ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT ("Agreement") is dated June 5, 2000,
by and between xXxx.xxx, Inc., a corporation with its principal
business address at 000 Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, X.X.,
Xxxxxx ("eCom") and Rukos Security Advice AG, a corporation with
its representative address at Xxxxx Xxxx, Xxx 00, 00000
Xxxxxxxxx/Xxxx, Xxxxxxx (the "Company"). Each of eCom and the
Company is sometimes individually referred to herein as a
"party," and eCom and the Company are sometimes collectively
referred to herein as the "parties."
BACKGROUND
The Company owns all proprietary software and software rights to
the Web Crawler Search Engine "xxxxxxxx0x.xxx". eCom is a
Colorado corporation, with its principal offices in Newport
Beach, California. As of this date, eCom has 10 Billion
(10,000,000,000) authorized shares of common stock, par value
$0.01 per share ("eCom Common Stock"), of which 24,595,739 shares
are outstanding, and 1,000,000 authorized shares of preferred
stock, par value $100 per share ("eCom Preferred Stock"), none of
which are outstanding.
eCom desires to acquire all of the proprietary software and
software rights to the Web Meta Crawler Search Engine
"xxxxxxxx0x.xxx".
NOW THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements hereinafter
set forth, the parties hereby agree as follows:
ARTICLE I
THE ACQUISITION AND RELATED MATTERS
1.1 Consideration. eCom shall pay the Company U.S. $1,250,000
subject to the completion of a financing by eCom.
1.2 Payment: At the Acquisition Effective Time, by virtue of the
Acquisition and without any action on the part of the Company or
eCom and subject to 1.1 above, eCom agrees to pay the purchase
price to the Company:
(a) The Company shall deliver to eCom all of the proprietary
software and software rights and all rights title and interest in
and to the said Web Crawler and internet web site
"xxxxxxxx0x.xxx".
(b) The Company, holders of all rights title and interest in and
to the said Web Crawler and internet web site "xxxxxxxx0x.xxx",
shall cease to have any rights as owners of the said Web Crawler
and internet web site "xxxxxxxx0x.xxx".
1.3 Authorization for Issuance of eCom Common Stock to
finance the acquisition of all rights, title, income and interest
in and to the said Web Crawler and internet web site
"xxxxxxxx0x.xxx";
(a) eCom shall reserve for issuance a sufficient number of
shares of eCom Common Stock for financing this Acquisition in
accordance with this Agreement.
(b) After the Acquisition Effective Time, eCom shall become
holders of all rights, title, income and interest in and to the
said Web Crawler and internet web site "xxxxxxxx0x.xxx" and shall
be entitled to receive all rights, title, income and interest in
and to the said Web Crawler and internet web site
"xxxxxxxx0x.xxx";
1.4 Cooperation. The parties shall cooperate in the
preparation and submission by them, as promptly as reasonably
practicable, of such applications, petitions, and other filings
as any of them may reasonably deem necessary or desirable to or
with any regulatory or governmental authorities for the purpose
of obtaining any approvals or consents necessary to consummate
the Acquisition, including, but not limited to, obtaining
consents to assignments of product licenses. Each party will
have the right to review and comment on such applications,
petitions, and filings in advance and shall furnish to the other
copies thereof promptly after submission. Each party agrees to
consult with the other with respect to obtaining all necessary
consents and approvals, and each will keep the other apprized of
the status of matters relating to such approvals and consents.
At the date hereof, no party is aware of any reason that any
approval required to be obtained by it would not be obtained.
1.5 Closing. Closing (the "Closing") shall take place on June
5, 2000 at the principal office of eCom, or at such other place
as the parties agree, at which the parties will exchange
certificates, opinions, letters, payment and other documents as
required.
1.6 At Closing, eCom shall pay to the Company the non
refundable sum of $50,000, and shall thereafter pay the balance
of $1,200,000 to the Company as per the terms of the Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
eCom represents and warrants to the Company, except as disclosed
in the Disclosure Schedule delivered by it to eCom pursuant to
this article herein, as follows:
2.1 Organization, Good Standing, Authority, Insurance, Etc. It
is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation.
