Exhibit 10.4
PLAN OF REORGANIZATION AND ACQUISITION
BY WHICH
TREASURY INTERNATIONAL, INC.
(A DELAWARE CORPORATION)
SHALL ACQUIRE
AMERICAN SPORTS ACADEMY, LLC
(A NEW YORK CORPORATION)
FROM AMERICAN SPORTS HISTORY, INC.
(A NEVADA CORPORATION)
This PLAN OF REORGANIZATION AND ACQUISITION ("Agreement") is made and
dated this 18th day of April 2002 by and between the above referenced
corporations, and shall become effective on "the Closing Date" as defined
herein.
I. THE INTERESTED PARTIES
A. THE PARTIES TO THIS AGREEMENT
1. Treasury International, Inc., a Delaware corporation ("Treasury").
2. American Sports Academy, LLC, a New York Limited Liability Company
("American").
3. American Sports History, Inc., a Nevada corporation,
("Shareholder") owner of 100% of the outstanding interests of
American.
4. Treasury, American, and the Shareholder may be referred to
collectively herein as the "Parties."
II. RECITALS
A. THE CAPITAL OF TREASURY AND AMERICAN
1. The capital of Treasury consists of 100,000,000 shares of Common
Stock, $.001 par value, authorized, of which 4,421,211 are issued and
outstanding as of the date of this Agreement, and no shares of Preferred Stock.
2. The capital of American consists of one membership interests
outstanding all of which are issued to American Sports History, Inc., a Nevada
corporation.
B. THE BACKGROUND FOR THE ACQUISITION
Treasury desires to acquire American, and the directors of the
Shareholder desire to sell American to Treasury.
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III. CONDITIONS PRECEDENT TO REORGANIZATION
A. DIRECTOR APPROVAL
The Board of Directors of the Parties respectively shall have
determined that it is advisable and in the best interests of each of them and
both of them to proceed with the acquisition by Treasury of American.
B. EFFECTIVE DATE
This Plan of Reorganization and Acquisition shall become effective on a
date designated hereinafter as the "Closing Date"; provided that the following
conditions precedent shall have been met, or waived in writing by the Parties:
1. At the Closing, Treasury shall issue 100,000 shares of Treasury
Common Stock to the Shareholder and deliver a $100,000 Promissory Note to
Shareholder.
2. Each Party shall have furnished to the other Party all corporate and
financial information which is customary and reasonable, to conduct its
respective due diligence, normal for this kind of transaction. If any Party
determines that there is a reason not to complete this Plan of Reorganization
and Acquisition as a result of their due diligence examination, then they must
give written notice to the other Parties prior to the expiration of the due
diligence examination period. The Due Diligence period, for purposes of this
paragraph, shall expire on a date determined by the Parties, which shall be no
later than sixty days after the Closing Date.
3. All of the terms, covenants and conditions of this Plan of
Reorganization and Acquisition to be complied with or performed by each Party
for Closing shall have been complied with, performed or waived in writing.
4. The representations and warranties of the Parties, contained in this
Plan of Reorganization and Acquisition, as herein contemplated, except as
amended, altered or waived by the Parties in writing, shall be true and correct
in all material respects at the Closing Date with the same force and effect as
if such representations and warranties are made at and as of such time; and each
Party shall provide the other with a corporate certificate, of a director of
each Party, dated the Closing Date, to the effect, that all conditions precedent
have been met, and that all representations and warranties of such Party are
true and correct as of that date. The form and substance of each Party's
certification shall be in form reasonably satisfactory to the other.
C. TERMINATION
This Plan of Reorganization and Acquisition may be terminated at any
time prior to the Closing Date, whether before or after approval by the
shareholders of the Parties: (i) by mutual consent of the Parties; or (ii) by
any Party if any other Party is unable to meet the specific conditions precedent
applicable to its performance within a reasonable time. In the event that
termination of this Plan of Reorganization and Acquisition occurs, as provided
above, this Plan of Reorganization and Acquisition shall forthwith become void
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and there shall be no liability on the part of any Party or its respective
officers, directors and managers.
IV. PLAN OF ACQUISITION
A. REORGANIZATION AND ACQUISITION
Treasury and American are hereby reorganized, such that Treasury shall
acquire all the issued and outstanding membership interests of American with all
of its current assets, liabilities and businesses, and American shall become a
wholly owned subsidiary of Treasury.
B. SURVIVING CORPORATION
Both Treasury and American shall survive the Reorganization herein
contemplated and shall continue to be governed by the laws of their respective
jurisdiction. The resulting parent corporation is the entity responsible for the
rights of dissenting shareholders.
C. SURVIVING ARTICLES OF INCORPORATION
The Articles of Incorporation and Operating Agreement of Treasury and
American, respectively, shall remain in full force and effect, unchanged.
D. SURVIVING BYLAWS
The Bylaws of both Treasury and American shall remain in full force and
effect, unchanged.
