EXHIBIT 10.2.1
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger ("AGREEMENT"), is made and entered
into this 9th day of March 2006, by and among GROWTH MERGERS, INC., a Nevada
corporation ("GROWTH"), having its principal offices at 0000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxx Xxxx, Xxxxxx 00000; GROWTH ACQUISITION CORP., a Washington
corporation ("MERGERCO"); NEAH POWER SYSTEMS, INC., a Washington corporation
("NEAH"); and SUMMIT TRADING LIMITED, a BVI corporation, and SPECIAL INVESTMENTS
ACQUISITIONS ASSOCIATES LLC, a Delaware limited liability company (collectively,
the "GROWTH PRINCIPAL STOCKHOLDERS"). GROWTH, MERGERCO, NEAH and the GROWTH
PRINCIPAL STOCKHOLDERS are hereinafter sometimes collectively referred to as the
"PARTIES."
RECITALS:
A. GROWTH desires to acquire all of the issued and outstanding
capital stock of NEAH, through the merger of MERGERCO with and into NEAH (the
"MERGER"), with NEAH as the surviving corporation of the Merger.
B. It is the intention of the parties hereto that: (i) the Merger
shall qualify as a tax free reorganization under Section 368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended, and related sections thereunder; and
the parties intend this Agreement to qualify as a "plan of reorganization"
within the meaning of Treasury Regulation Sections 1.368-2(g) and 1.368-3(a),
and (ii) the Merger shall qualify as a transaction in securities exempt from
registration or qualification under the Securities Act of 1933, as amended, and
under the applicable securities laws of each state or jurisdiction where the
NEAH Security Holders reside.
C. The board of directors of each of GROWTH, MERGERCO and NEAH
and the GROWTH PRINCIPAL STOCKHOLDERS each deem it to be in the best interests
of GROWTH and NEAH and their respective shareholders to consummate the Merger,
as a result of which GROWTH shall acquire all of the issued and outstanding
capital stock of NEAH.
D. On the "EFFECTIVE TIME" of the Merger, GROWTH or its
affiliates shall provide the sum of Five Hundred Thousand Dollars ($500,000) to
NEAH for working capital (the "INITIAL FINANCING"); 100% of the proceeds of such
Initial Financing will be transferred to NEAH pursuant to this Agreement.
E. Immediately following the Effective Time of the Merger (a) the
NEAH SECURITY HOLDERS shall own approximately 25% of the "GROWTH Fully-Diluted
Common Stock" (as hereinafter defined), and (b) the GROWTH Principal
Stockholders, all other holders of GROWTH Common Stock and the holders of
securities in connection with the GROWTH Initial Financing shall own 75% of such
GROWTH Fully-Diluted Common Stock
F. Following the Effective Time of the Merger, GROWTH shall
undertake to consummate, within forty-five (45) days of the Effective Time of
the Merger, the $2,000,000 minimum "GROWTH ADDITIONAL FINANCING" the effect of
which shall dilute only the equity interests of the GROWTH Principal
Stockholders.
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:
DEFINITIONS
As used in this Agreement, the following terms shall have the meanings
set forth below:
"APPLICABLE LAW" means any domestic or foreign law, statute,
regulation, rule, policy, guideline or ordinance applicable to the businesses of
the Parties, the Merger and/or the Parties.
"ARTICLES OF MERGER" shall mean the certificate of merger of MERGERCO
with and into NEAH pursuant to the WBCA, and in the form of EXHIBIT A annexed
hereto and made a part hereof.
"BUSINESS DAY" shall mean any day, excluding Saturday or Sunday or any
other day on which national banks located in New York, New York shall be closed
for business.
"DOLLAR" and "$" means lawful money of the United States of America.
"EFFECTIVE TIME" shall mean the date upon which the Merger of MERGERCO
into NEAH shall be consummated pursuant to the filing of the Articles of Merger
with the Secretary of State of the State of Washington.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"GAAP" means generally accepted accounting principles in the United
States of America as promulgated by the American Institute of Certified Public
Accountants and the Financial Accounting Standards Board or any successor
Institutes concerning the treatment of any accounting matter.
"GROWTH ADDITIONAL FINANCING" shall mean the sale, on any one or more
occasions, of debt or equity securities of GROWTH pursuant to which GROWTH shall
have received gross cash proceeds of not less than $2,000,000 and not more than
$2,500,000, all upon such terms and conditions as shall be acceptable to the
Board of Directors of GROWTH; PROVIDED, HOWEVER, that to the extent that any of
the maximum of $500,000 of Stockholder Debt shall be converted by the holder(s)
into Stockholder Loan Shares, the same shall be deemed to be credited toward the
minimum $2,000,000 of GROWTH Additional Financing.
"GROWTH COMMON STOCK" shall mean the shares of common stock of GROWTH,
$0.001 par value per share.
"GROWTH FINANCINGS" shall mean the collective reference to the GROWTH
Initial Financing and any one or more GROWTH Additional Financing.
"GROWTH FULLY-DILUTED COMMON STOCK" means, as at the time in question,
the maximum number shares of GROWTH Common Stock that are issued and
outstanding, AFTER GIVING EFFECT TO: (a) the issuance of all of the Merger
Shares; (b) the issuance of all Series A Preferred Conversion Shares; and (c)
the issuance of any other shares of GROWTH Common Stock that are issuable upon
conversion of any GROWTH notes or shares of GROWTH Preferred Stock, or upon the
exercise of options, warrants or other rights to purchase shares of GROWTH
capital stock, but only to the extent that such securities are (i) outstanding
as at the Effective Time of the Merger, or (ii) issued subsequent to the
Effective Time of the Merger in connection with (A) the GROWTH Financings, (B)
the issuance of the Novellus Shares, and (C) the issuance of the Stockholder
Loan Shares; PROVIDED, HOWEVER, that, as used in this Agreement, the term
"GROWTH FULLY-DILUTED COMMON STOCK" shall NOT mean or include any shares of
GROWTH Common Stock issued or issuable upon conversion of any GROWTH notes or
shares of GROWTH Preferred Stock, or upon the exercise of options, warrants or
other rights to purchase shares of GROWTH capital stock, to the extent such
securities are issued or issuable (1) in connection with the Novellus Incentive
Warrants and Novellus Incentive Warrant Shares, (2) in connection with any one
or more financings subsequent to the GROWTH Financings, (3) in connection with
any purchase of the assets, securities or the businesses of any other persons or
for any other valid business purpose approved by the Board of Directors (other
than the transactions referenced in clauses (a) and (b) above), or (4) in
connection with any stock options or other incentive equity securities issued to
any employees, board members or consultants of GROWTH or NEAH in consideration
of services to be rendered subsequent to the Effective Date of the Merger.
"GROWTH INITIAL FINANCING" shall mean the $500,000 financing provided
to GROWTH on or before the Effective Time of the Merger.
"GROWTH PRINCIPAL STOCKHOLDERS" means Summit Trading Limited, Special
Investments Acquisitions Associates LLC and their business associates and
affiliates.
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"KNOWLEDGE" means the knowledge after reasonable inquiry.
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest, encumbrance or other adverse claim of
any kind in respect of such property or asset.
"MATERIAL ADVERSE EFFECT" with respect to any entity or group of
entities means any event, change or effect that has or would have a materially
adverse effect on the financial condition, business or results of operations of
such entity or group of entities, taken as a consolidated whole.
"MERGER SHARES" shall mean that number of shares of GROWTH Common Stock
to be issued to the NEAH Security Holders on the Closing Date and as at the
Effective Time of the Merger as shall represent approximately twenty-five
percent (25%) of the GROWTH Fully-Diluted Common Stock, as contemplated by this
Agreement; it being the intention of the Parties that an aggregate of 25,000,026
Merger Shares shall be issued to the NEAH Security Holders.
"NEAH COMMON STOCK" means the 7,990,457 issued and outstanding shares
of common stock, $0.001 par value per share, of NEAH.
"NEAH FULLY-DILUTED COMMON STOCK" means the maximum number shares of
NEAH Common Stock that are issued and outstanding at the Effective Time of the
Merger, plus all additional shares of NEAH Common Stock that would be issuable
at the Effective Time of the Merger upon the exercise of all outstanding
options, warrants or other rights to purchase shares of NEAH capital stock.
"NEAH PRINCIPAL EXECUTIVE OFFICER" shall mean any one of Xxxxxx Xxxxx
or Xxxxx Xxxxxxx, the Chairman of the Board of Directors, the President and
Chief Executive Officer, respectively, of NEAH.
"NEAH SECURITIES" means, as at the date in question, all of the issued
and outstanding equity securities of NEAH, consisting of the NEAH Common Stock
and (if applicable) any NEAH preferred stock.
"NEAH SECURITY HOLDERS" means the collective reference to all of the
record holders of the NEAH Securities at the Effective Time of the Merger,
including the NEAH Principal Executive Officers.
"NOVELLUS shall mean Novellus Systems, Inc., a California corporation.
"NOVELLUS INCENTIVE WARRANTS" shall mean the five (5) year warrants to
be issued to Novellus at or within fourteen (14) days following the Effective
Time of the Merger (unless extended by mutual agreement of NEAH and Novellus),
entitling the holder(s) to purchase up to 4,705,000 shares of GROWTH Common
Stock at an exercise price per share of $0.001; which Novellus Incentive
Warrants shall be exercisable only upon achieving certain business and/or
technical milestones, all as shall be negotiated between NEAH and Novellus.
