Exhibit 99.1
SHARE EXCHANGE AGREEMENT
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THIS SHARE EXCHANGE AGREEMENT (the "AGREEMENT") is entered into this _____
day of ______, 2003, by and among CARCORP USA CORPORATION, a Delaware
corporation ("CARCORP"), ELITE FLIGHT SOLUTIONS, INC., a Nevada corporation
("ELITE"), and the individuals listed on SCHEDULE A attached hereto
(individually, a "SHAREHOLDER" and collectively, the "SHAREHOLDERS").
RECITALS:
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A. The Shareholders own all of the outstanding capital stock of Elite.
The authorized capital stock of the Elite consists of eight hundred million
(800,000,000) shares of common stock, par value $0.001 per share, one hundred
eighty-four million fifty thousand (184,050,000) of which are issued and
outstanding (the "ELITE COMMON STOCK") and twenty-five million (25,000,000)
shares of preferred stock, par value $0.001 per share, non of which is issued
and outstanding.
B. The Shareholders desire to transfer and exchange the Elite Common
Stock for newly-issued shares of common stock, par value $0.001 per share, of
Carcorp (the "CARCORP COMMON STOCK"), on the terms and conditions set forth
herein and Carcorp desires to consummate such transfer and exchange pursuant to
the terms and conditions set forth herein.
AGREEMENT:
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NOW, THEREFORE, in consideration of the mutual premises herein set forth
and certain other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. THE SHARE EXCHANGE AND RELATED TRANSACTIONS.
1.1. SHARE EXCHANGE. In accordance with the provisions of this
Agreement, the Delaware General Corporation Law (the "DGCL") and other
applicable law, on the Closing Date (as defined below), the Shareholders shall
exchange with, and deliver to, Carcorp, the Elite Common Stock, and in exchange
therefore, Carcorp shall issue, and deliver, to the Shareholders in the
denominations set forth opposite each Shareholder's name on SCHEDULE A attached
hereto, newly-issued shares of Carcorp Common Stock (the exchange transaction is
referred to herein as the "SHARE EXCHANGE"). The total number of shares of
Carcorp Common Stock to be issued to the Shareholders shall be equal to
twenty-seven million six hundred seven thousand five hundred (27,607,500)
shares. The shares of Carcorp Common Stock to be issued as part of the Share
Exchange are referred to herein as the "CARCORP SHARES," also sometimes referred
to hereinafter as the "EXCHANGE CONSIDERATION."
1.2. CLOSING. The parties to this Agreement shall file Articles of
Exchange (as defined below) pursuant to the DGCL, cause the Share Exchange to
become effective and consummate the other transactions contemplated by this
Agreement (the "CLOSING") no later than April 30, 2003; provided, in no event
shall the Closing occur prior to the satisfaction of the conditions precedent
set forth in Sections 6, 7 and 8 hereof. The date of the Closing is referred to
herein as the "CLOSING DATE." The Closing shall take place at the offices of
counsel to Carcorp, or at such other place as may be mutually agreed upon by
Carcorp and the Shareholders. At the Closing, (i) the Shareholders shall deliver
to Carcorp the original stock certificates representing the Elite Common Stock,
together with stock powers duly executed in blank; and (ii) the Carcorp shall
deliver to the Shareholders stock certificates representing the Carcorp Shares.
1.3. PLAN OF EXCHANGE; ARTICLES OF SHARE EXCHANGE. The parties to
this Agreement shall cause Carcorp and Elite to enter into a plan of exchange on
the date hereof, a copy of which is attached hereto as EXHIBIT "B" (the "PLAN OF
EXCHANGE"), and, at the Closing, to execute the Articles of Exchange in the form
attached hereof as EXHIBIT "C" (the "ARTICLES OF EXCHANGE"). The Articles of
Exchange shall be filed with the Secretary of State of Nevada on the Closing
Date in accordance with the DGCL.
1.4. APPROVAL OF SHARE EXCHANGE. By their execution of this
Agreement, each Shareholder hereby ratifies, approves and adopts the Share
Exchange and the Plan of Exchange for all purposes under the DGCL. On or before
the execution of this Agreement, the respective Boards of Directors of Carcorp
and Elite shall have approved this Agreement, the Plan of Exchange and the
transactions contemplated hereby and thereby.
2. ADDITIONAL AGREEMENTS.
2.1. ACCESS AND INSPECTION, ETC. Elite and the Shareholders have
allowed and shall allow Carcorp and its authorized representatives full access
during normal business hours from and after the date hereof and prior to the
Closing Date to all of the properties, books, contracts, commitments and records
of Elite for the purpose of making such investigations as Carcorp may reasonably
request in connection with the transactions contemplated hereby, and shall cause
Elite to furnish Carcorp such information concerning its affairs as Carcorp may
reasonably request. Elite and the Shareholders have caused and shall cause the
personnel of Elite to assist Carcorp in making such investigation and shall use
their best efforts to cause the counsel, accountants, and other non-employee
representatives of Elite to be reasonably available to Carcorp for such
purposes. The Shareholders shall cause Elite to comply with all obligations of
Elite under this Agreement.
2.2. CONFIDENTIAL TREATMENT OF INFORMATION. From and after the
date hereof, the parties hereto shall and shall cause their representatives to
hold in confidence this Agreement (including the Exhibits and Schedules hereto),
all matters relating hereto and all data and information obtained with respect
to the other parties or their business, except such data or information as is
published or is a matter of public record, or as compelled by legal process. In
the event this Agreement is terminated pursuant to Section 10 hereof, each party
shall promptly return to the other(s) any statements, documents, schedules,
exhibits or other written information obtained from them in connection with this
Agreement, and shall not retain any copies thereof.
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2.3. PUBLIC ANNOUNCEMENTS. After the date hereof and prior to the
Closing, none of the parties hereto shall make any press release, statement to
employees or other disclosure of this Agreement or the transactions contemplated
hereby without the prior written consent of the other parties, except as may be
required by law. Neither Elite nor the Shareholders shall make any such
disclosure unless Carcorp shall have received prior notice of the contemplated
disclosure and has had adequate time and opportunity to comment on such
disclosure, which shall be satisfactory in form and content to Carcorp and its
counsel.
2.4. SECURITIES LAW COMPLIANCE. The issuance of the Carcorp Shares
to the Shareholders hereunder shall not be registered under the Securities Act
of 1933, as amended, by reason of the exemption provided by Section 4(2)
thereof, and such shares may not be further transferred unless such transfer is
registered under applicable securities laws or, in the opinion of Carcorp'
counsel, such transfer complies with an exemption from such registration. All
certificates evidencing the Carcorp Shares to be issued to the Shareholders
shall be legended to reflect the foregoing restriction.
2.5. REGISTRATION. Carcorp shall prepare and file with the United
States Securities and Exchange Commission (the "SEC") a registration statement
on Form X-0, XX-0 or on such other form as available, registering the Carcorp
Shares owned by Xxxxxxx XxXxx. Carcorp shall use its best efforts to cause such
registration statement to be declared effective by the SEC as soon as
practicable.
2.6. BEST EFFORTS. Subject to the terms and conditions provided in
this Agreement, each of the parties shall use its best efforts in good faith to
take or cause to be taken as promptly as practicable all reasonable actions that
are within its power to cause to be fulfilled those conditions precedent to its
obligations or the obligations of the other parties to consummate the
transactions contemplated by this Agreement that are dependent upon its actions.
