Exhibit 99.1
AGREEMENT AND PLAN OF ACQUISITION
THIS AGREEMENT AND PLAN OF ACQUISITION (this
"Agreement"), dated and made Closing as of this 18th day of
February 2003, is by and between Presidential Air
Corporation (hereafter "PAC"), a publicly held Nevada
corporation and Certified Aviation Parts, Inc. (hereafter
"CAP"), a Nevada corporation. PAC and CAP are referred to
herein sometimes collectively as the "Parties" and
individually as the "Party."
W I T N E S S E T H:
WHEREAS, the Boards of Directors of PAC and CAP deem
that the acquisition of CAP's common stock by PAC on the
terms herein set forth to be desirable and in the best
interests of their respective stockholders and, subject to
approval by their respective shareholders, desire to adopt
this Agreement to result in a tax-free reorganization within
the meaning of Section 368(a)(1)(A) of the Internal Revenue
Code of 1954, as amended; and
WHEREAS, the Boards of Directors of PAC and CAP have
approved this Agreement and have directed that this
Agreement and the Acquisition contemplated hereby (the
"Acquisition") be submitted to their respective stockholders
for adoption.
NOW THEREFORE, in consideration of the premises and of
the mutual representations, warranties, covenants and
agreements contained herein, PAC and CAP hereby agree that
PAC shall acquire CAP, and that the plan, terms and
conditions of the Acquisition shall be as follows:
ARTICLE I
Plan of Acquisition of CAP with and into PAC
1.01. The Acquisition. Upon the Closing Date (as
defined in Article 4.01) of the Acquisition, the following
shall occur: all of CAP's common stock shall be acquired by
PAC; CAP shall become a wholly-owned subsidiary of PAC;
both entities shall continue their corporate existence
under the laws of the state of Nevada and shall possess all
of the rights, privileges, immunities, powers, franchises
and authority, of a public as well as of a private nature.
Upon the Closing Date, PAC shall be subject to all of CAP's
restrictions, disabilities and duties. In addition, on the
Closing Date, PAC shall be vested in the following and the
same shall become PAC's property, effectually as if it were
CAP's property: CAP's rights, privileges, immunities,
powers, franchises and authority; CAP's assets and property
of every description (real, personal and mixed, and every
interest therein, wherever located); all debts or other
obligations belonging to or due to CAP on whatever account;
all stock subscriptions and all other things in action or
belonging to CAP on whatever account; any and all of CAP's
assets, property, rights, privileges, immunities, powers,
franchises and authority; any and all of CAP's liabilities
an obligations owing at the time of Closing, defined
hereinafter; and all and every other interest. Furthermore,
all rights of creditors and all liens upon any of CAP's
property shall be preserved unimpaired, and all debts,
liabilities and duties of CAP shall thenceforth be attached
to PAC and may be enforced against PAC to the same extent
as if said debts, liabilities and duties had been incurred
or contracted by PAC prior to the Acquisition.
1.02. Adoption of Plan; Requirement of Shareholder
Approval of Both PAC and CAP; Dissenters' Rights;
Notification. The Acquisition described in this Agreement
will require the approval of PAC's and CAP's shareholders
under corporate law. (See Sections 78.451 through 78.466,
Nevada Revised Statutes (NRS), as amended, titled
ACQUISITION; EXCHANGE OF SHARES.) The Parties intend to
accomplish such approval by consent of at least fifty-one
percent (51%) of their current shareholders pursuant to
Section 78.320, NRS, titled "Stockholders Meetings: Quorum;
Consent for actions taken without meeting." If Nevada law
requires that PAC give dissenters' rights of appraisal as
contemplated in NRS Sections 78.471 through 78.502, titled
Rights of Dissenting Shareholders, PAC will do so. PAC
shall not solicit proxies in connection with this meeting
of its stockholders.
1.03. Proposals To Be Approved By the Shareholders of
Both PAC and CAP. The Shareholders of both PAC and CAP
shall approve the following proposals: (A) approval of
this Agreement; and (B) approval of any other amendments to
PAC's Articles of Incorporation if necessary, such as to
broaden the scope of its corporate purpose to include the
business operations presently carried on by CAP and its
acquisition.
1.04. Establishment of Record Date. The Record Date
for the PAC and CAP shareholders entitled to vote on this
Agreement shall be February 7, 2003. CAP shall establish
its own record date, if necessary, for its shareholders to
vote on and approve the Acquisition in accordance with
Nevada corporate law.
1.05. The Acquisition. The Acquisition shall become
effective as provided in Article 4.02 (the "Closing Date").
1.06. Instruments and Further Assurances. PAC and CAP
agree to execute all documents necessary and required under
this Agreement to effect the Acquisition.
ARTICLE 2
Articles of Incorporation, Directors and Officers and By-
Laws
2.01. Articles of Incorporation. PAC's Articles of
Incorporation, in effect on the Closing Date, are CAP's
Articles of Incorporation.