"NOVELLUS INCENTIVE WARRANT SHARES" shall mean the aggregate number of
shares of GROWTH Common Stock issuable upon the full exercise of the Novellus
Incentive Warrants.
"NOVELLUS SHARES" means that number of shares of GROWTH Common Stock
(anticipated to be 750,000 shares of Common Stock) as shall be determined by
dividing (i) the aggregate amount of the $150,000 of accounts payable and other
amounts due from NEAH to Novellus as at the Effective Date of the Merger (the
"NOVELLUS OBLIGATIONS"), by a price per share which is $0.20 per share.
"PERSON" means any individual, corporation, partnership, trust or
unincorporated organization or a government or any agency or political
subdivision thereof.
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"SERIES A PREFERRED CERTIFICATE OF DESIGNATION" shall mean the
certificate of the designations, rights, preferences and privileges of the
Series A Preferred Stock of GROWTH, in the form annexed hereto as EXHIBIT B and
made a part hereof.
"SERIES A PREFERRED CONVERSION SHARES shall mean the maximum number of
shares of GROWTH Common Stock into which the Series A Preferred Stock shall be
converted, being a maximum of (a) sixty-five percent (65%) of the GROWTH
Fully-Diluted Common Stock (anticipated to be 65,000,000 shares of GROWTH Common
Stock), LESS (b) the sum of (i) the Novellus Shares, (ii) Stockholder Loan
Shares, and (iii) any shares of GROWTH Common Stock that are issued or issuable
in connection with any one or more of the GROWTH Additional Financings
aggregating maximum gross proceeds (inclusive of gross proceeds from conversion
of any Stockholder Debt into Stockholder Loan Shares) not to exceed $3,000,000
in the aggregate.
"SERIES A PREFERRED STOCK" shall mean the 6,500,000 shares of Series A
voting convertible preferred stock, par value $0.001 per share, of GROWTH that
is authorized for issuance to the GROWTH Principal Stockholders pursuant to the
Series A Preferred Certificate of Designation; which shares of Series A
Preferred Stock, as provided in the Series A Preferred Certificate of
Designation, shall: (a) vote, together with the GROWTH Common Stock on an "as
converted basis," (b) upon consummation of the GROWTH Additional Financing,
AUTOMATICALLY (and without any further action on the part of the holder(s)) be
converted into the Series A Preferred Conversion Shares; (c) have a liquidation
value equal to its par value per share (a total of $6,500.00) and (d) except for
such liquidation value, shall have no greater rights or privileges than the
GROWTH Common Stock.
"STOCKHOLDER LOAN SHARES" shall mean the SUM of: (a) that number of
shares of GROWTH Common Stock, as shall be determined by dividing: (i) the
aggregate amount of indebtedness owed by NEAH to certain of its stockholders in
connection with loans aggregating up to $500,000 that have been or will be made
to NEAH prior to or within five (5) Business Days following the Effective Time
of the Merger (the "STOCKHOLDER DEBT"); by (ii) by a price per share which is
$0.20 per share; PLUS (b) all shares of GROWTH Common Stock issuable upon the
full exercise of the Stockholder Warrants.
"STOCKHOLDER WARRANTS" shall mean the five (5) year warrants to
purchase that number of shares of GROWTH Common Stock as shall be determined by
dividing: (i) 150% of the aggregate amount of Stockholder Debt; by (ii) by a
price per share which is $0.20 per share.
"STOCK SUBSCRIPTION AGREEMENT" means that certain agreement dated as of
March 8, 2006, by and between GROWTH and the GROWTH PRINCIPAL STOCKHOLDERS
providing for the acquisition by the GROWTH Principal Stockholders of the Series
A Preferred Stock.
"SURVIVING ENTITY" shall mean NEAH as the surviving entity in the
Merger as provided in Section 1.3.
"TAX" (and, with correlative meaning, "TAXES" and "TAXABLE") means:
(i) any income, alternative or add-on minimum tax, gross
receipts tax, sales tax, use tax, ad valorem tax, transfer tax, franchise tax,
profits tax, license tax, withholding tax, payroll tax, employment tax, excise
tax, severance tax, stamp tax, occupation tax, property tax, environmental or
windfall profit tax, custom, duty or other tax, impost, levy, governmental fee
or other like assessment or charge of any kind whatsoever together with any
interest or any penalty, addition to tax or additional amount imposed with
respect thereto by any governmental or Tax authority responsible for the
imposition of any such tax (domestic or foreign), and
(ii) any liability for the payment of any amounts of the type
described in clause (i) above as a result of being a member of an affiliated,
consolidated, combined or unitary group for any Taxable period, and
(iii) any liability for the payment of any amounts of the type
described in clauses (i) or (ii) above as a result of any express or implied
obligation to indemnify any other person.
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"TAX RETURN" means any return, declaration, form, claim for refund or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"WBCA" means the Business Corporation Act of the State of Washington.
THE MERGER
SECTION 1. THE MERGER; EFFECTIVE TIME.
1.1 THE MERGER. At the Effective Time and subject to and upon the terms and
conditions of this Agreement, MERGERCO shall, and GROWTH shall cause MERGERCO
to, merge with and into NEAH in accordance with the provisions of the WBCA, the
separate corporate existence of MERGERCO shall cease and NEAH shall continue as
the Surviving Entity. The Effective Time of the Merger shall occur upon the
filing with the Secretary of State of the State of Washington of the Articles of
Merger executed in accordance with the applicable provisions of the WBCA, or at
such later time as may be agreed to by GROWTH and NEAH and specified in the
Certificate of Merger subject to the satisfaction or waiver of each of the
conditions set forth in Section 4. The date on which the Effective Time occurs
is referred to as the "EFFECTIVE DATE." Provided that this Agreement has not
been terminated, the Parties will cause the Articles of Merger to be filed at
Closing.
(a) Upon the terms and subject to the conditions set forth in this
Agreement and in accordance with the WBCA, at the Effective Time, all NEAH
Securities shall be converted into the right to receive the Merger Shares. In
connection therewith, the following terms shall apply:
(b) EXCHANGE AGENT. GROWTH's corporate counsel, Xxxxx Xxxx, Esq.,
shall act as the exchange agent (the "EXCHANGE AGENT") for the purpose of
exchanging NEAH Securities for the Merger Shares. At or prior to the Effective
Date, GROWTH shall deliver to the Exchange Agent certificates evidencing the
Merger Shares. The Merger Shares issued at the Effective Time of the Merger
shall be registered in the names of the NEAH Security Holders in such amounts
and proportions as are set forth on SCHEDULE 1.1 annexed hereto and made a part
hereof.
1.2 CONVERSION OF SECURITIES.
(a) CONVERSION OF NEAH SECURITIES. At the Effective Time, by
virtue of the Merger and without any action on the part of GROWTH, MERGERCO,
NEAH or the holders of any of their respective securities:
(i) Each of the 7,990,457 shares of NEAH Common Stock
issued and outstanding immediately prior to the Effective Time shall be
converted into, and represent the right to receive, 3.1287321 Merger Shares (the
"CONVERSION RATE"). All fractional shares obtained by applying such conversion
shall be rounded up to the nearest whole share.
(ii) All warrants to purchase shares of NEAH Common Stock
and all options entitling the holder to purchase shares of NEAH Common Stock are
"out of the money" and without value as at the date of this Agreement and as at
the Effective Date, and shall be cancelled and retired and cease to exist as at
the Effective Date of the Merger; PROVIDED, HOWEVER, that GROWTH shall set aside
and reserve for issuance 225,000 shares of GROWTH Common Stock for issuance to
any holder of a warrant to purchase share of NEAH Common Stock which has not
terminated or expired.
(iii) All NEAH Securities shall no longer be outstanding
and shall automatically be canceled and retired and shall cease to exist, and
each holder of a certificate representing any such NEAH Securities shall cease
to have any rights with respect thereto, except the right to receive the Merger
Shares to be issued pursuant to this Section 1.2(a) (fractional shares may be
issued rounded to the hundredth decimal point) upon the surrender of such
certificate in accordance with Section 1.8, without interest.
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(iv) Each NEAH Share that immediately prior to the
Effective Time is held by NEAH as a treasury share shall be cancelled and
retired without payment of any consideration therefor and without any conversion
thereof into a right to receive the Merger Shares.
(b) CONVERSION OF MERGERCO STOCK. At the Effective Time, by virtue
of the Merger and without any action on the part of GROWTH, MERGERCO, NEAH or
the holders of any of their respective securities, each share of capital stock
of MERGERCO outstanding immediately prior to the Effective Time shall be
converted into one share of the common stock of the Surviving Entity and the
share of common stock of the Surviving Entity so issued in such conversion shall
constitute the only outstanding share of capital stock of the Surviving Entity
and the Surviving Entity shall be a wholly owned subsidiary of GROWTH.
(c) EXEMPTION FROM REGISTRATION. The Parties intend that (i) the
Merger Shares to be issued by GROWTH to the NEAH Security Holders, and (ii) the
Series A Preferred Stock to be issued by GROWTH to the GROWTH Principal
Stockholders and the Series A Preferred Conversion Shares shall be exempt from
the registration requirements of the Securities Act pursuant to Section 4(2) of
the Securities Act to NEAH Security Holders and the rules and regulations
promulgated thereunder.