2.7. FURTHER ASSURANCES. The parties shall deliver any and all
other instruments or documents required to be delivered pursuant to, or
necessary or proper in order to give effect to, the provisions of this
Agreement, including, without limitation, all necessary stock powers and such
other instruments of transfer as may be necessary or desirable to transfer
ownership of the Elite Common Stock and to consummate the transactions
contemplated by this Agreement.
2.8. NON-INTERFERENCE. From and after the date hereof, no
Shareholder shall induce or solicit any employee of Carcorp, its subsidiaries or
affiliates or any person doing business with Carcorp or to terminate his or her
employment or business relationship with Carcorp its subsidiaries or affiliates
or otherwise interfere with any such relationship.
2.9. CONFIDENTIALITY. The Shareholders agree and acknowledge that,
by reason of the nature of the Shareholders' ownership interest in Carcorp, each
Shareholder will have or may have access to and become informed of confidential
and secret information which is a competitive asset of Carcorp including
information of its subsidiaries and affiliates ("CONFIDENTIAL INFORMATION"),
including, without limitation, technology, any lists of customers, financial
statistics, research data or any other statistics and plans contained in profit
plans, capital plans, critical issue plans, strategic plans or marketing or
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operation plans or other trade secrets of Carcorp its subsidiaries or affiliates
and any of the foregoing which belong to any person or company but to which the
Shareholders have had access by reason of their relationship with Carcorp its
subsidiaries or affiliates. The Shareholders agree faithfully to keep in strict
confidence, and not, either directly or indirectly, to make known, divulge,
reveal, furnish, make available or use any such Confidential Information. The
Shareholders acknowledge that all manuals, instruction books, price lists,
information and records and other information and aids relating to Carcorp' or
the business of its subsidiaries or affiliates business, and any and all other
documents containing Confidential Information furnished to the Shareholders by
Carcorp or otherwise acquired or developed by the Shareholders, shall at all
times be the property of Carcorp. Upon the termination of this Agreement, each
Shareholder shall return to Carcorp any such property or documents which are in
their possession, custody or control, but the Shareholders' obligation of
confidentiality shall survive such termination and unless any such Confidential
Information shall have become, through no fault of the Shareholder, generally
known to the trade. The obligations of the Shareholder under this subsection are
in addition to, and not in limitation or preemption of, all other obligations of
confidentiality which the Shareholder may have to Carcorp its subsidiaries or
affiliates under general legal or equitable principles.
2.10. REMEDIES. It is expressly agreed by the Shareholders and
Carcorp that the provisions in this Section 2 are reasonable for purposes of
preserving for Carcorp and its subsidiaries and affiliates their business,
goodwill and Confidential Information. It is also agreed that if any provision
is found by a court having jurisdiction to be unreasonable because of scope,
area or time, then that provision shall be amended to correspond in scope, area
and time to that considered reasonable by a court and as amended shall be
enforced and the remaining provisions shall remain effective. In the event any
breach of these provisions by any Shareholder, the parties recognize and
acknowledge that a remedy at law will be inadequate and Carcorp and its
subsidiaries and affiliates may suffer irreparable injury. The Shareholders
consent to injunctive and other appropriate equitable relief without the posting
of a bond upon the institution of proceedings therefor by Carcorp in order to
protect Carcorp' rights and the rights of its subsidiaries and affiliates. Such
relief shall be in addition to any other relief to which Carcorp and its
subsidiaries and affiliates may be entitled at law, in equity, or under any
other agreement between each Shareholder and Carcorp. The provisions of this
Section 2 (including the subsections) shall survive the termination of this
Agreement.
2.11. RELEASE OF CLAIMS BY EACH SHAREHOLDER. Effective as of the
Closing Date, and except for any obligations arising out of this Agreement, each
Shareholder, and his successors, predecessors, assigns, agents, advisors, legal
representatives, partners and all persons acting by, through or under him,
hereby release Elite and each of its successors, predecessors, assigns, agents,
advisors, officers, directors, employees, legal representatives, partners and
all persons acting by, through or under each of them, from any and all claims,
obligations, causes of action, actions, suits, contracts, controversies,
agreements, promises, damages, demands, costs, attorneys' fees and liabilities
of any nature whatsoever from the beginning of time up to and including the
Closing Date, in law or at equity, whether known now or on the Closing Date,
anticipated or unanticipated, suspected or claimed, fixed or contingent,
liquidated or unliquidated, arising out of, in connection with or relating to
any matter, cause or thing whatsoever.
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2.12. NO-SHOP. From the date hereof until the termination of this
Agreement, neither Elite nor any Shareholder shall, directly or indirectly,
make, solicit, initiate or encourage submission of proposals or offers from any
persons (including any of their employees or officers) relating to an
Acquisition Proposal. As used herein, "ACQUISITION PROPOSAL" means any proposal
or offer involving a liquidation, dissolution, recapitalization, Share Exchange,
consolidation or acquisition or purchase of all or substantially all of the
assets of, or equity interest in, Elite or other similar transaction or business
combination involving Elite. Each of Elite and each Shareholder shall
immediately cease and cause to be terminated all discussions or negotiations
with third parties with respect to any Acquisition Proposal, if any, exiting on
the date hereof.
3. REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE SHAREHOLDERS.
To induce Carcorp to enter into this Agreement and to consummate the
transactions contemplated hereby, Elite and the Shareholders jointly and
severally represent and warrant to and covenant with Carcorp as follows:
3.1. ORGANIZATION; COMPLIANCE. Elite is a corporation duly
organized, validly existing and in good standing under the laws of Nevada. Elite
is: (a) entitled to own or lease its properties and to carry on its business as
and in the places where such business is now conducted, and (b) duly licensed
and qualified in all jurisdictions where the character of the property owned by
it or the nature of the business transacted by it makes such license or
qualification necessary, except where the failure to do so would not result in a
material adverse effect on Elite.
3.2. CAPITALIZATION AND RELATED MATTERS.
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(a) Elite has an authorized capital consisting of
800,00,000 shares of common stock, $0.001 par value per share, of which
184,050,000 are issued and outstanding at the date hereof, and 25,000,000 shares
of preferred stock, $0.001 par value per share, none of which are issued and
outstanding at the date hereof. All shares of Elite Common Stock are duly and
validly issued, fully paid and nonassessable. No shares of Elite Common Stock
(i) were issued in violation of the preemptive rights of any shareholder, or
(ii) are held as treasury stock.
(b) There are not outstanding any securities
convertible into capital stock of Elite nor any rights to subscribe for or to
purchase, or any options for the purchase of, or any agreements providing for
the issuance (contingent or otherwise) of, or any calls, commitments or claims
of any character relating to, such capital stock or securities convertible into
such capital stock. Elite: (i) is not subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any of its capital
stock; or (ii) has no liability for dividends or other distributions declared or
accrued, but unpaid, with respect to any capital stock.
(c) The Shareholders are, and will be at Closing, the
record and beneficial owner of one hundred eighty-four million fifty thousand
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(184,050,000) shares of Elite Common Stock, free and clear of all claims, liens,
options, agreements, restrictions, and encumbrances whatsoever and no
Shareholder is a party to any agreement, understanding or arrangement, direct or
indirect, relating to the Elite Common Stock, including, without limitation,
agreements, understandings or arrangements regarding voting or sale of such
stock.