2.02. Directors and Officers. Upon the Acquisition,
CAP's officers and directors shall remain in place.
2.03. By-Laws. PAC's By-Laws shall remain in effect
until they are amended as provided therein or otherwise by
law.
ARTICLE 3
Consideration; Conversion and Exchange of Shares
3.01. Consideration. As consideration for PAC's
acquisition of CAP's outstanding shares of stock, PAC shall
pay the following:
(A) The Stock Price. CAP's shareholders shall
receive a total of 31,500,000 shares of PAC's common stock.
Such stock shall be restricted within the meaning of Rule
144 of the 1934 Act (the "Stock Consideration"). The CAP
shareholders shall distribute the Stock Consideration as
described in paragraph 3.02 below.
3.02 Conversion of Shares. Upon the Closing of the
Acquisition, PAC shall acquire all of the shares of CAP, and
the CAP shareholders shall receive, pro rata, 3 (three)
shares of PAC's common stock for every 1 (one) share of
ownership in CAP.
3.03 Exchange of Certificates or Delivery of Shares.
On and after the Closing of the Acquisition, each holder of
a certificate or certificates representing CAP Common Stock,
upon presentation and surrender of such certificate or
certificates to PAC or its transfer agent, Pacific Stock
Transfer, Las Vegas, NV, shall be entitled to receive in
exchange therefore a certificate or certificates
representing the number of full shares of PAC common stock
to which he/she/it is entitled, as provided in Article 3.02.
Until so presented and surrendered in exchange for a
certificate representing PAC common stock, each certificate
representing issued and outstanding shares of CAP common
stock relative to the Acquisition shall, except as provided
in the following sentence, be deemed for all purposes to
evidence ownership of the number of full shares of PAC
common stock into which such shares of CAP common stock have
been converted pursuant to the Acquisition. Until surrender
of such certificates in exchange for certificates
representing PAC common stock, the holder thereof shall not
be entitled to vote at any PAC shareholders meeting.
ARTICLE 4
Closing Date
4.01 Closing. The Closing of the Acquisition shall
take place on February 18, 2003. The Closing of such
transactions is herein called the "Closing" and the date of
that Closing is referred to herein as the "Closing Date."
ARTICLE 5
Representations and Warranties of PAC
5.01. Organization, Standing, Qualification, etc.
PAC is a publicly held Nevada corporation duly organized,
validly existing and in good standing under the laws of the
State of Nevada. PAC has at all times had requisite
corporate power and is duly authorized, qualified,
franchised and licensed under all applicable laws,
regulations, ordinances and orders of public authorities to
own its properties and assets and to carry on any business
it has conducted.
5.02. Capitalization. PAC's authorized capital stock
consists of 200,000,000 shares of common stock, and
25,000,000 shares of preferred stock, with a $.001 par
value, of which approximately 97,400,000 common shares and
zero preferred will be issued and outstanding at the
Closing. All issued and outstanding shares are and will be
duly authorized, fully paid, validly issued and non-
assessable in accordance with applicable law. No dividends
or other distribution of the assets of PAC have been
declared or paid in PAC's capital stock.
5.03 Articles of Incorporation, By-Laws and Minutes.
PAC's existing Articles of Incorporation and the By-Laws
will remain in effect on and after the Closing Date.
5.04. Financial Statements and Assets. PAC's audited
financial statements are filed with the Securities and
Exchange Commission and is a matter of public record. All
such financial statements have been prepared in accordance
with generally accepted accounting principles consistently
applied throughout the periods involved. To the best
knowledge, information and belief of PAC's management, such
statements of operations present fairly the results of
operations of PAC for the periods indicated.
5.05. Authorization. PAC's Board of Directors has
approved this Agreement and the Acquisition contemplated
hereby and has authorized the execution and delivery of this
Agreement. PAC has full power, authority and legal right to
enter into this Agreement and this Agreement constitutes a
legal, valid and binding obligation of PAC, enforceable in
accordance with its terms.
5.06. Litigation. There is no action, suit,
proceeding or investigation pending, at law or in equity, or
to the knowledge of PAC's management, threatened, against or
affecting PAC before or in any court, either state or
federal, public board, or body which calls into question the
creation or existence of PAC, the validity of this Agreement
or the authority of PAC to execute, deliver and carry out
the terms of this Agreement.
5.07. Compliance with Law and Other Instruments. PAC,
to the best of management's knowledge, is not in violation
or default of any term of its Articles of Incorporation or
By-Laws, and has filed all reports and any other documents
required by it to be filed with any governmental agency,
including the Commission. The execution, delivery and
performance of this Agreement and the taking of action
contemplated hereby will not result in any violation of or
be in action contemplated hereby will not result in any
violation of or be in conflict with or constitute a default
under the Articles of Incorporation or By-Laws of PAC.