1.3 CLOSING.
The closing of the Merger (the "CLOSING") will take place at the
offices of Xxxxx Xxxx, Esq., counsel to GROWTH, at his office in Seattle,
Washington, within one (1) Business Day following the satisfaction or waiver of
the conditions precedent set forth in Section 4 or at such other date as GROWTH
and NEAH shall agree (the "CLOSING DATE"), but in no event shall the Closing
Date occur later than March 15, 2006.
1.4 EFFECT OF THE MERGER.
The Merger shall have the effect set forth in Section 23B.11.060 of the
WBCA. Without limiting the generality of the foregoing, and subject thereto, at
the Effective Time, all the properties, rights, privileges, powers and
franchises of NEAH and MERGERCO shall vest in the Surviving Entity, and all
debts, liabilities and duties of NEAH and MERGERCO shall become the debts,
liabilities and duties of the Surviving Entity.
1.5 CERTIFICATE OF INCORPORATION AND BYLAWS; DIRECTORS AND OFFICERS. Prior
to the Effective Time of the Merger:
(a) The Certificate of Incorporation of GROWTH, as amended and
restated in accordance with EXHIBIT C annexed hereto and made a part hereof
shall be the Certificate of Incorporation of GROWTH following the Merger. The
Bylaws of GROWTH, as amended and restated in accordance with EXHIBIT D annexed
hereto and made a part hereof shall be the Bylaws of GROWTH following the
Merger.
(b) The initial board of directors of GROWTH and its NEAH
subsidiary subsequent to the Merger shall be (i) three (3) of the current
members of NEAH's Board of Directors, (ii) two representatives of the GROWTH
Principal Stockholders, and (iii) two other persons acceptable to the GROWTH
Principal Stockholders who shall be independent directors (within the meaning of
the Sarbanes Oxley Act of 2002, as amended). Such initial members of the board
of directors shall serve until the earlier of their death, resignation or
removal or until the next annual meeting of the stockholders of GROWTH, when
their respective successors are duly appointed and qualified. The officers of
GROWTH subsequent to the Merger shall be the current officers of NEAH. Subject
to the observance of their fiduciary duties, three (3) of the current members of
the NEAH Board of Directors shall continue to serve as members of the Board of
Directors of NEAH and GROWTH for not less than 180 days following the Effective
Date of the Merger.
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1.6 FURTHER ACTIONS.
(a) If, at any time after the Effective Time, the Surviving Entity
considers or is advised that any deeds, bills of sale, assignments, assurances
or any other actions or things are necessary or desirable to vest, perfect or
confirm (of record or otherwise) in the Surviving Entity its right, title or
interest in, to or under any of the rights, properties, or assets of either NEAH
or MERGERCO, or otherwise to carry out the intent and purposes of this
Agreement, the officers and directors of the Surviving Entity will be authorized
to execute and deliver, in the name and on behalf of each of NEAH and MERGERCO,
all such deeds, bills of sale, assignments and assurances and to take and do, in
the name and on behalf of each of NEAH and MERGERCO, all such other actions and
things as the Board of Directors of the Surviving Entity may determine to be
necessary or desirable to vest, perfect or confirm any and all right, title and
interest in, to and under such rights, properties or assets in the Surviving
Entity or otherwise to carry out the intent and purposes of this Agreement.
(b) On the Effective Date of the Merger, GROWTH shall file an
amendment to its certificate of incorporation changing its name to NEAH POWER
SYSTEMS, INC., or such other name as shall be acceptable to NEAH.
1.7 RESTRICTIONS ON RESALE
(a) THE MERGER SHARES AND SERIES A PREFERRED STOCK. The Merger
Shares and the Series A Preferred Stock will not be registered under the
Securities Act, or the securities laws of any state, and cannot be transferred,
hypothecated, sold or otherwise disposed of until: (i) a registration statement
with respect to such securities is declared effective under the Securities Act,
or (ii) GROWTH receives an opinion of counsel for the stockholder, reasonably
satisfactory to counsel for GROWTH, that an exemption from the registration
requirements of the Securities Act is available.
The certificates representing the Merger Shares and Series A Preferred
Stock to be issued on the Effective Date pursuant to this Agreement shall
contain a legend substantially as follows:
"THE SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT WITH
RESPECT THERETO IS DECLARED EFFECTIVE UNDER SUCH ACT, OR NEAH
POWER SYSTEMS, INC. RECEIVES AN OPINION OF COUNSEL FOR THE
HOLDER REASONABLY SATISFACTORY TO COUNSEL FOR NEAH POWER
SYSTEMS, INC. THAT AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT IS AVAILABLE."
"PURSUANT TO THE AGREEMENT AND PLAN OF MERGER DATED AS OF
MARCH 9, 2006, BY AND AMONG NEAH POWER SYSTEMS, INC., A
WASHINGTON CORPORATION ("NEAH WASHINGTON"), GROWTH ACQUISITION
CORP., NEAH POWER SYSTEMS, INC. (formerly, GROWTH ACQUISITION,
INC.), A NEVADA CORPORATION ("NEAH NEVADA") AND CERTAIN OF THE
SHAREHOLDERS AND EXECUTIVE OFFICERS OF NEAH NEVADA, THE
SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE MAY NOT
BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF,
EXCEPT IN ACCORDANCE WITH THE TERMS AND CONDITIONS SET FORTH
IN A LOCK-UP AGREEMENT BY AND BETWEEN THE HOLDER HEREOF AND
NEAH NEVADA."
(b) THE SERIES A PREFERRED CONVERSION SHARES. The Series A
Preferred Conversion Shares will not be registered under the Securities Act, or
the securities laws of any state, and cannot be transferred, hypothecated, sold
or otherwise disposed of until: (i) a registration statement with respect to
such securities is declared effective under the Securities Act, or (ii) GROWTH
receives an opinion of counsel for the stockholder, reasonably satisfactory to
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counsel for GROWTH, that an exemption from the registration requirements of the
Securities Act is available.
The certificates representing the number of Series A Preferred
Conversion Shares into which the Series A Preferred Stock may be converted shall
contain a legend substantially as follows:
"THE SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT WITH
RESPECT THERETO IS DECLARED EFFECTIVE UNDER SUCH ACT, OR NEAH
POWER SYSTEMS, INC. RECEIVES AN OPINION OF COUNSEL FOR THE
HOLDER REASONABLY SATISFACTORY TO COUNSEL FOR NEAH POWER
SYSTEMS, INC. THAT AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT IS AVAILABLE."
"PURSUANT TO THE AGREEMENT AND PLAN OF MERGER DATED AS OF
MARCH 9, 2006, BY AND AMONG NEAH POWER SYSTEMS, INC., A
WASHINGTON CORPORATION ("NEAH WASHINGTON"), GROWTH ACQUISITION
CORP., NEAH POWER SYSTEMS, INC. (formerly, GROWTH ACQUISITION,
INC.), A NEVADA CORPORATION ("NEAH NEVADA") AND CERTAIN OF THE
SHAREHOLDERS AND EXECUTIVE OFFICERS OF NEAH NEVADA, THE
SECURITIES WHICH ARE REPRESENTED BY THIS CERTIFICATE MAY NOT
BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF,
EXCEPT IN ACCORDANCE WITH THE TERMS AND CONDITIONS SET FORTH
IN A LOCK-UP AGREEMENT BY AND BETWEEN THE HOLDER HEREOF AND
NEAH NEVADA."
1.8 EXCHANGE OF CERTIFICATES.
(a) After the Effective Time and pursuant to a customary letter of
transmittal or other instructional form provided by the Exchange Agent to the
NEAH Security Holders, the NEAH Security Holders shall be required to surrender
all their NEAH Securities to the Exchange Agent, and the NEAH Security Holders
shall be entitled upon such surrender to receive in exchange therefor
certificates representing the proportionate number of Merger Shares into which
the NEAH Securities theretofore represented by the stock transfer forms so
surrendered shall have been exchanged pursuant to this Agreement. Until so
surrendered, each outstanding certificate which, prior to the Effective Time,
represented NEAH Securities shall be deemed for all corporate purpose, subject
to the further provisions of this Article I, to evidence the ownership of the
number of whole Merger Shares for which such NEAH Securities have been so
exchanged. No dividend payable to holders of Merger Shares of record as of any
date subsequent to the Effective Time shall be paid to the owner of any
certificate which, prior to the Effective Time, represented NEAH Securities,
until such certificate or certificates representing all the relevant NEAH
Securities, together with a stock transfer form, are surrendered as provided in
this Article I or pursuant to letters of transmittal or other instructions with
respect to lost certificates provided by the Exchange Agent.
(b) All Merger Shares for which the NEAH Securities shall have
been exchanged pursuant to this Article I shall be deemed to have been issued in
full satisfaction of all rights pertaining to the NEAH Securities.
(c) All certificates representing NEAH Securities converted into
the right to receive Merger Shares pursuant to this Article I shall be furnished
to GROWTH subsequent to delivery thereof to the Exchange Agent pursuant to this
Agreement.
(d) On the Effective Date, the stock transfer book of NEAH shall
be deemed to be closed and no transfer of NEAH Securities shall thereafter be
recorded thereon.
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SECTION 2. REPRESENTATIONS AND WARRANTIES OF NEAH
NEAH hereby represents and warrants as follows:
2.1 ORGANIZATION AND GOOD STANDING: OWNERSHIP OF SHARES. NEAH is a
corporation duly organized and validly existing under the laws of the State of
Washington. There are no outstanding subscriptions, rights, options, warrants or
other agreements obligating NEAH to issue, sell or transfer any stock or other
securities of NEAH except the warrants listed on SCHEDULE 2.1 attached hereto
and made a part hereof.