3.3. SUBSIDIARIES. Elite owns (a) no shares of capital stock of
any other corporation, including any joint stock company, and (b) no other
proprietary interest in any company, partnership, trust or other entity,
including any limited liability company.
3.4. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC.
(a) This Agreement is a valid and binding agreement of
Elite and the Shareholders, enforceable in accordance with its terms, except as
such enforcement may be limited by bankruptcy or similar laws affecting the
enforcement of creditors' rights generally, and the availability of equitable
remedies. Elite and the Shareholders have the absolute and unrestricted right,
power, authority, and capacity to execute and deliver this Agreement and the
documents to be delivered by them in connection with the Closing and to perform
their obligations under this Agreement.
(b) The execution and delivery of this Agreement by
Elite and the Shareholders does not, and the consummation of the transactions
contemplated hereby will not, constitute a breach or violation of the charter or
bylaws of Elite, or a default under any of the terms, conditions or provisions
of (or an act or omission that would give rise to any right of termination,
cancellation or acceleration under) any note, bond, mortgage, lease, indenture,
agreement or obligation to which Elite or any Shareholder is a party, pursuant
to which Elite or any Shareholder otherwise receives benefits, or to which any
of the properties of Elite or any Shareholder is subject, or violate any
judgment, order, decree, statute or regulation applicable to Elite or any
Shareholder or by which any of them may be subject.
3.5. CORPORATE RECORDS. The statutory records, including the stock
register and minute books of Elite, fully reflect all issuances, transfers and
redemptions of its capital stock, currently show and will correctly show the
total number of shares of its capital stock issued and outstanding on the date
hereof and on the Closing Date, the charter or other organizational documents
and all amendments thereto, the bylaws as amended and currently in force. To the
knowledge of the Shareholders, the books of account, minute books, stock record,
books, and other records of Elite, all of which have been made available to
Carcorp, are complete and correct and have been maintained in accordance with
sound business practices. The minute books of Elite contain accurate and
complete records of all meetings held of, and corporate action taken by, the
Shareholders, the Board of Directors, and committees of the Boards of Directors
of Elite, and no meeting of any such Shareholders, Board of Directors, or
committee has been held for which minutes have not been prepared and are not
contained in such minute books. At the Closing, all of those books and records
will be in the possession of Elite.
3.6. FINANCIAL STATEMENTS.
(a) Elite and the Shareholders have delivered to
Carcorp the audited balance sheet of Elite as of December 31, 2002, (the
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"BALANCE SHEET") and the related statements of income, shareholders' equity and
cash flows of Elite for the period ended December 31, 2002. All the foregoing
financial statements, and any financial statements delivered pursuant to Section
3.6(c) below, are referred to herein collectively as the "ELITE FINANCIAL
STATEMENTS."
(b) The Elite Financial Statements have been and will
be prepared in accordance with GAAP throughout the periods involved, subject, in
the case of interim financial statements, to normal recurring year-end
adjustments (the effect of which will not, individually or in the aggregate, be
materially adverse) and the absence of notes (that, if presented, would not
differ materially from those included in the Balance Sheet), applied on a
consistent basis, and fairly reflect and will reflect in all material respects
the financial condition of Elite as at the dates thereof and the results of the
operations of Elite for the periods then ended, and are true and complete and
are consistent with the books and records of Elite.
(c) Until Closing, Elite will furnish to Carcorp
unaudited interim financial statements of Elite for each month subsequent to
December 31, 2002 as soon as practicable but in any event within thirty (30)
days after the close of any such month.
3.7. LIABILITIES. Elite has no debt, liability or obligation of
any kind, whether accrued, absolute, contingent or otherwise.
3.8. ABSENCE OF CHANGES. Except as described in Schedule 3.8, from
December 31, 2002 to the date of this Agreement:
(a) there has not been any adverse change in the
business, assets, liabilities, results of operations or financial condition of
Elite;
(b) Elite has complied with the covenants and
restrictions set forth in Section 5 to the same extent as if this Agreement had
been executed on, and had been in effect since, December 31, 2002.
3.9. TITLE TO PROPERTIES. Elite has good and marketable title to
all of its properties and assets, real and personal, including, but not limited
to, those reflected in the Balance Sheet (except as since sold or otherwise
disposed of in the ordinary course of business, or as expressly provided for in
this Agreement), free and clear of all encumbrances, liens or charges of any
kind or character.
3.10. COMPLIANCE WITH LAW. The business and activities of Elite has
at all times been conducted in accordance with its Articles of Incorporation and
Bylaws and any applicable law, regulation, ordinance, order, License (as defined
below), permit, rule, injunction or other restriction or ruling of any court or
administrative or governmental agency, ministry, or body, except where the
failure to do so would not result in a material adverse effect on Elite.
3.11. TAXES. Elite has duly filed all federal, state, and material
local and foreign tax returns and reports, and all returns and reports of all
other governmental units having jurisdiction with respect to taxes imposed on it
or on its income, properties, sales, franchises, operations or employee benefit
plans or trusts, all such returns were complete and accurate when filed, and all
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taxes and assessments payable by Elite have been paid to the extent that such
taxes have become due. Elite has withheld proper and accurate amounts from its
employees for all periods in full compliance with the tax withholding provisions
of applicable foreign, federal, state and local tax laws. There are no waivers
or agreements by Elite for the extension of time for the assessment of any
taxes. There are not now any examinations of the income tax returns of Elite
pending, or any proposed deficiencies or assessments against Elite of additional
taxes of any kind.
3.12. REAL PROPERTIES. Elite does not have any interest in any real
property.
3.13. CONTINGENCIES. There are no actions, suits, claims or
proceedings pending, or to the knowledge of the Shareholders threatened against,
by or affecting, Elite in any court or before any arbitrator or governmental
agency that may have a material adverse effect on Elite or which could
materially and adversely affect the right or ability of any Shareholder to
consummate the transactions contemplated hereby. To the knowledge of the
Shareholders, there is no valid basis upon which any such action, suit, claim,
or proceeding may be commenced or asserted against Elite. There are no
unsatisfied judgments against Elite and no consent decrees or similar agreements
to which Elite is subject and which could have a material adverse effect on
Elite.
3.14. INTELLECTUAL PROPERTY RIGHTS. Elite has: (a) the exclusive
right to use the name Elite Flight Solutions, Inc., and the use of such name
does not conflict with or infringe upon the rights of any other person, and (b)
made all material filings and publications required to register and perfect such
exclusive right. Elite is not, and will not be, subject to any liability, direct
or indirect, for infringement damages, royalties, or otherwise, by reason of (a)
the use of the name "Elite Flight Solutions" in or outside the United States or
(b) the business operations of Elite, at any time prior to the Closing Date.
Elite has not registered the name "Elite Flight Solutions" for trademark or use
rights with any state or federal agency for exclusive use. The State of Nevada
granted incorporation under the name Elite Flight Solutions, Inc.
3.15. MATERIAL CONTRACTS. Schedule 3.15 contains a complete list of
all contracts of Elite, which involve consideration in excess of the equivalent
of $10,000 or have a term of one year or more (the "MATERIAL CONTRACTS"). Elite
has delivered to Carcorp a true, correct and complete copy of each of the
written contracts, and a summary of each oral contract, listed on Schedule 3.15.