It has all requisite power and authority and, to the extent
required by applicable law, is licensed to own, lease and operate
its properties and conduct its business as it is now being
conducted. It has delivered or made available to eCom a true,
complete and correct copy of its articles of incorporation,
certificate of incorporation or other organizing document and of
its bylaws, as in effect on the date of this Agreement. Its
minute books contain complete and accurate records of all
meetings and other corporate actions taken by its stockholders
and Board of Directors (including the committees of such Board).
2.2 Capitalization. Its authorized capital stock and the
number of issued and outstanding shares of its capital stock as
of the date hereof are accurately set forth in the recitals in
this Agreement. All outstanding shares of its common stock are
duly authorized, validly issued, and fully paid, non-assessable
and free of preemptive rights. As of the date of this Agreement,
there are no options, convertible securities, warrants or other
rights (preemptive or otherwise) to purchase or acquire any of
its capital stock from it and no oral or written agreement,
contract, arrangement, understanding, plan or instrument of any
kind to which it is subject with respect to the issuance, voting
or sale of issued or unissued shares of its capital stock. Only
the holders of its common stock have the right to vote at
meetings of its stockholders on matters to be voted thereat.
2.3 Absence of Changes.
(a) Since its incorporation there has been no material adverse
change affecting it. There is no occurrence, event, or
development of any nature existing or, to its best knowledge,
threatened which may reasonably be expected to have a material
adverse effect upon it.
(b) Since its incorporation it has owned and operated its
assets, properties and businesses in the ordinary course and
consistent with past practice.
2.4 Information Statement. This Agreement, with respect to all
information set forth therein relating to it and/or its common
stock, this Agreement, the Acquisition and the other transactions
contemplated hereby, will:
(a) Comply in all material respects with applicable provisions
of law; and
(b) Not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or
necessary in order to avoid making the statements contained
therein, in light of the circumstances under which they are made,
misleading.
(c) Notwithstanding the foregoing, the Company makes no
representations or warranties regarding information in the
Information Statement pertaining to eCom.
2.5 Litigation and Other Proceedings. Except for matters which
would not have a material adverse effect on it, it is not a
defendant in, nor is any of its property subject to, any pending
or, to its best knowledge, threatened claim, action, suit,
investigation or proceeding or subject to any judicial order,
judgment or decree.
2.6 Compliance with Law.
(a) It is in compliance in all material respects with all laws,
regulations, ordinances, rules, judgments, orders, or decrees
applicable to its respective operations or businesses.
(b) It has all permits, licenses, certificates of authority,
orders and approvals of, and has made all filings, applications
and registrations with, all federal, state, local and foreign
governmental or regulatory bodies that are required in order to
permit them to carry on its respective businesses as they are
presently being conducted.
(c) Since its incorporation, it has not received any
notification or communication from any governmental or regulatory
entity (i) asserting that it is not in compliance with any of the
statutes, regulations or ordinances that such governmental or
regulatory entity administers or enforces; (ii) threatening to
revoke any license, franchise, permit or authorization; or (iii)
threatening or contemplating any enforcement action by a state or
federal regulator (nor, to the knowledge of its executive
officers, do any grounds for any of the foregoing exist).
2.7 Corporate Actions.
(a) Its Board of Directors has (i) duly approved the
Acquisition, this Agreement, and authorized its officers to
execute and deliver this Agreement, and to take all action
necessary to consummate the Acquisition and the other
transactions contemplated hereby.
(b) Its Board of Directors has taken all necessary action to
exempt this Agreement, and the transactions contemplated hereby
and thereby from, and this Agreement, and the transactions
contemplated hereby and thereby are exempt from, (i) any
applicable state takeover laws, (ii) any state laws limiting or
restricting the voting rights of stockholders, (iii) any state
laws requiring a stockholder approval vote in excess of the vote
normally required in transactions of similar type not involving a
"related person@, "interested stockholder" or person or entity of
similar type and (iv) any provision in its articles of
incorporation, certificate of incorporation, charter or bylaws,
(A) restricting or limiting stock ownership or the voting rights
of stockholders or (B) requiring a stockholder approval vote in
excess of the vote normally required in transactions of similar
type not involving a "related person", "interested stockholder"
or person or entity of similar type.