2.2 CORPORATE AUTHORITY. NEAH has the corporate power to enter into this
Agreement and to perform its respective obligations hereunder. The execution and
delivery of this Agreement and the consummation of the transaction contemplated
hereby have been duly authorized by the Board of Directors of NEAH. The
execution and performance of this Agreement will not constitute a material
breach of any agreement, indenture, mortgage, license or other instrument or
document to which NEAH is a party and will not violate any judgment, decree,
order, writ, rule, statute, or regulation applicable to NEAH or its properties.
The execution and performance of this Agreement will not violate or conflict
with any provision of the respective Articles of Incorporation or by-laws of
NEAH.
2.3 OWNERSHIP OF SHARES. The NEAH Security Holders set forth on SCHEDULE
2.3 are the owners of record and beneficially of all of the issued and
outstanding shares of NEAH Common Stock, options and warrants to purchase shares
of NEAH Common Stock, which NEAH Securities, to the best of NEAH's knowledge,
are owned free and clear of all rights, claims, liens and encumbrances, and have
not been sold, pledged, assigned or otherwise transferred except pursuant to
this Agreement. The NEAH Securities set forth on SCHEDULE 2.3 represent 100% of
the issued and outstanding capital stock of NEAH and SCHEDULE 2.3 also sets
forth the NEAH Fully-Diluted Common Stock, including all additional shares of
NEAH Common Stock issuable upon exercise of outstanding warrants and other
rights to acquire NEAH Securities.
2.4 FINANCIAL STATEMENTS, BOOKS AND RECORDS. SCHEDULE 2.4 consists of the
financial statements (balance sheet, income statement, notes) of NEAH as of
December 31, 2004 and December 31, 2003 and for the two (2) fiscal years then
ended, as audited by Xxxxx Xxxxxxxx & Company (the "AUDITED FINANCIAL
STATEMENTS"), and (b) the unaudited financial statements of NEAH as of December
31, 2005 and for the fiscal year then ended (the "UNAUDITED 2005 FINANCIAL
STATEMENTS" and together with the Audited Financial Statements, the "FINANCIAL
STATEMENTS"). The Financial Statements fairly represent the financial position
of NEAH as at such dates and the results of their operations for the periods
then ended. The Financial Statements were and will be prepared in accordance
with generally accepted accounting principles applied on a consistent basis with
prior periods except as otherwise stated therein and except that the Unaudited
2005 Financial Statements may not include all footnotes normally included under
such generally accepted accounting principles. The books of account and other
financial records of NEAH are in all respects complete and correct in all
material respects and are maintained in accordance with good business and
accounting practices. The Unaudited 2005 Financial Statements are capable of
being audited.
2.5 ACCESS TO RECORDS. The corporate financial records, minute books and
other documents and records of NEAH have been made available to GROWTH prior to
the Closing hereof.
2.6 NO MATERIAL ADVERSE CHANGES. Except as otherwise described on Schedule
2.6 hereto, since December 31, 2005 there has not been:
(a) any material adverse change in the financial position
of NEAH except changes arising in the ordinary course of business,
which changes will in no event materially and adversely affect the
financial position of NEAH;
(b) any damage, destruction or loss materially affecting
the assets, prospective business, operations or condition (financial or
otherwise) of NEAH whether or not covered by insurance;
(c) any declaration, setting aside or payment of any
dividend or distribution with respect to any redemption or repurchase
of NEAH capital stock;
9
(d) any sale of an asset (other than in the ordinary
course of business) or any mortgage or pledge by NEAH of any properties
or assets, other than as set forth in Section 2.13 below; or
(e) adoption of any pension, profit sharing, retirement,
stock bonus, stock option or similar plan or arrangement.
2.7 TAXES. NEAH as of December 31, 2005, has filed all material tax,
governmental and/or related forms and reports (or extensions thereof) due or
required to be filed and has (or will have) paid or made adequate provisions for
all taxes or assessments which had become due as of December 31, 2005, and there
are no deficiency notices outstanding.
2.8 COMPLIANCE WITH LAWS. Except as set forth on Schedule 2.8, NEAH has
complied with all federal, state, county and local laws, ordinances,
regulations, inspections, orders, judgments, injunctions, awards or decrees
applicable to it or its business which, if not complied with, would materially
and adversely affect the business of NEAH.
2.9 NO BREACH. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not:
(a) violate any provision of the Articles of Incorporation or
By-Laws of NEAH;
(b) violate, conflict with or result in the breach of any of the
terms of, result in a material modification of, otherwise give any other
contracting party the right to terminate, or constitute (or with notice or lapse
of time, or both constitute) a default under any contract or other agreement to
which NEAH is a party or by or to which it or any of its assets or properties
may be bound or subject;
(c) violate any order, judgment, injunction, award or decree of
any court, arbitrator or governmental or regulatory body against, or binding
upon, NEAH or upon the properties or business of NEAH; or
(d) violate any statute, law or regulation of any jurisdiction
applicable to the transactions contemplated herein which could have a materially
adverse effect on the business or operations of NEAH.
2.10 ACTIONS AND PROCEEDINGS. NEAH is not a party to any material pending
litigation or, to its knowledge, any governmental investigation or proceeding
not reflected in the NEAH Financial Statements, and to its best knowledge, no
material litigation, claims, assessments or Non-governmental proceedings are
threatened against NEAH except as set forth on Schedule 2.10 attached hereto and
made a part hereof.
2.11 AGREEMENTS. Schedule 2.11 sets forth any material contract or
arrangement to which NEAH is a party or by or to which it or its assets,
properties or business are bound or subject, whether written or oral.
2.12 BROKERS OR FINDERS. No broker's or finder's fee will be payable by NEAH
in connection with the transactions contemplated by this Agreement, nor will any
such fee be incurred as a result of any actions by NEAH or any of its
Shareholders.
2.13 REAL ESTATE. Except as set forth on Schedule 2.13, NEAH owns no real
property nor is a party to any leasehold agreement.
2.14 TANGIBLE ASSETS. Except as set forth on Schedule 2.14 hereto, NEAH has
full title and interest in all machinery, equipment, furniture, leasehold
improvements, fixtures, projects, owned or leased by NEAH, any related
capitalized items or other tangible property material to the business of NEAH
(the "Tangible Assets"). NEAH holds all rights, title and interest in all the
Tangible Assets owned by it on the Balance Sheet or acquired by it after the
date on the Balance Sheet free and clear of all liens, pledges, mortgages,
security interests, conditional sales contracts or any other
10
encumbrances. All of the Tangible Assets are in good operating condition and
repair and are usable in the ordinary course of business of NEAH and conform to
all applicable laws, ordinances and government orders, rules and regulations
relating to their construction and operation, except as set forth on Schedule
2.14 hereto.
2.15 LIABILITIES. NEAH did not have any direct or indirect indebtedness,
liability, claim, loss, damage, deficiency, obligation or responsibility, known
or unknown, fixed or unfixed, liquidated or unliquidated, secured or unsecured,
accrued or absolute, contingent or otherwise, including, without limitation, any
liability on account of taxes, any governmental charge or lawsuit (all of the
foregoing collectively defined to as "LIABILITIES"), which are not fully, fairly
and adequately reflected on the Financial Statement except for a specific
Liabilities set forth in the Unaudited Financial Statements or on SCHEDULE 2.15
attached hereto and made a part hereof. As of the date of Closing, NEAH will not
have any Liabilities, other than Liabilities fully and adequately reflected on
the Financial Statements except for Liabilities incurred in the ordinary course
of business and as set forth in SCHEDULE 2.15. There is no circumstance,
condition, event or arrangement which may hereafter give rise to any Liabilities
not in the ordinary course of business.
2.16 OPERATIONS OF NEAH. From December 31, 2005 through the Closing Date,
NEAH has not and will not have:
(a) incurred any indebtedness or borrowed money, except for the
Novellus Obligations and the Stockholders Debt;
(b) declared or paid any dividend or declared or made any
distribution of any kind to any shareholder, or made any direct or indirect
redemption, retirement, purchase or other acquisition of any shares in its
capital stock;
(c) made any loan or advance to any shareholder, officer,
director, employee, consultant, agent or other representative or made any other
loan or advance otherwise than in the ordinary course of business;
(d) except in the ordinary course of business, incurred or assumed
any indebtedness or liability (whether or not currently due and payable);
(e) disposed of any assets of NEAH except in the ordinary course
of business, except as described in SCHEDULE 2.16;
(f) materially increased the annual level of compensation of any
executive employee of NEAH;
(g) increased, terminated, amended or otherwise modified any plan
for the benefit of employees of NEAH;
(h) issued any equity securities or rights to acquire such equity
securities; or
(i) except in the ordinary course of business, entered into or
modified any contract, agreement or transaction.
2.17 CAPITALIZATION. The authorized capital stock of NEAH consists of
35,000,000 shares of NEAH Common Stock, $.001 per share par value, and
11,000,000 shares of NEAH Preferred Stock, of which (a) 7,990,457 shares of NEAH
Common Stock and no shares of NEAH Preferred Stock are presently issued and
outstanding, and (b) no shares of NEAH Preferred Stock are presently issued and
outstanding. NEAH has not granted, issued or agreed to grant, issue or make any
warrants, options, subscription rights or any other commitments of any character
relating to the issued or unissued shares of capital stock of NEAH except as set
forth on SCHEDULE 2.3 attached hereto and made a part hereof.