Elite has performed all material obligations to be performed by it under all
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such contracts, and is not in material default thereof, and no condition exists
or has occurred which with the giving of notice or the lapse of time, or both,
would constitute a material default by Elite or accelerate the maturity of, or
otherwise modify, any such contract, and all such contracts are in full force
and effect. No default by any other party to any of such contracts is known or
claimed by Elite or any Shareholder to exist.
3.16. EMPLOYMENT AND LABOR MATTERS. Schedule 3.16 sets forth the
name, position, employment date, compensation (base and bonus) of each employee
of Elite who earned $25,000 or more in 2002 or is anticipated to earn $25,000 or
more in 2003. Elite is not a party to or bound by any employment contract,
consulting agreement, deferred compensation agreement, bonus plan, incentive
plan, profit sharing plan, retirement agreement, or other employee compensation
agreement. Elite is not aware that any officer or key employee, or that any
group of key employees, intends to terminate their employment with Elite, nor
does Elite have a present intention to terminate the employment of any of the
foregoing.
3.17. EMPLOYEE BENEFIT MATTERS. Elite does not provide, nor is it
obligated to provide, directly or indirectly, any benefits for employees other
than salaries, sales commissions and bonuses, including, but not limited to, any
pension, profit sharing, stock option, retirement, bonus, hospitalization,
insurance, severance, vacation or other employee benefits (including any housing
or social fund contributions) under any practice, agreement or understanding.
3.18. POSSESSION OF FRANCHISES, LICENSES, ETC. Elite: (a) possess
all material franchises, certificates, licenses, permits and other
authorizations (collectively, the "LICENSES") from governmental authorities,
political subdivisions or regulatory authorities that are necessary for the
ownership, maintenance and operation of its business in the manner presently
conducted; (b) are not in violation of any provisions thereof; and (c) have
maintained and amended, as necessary, all Licenses and duly completed all
filings and notifications in connection therewith.
3.19. ENVIRONMENTAL MATTERS. (i) Elite is not in violation, in any
material respect, of any Environmental Law (as defined below); (ii) Elite has
received all permits and approvals with respect to emissions into the
environment and the proper collection, storage, transport, distribution or
disposal of Wastes (as defined below) and other materials required for the
operation of its business at present operating levels; and (iii) Elite is not
liable or responsible for any material clean up, fines, liability or expense
arising under any Environmental Law, as a result of the disposal of Wastes or
other materials in or on the property of Elite (whether owned or leased), or in
or on any other property, including property no longer owned, leased or used by
Elite. As used herein, (a) "ENVIRONMENTAL LAWS" means, collectively, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, the Superfund Amendments and Reauthorization Act of 1986, the Resource
Conservation and Recovery Act, the Toxic Substances Control Act, as amended, the
Clean Air Act, as amended, the Clean Water Act, as amended, any other
"Superfund" or "Superlien" law or any other federal, or applicable state or
local statute, law, ordinance, code, rule, regulation, order or decree (foreign
or domestic) regulating, relating to, or imposing liability or standards of
conduct concerning, Wastes, or the environment; and (B) "WASTES" means and
includes any hazardous, toxic or dangerous waste, liquid, substance or material
(including petroleum products and derivatives), the generation, handling,
storage, disposal, treatment or emission of which is subject to any
Environmental Law.
3.20. AGREEMENTS AND TRANSACTIONS WITH RELATED PARTIES. Except as
disclosed on Schedule 3.20, and except as disclosed in the Elite Financial
Statements, Elite is not a party to any contract, agreement, lease or
transaction with, or any other commitment to, (a) any Shareholder, (b) any
person related by blood, adoption or marriage to any Shareholder, (c) any
director or officer of Elite, (d) any corporation or other entity in which any
of the foregoing parties has, directly or indirectly, at least five percent
(5.0%) beneficial interest in the capital stock or other type of equity interest
in such corporation or other entity, or (e) any partnership in which any such
party is a general partner or a limited partner having a five percent (5%) or
more interest therein (any or all of the foregoing being herein referred to as a
"RELATED PARTY" and, collectively, as the "RELATED PARTIES"). Without limiting
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the generality of the foregoing, no Related Party, directly or indirectly, owns
or controls any assets or properties which are used in the business of Elite.
3.21. BUSINESS PRACTICES. Elite has not, at any time, directly or
indirectly, made any contributions or payment, or provided any compensation or
benefit of any kind, to any municipal, county, state, federal or foreign
governmental officer or official, or any other person charged with similar
public or quasi-public duties, or any candidate for political office.
3.22. LITIGATION. There is no suit, action or proceeding pending,
and no person has overtly-threatened in a writing delivered to Elite or the
Shareholders to commence any suit, action or proceeding, against or affecting
Elite that would, individually or in the aggregate, have an adverse effect on
Elite, nor is there any judgment, decree, injunction, or order of any
governmental entity or arbitrator outstanding against, or, to the knowledge of
Elite, pending investigation by any governmental entity involving, Elite or any
Shareholders that individually or in the aggregate would have an adverse effect
on Elite.
3.23. FULL DISCLOSURE. No representation or warranty of the
Shareholders contained in this Agreement, and none of the statements or
information concerning Elite contained in this Agreement and the Schedules,
contains or will contain as of the date hereof and as of the Closing Date any
untrue statement of a material fact nor will such representations, warranties,
covenants or statements taken as a whole omit a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
4. REPRESENTATIONS AND WARRANTIES OF CARCORP.
To induce the Shareholders to enter into this Agreement and to consummate
the transactions contemplated hereby, Carcorp represents and warrants to and
covenants with the Shareholders as follows:
4.1. ORGANIZATION. Carcorp is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Carcorp is entitled to own or lease its properties and to carry on its business
as and in the places where such business is now conducted, and Carcorp is duly
licensed and qualified in all jurisdictions where the character of the property
owned by it or the nature of the business transacted by it makes such license or
qualification necessary, except where such failure would not result in a
material adverse effect on Carcorp.
4.2. CAPITALIZATION AND RELATED MATTERS.
(a) Carcorp has authorized capital stock consisting
of 100,000,000 shares of common stock, par value $0.001 per share, of which
19,951,033 shares were issued and outstanding as of the date hereof. The Carcorp
Shares will be, when issued, duly and validly authorized and fully paid and
non-assessable, and will be issued to the Shareholder free of all encumbrances,
claims and liens whatsoever.
(b) Except as set forth in Schedule 4.2, and except
for employee stock options to purchase shares of Carcorp' Common Stock, Carcorp
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does not have outstanding any securities convertible into capital stock, nor any
rights to subscribe for or to purchase, or any options for the purchase of, or
any agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock or
securities convertible into its capital stock.
4.3. EXECUTION; NO INCONSISTENT AGREEMENTS; ETC.
(a) Subject to Carcorp' Board of Directors approval
contemplated by Section 7.5 hereof, the execution and delivery of this Agreement
and the performance of the transactions contemplated hereby have been duly and
validly authorized and approved by Carcorp and this Agreement is a valid and
binding agreement of Carcorp, enforceable against Carcorp in accordance with its
terms, except as such enforcement may be limited by bankruptcy or similar laws
affecting the enforcement of creditors' rights generally, and the availability
of equitable remedies.