2.8 Material Contract Defaults. Neither it nor any other party
is in default in any respect under any contract, agreement,
commitment, arrangement, lease, insurance policy or other
instrument to which it is a party or by which its assets,
business or operations may be bound or affected or under which it
or its assets, business or operations receive benefits, which
default is reasonably expected to have either individually or in
the aggregate a material adverse effect on it, and there has not
occurred any event that, with the lapse of time or the giving of
notice or both, would constitute such a default.
2.9 Tax Matters.
(a) It has duly and properly filed all federal, state, local and
other tax returns and reports required to be filed by it and has
made timely payments of all taxes due and payable, whether
disputed or not and it has no agreement for the extension of time
for the assessment or payment of any taxes payable. Neither the
Internal Revenue Service nor any other taxing authority is now
asserting or, to its best knowledge, is threatening to assert any
deficiency or claim for additional taxes (or interest thereon or
penalties in connection therewith), nor is it aware of any basis
for any such assertion or claim. It has complied in all material
respects with applicable Internal Revenue Service backup
withholding requirements. It has complied with all applicable
state law tax collection and reporting requirements.
ARTICLE III
COVENANTS
3.1 Investigations; Access and Copies. Between the date of this
Agreement and the Acquisition Effective Time, the Company agrees
to give eCom and its respective representatives and agents full
access (to the extent lawful) to all of the premises, books,
records and employees of it at reasonable times and to furnish to
eCom and its respective agents or representatives access to and
true and complete copies of such financial and operating data,
all documents with respect to matters to which reference is made
in Article II of this Agreement or on any list, schedule or
certificate delivered or to be delivered in connection herewith
and such other documents, records, or information with respect to
its businesses and properties as eCom or its respective agents or
representatives shall from time to time reasonably request;
provided however, that any such inspection (a) shall be conducted
in such manner as not to interfere unreasonably with the
operation of the business of the entity inspected and (b) shall
not affect any of the representations and warranties hereunder.
One representative of eCom shall be permitted to attend all
meetings of the Company's board of directors (except for any
portion of such meetings which relates to the transactions
contemplated by this Agreement or such other matters deemed
confidential). Each party will also give prompt written notice to
the other party of any event or development which, had it existed
or been known on the date of this Agreement, would have been
required to be disclosed under this Agreement, or would cause any
of its representations and warranties contained herein to be
inaccurate or otherwise materially misleading, or which
materially relates to the satisfaction of the conditions set
forth in Article IV of this Agreement. Notwithstanding anything
to the contrary herein, neither party hereto shall be required to
provide access to or to disclose information where such access or
disclosure would jeopardize the attorney-client privilege of the
entity in possession or control of such information or contravene
any law, rule, regulation, order, judgment, decree, fiduciary
duty or binding agreement entered into prior to the date of this
Agreement or, in the event of any litigation or threatened
litigation between the parties over the terms of this Agreement,
where access to information may be adverse to the interests of
such party. To the extent reasonably practicable, the parties
hereto will make appropriate substitute disclosure arrangements
under circumstances in which the restrictions of the preceding
sentence apply.
3.2 Conduct of Business. Between the date of this Agreement
and the Acquisition Effective Time or the termination of this
Agreement, each party agrees:
(a) That it shall (i) except as contemplated in this Agreement
conduct its business only in the ordinary course consistent with
past practices, (ii) maintain its books and records in accordance
with past practices and (iii) use all reasonable efforts to
preserve intact its business organizations and assets, to
maintain its rights, franchises and existing relations with
customers, suppliers, employees and business associates and to
take no action that would (A) adversely affect its ability to
obtain consents and approvals or which would reasonably be
expected to hinder or delay receipt of the Governmental Approvals
or (B) adversely affect its ability to perform its obligations
under this Agreement, or;
(b) That it shall not: (i) declare, set aside or pay any
dividend or make any other distribution with respect to its
capital stock, (ii) reacquire or buy any of its outstanding
shares; (iii) issue or sell any shares of its capital stock; (iv)
effect any stock split, stock dividend, reverse stock split or
other reclassification or recapitalization of its common stock;
or (v) grant any options or issue any warrants exercisable for or
securities convertible or exchangeable into its capital stock or
grant any stock appreciation or other rights with respect to its
shares of capital stock.
