so noticed, the indemnifying
party shall be entitled to participate in the resolution of such claim, and if
such action is brought against any indemnified party, the indemnifying party
shall be entitled to participate and assume defense thereof with counsel
reasonably satisfactory to such indemnified party, and after notice from the
indemnifying party to the indemnified party of its election to so assume defense
thereof, the indemnifying party shall have no obligation for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof. No indemnifying party shall make any settlement of any claims
without the written consent of the indemnified party, which consent shall not be
unreasonably withheld. Without limiting the generality of the foregoing, it
shall not be deemed unreasonable to withhold consent to a settlement involving
injunctive or other equitable relief against the indemnified party or its
assets, employees or business. With regard to claims of third parties for which
indemnification is payable hereunder, such indemnification shall be paid by the
indemnifying party upon the earlier to occur of; (i) the entry of a judgment
against the indemnified party and the expiration of any applicable appeal
period, of if earlier, five days prior to the date that the judgment creditor
has the right to execute the judgment; (ii) the entry of an unappealable
judgment or final appellate decision against the indemnified party; or (iii) a
settlement of the claim. Notwithstanding the foregoing, expenses by counsel to
the indemnified party shall be reimbursed on a current basis by indemnifying
party. With regard to other claims for which indemnification is payable
hereunder, such indemnification shall be paid promptly by indemnifying party
upon demand by the indemnified party. Any claim for indemnity shall be reduced
by the amount of any insurance proceeds received. In no event shall a
Shareholder be required to advance any funds as all claims for indemnity are to
be satisfied from the Escrow Portion and no Shareholder shall have any liability
beyond his or her allocable share of the Escrow Portion (except as otherwise
provided in Section 12.01(e)).
Section 12.04. Indemnification for Brokers. Acquisition and
the Shareholders shall each indemnify and hold harmless the other against any
losses, claims, expenses (including court costs and attorneys' fees), costs or
liabilities to which the indemnified party may become subject relating to any
brokerage or finders' fees or agents' or banker's commissions or other similar
charges incurred by the indemnifying party in connection with this Agreement or
any transaction contemplated hereby.
Section 12.05. Title IV Liabilities. Upon Acquisition
receiving certification from the ED authorizing Colorado Tech College to
participate in Title IV Programs, and for a period of two (2) years thereafter,
the Shareholders shall be severally liable with Acquisition for Title IV
liabilities arising prior to the Closing date and any Shareholder liabilities
will be satisfied from the Escrow Portion.
In the case that the Department of Education, Guaranty Agency or
other agency indicates that it will conduct a review for a period prior to the
Closing Date, the Shareholders shall have the option of being present at the
Colorado Tech College facilities under review, and the Shareholders shall have
the right to be present during and participate in any discussions or interviews
with the reviewers.
Section 12.06. Release of Escrow Portion. Xxxxxxx shall release
to each Shareholder his or her allocable share of the Escrow Portion, if any,
after giving effect to the exercise of the set-off rights granted to Xxxxxxx in
accordance with Section 12.01, upon the later to occur of (i) the satisfaction
of the Condition Subsequent and (ii) the issuance of the first independent audit
report (following the completion of the Merger) on the combined results of
Acquisition and MDJB (the "Escrow Release Date"); provided, however, that
notwithstanding the foregoing, in no event shall the Escrow Portion be released
following the exercise of Xxxxxxx'x Rescission Right (as defined and provided in
Section 7A.4 hereof).
Section 12.07. Acquisition's Insurance Requirements. For a
period of three (3) years following the Effective Time, Acquisition shall
maintain liability insurance coverage known as "Tail Coverage" covering the
prior acts and omissions of the officers and directors of MDJB and Colorado Tech
preceding the Effective Time. In addition, Acquisition shall maintain Director
and Officer Liability Insurance for each of its officers and directors for a
period of at least three (3) years following the Effective Time.
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Successors, Assigns and Third Parties. This
Agreement shall inure to the benefit of and be binding upon the parties hereto
and their respective successors and assigns; provided, however, that, none of
the parties hereto may make any assignment of this Agreement or any interest
herein without the prior written consent of the other parties hereto.
Notwithstanding the foregoing, Xxxxxxx and Acquisition may assign their rights,
but not their obligations under this Agreement to a wholly-owned subsidiary of
Xxxxxxx or Acquisition without the consent of MDJB or Colorado Tech. Nothing
herein expressed or implied is intended or shall be construed to confer upon or
give to any person, firm or corporation, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.
Section 13.02. Governing Law. This Agreement shall in all
respects be interpreted, construed and governed by and in accordance with the
internal substantive laws of the State of New Jersey, disregarding principles of
conflict of laws and the like.
Section 13.03. Severability. Each section, subsection and
lesser section of this Agreement constitutes a separate and distinct
undertaking, covenant and/or provision hereof. In the event that any provision
of this Agreement shall finally be determined to be unlawful, such provision
shall be deemed severed from this Agreement, but every other provision of this
Agreement shall remain in full force and effect; provided, however that if such
unlawful clause is so material to the party for whose benefit the clause was
originally included so that such party would not have entered into this
Agreement without such unlawful clause, the severability of such clause shall be
arbitrated pursuant to Section 13.09 hereof.