(b) The execution and delivery of this Agreement by
Carcorp does not, and the consummation of the transactions contemplated hereby
will not, constitute a breach or violation of the charter or bylaws of Carcorp,
or a default under any of the terms, conditions or provisions of (or an act or
omission that would give rise to any right of termination, cancellation or
acceleration under) any material note, bond, mortgage, lease, indenture,
agreement or obligation to which Carcorp or any of its subsidiaries is a party,
pursuant to which any of them otherwise receive benefits, or by which any of
their properties may be bound.
4.4. FINANCIAL STATEMENTS. Carcorp has delivered or will deliver
to Elite the consolidated audited balance sheets of Carcorp as of December 31,
2001, the consolidated unaudited balance sheet as of September 30, 2002, the
consolidated audited statement of income for the two fiscal years ended December
31, 2001, and the unaudited statement of income for the nine (9) months ended
September 30, 2002 (collectively, the "CARCORP FINANCIAL STATEMENTS"). The
Carcorp Financial Statements have been prepared in accordance with GAAP, applied
on a consistent basis (except that the unaudited statements do not contain all
the disclosures required by GAAP), and fairly reflect in all material respects
the consolidated financial condition of Carcorp and its subsidiaries as at the
dates thereof and the consolidated results of Carcorp' operations for the
periods then ended. Since September 30, 2002, there has been no material adverse
change in the assets or liabilities, in the business or condition, financial or
otherwise, of Carcorp, or in its results of operations.
4.5. LIABILITIES. Neither Carcorp nor any of its subsidiaries has
any material debt, liability or obligation of any kind, whether accrued,
absolute, contingent or otherwise, except (a) those reflected on the Carcorp
Financial Statements, including the notes thereto, and (b) liabilities incurred
in the ordinary course of business since September 30, 2002, none of which have
had or will have a material adverse affect on the financial condition of Carcorp
and its subsidiaries taken as a whole.
4.6. CONTINGENCIES. There are no actions, suits, claims or
proceedings pending or, to the knowledge of Carcorp' management, threatened
against, by or affecting Carcorp or any of its subsidiaries in any court or
before any arbitrator or governmental agency which could have a material adverse
effect on Carcorp or its subsidiaries or which could materially and adversely
11
affect the right or ability of Carcorp to consummate the transactions
contemplated hereby. To the knowledge of Carcorp, there is no valid basis upon
which any such action, suit, claim or proceeding may be commenced or asserted
against Carcorp or its subsidiaries. There are no unsatisfied judgments against
Carcorp and no consent decrees or similar agreements to which Carcorp or its
subsidiaries is subject and which could have a material adverse effect on
Carcorp or its subsidiaries or which could materially and adversely affect the
right or ability of Carcorp to consummate the transactions contemplated hereby.
4.7. FULL DISCLOSURE. No representation or warranty of Carcorp
contained in this Agreement, and none of the statements or information
concerning Carcorp contained in this Agreement and the Schedules, contains or
will contain as of the date hereof and as of the Closing Date any untrue
statement of a material fact nor will such representations, warranties,
covenants or statements taken as a whole omit a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
5. CONDUCT OF BUSINESS OF ELITE PENDING CLOSING.
Elite and the Shareholders covenant and agree that between the date hereof
and the Closing Date:
5.1. BUSINESS IN THE ORDINARY COURSE. The business of Elite shall
be conducted only in the ordinary course, and consistent with past practice.
Without limiting the generality of the foregoing, or as otherwise approved in
writing by Carcorp:
(a) Elite shall not enter into any contract, agreement
or other arrangement which would constitute a Material Contract, except for
contracts to sell or supply goods or services to customers in the ordinary
course of business at prices and on terms substantially consistent with the
prior operating practices of Elite;
(b) except for sales of personal property in the
ordinary course of its business, Elite shall not sell, assign, transfer,
mortgage, convey, encumber or otherwise dispose of, or cause the sale,
assignment, transfer, mortgage, conveyance, encumbrance or other disposition of
any of the assets or properties of Elite or any interest therein;
(c) Elite shall not acquire any material assets,
except expenditures made in the ordinary course of business as reasonably
necessary to enable Elite to conduct its normal business operations;
(d) the books, records and accounts of Elite shall be
maintained in the usual, regular and ordinary course of business on a basis
consistent with prior practices and in accordance with GAAP;
(e) Elite shall use its best efforts to preserve its
business organization, to preserve the good will of its suppliers, customers and
others having business relations with Elite, and to retain the services of key
employees and agents of Elite after the Closing Date on terms acceptable to
Carcorp;
12
(f) except as they may terminate in accordance with
the terms of this Agreement, Elite shall keep in full force and effect, and not
cause a default of any of its obligations under, each of its contracts and
commitments;
(g) Elite shall duly comply in all material respects
with all laws applicable to it and to the conduct of its business;
(h) Elite shall not create, incur or assume any
liability or indebtedness, except in the ordinary course of business consistent
with past practices;
(i) Elite shall not make or commit to make any capital
expenditures;
(j) other than as contemplated in this Agreement,
Elite shall not apply any of its assets to the direct or indirect payment,
discharge, satisfaction or reduction of any amount payable directly or
indirectly to or for the benefit of the Shareholder or any Related Party; and
(k) neither Elite nor the Shareholders shall take or
omit to take any action which would render any of the Shareholders'
representations or warranties untrue or misleading, or which would be a breach
of any of the Shareholders' covenants.
5.2. NO MATERIAL CHANGES. Elite shall not, without the prior
written consent of Carcorp which consent shall not be unreasonably withheld,
materially alter its organization, capitalization, or financial structure,
practices or operations. Without limiting the generality of the foregoing:
(a) no change shall be made in the Articles of
Incorporation or Bylaws of Elite;
(b) no change shall be made in the authorized or
issued capital stock of Elite;
(c) Elite shall not issue or grant any right or option
to purchase or otherwise acquire any of its capital stock or other securities;
(d) no dividend or other distribution or payment shall
be declared or made with respect to any of the capital stock of Elite; and
(e) no change shall be made affecting the banking
arrangements of Elite.
5.3. COMPENSATION. No increase shall be made in the compensation
or employee benefits payable or to become payable to any director, officer,
employee or agent of Elite, and no bonus or profit-sharing payment or other
arrangement (whether current or deferred) shall be made to or with any such
director, officer, employee or agent, except in the ordinary course of business
and consistent with prior practices.
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5.4. NOTIFICATION. Each party to this Agreement shall promptly
notify the other parties in writing of the occurrence, or threatened occurrence,
of any event that would constitute a breach or violation of this Agreement by
any party or that would cause any representation or warranty made by the
notifying party in this Agreement to be false or misleading in any respect. The
Shareholders will promptly notify Carcorp of any event of which the Shareholders
obtain knowledge which could have an adverse effect on the business, assets,
financial condition or prospects of Elite. The Shareholders shall have the right
to update the Schedules to this Agreement immediately prior to Closing;
provided, if such update discloses any breach of a representation, warranty,
covenant or obligation of the Shareholders and/or Elite, Carcorp shall have the
right to then exercise its available rights and remedies hereunder.