(c) That it shall not: (i) sell, dispose of or pledge any of its
significant assets or borrow funds in consistent with the
provisions of this Agreement; (ii) merge or consolidate into
another entity or acquire any other entity, or acquire any
significant assets; (iii) change its articles of incorporation or
certificate of incorporation, charter, bylaws or other governing
instruments, except, in the case of eCom, as contemplated by this
Agreement, (iv) form any new subsidiary, (v) engage in any off
balance sheet arrangement, (vi) engage in any activity not
contemplated by its written business plan in effect on the date
hereof, (vii) purchase any equity securities or assume any
indebtedness; (viii) authorize capital expenditures other than in
the ordinary and usual course of business; or (ix) implement or
adopt any change in its accounting principles, practices or
methods other than as may be required by generally accepted
accounting principles consistently applied. The limitations
contained in this Section 3.2(c) shall also be deemed to
constitute limitations as to the making of any commitment with
respect to any of the matters set forth in this Section 3.2(c).
(d) That it shall not: (i) grant any general increase in
compensation or benefits to its employees or officers or pay any
bonuses to its employees or officers except in accordance with
policies in effect on the date hereof; (ii) enter into, extend,
renew, modify, amend or otherwise change any employment or
severance agreements with any of its directors, officers or
employees; (iii) grant any increase in fees or other increases in
compensation or other benefits to any of its present or former
directors in such capacity; or (iv) establish or sponsor any new
Employee Plan or Benefit Arrangement or effect any change in its
Employee Plans or Benefit Arrangements.
3.3 Stockholder Approvals. Each of the parties hereto each have
the necessary approvals from their stockholders for the purpose
of executing this Agreement and related matters, as referred to
in Section 1.5 hereof.
3.4 Publicity. Between the date of this Agreement and the
Acquisition Effective Time, neither party shall, without the
prior approval of the other party, issue or make, or permit any
of its directors, employees, officers or agents to issue or make,
any press release, disclosure or statement to the press or any
third party with respect to the Acquisition or the other
transactions contemplated hereby, except as required by law. The
parties shall cooperate when issuing or making any press release,
disclosure or statement with respect to the Acquisition or the
other transactions contemplated hereby.
3.5 Cooperation Generally. Between the date of this Agreement
and the Acquisition Effective Time, the parties use their best
efforts, and take all actions necessary or appropriate, to
consummate the Acquisition and the other transactions
contemplated hereby at the earliest practicable date.
ARTICLE IV
CONDITIONS OF THE ACQUISITION; TERMINATION OF AGREEMENT
4.1 General Conditions. The obligations of each party to effect
the Acquisition shall be subject to the satisfaction (or written
waiver by such party, to the extent such condition is waivable)
of the parties.
4.2 Conditions to Obligations of the Company. The obligations
of the Company to effect the Acquisition and the other
transactions contemplated hereby shall be subject to the
satisfaction of eCom or waiver by the Company of the following
additional conditions before the Acquisition Effective Time:
(a) No Material Adverse Effect. Between the date of this
Agreement and the Closing, eCom shall not have been affected by
any event or change that has had or caused a material adverse
effect or material adverse change on it.
(b) Representations and Warranties to be True; Fulfillment of
Covenants and Conditions.
(i) The representations and warranties of the Company shall be
true and correct as of the date hereof and at the Acquisition
Effective Time with the same effect as though made at the
Acquisition Effective Time (or on the date when made in the case
of any representation or warranty which specifically relates to
an earlier date) except where the failure to be true and correct
would not have, or would not reasonably be expected to have, a
material adverse effect on eCom;
(ii) The Company shall have performed all obligations and
complied with each covenant, in all material respects, and
satisfied all conditions under this Agreement on its part to be
satisfied at or before the Acquisition Effective Time; and
(c) No Litigation. eCom shall not be subject to any pending
litigation that, if determined adversely to eCom, would have a
material adverse effect on eCom.