E. PURCHASE PRICE
At Closing, Treasury shall purchase all of the issued and outstanding
membership interests of American for the consideration as follows:
1. Issuance and delivery to Shareholder of 100,000 shares of Treasury
Common Stock, and
2. Delivery of a $100,000 Promissory Note due and payable two years
after the Closing with interest of seven percent (7%) per annum payable
semi-annually, and
3. Payment, semi-annually, to Shareholder of five percent (5%) of the
net profits earned by American, up to an aggregate amount of $500,000. For
purposes of this Agreement, "net profit" shall mean American's net sales plus
other income, less (i) cost of goods sold and (ii) all expenses and charges of
every kind and description accrued by it (including without limitation any
corporate overhead fees paid to Treasury), all as determined in accordance with
generally accepted accounting principles consistently applied.
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4. Also at the Closing, the Shareholder will transfer and convey 100
percent of the issued and outstanding membership interests of American to
Treasury in form and substance satisfactory to Treasury.
F. OTHER CONDITIONS OF ACQUISITIONS
1. American shall own all of the assets it currently owns except as may
be sold or transferred in the ordinary course of business;
2. Receipt by Treasury, prior to Closing, of an Indemnification
Agreement signed by Xxxxxxx Xxxxx in a form and content acceptable to Treasury;
and
3. American shall provide Treasury with the financial records necessary
for Treasury's accountants to audit American for the years-ending January 31,
2001 and January 31, 2002.
4. At the Closing, American shall have no more than $80,000.00
in liabilities, including contingent or otherwise.
G. FURTHER ASSURANCE, GOOD FAITH AND FAIR DEALING
The directors and managers of each Party shall and will execute and
deliver any and all necessary documents, acknowledgments and assurances and do
all things proper to confirm or acknowledge any and all rights, titles and
interests created or confirmed herein; and all Parties covenant hereby to deal
fairly and in good faith with each other and each others shareholders.
V. GENERAL MUTUAL REPRESENTATIONS AND WARRANTIES
The purpose and general import of the Mutual Representations and
Warranties are that each Party has made appropriate full disclosure to the
others, that no material information has been withheld, and that the information
exchanged is accurate, true and correct.
A. ORGANIZATION AND QUALIFICATION
Each Party warrants and represents that it is duly organized and in
good standing, and is duly qualified to conduct any business it may be
conducting, as required by law or local ordinance.
B. CORPORATE AUTHORITY
Each Party warrants and represents that it has corporate authority,
under the laws of its jurisdiction and its constituent documents, to do each and
every element of performance to which it has agreed, and which is reasonably
necessary, appropriate and lawful, to carry out this Agreement in good faith.
C. OWNERSHIP OF ASSETS AND PROPERTY
Each Party warrants and represents that it has lawful title and
ownership of its property as reported to the other, and as disclosed in its
financial statements.
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D. ABSENCE OF CERTAIN CHANGES OR EVENTS
Each Party warrants and represents that there are no material changes
of circumstances or events which have not been fully disclosed to the other
Party, and which, if different than previously disclosed in writing, have been
disclosed in writing as currently as is reasonably practicable.
E. ABSENCE OF UNDISCLOSED LIABILITIES
Each Party warrants and represents specifically that it has, and has no
reason to anticipate having, any material liabilities which have not been
disclosed to the other, in the financial statements or otherwise in writing.
F. LEGAL PROCEEDINGS
Each Party warrants and represents that there are no legal proceedings,
administrative or regulatory proceeding, pending or suspected, which have not
been fully disclosed in writing to the other.
G. NO BREACH OF OTHER AGREEMENTS
Each Party warrants and represents that this Agreement, and the
faithful performance of this Agreement, will not cause any breach of any other
existing agreement, or any covenant, consent decree, or undertaking by either,
not disclosed to the other.
H. CAPITAL STOCK
Each Party warrants and represents that the issued and outstanding
shares and membership interests and all shares and interests of capital stock
and capital memberships of each Party, is as detailed herein, that all such
shares and interests are in fact issued and outstanding, duly and validly
issued, were issued as and are fully paid and non-assessable shares and
interests, and that, other than as represented in writing, there are no other
securities, membership interests, options, warrants or rights outstanding, to
acquire further shares or membership interests of such Party, except as has been
disclosed to the other Party.
I. BROKERS' OR FINDER'S FEES
Other than as described herein, each Party warrants and represents that
it is aware of no claims for brokers' fees, or finders' fees, or other
commissions or fees, by any person not disclosed to the other, which would
become, if valid, an obligation of either Party.
VI. INDEMNIFICATION
Both parties shall, and from and after the Closing Date, indemnify,
defend and hold harmless each person who is now, or has been at any time prior
to the date hereof or who becomes prior to the Closing Date, an officer or
director of either party (the "Indemnified Parties") against all losses, claims,
damages, costs, expenses (including reasonable attorneys' fees and expenses),
liabilities or judgments or amounts that are paid in settlement with the
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approval of the indemnifying party of or in connection with any threatened or
actual claim, action, suit, proceeding or investigation based on or arising out
of the fact that such person is or was a director or officer of either party
whether pertaining to any matter existing or occurring at or prior to the
Closing Date and whether asserted or claimed prior to, or at or after, the
Closing Date ("Indemnified Liabilities"), including all Indemnified Liabilities
based on, or arising out of, or pertaining to this Agreement or the transactions
contemplated hereby, in each case, to the full extent a corporation is permitted
under the California law to indemnify directors or officers.