6. CONDITIONS TO OBLIGATIONS OF ALL PARTIES.
The obligation of the Shareholders and Carcorp to consummate the
transactions contemplated by this Agreement are subject to the satisfaction, on
or before the Closing, of each of the following conditions; any or all of which
may be waived in whole or in part by the joint agreement of Carcorp, Elite and
the Shareholders:
6.1. ABSENCE OF ACTIONS. No action or proceeding shall have been
brought or threatened before any court or administrative agency to prevent the
consummation or to seek damages in a material amount by reason of the
transactions contemplated hereby, and no governmental authority shall have
asserted that the within transactions (or any other pending transaction
involving Carcorp, any of its subsidiaries, the Shareholders or Elite when
considered in light of the effect of the within transactions) shall constitute a
violation of law or give rise to material liability on the part of the
Shareholders, Elite or Carcorp or its subsidiaries.
6.2. CONSENTS. The parties shall have received from any suppliers,
lessors, lenders, lien holders or governmental authorities, bodies or agencies
having jurisdiction over the transactions contemplated by this Agreement, or any
part hereof, such consents, authorizations and approvals as are necessary for
the consummation hereof.
7. CONDITIONS TO OBLIGATIONS OF CARCORP.
All obligations of Carcorp to consummate the transactions contemplated
by this Agreement are subject to the fulfillment and satisfaction of each and
every of the following conditions on or prior to the Closing, any or all of
which may be waived in whole or in part by Carcorp:
7.1. REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Section 3 of this Agreement and in any certificate,
instrument, schedule, agreement or other writing delivered by or on behalf of
the Shareholders in connection with the transactions contemplated by this
Agreement shall be true, correct and complete in all material respects (except
for representations and warranties which are by their terms qualified by
materiality, which shall be true, correct and complete in all respects) as of
the date when made and shall be deemed to be made again at and as of the Closing
Date and shall be true, correct and complete at and as of such time in all
material respects (except for representations and warranties which are by their
terms qualified by materiality, which shall be true, correct and complete in all
respects).
14
7.2. COMPLIANCE WITH AGREEMENTS AND CONDITIONS. The Shareholders
and Elite shall have performed and complied with all material agreements and
conditions required by this Agreement to be performed or complied with by each
Shareholder and/or by Elite prior to or on the Closing Date.
7.3. ABSENCE OF MATERIAL ADVERSE CHANGES. No material adverse
change in the business, assets, financial condition, or prospects of Elite shall
have occurred, no substantial part of the assets of Elite not substantially
covered by insurance shall have been destroyed due to fire or other casualty,
and no event shall have occurred which has had or will have an adverse effect on
the business, assets, financial condition or prospects of Elite.
7.4. CERTIFICATE OF THE SHAREHOLDERS. The Shareholders shall have
executed and delivered, or caused to be executed and delivered, to Carcorp one
or more certificates, dated the Closing Date, certifying in such detail as
Carcorp may reasonably request to the fulfillment and satisfaction of the
conditions specified in Sections 7.1 through 7.3 above.
7.5. BOARD APPROVAL. This Agreement and the transactions
contemplated hereby shall have been approved by the unanimous approval of the
Carcorp' Board of Directors.
7.6. SATISFACTORY RESULTS OF INSPECTION. The results of the
inspection referred to in Section 2.1 hereof shall be satisfactory to the
Carcorp in its sole discretion.
8. CONDITIONS TO OBLIGATIONS OF THE SHAREHOLDERS.
All of the obligations of the Shareholders to consummate the transactions
contemplated by this Agreement are subject to the fulfillment and satisfaction
of each and every of the following conditions on or prior to the Closing, any or
all of which may be waived in whole or in part by the Shareholders:
8.1. REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Section 4 of this Agreement and in any certificate,
instrument, schedule, agreement or other writing delivered by or on behalf of
Carcorp in connection with the transactions contemplated by this Agreement shall
be true and correct in all material respects (except for representations and
warranties which are by their terms qualified by materiality, which shall be
true, correct and complete in all respects) when made and shall be deemed to be
made again at and as of the Closing Date and shall be true at and as of such
time in all material respects (except for representations and warranties which
are by their terms qualified by materiality, which shall be true, correct and
complete in all respects).
8.2. COMPLIANCE WITH AGREEMENTS AND CONDITIONS. Carcorp shall have
performed and complied with all material agreements and conditions required by
this Agreement to be performed or complied with by Carcorp prior to or on the
Closing Date.
8.3. ABSENCE OF MATERIAL ADVERSE CHANGES. No material adverse
change in the business, assets, financial condition, or prospects of Carcorp and
its subsidiaries, taken as a whole, shall have occurred, no substantial part of
the assets of Carcorp and its subsidiaries, taken as a whole, shall have been
destroyed due to fire or other casualty, and no event shall have occurred which
15
has had, or will have a material adverse effect on the business, assets,
financial condition or prospects of Carcorp and its subsidiaries, taken as a
whole.
8.4. CERTIFICATE OF CARCORP. Carcorp shall have delivered to the
Shareholders a certificate, executed by an executive officer and dated the
Closing Date, certifying to the fulfillment and satisfaction of the conditions
specified in Sections 8.1 through 8.3 above.
8.5. SALE OF OWNERSHIP OF CARCORP USA, INC. Carcop shall have sold
its entire ownership interest in Carcorp USA, Inc., a Florida corporation.
9. INDEMNITY.
9.1. INDEMNIFICATION BY SHAREHOLDERS. The Shareholders
(hereinafter, collectively, called the "SHAREHOLDER INDEMNITORS") shall jointly
and severally defend, indemnify and hold harmless Carcorp and its direct and
indirect Carcorp corporations, subsidiaries (including Elite after Closing) and
affiliates, their officers, directors, employees and agents (hereinafter,
collectively, called "CARCORP INDEMNITEES") against and in respect of any and
all loss, damage, liability, fine, penalty, cost and expense, including
reasonable attorneys' fees and amounts paid in settlement (collectively,
"CARCORP LOSSES"), suffered or incurred by any Carcorp Indemnitee by reason of,
or arising out of:
(a) any misrepresentation, breach of warranty or
breach or non-fulfillment of any agreement of the Shareholders or Elite
contained in this Agreement or in any certificate, schedule, instrument or
document delivered to Carcorp by or on behalf of the Shareholders or Elite
pursuant to the provisions of this Agreement (without regard to materiality
thresholds contained therein); and
(b) any liabilities of Elite of any nature whatsoever
(including tax liability, penalties and interest), whether accrued, absolute,
contingent or otherwise, (i) existing as of the date of the Balance Sheet, and
required to be shown therein in accordance with GAAP, to the extent not
reflected or reserved against in full in the Balance Sheet; or (ii) arising or
occurring between December 31, 2002 and the Closing Date.
9.2. INDEMNIFICATION BY CARCORP. Carcorp (hereinafter called the
"CARCORP INDEMNITOR") shall defend, indemnify and hold harmless the Shareholders
(hereinafter called "SHAREHOLDER INDEMNITEES") against and in respect of any and
all loss, damage, liability, cost and expense, including reasonable attorneys'
fees and amounts paid in settlement (collectively, "SHAREHOLDER LOSSES"),
suffered or incurred by Shareholder Indemnitees by reason of or arising out of:
(a) any misrepresentation, breach of warranty or
breach or non-fulfillment of any material agreement of Carcorp contained in this
Agreement or in any other certificate, schedule, instrument or document
delivered to the Shareholders by or on behalf of Carcorp pursuant to the
provisions of this Agreement (without regard to materiality thresholds contained
therein); and
(b) any liabilities of Elite of any nature whatsoever
(including tax liability, penalties and interest), whether accrued, absolute,
16
contingent or otherwise, arising from Carcorp' ownership or operation of Elite
after Closing, but only so long as such liability is not the result of an act or
omission of Elite or any Shareholder occurring prior to the Closing. Carcorp
Losses and Shareholder Losses are sometimes collectively referred to as
"INDEMNIFIABLE LOSSES."