(d) eCom Preferred Stock. No shares of eCom Preferred Stock
shall be issued or outstanding.
4.3 Conditions to Obligations of the Company. The obligations
of the Company to effect the Acquisition and the other
transactions contemplated hereby shall be subject to the
satisfaction of or written waiver by the Company of the following
additional conditions before the Acquisition Effective Time:
(a) No Material Adverse Effect. Between the date of this
Agreement and Closing, Esearchb2b shall not have been affected by
any event or change that has had or caused a material adverse
effect or material adverse change on it.
(b) Representations and Warranties to be True; Fulfillment of
Covenants and Conditions.
(i) The representations and warranties of the Company shall be
true and correct as of the date hereof and at the Acquisition
Effective Time with the same effect as though made at the
Acquisition Effective Time (or on the date when made in the case
of any representation or warranty which specifically relates to
an earlier date) except where the failure to be true and correct
would not have, or would not reasonably be expected to have, a
material adverse effect on the Company.
(ii) The Company shall have performed all obligations and
complied with each covenant, in all material respects, and
satisfied all conditions under this Agreement on its part to be
satisfied at or before the Acquisition Effective Time; and
(c) No Litigation. The Company shall not be
subject to any pending litigation that, if determined adverse,
would have a material adverse effect on the Company.
4.4 Termination of Agreement and Abandonment of Acquisition.
This Agreement may be terminated at any time before the
Acquisition Effective Time, whether before or after approval
thereof by the stockholders of eCom or the Company, as provided
below:
(a) Mutual Consent. By mutual consent of the parties, evidenced
by their written agreement.
(b) Conditions to Performance Not Met. Upon delivery of written
notice of termination to the Company if any event occurs which
renders impossible satisfaction in any material respect of one or
more of the conditions to the obligations of the Company to
effect the Acquisition set forth in Sections 4.1 and 4.2 and
noncompliance is not waived in writing by eCom.
(i) Conditions to the Company Performance Not Met. By
the Company upon delivery of written notice of termination to
eCom if any event occurs which renders impossible satisfaction
any material respect of one or more of the conditions to the
obligations of eCom to effect the Acquisition set forth in
Sections 4.1 and 4.3 and noncompliance is not waived in writing
by the Company
(ii) Breach. By the Company if there has been a material breach
of eCom's representations and warranties (as contemplated in this
Agreement), covenants or agreements set forth in this Agreement
of which written notice has been given and which has not been
fully cured or cannot be fully cured within the earlier of (i)
five days of receipt of such notice or (ii) five days prior to
the Closing and which breach would, in the reasonable opinion of
the Company, individually or in the aggregate, have, or be
reasonably likely to have, a material adverse effect on eCom.
(iii) Breach. By eCom if there has been a material breach of
the Company's representations and warranties (as contemplated in
this Agreement), covenants or agreements set forth in this
Agreement of which written notice has been given and which has
not been fully cured or cannot be fully cured within the earlier
of (i) five days of receipt of such notice or (ii) five days
prior to the Closing and which breach would, in the reasonable
opinion of the Company, individually or in the aggregate, have,
or be reasonably likely to have, a material adverse effect on
eCom.
ARTICLE V
TERMINATION OF OBLIGATIONS; PAYMENT OF EXPENSES
5.1 Termination; Lack of Survival of Representations and
Warranties. In the event of the termination and abandonment of
this Agreement pursuant to Section 4.4 hereof, this Agreement
shall become void and have no effect, except (i) the provisions
of Sections 3.5 (Publicity), 5.2 (Payment of Expenses) or 7.2
(Confidentiality) hereof shall survive any such termination and
abandonment, and (ii) a termination pursuant to Section 4.4(d)(e)
of this Agreement shall not relieve a party from liability for
any uncured intentional and willful breach of a representation,
warranty, covenant or agreement giving rise to such termination.