Section 13.04. Certain Words. Words such as "herein,"
"hereof," "hereby," "hereunder" and words of similar import refer to this
Agreement as a whole and not to any particular Section or subsection of this
Agreement.
Section 13.05. Notices. Except as otherwise expressly provided
herein, any notice, consent, or other communication required or permitted to be
given hereunder shall be in writing, delivered by certified mail or a national
overnight delivery services and shall be deemed to have been given when
received, and shall be addressed as follows:
(a) If to Acquisition or Xxxxxxx: Xxxxxxx Medical Corp.
000X X.X. Xxxxxxx 0 Xxxxx
Xxxxx 000
Xxxxxx, Xxx Xxxxxx 00000
Attn: Xx. Xxxxx X. Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxxx X. Xxxxxxxx, Esq.
Xxxxxxxx, St. Xxxx & Xxxxx
Xxx Xxxx Xxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
(b) If to MDJB or Colorado Tech: MDJB, Inc.
c/o Colorado Technical
University
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx
00000-0000
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxxxx, Esq.
000 Xxxx Xxxxx Xxxx Xxxxxx
Xxxxxxxx Xxxxxxx, XX. 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
(c) If to the Shareholders: Xxxxx X'Xxxxxxx, as
Agent for the Shareholders
Colorado Technical University
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx
00000-0000
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxxxx, Esq.
000 Xxxx Xxxxx Xxxx Xxxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
or at such other address or addresses as the party addressed may from time to
time designate in writing. Any communication dispatched by telegram or telex
shall be confirmed by letter.
Section 13.06. Expenses. All legal and other costs and expenses
incurred in connection herewith and the transactions contemplated hereby shall
be paid by the party incurring such expenses. Without limiting the generality
of the foregoing, any and all fees and expenses of any attorneys, accountants or
investment bankers of the parties hereto incurred in connection with this
Agreement or the transactions contemplated hereby shall be borne by the party
incurring such expense and shall not be assumed by any other party; provided,
however, that in no event shall the legal, accounting and other fees and
expenses incurred by or on behalf of MDJB and/or Colorado Tech exceed an
aggregate of $75,000 without the prior written consent of Xxxxxxx.
Section 13.07. Headings. The headings in this Agreement are intended
solely for convenience of reference and shall be given no effect in the
construction or interpretation of this Agreement.
Section 13.08. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute the same agreement.
Section 13.09. Arbitration. Any controversy or claim arising out of or
relating solely to Section 13.03 shall be settled by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association,
by a tribunal sitting in Newark, New Jersey if such claim is made by MDJB, or in
Colorado Springs, Colorado if such claim is made by Xxxxxxx or Acquisition, and
judgment on the award rendered by the Arbitrator(s) may be entered in any court
having jurisdiction thereof.
IN WITNESS WHEREOF, the parties hereto have caused their signatures to
be affixed to this as of the date first above written.
ATTEST: XXXXXXX MEDICAL CORP.
By: /s/ Xxxx X. Xxxx By: /s/ Xxxxx X. Xxxxx
Name: Xxxx X. Xxxx Name: Xxxxx X. Xxxxx
Title: V.P. Marketing Title: President
ATTEST: XXXXXXX MEDICAL ACQUISITION CORPORATION
By: /s/ Xxxx Xxxxxxxxxxxx By: /s/ Xxxxx X. Xxxxx
Name: Xxxx Xxxxxxxxxxxx Name: Xxxxx X. Xxxxx
Title: President of Ultrasound Title: President
ATTEST: MDJB, INC.
By:/s/Xxxxxxx X. Xxxx By:/s/ Xxxxx X. X'Xxxxxxx
Name:Xxxxxxx X. Xxxx Name:Xxxxx X. X'Xxxxxxx
Title:Secretary Title: Chairman &
President
ATTEST: COLORADO TECHNICAL UNIVERSITY, INC.
By:/s/ Xxxxxxx X. Xxxx By:/s/ Xxxxx X. X'Xxxxxxx
Name:Xxxxxxx X. Xxxx Name:Xxxxx X'Xxxxxxx
Title: Secretary Title: Chairman
Omitted Schedules to Agreement and Plan of Merger
Schedule No. Description
3.2 Stockholder List & Conversion Calculations
5.01 Organization and Capitalization
5.02 Power and Authority
5.03 Certificate of Incorporation and By-Laws of M.D.J.B.
5.06 No Violation To Result
5.07 No Existing Defaults
5.08 Financial Statements
5.09 No Adverse Changes
5.10 Employee Plans & Agreements
5.12 Taxes
5.16 Title To Assets
5.19 Intellectual Property
5.20 Real Property
5.24 Vehicles
5.26 Contracts
5.27 Assets Sufficient
5.28 Litigation
5.29 Compliance With Laws
5.30 Compliance with Title IV Programs
5.31 Institutional Approval and Accreditation
5.32 Environmental Matters
5.33 Insurance
5.34 Licenses, Permits and Approvals
5.35 Employee Compensation Agreements
6.05 No Adverse Changes
6.09 Litigation
7.02 Interim Covenants
Registrant agrees to furnish supplementally a copy of any omitted
schedule to the Commission upon request.