9.3. DEFENSE OF CLAIMS.
(a) Each party seeking indemnification hereunder (an
"INDEMNITEE"): (i) shall provide the other party or parties (the "INDEMNITOR")
written notice of any claim or action by a third party arising after the Closing
Date for which an Indemnitor may be liable under the terms of this Agreement,
within ten (10) days after such claim or action arises and is known to
Indemnitee, and (ii) shall give the Indemnitor a reasonable opportunity to
participate in any proceedings and to settle or defend any such claim or action.
The expenses of all proceedings, contests or lawsuits with respect to such
claims or actions shall be borne by the Indemnitor. If the Indemnitor wishes to
assume the defense of such claim or action, the Indemnitor shall give written
notice to the Indemnitee within ten (10) days after notice from the Indemnitee
of such claim or action, and the Indemnitor shall thereafter assume the defense
of any such claim or liability, through counsel reasonably satisfactory to the
Indemnitee, provided that Indemnitee may participate in such defense at their
own expense, and the Indemnitor shall, in any event, have the right to control
the defense of the claim or action.
(b) If the Indemnitor shall not assume the defense of,
or if after so assuming it shall fail to defend, any such claim or action, the
Indemnitee may defend against any such claim or action in such manner as they
may deem appropriate and the Indemnitees may settle such claim or litigation on
such terms as they may deem appropriate but subject to the Indemnitor's
approval, such approval not to be unreasonably withheld; provided, however, that
any such settlement shall be deemed approved by the Indemnitor if the Indemnitor
fails to object thereto, by written notice to the Indemnitee, within fifteen
(15) days after the Indemnitor's receipt of a written summary of such
settlement. The Indemnitor shall promptly reimburse the Indemnitee for the
amount of all expenses, legal and otherwise, incurred by the Indemnitee in
connection with the defense and settlement of such claim or action.
(c) If a non-appealable judgment is rendered against
any Indemnitee in any action covered by the indemnification hereunder, or any
lien attaches to any of the assets of any of the Indemnitee, the Indemnitor
shall immediately upon such entry or attachment pay such judgment in full or
discharge such lien unless, at the expense and direction of the Indemnitor, an
appeal is taken under which the execution of the judgment or satisfaction of the
lien is stayed. If and when a final judgment is rendered in any such action, the
Indemnitor shall forthwith pay such judgment or discharge such lien before any
Indemnitee is compelled to do so.
9.4. WAIVER. The failure of any Indemnitee to give any notice or
to take any action hereunder shall not be deemed a waiver of any of the rights
of such Indemnitee hereunder, except to the extent that Indemnitor is actually
prejudiced by such failure.
9.5. LIMITATIONS ON INDEMNIFICATION. Notwithstanding anything to
the contrary contained in this Agreement:
17
9.5.1. TIME LIMITATION. No party shall be responsible
hereunder for any Indemnifiable Loss unless the Indemnitee shall have provided
such party with written notice containing a reasonable description of the claim,
action or circumstances giving rise to such Indemnifiable Loss within three (3)
years after the Closing Date (the "INDEMNITY NOTICE PERIOD"); provided, however,
that:
(a) with respect to any Indemnifiable Loss resulting
or arising from any breach of a representation or warranty of the Shareholders
relating to taxes, or any tax liability of Elite arising or relating to periods
prior to the Closing Date, the Indemnity Notice Period shall extend for the full
duration of the statute of limitations; and
(b) there shall be no limit on the Indemnity Notice
Period for indemnity claims: (i) against the Shareholders for Indemnifiable
Losses arising or resulting from a breach of a representation or warranty
relating to Environmental Laws, or any liability which relates to the handling
or disposal of Wastes or the failure to comply with any Environmental Law; and
(ii) against any party based on fraud or intentional breach or
misrepresentation.
10. TERMINATION.
10.1. TERMINATION. This Agreement may be terminated at any time on
or prior to the Closing:
(a) By mutual consent of Carcorp and the Shareholders;
or
(b) At the election of Carcorp if: (i) the
Shareholders have breached or failed to perform or comply with any of their
representations, warranties, covenants or obligations under this Agreement; or
(ii) any of the conditions precedent set forth in Section 6 or 7 is not
satisfied as and when required by this Agreement; or (iii) the Closing has not
been consummated by April 30, 2003; or
(c) At the election of the Shareholders if: (i)
Carcorp has breached or failed to perform or comply with any of its
representations, warranties, covenants or obligations under this Agreement; or
(ii) any of the conditions precedent set forth in Section 6 or 8 is not
satisfied as and when required by this Agreement; or (iii) if the Closing has
not been consummated by April 30, 2003.
18
10.2. MANNER AND EFFECT OF TERMINATION. Written notice of any
termination ("TERMINATION NOTICE") pursuant to this Section 10 shall be given by
the party electing termination of this Agreement ("TERMINATING PARTY") to the
other party or parties (collectively, the "TERMINATED PARTY"), and such notice
shall state the reason for termination. The party or parties receiving
Termination Notice shall have a period of ten (10) days after receipt of
Termination Notice to cure the matters giving rise to such termination to the
reasonable satisfaction of the Terminating Party. If the matters giving rise to
termination are not cured as required hereby, this Agreement shall be terminated
effective as of the close of business on the tenth (10th) day following the
Terminated Party's receipt of Termination Notice. Upon termination of this
Agreement prior to the consummation of the Closing and in accordance with the
terms hereof, this Agreement shall become void and of no effect, and none of the
parties shall have any liability to the others, except that nothing contained
herein shall relieve any party from: (a) its obligations under Sections 2.2 and
2.3; or (b) liability for its intentional breach of any representation, warranty
or covenant contained herein, or its intentional failure to comply with the
terms and conditions of this Agreement or to perform its obligations hereunder.
11. MISCELLANEOUS.
11.1. NOTICES.
(a) All notices, requests, demands, or other
communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given upon receipt if delivered in person, or upon the
expiration of four (4) days after the date sent, if sent by federal express (or
similar overnight courier service) to the parties at the following addresses:
(i) If to Carcorp: Carcorp USA Corporation
0000 Xxxx Xxxxxxxxx Xxxx #000
Xxxxxxxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx XxXxx
with a copy to: _____________________________________
_____________________________________
_____________________________________
Attn:________________________________
(ii) If to a Shareholder: The name and address as listed
on the SCHEDULE A attached
hereto.
(b) Notices may also be given in any other manner
permitted by law, effective upon actual receipt. Any party may change the
address to which notices, requests, demands or other communications to such
party shall be delivered or mailed by giving notice thereof to the other parties
hereto in the manner provided herein.
11.2. SURVIVAL. Except as provided in the next sentence, the
representations, warranties, agreements and indemnifications of the parties
19
contained in this Agreement or in any writing delivered pursuant to the
provisions of this Agreement shall survive any investigation heretofore or
hereafter made by the parties and the consummation of the transactions
contemplated herein and shall continue in full force and effect after the
Closing, subject to the limitations of Section 9.5. The representations,
warranties and agreements of Elite contained in this Agreement shall not survive
the Closing.