5.2 Payment of Expenses. Each party shall bear and pay all
costs and expenses incurred by it or on its behalf concerning the
transactions contemplated hereby.
ARTICLE VI
CERTAIN POST-ACQUISITION AGREEMENTS
6.1 Indemnification. From and after the Acquisition Effective
Time, there shall be no indemnification Agreements.
ARTICLE VII
GENERAL
7.1 Amendments. Subject to applicable law, this Agreement may
be amended by an agreement in writing executed in the same manner
as this Agreement and authorized or ratified by the signatories
hereto, provided that after the approval of this Agreement by the
parties, no such amendment may change the amount or form of the
consideration to be delivered hereunder pursuant to Article I
herein without their approval.
7.2 Confidentiality. All information disclosed by any party to
any other party, whether prior or subsequent to the date of this
Agreement including, without limitation, any information obtained
pursuant to Section 3.1 hereof, shall be kept confidential by
such other party and shall not be used by such other party
otherwise than as herein contemplated. In the event of the
termination of this Agreement, each party shall use all
reasonable efforts to return upon request to the other party all
documents (and reproductions thereof) received from such other
party (and, in the case of reproductions, all such reproductions)
that include information subject to the confidentiality
requirement set forth above.
7.3 Governing Law. This Agreement and the legal relations
between the parties shall be governed by and construed in
accordance with the laws of the State of Nevada without taking
into account any provision regarding choice of law, except to the
extent certain matters may be governed by federal law by reason
of preemption.
7.4 Governing Jurisdiction & Venue. Litigation arising out of
this Agreement shall be resolved in either the Circuit Court of
the State of Nevada, or, to the extent required, in the Federal
District Court, Nevada.
7.5 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if sent by
registered mail or certified mail, postage prepaid, addressed, as
follows:
If to the Company, to
Rukos Security Advice AG
c/o Xxxxx Xxxxxxx.
Xxxxx Xxxx, Xxx 00
00000 Xxxxxxxxx/Xxxx
Xxxxxxx
If to eCom, to
xXxx.xxx, Inc.
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
or such other address as shall be furnished in writing by either
party to the other, and any such notice or communication shall be
deemed to have been given two business days after the date of
such mailing (except that the notice of change of address shall
not be deemed to have been given until received by the
addressee). Notices may also be sent by e-Mail, facsimile or
hand delivery and in such event shall be deemed to have been
given as of the date received by the addressee.
7.6 No Assignment. This Agreement may not be assigned by any
party hereto, by operation of law or otherwise, except as set
forth in this agreement.
7.7 Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only
and do not constitute a part of this Agreement.
7.8 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more
counterparts have been signed by each party and delivered to each
other party. Facsimile signatures shall be considered to be
original for this Agreement.
7.9 Construction and Interpretation. Except as the context
otherwise requires, all references herein to any state or federal
regulatory agency shall also be deemed to refer to any
predecessor or successor agency, and all references to state and
federal statutes or regulations shall also be deemed to refer to
any successor statute or regulation.
7.10 Entire Agreement. This Agreement, together with any
schedules, lists, exhibits and certificates required to be
delivered hereunder, and any amendment hereafter executed and
delivered in accordance with Section 7.1, constitutes the entire
agreement of the parties and supersedes any prior written or oral
agreement or understanding among any parties pertaining to the
Acquisition.
7.11 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable
law then such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of the
Agreement.
7.12 No Third Party Beneficiaries. Nothing in this Agreement
shall entitle any person (other than the parties hereto and their
respective successors and assigns permitted hereby) to any claim,
cause of action, remedy or right of any kind, except for those
provisions which are intended to be for the benefit of the
persons covered thereby and may be enforced by such persons,
including without limitation, as provided in Section 6.1.
IN WITNESS WHEREOF, each party has caused this Agreement to be
executed on its behalf by its duly authorized officers as of the
date set forth above.
xXxx.xxx, Inc.
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx, President
Rukos Security Advice AG
By: /s/ Xxxxx Xxxxxxx
Xxxxx Xxxxxxx, Director