2.18 STOCKHOLDER DEBT AND NOVELLUS OBLIGATIONS. As at the date hereof and at
the Effective Date of the Merger, the outstanding amount of all Stockholder Debt
is $142,400 and the aggregate amount owed by NEAH in respect of the Novellus
Obligations is $150,000. Prior to or within five (5) Business Days following the
Effective Date, NEAH may incur additional Stockholder Debt of up to $357,600.
SCHEDULE 2.18 lists the names and amounts owed by NEAH to all stockholders of
NEAH or their affiliates.
11
2.19 FULL DISCLOSURE. No representation or warranty by NEAH in this
Agreement or in any document or schedule to be delivered by them pursuant
hereto, and no written statement, certificate or instrument furnished or to be
furnished by NEAH pursuant hereto or in connection with the negotiation,
execution or performance of this Agreement contains or will contain any untrue
statement of a material fact or omits or will omit to state any fact necessary
to make any statement herein or therein not materially misleading or necessary
to a complete and correct presentation of all material aspects of the business
of NEAH.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF GROWTH
GROWTH hereby represents and warrants as to itself and Mergerco as
follows:
3.1 ORGANIZATION AND GOOD STANDING. GROWTH is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada.
MERGERCO is a corporation duly organized and validly existing under the laws of
the State of Washington. Each has the corporate power to own its own property
and to carry on its business as now being conducted and is duly qualified to do
business in any jurisdiction where so required except where the failure to so
qualify would have no material negative impact.
3.2 CORPORATE AUTHORITY. Each has the corporate power to enter into this
Agreement and to perform their respective obligations hereunder. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by the Board of Directors of
GROWTH as required by Nevada law and the directors and shareholders of MERGERCO
as required by Washington law. The execution and performance of this Agreement
will not constitute a material breach of any agreement, indenture, mortgage,
license or other instrument or document to which GROWTH is a party and will not
violate any judgment, decree, order, writ, rule, statute, or regulation
applicable to GROWTH or its properties. The execution and performance of this
Agreement will not violate or conflict with any provision of the respective
Articles of Incorporation or by-laws of GROWTH or MERGERCO.
3.3 CAPITALIZATION; PURCHASE OF GROWTH SHARES BY NEAH ASSOCIATES; GROWTH
INITIAL FINANCING AND MERGER SHARES.
(a) As of the date of this Agreement, GROWTH is authorized to
issue 100,000,000 shares of GROWTH Common Stock, $0.001 par value per share, and
no shares of GROWTH Preferred Stock, of which (i) 5,240,767 shares of GROWTH
Common Stock and (ii) no shares of GROWTH Preferred Stock are issued and
outstanding. As at the date of this Agreement: (i) there are approximately 90
shareholders of record, and no shares of GROWTH Common Stock (other than the
Series A Preferred Conversion Shares) are reserved for issuance pursuant to any
convertible securities, options or warrants. Prior to the Effective Time of the
Merger, GROWTH shall effect a 2-for-1 stock split of its 5,240,767 outstanding
shares of GROWTH Common Stock so that the existing holders of GROWTH Common
Stock, including the holders of publicly traded shares shall own an aggregate of
10,491,534 shares of GROWTH Common Stock.
(b) Immediately prior to the Effective Time of the Merger, GROWTH
will amend its certificate of incorporation in accordance with EXHIBIT C hereto,
to authorize for issuance an aggregate of 500,000,000 shares of GROWTH Common
Stock, $0.001 par value per share, and 25,000,026 shares of GROWTH Preferred
Stock, $0.001 par value per share, of which an aggregate of (i) 10,491,534
shares of GROWTH Common Stock and (ii) 6,500,000 shares of Series A Preferred
Stock shall be issued and outstanding immediately prior to the Effective Time of
the Merger.
(c) There are no outstanding warrants, issued stock options, stock
rights or other commitments of any character relating to the issued or unissued
shares of either Common Stock or Preferred Stock of GROWTH, other than those
which are set forth in Section 3.3(d) below.
12
(d) Prior to the Effective Time of the Merger, GROWTH and the
GROWTH Principal Stockholders have entered into the Stock Subscription
Agreement, pursuant to which such GROWTH Principal Stockholders shall purchase
6,500,000 shares of the Series A Preferred Stock from GROWTH. On the Effective
Time of the Merger (i) the GROWTH Principal Stockholders shall be the record and
beneficial owner of 6,500,000 shares of GROWTH Series A Preferred Stock,
convertible into the Series A Preferred Conversion Shares pursuant to the Series
A Preferred Certificate of Designation, and (ii) the remaining GROWTH
stockholders (including the holders of publicly traded shares) shall own an
aggregate of 10,481,767 shares of Fully-Diluted GROWTH Common Stock, or such
other number of shares as shall represent in the aggregate, 10.48% of the shares
of GROWTH Fully-Diluted Common Stock to be issued and issuable immediately
following the Effective Time of the Merger.
(e) On or prior to the Effective Time of the Merger, GROWTH shall
have in its account and available for use for general corporate purposes of NEAH
not less than five hundred thousand dollars ($500,000).
(f) At the Closing, the Merger Shares to be issued and delivered
to the NEAH Security Holders hereunder will when so issued and delivered,
constitute valid and legally issued shares of GROWTH Common and Preferred Stock,
fully paid and nonassessable. The Merger Shares issuable to such NEAH Security
Holders shall represent approximately 25% of the GROWTH Fully-Diluted Common
Stock as at the Effective Time of the Merger. For the avoidence of doubt, the
GROWTH Fully-Diluted Common Stock as at the Effective Time of the Merger shall
not mean or include any shares of GROWTH Common Stock issuable upon exercise of
the Novellus Incentive Warrants; which issuance(s) shall dilute all stockholders
of GROWTH on a pro-rata basis.
3.4 GROWTH 2005 BALANCE SHEET AND LIABILITIES.
(a) SCHEDULE 3.4 consists of a statement of the assets and
liabilities of GROWTH as at December 31, 2005 (the "GROWTH 2005 BALANCE SHEET").
Except as set forth on the GROWTH 2005 Balance Sheet or otherwise disclosed on
SCHEDULE 3.4, since January 1, 2006, GROWTH has no other assets and has incurred
no other liabilities, debts or obligations, whether fixed, contingent or
otherwise required to be set forth on a balance sheet prepared in accordance
with GAAP. The books of account and other financial records of GROWTH are in all
respects complete and correct in all material respects and are maintained in
accordance with good business and accounting practices.
(b) GROWTH disposed of all of its operating assets and
liabilities, effective as of December 31, 2002, and since such date has not
conducted any trade or business activities whatsoever, other than as set forth
on SCHEDULE 3.4 annexed hereto.
3.5 NO MATERIAL ADVERSE CHANGES. Except as set forth on SCHEDULE 3.5
hereto, since December 31, 2005, there has not been:
(a) any material adverse changes in the financial position of
GROWTH except changes arising in the ordinary course of business, which changes
will in no event materially and adversely affect the financial position of
GROWTH, and will be consistent with the representations made by GROWTH to NEAH.
(b) any damage, destruction or loss materially affecting the
assets, prospective business, operations or condition (financial or otherwise)
of GROWTH whether or not covered by insurance;
(c) any declaration setting aside or payment of any dividend or
distribution with respect to any redemption or repurchase of GROWTH capital
stock;
(d) any sale of an asset (other than in the ordinary course of
business) or any mortgage pledge by GROWTH of any properties or assets; or
(e) adoption or modification of any pension, profit sharing,
retirement, stock bonus, stock option or similar plan or arrangement.
13
(f) except in the ordinary course of business, incurred or assumed
any indebtedness or liability, whether or not currently due and payable;
(g) any loan or advance to any shareholder, officer, director,
employee, consultant, agent or other representative or made any other loan or
advance otherwise than in the ordinary course of business;
(h) any material increase in the annual level of compensation of
any executive employee of GROWTH;
(i) except in the ordinary course of business, entered into or
modified any contract, agreement or transaction, except as described in SCHEDULE
3.5;
(x) issued any equity securities or rights to acquire equity
securities other than as set forth in SCHEDULE 3.5.
3.6 TAXES. GROWTH has timely filed all material tax, governmental and/or
related forms and reports (or extensions thereof) due or required to be filed
and has paid or made adequate provisions for all taxes or assessments which have
become due as of the Closing Date, and there are no deficiencies outstanding.
3.7 COMPLIANCE WITH LAWS. GROWTH has complied with all federal, state,
county and local laws, ordinances, regulations, inspections, orders, judgments,
injunctions, awards or decrees applicable to it or its business, which, if not
complied with, would materially and adversely affect the business of GROWTH or
the trading market for the GROWTH Shares and specifically, and GROWTH has
complied with provisions for registration under the Securities Act of 1933 and
all applicable blue sky laws in connection with its public stock offering and
there are no outstanding, pending or threatened stop orders or other actions or
investigations relating thereto.
3.8 ACTIONS AND PROCEEDINGS. GROWTH is not a party to any material pending
litigation or, to its knowledge, any governmental proceedings are threatened
against GROWTH, except as set forth on SCHEDULE 3.8 attached hereto and made a
part hereof.
3.9 PERIODIC REPORTS. GROWTH has not filed forms or reports with the
Securities and Exchange Commission ("SEC") since 2003 and has not been a
reporting company under the Securities Exchange Act of 1934, as amended, since
that time. Prior to such date, all such reports and statements filed by GROWTH
with the SEC did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstance under which they were made, not
misleading.