5.08. Contracts and Commitments. PAC's contractual
obligations and commitments, to the best of its management's
knowledge, do not materially and adversely affect the
business, operations, properties, assets or condition of
PAC.
ARTICLE 6
Representations and Warranties of CAP
6.01. Organization, Standing, Qualification, etc.
CAP is a Nevada corporation engaged in aviation parts sales.
CAP is validly existing and in good standing under the laws
of the State of Nevada and has all requisite corporate power
necessary to engage in the business it is currently engaged
in. It is duly authorized, qualified, franchised and
licensed under all applicable laws, regulations, ordinances
and orders of public authorities to own its properties and
assets and to carry on its business as it is presently being
conducted.
6.02. Capitalization. The authorized capital stock of
CAP consists of 20,000,000 shares of common stock, having
..001 par value, of which 10,500,000 shares will be issued
and outstanding at the Closing.
6.03. Articles of Incorporation and By-Laws. CAP's
existing Articles of Incorporation and the By-Laws will
remain in effect on and after the Closing Date.
6.04. Financial Statements and Assets. CAP will
provide audited financial statements to PAC, timely filed
with the Securities and Exchange Commission as required by
law. All such financial statements will be prepared in
accordance with generally accepted accounting principles
consistently applied throughout the periods involved.
6.05. Authorization. CAP's Board of Directors has
approved this Agreement and the transactions contemplated
hereby and have authorized the execution and delivery of
this Agreement by CAP. CAP has full power, authority and
legal right to enter into this Agreement and to consummate
the transactions contemplated hereby and this Agreement
constitutes a legal, valid and binding obligation of CAP
enforceable in accordance with its terms.
6.06. Litigation. There is no action, suit,
proceeding or investigation pending, at law or in equity, or
to the knowledge of CAP's management, threatened, against or
affecting CAP before or in any court, either state or
federal, public board, or body which calls into question the
creation or existence of CAP, the validity of this Agreement
or the authority of CAP to execute, deliver and carry out
the terms of this Agreement.
6.07. Compliance with Law and Other Instruments. CAP,
to the best of management's knowledge, is not in violation
or default of any term of its Articles of Incorporation or
By-Laws, and has filed all reports and any other documents
required by it to be filed with any governmental agency.
The execution, delivery and performance of this Agreement
and the taking of action contemplated hereby will not result
in any violation of or be in action contemplated hereby will
not result in any violation of or be in conflict with or
constitute a default under the Articles of Incorporation or
By-Laws of CAP.
6.08. Contracts and Commitments. CAP's contractual
obligations and commitments, to the best of its management's
knowledge, do not materially and adversely affect the
business, operations, properties, assets or condition of
CAP.
ARTICLE 7
Conditions to Obligations of PAC and CAP
The obligations of PAC and CAP to effect the
Acquisition hereunder are, at their respective elections,
subject to the satisfaction or waiver of the following
condition:
7.01. Stockholder Approval. On or before the Closing,
PAC's and CAP's stockholders shall have approved this
Agreement. Such approval may be effected either by a noticed
shareholder meeting or a shareholder approval by consent, as
allowed by the State of Nevada and/or Nevada law.
ARTICLE 8
Miscellaneous
8.01. Amendments. This Agreement may be amended at
any time by a written instrument executed by PAC and CAP
with the approval of their respective Boards of Directors
and Shareholder consent.
8.02. Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State
Nevada and any conflict in such laws shall be resolved
according to conflicts of law principles.
8.03 Parties. This Agreement shall inure to the
benefit of and be binding upon PAC and CAP and their
respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other
than the Parties to this Agreement and their respective
successors, and any person who controls PAC or CAP within
the meaning of Section 15 of the Securities Act of 1933, and
the heirs and legal representatives of each of them, any
legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained in this
Agreement. This Agreement and all conditions and provisions
of this Agreement are intended to be for the sole and
exclusive benefit of the Parties to this Agreement and their
respective successors, heirs and legal representatives and
such controlling persons and officers and directors and
their heirs and legal representatives, and for the benefit
of no other person, firm or corporation.
8.04. Complete Agreement - Severability. This
Agreement contains the entire understanding between the
parties and supersedes any and all prior agreements between
the parties. If any provision of this Agreement is found to
be void by any court of competent jurisdiction, the
remaining provisions shall remain in full force and effect.
8.05. Multiple Copies. This Agreement may be executed
in multiple copies, each of which shall constitute an
original, but all of which shall constitute one and the same
agreement.
IN WITNESS WHEREOF, PAC and CAP have caused this
Agreement to be executed as of the date first above written.
PRESIDENTIAL AIR CORPORATION
/s/ Xxxx Xxxxxxxx
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By: Xxxx Xxxxxxxx
Its: CFO
CERTIFIED AVIATION PARTS, INC.
/s/ Xxxx X. Xxxxxx
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By: Xxxx X. Xxxxxx
Its: CEO