11.3. COUNTERPARTS; INTERPRETATION. This Agreement may be executed
in any number of counterparts, each of which shall be deemed an original, and
all of which shall constitute one and the same instrument. This Agreement
supersedes all prior discussions and agreements between the parties with respect
to the subject matter hereof, and this Agreement contains the sole and entire
agreement among the parties with respect to the matters covered hereby. All
Schedules hereto shall be deemed a part of this Agreement. This Agreement shall
not be altered or amended except by an instrument in writing signed by or on
behalf of all of the parties hereto. No ambiguity in any provision hereof shall
be construed against a party by reason of the fact it was drafted by such party
or its counsel. For purposes of this Agreement: "herein", "hereby", "hereunder",
"herewith", "hereafter" and "hereinafter" refer to this Agreement in its
entirety, and not to any particular section or paragraph. References to
"INCLUDING" means including without limiting the generality of any description
preceding such term. Nothing expressed or implied in this Agreement is intended,
or shall be construed, to confer upon or give any person other than the parties
hereto any rights or remedies under or by reason of this Agreement.
11.4. GOVERNING LAW. The validity and effect of this Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of Florida, without regard to principles of conflicts of laws thereof.
Any dispute, controversy or question of interpretation arising under, out of, in
connection with or in relation to this Agreement or any amendments hereof, or
any breach or default hereunder, shall be litigated in the state or federal
courts in Miami-Dade County, Florida, U.S.A. Each of the parties hereby
irrevocably submits to the jurisdiction of any state or federal court sitting in
Miami-Dade County, Florida. Each party hereby irrevocably waives, to the fullest
extent it may effectively do so, the defense of an inconvenient forum to the
maintenance of any such action in Miami-Dade County, Florida.
11.5. SUCCESSORS AND ASSIGNS; ASSIGNMENT. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, executors, legal representatives, and successors; provided,
however, that no Shareholder may assign this Agreement or any rights hereunder,
in whole or in part.
11.6. PARTIAL INVALIDITY AND SEVERABILITY. All rights and
restrictions contained herein may be exercised and shall be applicable and
binding only to the extent that they do not violate any applicable laws and are
intended to be limited to the extent necessary to render this Agreement legal,
valid and enforceable. If any terms of this Agreement not essential to the
commercial purpose of this Agreement shall be held to be illegal, invalid or
unenforceable by a court of competent jurisdiction, it is the intention of the
parties that the remaining terms hereof shall constitute their agreement with
respect to the subject matter hereof and all such remaining terms shall remain
in full force and effect. To the extent legally permissible, any illegal,
invalid or unenforceable provision of this Agreement shall be replaced by a
valid provision which will implement the commercial purpose of the illegal,
invalid or unenforceable provision.
20
11.7. WAIVER. Any term or condition of this Agreement may be waived
at any time by the party which is entitled to the benefit thereof, but only if
such waiver is evidenced by a writing signed by such party. No failure on the
part of a party hereto to exercise, and no delay in exercising, any right, power
or remedy created hereunder, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or remedy by any such party
preclude any other future exercise thereof or the exercise of any other right,
power or remedy. No waiver by any party hereto to any breach of or default in
any term or condition of this Agreement shall constitute a waiver of or assent
to any succeeding breach of or default in the same or any other term or
condition hereof.
11.8. HEADINGS. The headings as to contents of particular
paragraphs of this Agreement are inserted for convenience only and shall not be
construed as a part of this Agreement or as a limitation on the scope of any
terms or provisions of this Agreement.
11.9. EXPENSES. Except as otherwise expressly provided herein, all
legal and other costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by Carcorp or the
Shareholder as each party incurs such expenses, and none of such expenses shall
be charged to or paid by Elite.
11.10. FINDER'S FEES. Carcorp represents to the Shareholders that no
broker, agent, finder or other party has been retained by it in connection with
the transactions contemplated hereby and that no other fee or commission has
been agreed by the Carcorp to be paid for or on account of the transactions
contemplated hereby. The Shareholders represent to Carcorp that no broker,
agent, finder or other party has been retained by Shareholders or Elite in
connection with the transactions contemplated hereby and that no other fee or
commission has been agreed by the Shareholders or Elite to be paid for or on
account of the transactions contemplated hereby.
11.11. GENDER. Where the context requires, the use of the singular
form herein shall include the plural, the use of the plural shall include the
singular, and the use of any gender shall include any and all genders.
11.12. ACCEPTANCE BY FAX. This Agreement shall be accepted,
effective and binding, for all purposes, when the parties shall have signed and
transmitted to each other, by telecopier or otherwise, copies of the signature
pages hereto.
11.13. ATTORNEYS FEES. In the event of any litigation arising under
the terms of this Agreement, the prevailing party or parties shall be entitled
to recover its or their reasonable attorneys fees and court costs from the other
party or parties.
11.14. OPPORTUNITY TO HIRE COUNSEL; ROLE OF XXXXXXXXXXX & XXXXXXXX
LLP. Carcorp and each Shareholder acknowledge that it has been advised and has
been given an opportunity to hire counsel with respect to this Agreement and the
transactions contemplated hereby. Carcorp and each Shareholder further
acknowledge that the law firm of Xxxxxxxxxxx & Xxxxxxxx LLP has solely
represented Elite in connection with this Agreement and the transactions
contemplated hereby and no other person.
21
11.15. TIME IS OF THE ESSENCE. It is understood and agreed among the
parties hereto that time is of the essence in this Agreement and this applies to
all terms and conditions contained herein.
11.16. NO JURY TRIAL. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT AND ANY DOCUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE PARTIES' ACCEPTANCE OF THIS AGREEMENT.
[REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement to be duly
executed by their duly authorized officers as of the day and year first above
written.
CARCORP USA CORPORATION
By:__________________________________
Name:________________________________
Title:_______________________________
ELITE FLIGHT SOLUTIONS, INC.
By:__________________________________
Name:________________________________
Title:_______________________________
SHAREHOLDERS:
-------------
PARADISE RUN, LLC AMBER RUN, LLC
By:_________________________________ By:__________________________________
Name:_______________________________ Name:________________________________
Title:______________________________ Title:_______________________________
____________________________________ FUNDING ENTERPRISES, INC.
XXXXXX XXXXXX
By:__________________________________
Name:________________________________
Title:_______________________________
____________________________________
XXXX XXXXX
____________________________________ _____________________________________
XXXX XXXXX XXXXX XXXX
____________________________________ _____________________________________
XXXXX XXXX XXX XXXXXXX
23
SCHEDULE A
----------
Name of Elite Flight Solutions, Number of Shares of Elite Number of Shares Of
Inc. Shareholder Flight Solutions Owned Carcorp to be Delivered
------------------------------------- --------------------------- -------------------------
Paradise Run, LLC 131,500,000 19,725,000
Amber Run, LLC 19,500,000 2,925,000
Xxxxxx Xxxxxx 10,550,000 1,582,500
Funding Enterprises 8,000,000 1,200,000
Xxxx Xxxxx 9,000,000 1,350,000
Xxxx Xxxxx 2,500,000 375,000
Xxxxx Xxxx 1,000,000 150,000
Xxxxx Xxxx 1,000,000 150,000
Xxx Xxxxxxx 1,000,000 150,000
24