3.10 DISCLOSURE. GROWTH has (and at the Closing it will have) disclosed in
writing to NEAH all events, conditions and facts materially affecting the
business, financial conditions or results of operation of GROWTH all of which
have been set forth herein. GROWTH has not now and will not have, at the
Closing, withheld disclosure of any such events, conditions, and facts which
they have knowledge of or have reasonable grounds to know may exist.
3.11 ACCESS TO RECORDS. The corporate financial records, minute books, and
other documents and records of GROWTH have been made available to NEAH prior to
the Closing hereof.
3.12 NO BREACH. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby will not:
(a) violate any provision of the Articles of Incorporation or
By-Laws of GROWTH;
(b) violate, conflict with or result in the breach of any of the
terms of, result in a material modification of, otherwise give any other
contracting party the right to terminate, or constitute (or with notice or lapse
of time or both
14
constitute) a default under, any contract or other agreement to which GROWTH is
a party or by or to which it or any of its assets or properties may be bound or
subject;
(c) violate any order, judgment, injunction, award or decree of
any court, arbitrator or governmental or regulatory body against, or binding
upon, GROWTH or upon the securities, properties or business to GROWTH; or
(d) violate any statute, law or regulation of any jurisdiction
applicable to the transactions contemplated herein.
3.14 BROKERS OR FINDERS. No broker's or finder's fee will be payable by
GROWTH in connection with the transactions contemplated by this Agreement, nor
will any such fee be incurred as a result of any actions of GROWTH.
3.15 AUTHORITY TO EXECUTE AND PERFORM AGREEMENTS. GROWTH has the full legal
right and power and all authority and approval required to enter into, execute
and deliver this Agreement and to perform fully its obligations hereunder. This
Agreement has been duly executed and delivered and is the valid and binding
obligation of GROWTH enforceable in accordance with its terms, except as may be
limited by bankruptcy, moratorium, insolvency or other similar laws generally
affecting the enforcement of creditors' rights. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby and
the performance by GROWTH of this Agreement, in accordance with its respective
terms and conditions will not:
(a) require the approval or consent of any governmental or
regulatory body or the approval or consent of any other person;
(b) conflict with or result in any breach or violation of any of
the terms and conditions of, or constitute (or with any notice or lapse of time
or both would constitute) a default under, any order, judgment or decree
applicable to GROWTH, or any instrument, contract or other agreement to which
GROWTH is a party or by or to which GROWTH is bound or subject; or
(c) result in the creation of any lien or other encumbrance on the
assets or properties of GROWTH.
3.16 FULL DISCLOSURE. No representation or warranty by GROWTH in this
Agreement or in any document or schedule to be delivered by them pursuant
hereto, and no written statement, certificate or instrument furnished or to be
furnished by GROWTH pursuant hereto or in connection with the negotiation,
execution or performance of this Agreement contains or will contain any untrue
statement of a material fact or omits or will omit to state any fact necessary
to make any statement herein or therein not materially misleading or necessary
to complete and correct presentation of all material aspects of the business of
GROWTH.
SECTION 4. CONDITIONS PRECEDENT
4.1 CONDITIONS PRECEDENT TO THE OBLIGATION OF NEAH. All obligations of NEAH
and the NEAH Security Holders under this Agreement are subject to the
fulfillment, prior to or as of the Closing Date, as indicated below, of each of
the following conditions (any one of which may be waived at Closing by NEAH):
(a) The representations and warranties by or on behalf of GROWTH
contained in this Agreement or in any certificate or document delivered pursuant
to the provisions hereof shall be true in all material respects at and as of
Closing Date as though such representations and warranties were made at and as
of such time.
(b) GROWTH shall have performed and complied in all material
respects, with all covenants, agreements, and conditions set forth in, and shall
have executed and delivered all documents required by this Agreement to be
performed or complied with or executed and delivered by them prior to or at the
Closing.
(c) On the Closing Date, an executive officer of GROWTH or one of
the GROWTH Principal
15
Stockholders shall have delivered to NEAH a certificate, duly executed by such
Person and certifying, that to the best of such Person's knowledge and belief,
the representations and warranties of GROWTH set forth in this Agreement are
true and correct in all material respects.
(d) On or before the Closing, the Board of Directors and the
shareholders of GROWTH shall have approved, in accordance with Nevada law, the
execution, delivery and performance of this Agreement and the consummation of
the transaction contemplated herein and authorized all of the necessary and
proper action to enable GROWTH to comply with the terms of the Agreement.
(e) The Merger shall be permitted by Washington law and GROWTH
shall have sufficient shares of GROWTH Common Stock authorized to complete the
Merger.
(f) At the Closing, all instruments and documents delivered to
NEAH and the Shareholders pursuant to provisions hereof shall be reasonably
satisfactory to legal counsel for NEAH.
(g) At the Closing, GROWTH shall have delivered to NEAH an opinion
of counsel to GROWTH dated as of the Closing to the effect that:
(i) GROWTH is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada;
(ii) This Agreement has been duly authorized, executed and
delivered by GROWTH and is a valid and binding obligation of GROWTH enforceable
in accordance with its terms;
(iii) GROWTH, through its Board of Directors and its
shareholders, has taken all corporate action under Nevada law that is necessary
for the performance by GROWTH of its obligations under this Agreement;
(iv) The documents executed and delivered to NEAH and the
NEAH Security Holders hereunder are valid and binding in accordance with their
terms, and the Merger Shares to be issued pursuant to Section 1.1 hereof will be
duly and validly issued, fully paid and non-assessable;
(v) GROWTH has the corporate power to execute, deliver
the Merger Shares and perform under this Agreement; and
(vi) The capitalization of GROWTH as at the Effective Time
of the Merger is as set forth in Section 3.3 of this Agreement.
(h) The Merger Shares to be issued to the Shareholders of NEAH at
Closing and the underlying Series A Preferred Conversion Shares will be validly
issued, nonassessable and fully paid under the Nevada General Corporation Law
and will be issued in a non-public offering and exempt merger transaction in
compliance with all federal and state securities laws, bearing a restrictive
legend, as is more fully set forth herein.
(i) An aggregate of not less than $500,000, representing the net
proceeds of the GROWTH Initial Financing, on substantially the terms set forth
in this Agreement or on other terms as shall be acceptable to NEAH, shall have
been deposited in escrow on or before the Closing Date with Xxxxx Xxxx, Esq.,
counsel to GROWTH, which net proceeds shall be delivered to NEAH on or before
the Effective Time of the Merger.
(j) NEAH shall have issued notes or agreements evidencing the
$150,000 of Novellus Obligations and the Stockholders Debt and convertible into
the Novellus Shares and the Stockholder Loan Shares (anticipated to be a maximum
of 3,250,000 shares of GROWTH Common Stock), all upon the terms and conditions
set forth in this Agreement.
16
(k) GROWTH and Novellus shall have entered into an agreement, all
upon terms and conditions acceptable to NEAH, pursuant to which the parties
shall confirm the terms of their agreement to renew, assign and extend the
Collaboration Agreements between NEAH and Novellus (the "NOVELLUS COLLABORATION
AGREEMENTS").
(l) GROWTH shall have issued to GROWTH Principal Stockholders the
shares of Series A Preferred Stock and the Series A Preferred Certificate of
Designation has been filed with the Secretary of State of the State of Nevada.
4.2 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF GROWTH. All obligations of
GROWTH under this Agreement are subject to the fulfillment, prior to or at
Closing, of each of the following conditions (any one of which may be waived at
Closing by GROWTH):
(a) The representations and warranties by NEAH contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be true in all material respects at and as of the Closing as though
such representations and warranties were made at and as of such time;
(b) NEAH and the NEAH Security Holders shall have performed and
complied with, in all material respects, with all covenants, agreements, and
conditions set forth in, and shall have executed and delivered all documents
required by this Agreement to be performed or complied or executed and delivered
by them prior to or at the Closing;
(c) On the Closing Date, one of the NEAH Principal Executive
Officers shall have delivered to GROWTH a certificate, duly executed by such
Person and certifying, that to the best of such Person's knowledge and belief,
the representations and warranties of NEAH set forth in this Agreement are true
and correct in all material respects.
(d) The holders of a majority of the issued and outstanding shares
of NEAH Common Stock shall have approved, ratified and confirmed this Agreement,
the Merger and all of the transactions contemplated hereby, all in accordance
with applicable Washington law.
(e) NEAH and all NEAH Security Holders receiving Merger Shares
shall deliver to GROWTH a letter commonly known as an "Investment Letter," or
investment representations acknowledging that the Merger Shares and Merger
Conversion Shares are being acquired for investment purposes.
(f) The existing employment agreements for each of Xxxxx Xxxxxxx
and Xxxxxx Xxxx, the President and CEO and Vice President and Chief Scientist,
respectively, of NEAH shall remain in full force and effect and GROWTH shall
guaranty the obligations of NEAH under such employment agreements. On or before
the Effective Date of the Merger, each of Xxxxx Xxxxxxx and Xxxxxx Xxxx shall
have executed agreements in form and content acceptable to counsel to GROWTH, to
the effect that such Persons (i) shall waive any rights, as a result of
consummation of the Merger, to any compensation or other payments by reason of
any change of control provisions that may exist in their present employment
agreements with NEAH, and (ii) shall waive and release each officer, director,
shareholder, agent or employee of GROWTH from and against any claims that such
Persons may have in respect of severance or other compensation arising out of
their employment with NEAH prior to March 1, 2006.
(g) An aggregate of not less than $500,000, representing the net
proceeds of the GROWTH Initial Financing, on substantially the terms set forth
in this Agreement or on other terms as shall be acceptable to GROWTH, shall have
been deposited in escrow on or before the Closing Date with Xxxxx Xxxx, Esq.,
counsel to GROWTH; which net proceeds shall be delivered to GROWTH simultaneous
with the Effective Time of the Merger.
(h) NEAH shall have issued the Stockholder Warrants and agreements
evidencing the $150,000 of Novellus Obligations and notes evidencing the
Stockholder Debt, which Stockholder Debt and Novellus Obligations shall be
AUTOMATICALLY converted into the Novellus Shares (anticipated to be 750,000
shares of GROWTH Common
17
Stock) and Stockholder Loan Shares (anticipated to be a maximum of 2,500,000
shares of GROWTH Common Stock, exclusive of a maximum additional 3,750,000
Stockholder Loan Shares subsequently issuable upon exercise of the Stockholder
Warrants), all upon the terms and conditions set forth in this Agreement.
(i) GROWTH and Novellus shall have entered into an agreement to
confirm the terms of their agreement to renew, assign and extend the Novellus
Collaboration Agreements.
(j) RETENTION OF KEY EMPLOYEES. GROWTH shall have received legal
or other assurances reasonably satisfactory to it that the key executive and
technical employees of NEAH shall have elected to continue their employment with
NEAH subsequent to the Effective Time of the Merger; it being understood,
however, that any such commitments shall be contingent upon the timely
consummation of the GROWTH Financings.
SECTION 5. COVENANTS
5.1 CORPORATE EXAMINATIONS AND INVESTIGATIONS. Prior to the Closing Date,
the parties acknowledge that they have been entitled, through their employees
and representatives, to make such investigation of the assets, properties,
business and operations, books, records and financial condition of the other as
they each may reasonably require. No investigations, by a party hereto shall,
however, diminish or waive any of the representations, warranties, covenants or
agreements of the party under this Agreement.
5.2 FURTHER ASSURANCES. The parties shall execute such documents and other
papers and take such further actions as may be reasonably required or desirable
to carry out the provisions hereof and the transactions contemplated hereby.
Each such party shall use its best efforts to fulfill or obtain the fulfillment
of the conditions to the Closing, including, without limitation, the execution
and delivery of any documents or other papers, the execution and delivery of
which are necessary or appropriate to the Closing.
5.3 CONFIDENTIALITY. In the event the transactions contemplated by this
Agreement are not consummated, GROWTH, the GROWTH Principal Stockholders, NEAH
and the NEAH Principal Executive Officers agree to keep confidential any
information disclosed to each other in connection therewith for a period of
three (3) years from the date hereof; provided, however, such obligation shall
not apply to information which:
(i) at the time of the disclosure was public knowledge;
(ii) is required to be disclosed publicly pursuant to any
applicable federal or state securities laws;
(iii) after the time of disclosure becomes public knowledge (except
due to the action of the receiving party);
(iv) the receiving party had within its possession at the time of
disclosure; or
(v) is ordered disclosed by a Court of proper jurisdiction.
5.4 STOCK CERTIFICATES. At the Closing, the NEAH Security Holders shall
have delivered the certificates representing the NEAH Securities duly endorsed
(or with executed stock powers) so as to make GROWTH the sole owner thereof. At
such Closing, GROWTH shall issue to the NEAH Security Holders the Merger Shares.
5.5 INVESTMENT LETTERS. The NEAH Securlty Holders receiving Merger Shares
shall have delivered to GROWTH an "Investment Letter" agreeing that the shares
are being acquired for investment purposes only and not with the view to public
resale or distribution.
5.6 FILING OF CERTIFICATE OF MERGER. The Articles of Merger shall have been
filed in the office of the Secretary of State of the State of Washington.
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5.7 COVENANT TO VOTE. By execution of a separate letter agreement in the
form of EXHIBIT E annexed hereto, the holders of a majority of the issued and
outstanding voting capital stock of NEAH, voting together as a single class,
shall have agreed, subject at all times to the satisfaction of all of the
conditions to Closing set forth in Section 4.1 of this Agreement, to vote all of
their NEAH Securities entitled to vote at any regular or special meeting of NEAH
Security Holders, IN FAVOR of the Merger and all other transactions contemplated
by this Agreement and the Exhibits hereto.
5.8 BOARD OF DIRECTORS. At the Effective Time of the Merger, the initial
Board of Directors of each of GROWTH and NEAH shall consist of five (5) persons,
three (3) of whom shall be members of the current NEAH Board of Directors and
two (2) of whom shall be the GROWTH Principal Stockholders or other Persons
designated by them. On or prior to the date on which GROWTH's Common Stock shall
be traded on the NASD OTC-Bulletin Board or another national securities
exchange, two (2) additional persons acceptable to the GROWTH Principal
Stockholders shall be added as independent directors (as defined in the Sarbanes
Oxley Act of 2002 or rules of the stock exchange on which GROWTH trades,
including a financial expert).
5.9 REAFFIRMATION OF NON-DISCLOSURE AGREEMENT. On the Closing Date,
Novellus, Intel and each of the NEAH Principal Executive Officers and other key
technical employees shall reaffirm in writing the non-disclosure agreements
previously executed with NEAH.
5.10 CERTAIN CONSENTS REQUIRED. For so long as GROWTH Principal Stockholders
shall hold any shares of Series A Preferred Stock, without the consent of the
GROWTH Principal Stockholders or the two (2) representatives of the GROWTH
Principal Stockholders on the GROWTH Board of Directors and NEAH Board of
Directors, neither NEAH nor GROWTH shall:
(a) consummate the acquisition or purchase of any assets, capital
stock or other securities of any other person, firm, corporation or other
business, or enter into any binding agreements to do so; or
(b) consummate the sale of any assets, capital stock or other
securities of GROWTH or any subsidiary thereof, including NEAH, or enter into
any binding agreements to do so; or
(c) consummate any debt or equity financings in excess of $500,000
individually or in the aggregate, or enter into any binding agreements to do so;
or
(d) enter into any employment agreement or other material
agreement with any executive, employee or consultant that cannot be cancelled or
terminated by GROWTH or NEAH within ninety (90) days of written notice without
further liability; or
(e) mortgage, pledge or otherwise encumber any of the assets of
NEAH or GROWTH, or enter into any binding agreement to do so; or
(f) license or otherwise convey any of the intellectual property
of NEAH to any third party, or enter into any binding agreement to do so; or
(g) enter into any other transaction with officer, director or
other affiliate of NEAH or GROWTH.
Section 5.11 AUDIT AND FORM 10 REGISTRATION STATEMENT. As soon as
practicable after the Closing, NEAH shall have (a) completed the audit of the
Unaudited 2005 Financial Statements of NEAH by an auditor acceptable to GROWTH,
and (b) delivered to GROWTH a definitive final draft of a Form 10 Registration
Statement to register the shares of GROWTH Common Stock under the Securities
Exchange Act of 1934, as amended; which Form 10 Registration Statement shall
contain all appropriate disclosures of the business, management, risk factors,
capitalization and principal security holders of GROWTH and its NEAH subsidiary
(after giving effect to the Merger), as shall be required under Section 12(g) of
the Securities Exchange Act of 1934, as amended (the "FORM 10 REGISTRATION
19
STATEMENT"). Subject only to receipt of the consent of Xxxxx Xxxxxxxx & Co. to
include the 2003 and 2004 Audited Financial Statements in the filing, GROWTH
shall cause the Form 10 Registration Statement to be filed with the SEC not
later than five (5) Business Days after the delivery of the items referred to in
clauses (a) and (b) above. In connection with the foregoing, GROWTH and the
GROWTH Principal Stockholders shall assist and cooperate with NEAH in complying
with the covenants set forth in this Section 5.11.
Section 5.12 LOCK-UP AGREEMENTS. On the Effective Date of the Merger, each
of the GROWTH Principal Stockholders and the holders of a majority of the Merger
Shares shall execute and deliver to GROWTH identical agreements (the "LOCK-UP
AGREEMENTS"), pursuant to which such Persons shall, INTER ALIA, agree (a) not to
effect any public sales of their GROWTH Common Stock for not less than six
months following the Effective Time of the Merger (or such longer time (not to
exceed 12 months from the Effective Time) as my be required after negotiation
with the investors in the GROWTH Additional Financing), and (b) after twelve
months from the Effective Time of the Merger, to the extent any Persons shall
elect to make public sales under Rule 144, such selling stockholders shall
effect sales every ninety (90) days in pro-rata percentages of their respective
holdings in GROWTH Common Stock. In the event that the purchasers of securities
in the GROWTH Additional Financing shall require any changes or modifications to
such Lock-up Agreements, all parties to the Lock-up Agreements agree to
cooperate in order to facilitate consummation of the GROWTH Additional
Financing; PROVIDED, that all such parties shall be treated equally in
connection with any such changes or modifications to the Lock-up Agreement. In
addition, should GROWTH file any registration statement under the Securities Act
of 1933, as amended, to register shares of GROWTH Common Stock for resale, it
shall register for resale all shares of GROWTH Common Stock owned by the NEAH
Security Holders if any Series A Conversion Shares are simultaneously registered
for resale on behalf of the GROWTH Principal Stockholders
Section 5.13 STOCK OPTION PLAN. Following the Effective Time of the Merger,
the board of directors of GROWTH shall form a compensation committee of the
board of directors which shall propose an incentive stock option plan for key
employees, directors, consultants and others providing services to GROWTH and
NEAH, pursuant to which up to 10,000,000 shares of GROWTH Common Stock shall be
authorized for issuance upon such terms and conditions as shall be recommended
by the compensation committee and approved by a majority of the members of the
board of directors (the "STOCK OPTION PLAN"). Such Stock Option Plan shall
thereupon be submitted to the GROWTH stockholders for approval.
Section 5.14 INDEMNIFICATION OF OFFICERS AND DIRECTORS. It is the intention
of the Parties that GROWTH and NEAH shall indemnify its officers and directors
to the fullest extent permitted by Nevada and Washington law, as applicable. In
such connection, the Parties agree not to amend the certificates of
incorporation or by-laws of either GROWTH or NEAH if such amendment shall have
the effect of reducing, terminating or otherwise adversely affecting the
indemnification rights and privileges applicable to officers and directors of
each of GROWTH and NEAH, as the same are in effect immediately prior to the
Effective Time of the Merger.
SECTION 6. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
Notwithstanding any right of either party to investigate the affairs of
the other party and its Shareholders, each party has the right to rely fully
upon representations, warranties, covenants and agreements of the other party
and its Shareholders contained in this Agreement or in any document delivered to
one by the other or any of their representatives, in connection with the
transactions contemplated by this Agreement. All such representations,
warranties, covenants and agreements shall survive the execution and delivery
hereof and the closing hereunder for 3 years following the Closing.
SECTION 7. DOCUMENTS AT CLOSING AND THE CLOSING
7.1 DOCUMENTS AT CLOSING. At the Closing, the following transactions shall
occur, all of such transactions being deemed to occur simultaneously:
20
(a) NEAH will deliver, or will cause to be delivered, to GROWTH
the following:
(i) a certificate executed by the President and Secretary
of NEAH to the effect that all representations and
warranties made by NEAH under this Agreement are true
and correct as of the Closing, the same as though
originally given to GROWTH on said date;
(ii) a certificate from the State of Washington dated at
or about the Closing to the effect that NEAH is
validly existing under the laws of said State;
(iii) Investment Letters or investment representations in
the form executed by each NEAH Shareholder;
(iv) Stock certificates representing those shares of NEAH
to be cancelled and exchanged for the Merger Shares.
(v) all other items, the delivery of which is a condition
precedent to the obligations of GROWTH, as set forth
in Section 4.
(b) GROWTH will deliver or cause to be delivered to NEAH and the
NEAH SECURITY HOLDERS:
(i) stock certificates representing all Merger Shares to
be issued as a part of the Merger as described in
Section I hereof;
(ii) a certificate from GROWTH executed by the President
or Secretary of GROWTH, to the effect that all
representations and warranties of GROWTH made under
this Agreement are true and correct as of the
Closing, the same as though originally given to NEAH
on said date;
(iii) certified copies of resolutions by GROWTH Board of
Directors authorizing this transaction; and an
opinion of GROWTH counsel as described in Section 4
above;
(iv) certificates from the Nevada Secretary of State dated
at or about the Closing Date that GROWTH is in good
standing under the laws of said State;
(v) all other items, the delivery of which is a condition
precedent to the obligations of NEAH, as set forth in
Section 4 hereof.
SECTION 8. MISCELLANEOUS
8.1 WAIVERS. The waiver of a breach of this Agreement or the failure of any
party hereto to exercise any right under this Agreement shall in no way
constitute waiver as to future breach whether similar or dissimilar in nature or
as to the exercise of any further right under this Agreement.
8.2 AMENDMENT. This Agreement may be amended or modified only by an
instrument of equal formality signed by the parties or the duly authorized
representatives of the respective parties.
8.3 ASSIGNMENT. This Agreement is not assignable except by operation of
law.
8.4 NOTICE. Until otherwise specified in writing, the mailing addresses and
fax numbers of the parties of this Agreement shall be as follows:
21
To: GROWTH:
GROWTH MERGERS, INC.
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
Attn: Xxxx Xxxxx, President and CEO
cc: Xxxxx Xxxx, Esq.
The Xxxx Law Group, PLLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
-and-
Xxxxxxx X. Xxxxx, Esq.
Xxxxxxx Xxxx, LLC
00 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
(000) 000-0000
To: NEAH AND THE NEAH PRINCIPAL EXECUTIVE OFFICERS:
NEAH Power Systems, Inc.
00000 00xx Xxxxxx, X.X., Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxx, President and CEO
cc: Xxxxx X. Xxxxxxx, Esq.
DLA Xxxxx Xxxxxxx Xxxx Xxxx US LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Any notice or statement given under this Agreement shall be deemed to have been
given if sent by registered mail addressed to the other party at the address
indicated above or at such other address which shall have been furnished in
writing to the addressor.
8.5 GOVERNING LAW. This Agreement shall be construed, and the legal
relations between the parties determined, in accordance with the laws of the
State of Washington, thereby precluding any choice of law rules which may direct
the application of the laws of any other jurisdiction.
8.6 ARBITRATION. The parties hereby agree that any dispute or cause of
action arising under this Agreement shall be settled by arbitration conducted by
one arbitrator. The arbitrator shall be acceptable to both NEAH and GROWTH. If
an arbitrator cannot be agreed upon as provided in the preceding sentence, an
arbitrator will be appointed by Judicial Dispute Resolution, LLC, in Seattle,
Washington. The arbitrator shall set a limited time period and establish
procedures designed to reduce the cost and time for discovery while allowing the
parties an opportunity, adequate in the sole judgment of the arbitrator, to
discover relevant information from the opposing parties about the subject matter
of the dispute. The arbitrator shall rule upon motions to compel or limit
discovery and shall have the authority to impose sanctions, including attorneys'
fees and costs, to the same extent as a court of competent law or equity, should
the arbitrator determine that discovery was sought without substantial
justification or that discovery was refused or objected to without substantial
justification. The decision of the arbitrator shall be written, shall be in
accordance with applicable law and with this Agreement, and shall be supported
by written findings of fact and conclusion of law which shall set forth the
basis for the decision of the arbitrator. Any such arbitration shall be held
exclusively in King County, Washington.
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8.7 PUBLICITY. No publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be issued by either
party hereto at any time from the signing hereof without advance approval in
writing of the form and substance by the other party.
8.8 ENTIRE AGREEMENT. This Agreement (including the Exhibits and Schedules
to be attached hereto) and the collateral agreements executed in connection with
the consummation of the transactions contemplated herein contain the entire
agreement among the parties with respect to the transactions contemplated
hereby, and supersedes all prior agreements, written or oral, with respect
hereof.
8.9 HEADINGS. The headings in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.
8.10 SEVERABILITY OF PROVISIONS. The invalidity or unenforceability of any
term, phrase, clause, paragraph, restriction, covenant, agreement or provision
of this Agreement shall in no way affect the validity or enforcement of any
other provision or any part thereof.
8.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed, shall constitute an original copy
hereof, but all of which together shall consider but one and the same document.
8.12 BINDING EFFECT. This Agreement shall be binding upon the parties hereto
and inure to the benefit of the parties, their respective heirs, administrators,
executors, successors and assigns.
8.13 PRESS RELEASES. The parties will mutually agree as to the wording and
timing of any informational releases concerning this transaction prior to and
through Closing.
[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK - SIGNATURE PAGES FOLLOW]
23
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.
ATTEST: GROWTH MERGERS, INC.
a Nevada corporation
________________________ By: /s/ Xxxxx Xxxx
--------------
___________, Secretary Xxxxx Xxxx, President
GROWTH ACQUISITION CORP
a Washington corporation
________________________ By: /s/ Xxxxx Xxxx
Secretary --------------
Xxxxx Xxxx, President
ATTEST: NEAH POWER SYSTEMS, INC.
a Washington corporation
________________________ By: /s/ Xxxxx X. Xxxxxxx
Secretary --------------------
Xxxxx X. Xxxxxxx,
President and CEO
SUMMIT TRADING LIMITED
By: /s/ Xxxxxxx Xxxxxxx
-------------------
Xxxxxxx Xxxxxxx,
Authorized Signatory
SPECIAL INVESTMENTS ACQUISITIONS
ASSOCIATES LLC
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Xxxx Xxxxxxxxxx, Manager
24
EXHIBITS
A Certificate of Merger
B Series A Preferred Certificate of Designations
C Restated GROWTH Certificate of Incorporation
D Restated GROWTH By-Laws
E Agreement of NEAH Security Holders to Vote
SCHEDULES
NEAH SCHEDULES
2.1 NEAH Warrants and Options currently in existence
2.4 NEAH Financial Statements
2.10 NEAH Claims, Litigation, Government actions pending
2.11 NEAH Significant contracts
2.12 NEAH Brokers Agreements due by NEAH contract
2.13 NEAH List of Real Estate Owned and List of Leases:
2.14 NEAH List of exceptions to the Tangible Assets on balance sheets.
2.15 NEAH List of undisclosed Liabilities
2.17 NEAH List of Subsidiaries
GROWTH SCHEDULES
3.4 GROWTH Financial Statements
3.5 List of transactions of GROWTH for contracts and in which stock has
been issued or committed
3.8 GROWTH List of Pending Actions not disclosed in financial statements
25