Without limiting the foregoing, in the event any such claim, action,
suit, proceeding or investigation is brought against any Indemnified Parties
(whether arising before or after the Closing Date), (i) the Indemnified Parties
may retain counsel satisfactory to them and the Parties shall pay all fees and
expenses of such counsel for the Indemnified Parties promptly as statements
therefore are received; and (ii) each party shall use all reasonable efforts to
assist in the vigorous defense of any such matter, provided that each party
shall not be liable for any settlement effected without its prior written
consent. Any Indemnified Party wishing to claim indemnification under this
section, upon learning of any such claim, action, suit, proceeding or
investigation, shall notify the Parties (but the failure so to notify shall not
relieve a party from any liability which it may have under this section except
to the extent such failure prejudices such party). The Indemnified Parties as a
group may retain only one law firm to represent them with respect to each such
matter unless there is, under applicable standards of professional conduct, a
conflict on any significant issue between the positions of any two or more
Indemnified Parties. The Parties agree that all rights to indemnification,
including provisions relating to advances of expenses incurred in defense of any
action or suit, existing in favor of the Indemnified Parties with respect to
matters occurring through the Closing Date, shall survive the reverse
acquisition and shall continue in full force and effect for a period of not less
than seven years from the Closing Date; provided, however, that all rights to
indemnification in respect of any Indemnified Liabilities asserted or made
within such period shall continue until the disposition of such Indemnified
Liabilities.
The provisions of this section are intended to be for the benefit of,
and shall be enforceable by, each Indemnified Party, his or her heirs and his or
her personal representatives and shall be binding upon all successors and
assigns of both Parties.
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VII. DEFAULT, AMENDMENT AND WAIVER
A. DEFAULT
Upon a breach or default under this Agreement by any of the Parties
(following the cure period provided herein), the non-defaulting party shall have
all rights and remedies given hereunder or now or hereafter existing at law or
in equity or by statute or otherwise. Notwithstanding the foregoing, in the
event of a breach or default by any Party hereto in the observance or in the
timely performance of any of its obligations hereunder which is not waived by
the non-defaulting Party, such defaulting Party shall have the right to cure
such default within 15 days after receipt of notice in writing of such breach or
default.
B. WAIVER AND AMENDMENT
Any term, provision, covenant, representation, warranty, or condition
of this Agreement may be waived, but only by a written instrument signed by the
Party entitled to the benefits thereof. The failure or delay of any party at any
time or times to require performance of any provision hereof or to exercise its
rights with respect to any provision hereof shall in no manner operate as a
waiver of or affect such party's right at a later time to enforce the same. No
waiver by any Party of any condition, or of the breach of any term, provision,
covenant, representation, or warranty contained in this Agreement, in any one or
more instances, shall be deemed to be or construed as a further or continuing
waiver of any such condition or breach or waiver of any other condition or of
the breach of any other term, provision, covenant, representation, or warranty.
No modification or amendment of this Agreement shall be valid and binding unless
it be in writing and signed by all Parties hereto.
VIII. MISCELLANEOUS
A. EXPENSES
Whether or not the transactions contemplated hereby are consummated,
each of the Parties hereto shall bear all taxes of any nature (including,
without limitation, income, franchise, transfer, and sales taxes) and all fees
and expenses relating to or arising from its compliance with the various
provisions of this Agreement and such Party's covenants to be performed
hereunder, and except as otherwise specifically provided for herein, each of the
Parties hereto agrees to pay all of its own expenses (including, without
limitation, attorneys and accountants' fees, and printing expenses) incurred in
connection with this Agreement, the transactions contemplated hereby, the
negotiations leading to the same and the preparations made for carrying the same
into effect, and all such taxes, fees, and expenses of the Parties hereto shall
be paid prior to Closing.
B. NOTICES
Any notice, request, instruction, or other document required by the
terms of this Agreement, or deemed by any of the Parties hereto to be desirable,
to be given to any other party hereto shall be in writing and shall be given by
facsimile, personal delivery, overnight delivery, or mailed by registered or
certified mail, postage prepaid, with return receipt requested, to the following
addresses:
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TO Treasury: Treasury International, Inc.
000 Xxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
FAX: (000) 000-0000
With copy to: Xxxxxxx X. Xxxxxxx, Esq.
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
TO AMERICAN AND/OR American Sports Academy, LLC and/or
THE SHAREHOLDER: American Sports History, Inc.
00 Xxxxx Xxxxxx
Xxx Xxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Fax: (___) _______
WITH COPY TO: Xxxx X. Xxxxxx, Esq.
Cohne Xxxxxxxxx & Xxxxx, P.C.
525 E. 000 Xxxxx, 0xx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
The persons and addresses set forth above may be changed from time to
time by a notice sent as aforesaid. If notice is given by facsimile, personal
delivery, or overnight delivery in accordance with the provisions of this
Section, said notice shall be conclusively deemed given at the time of such
delivery. If notice is given by mail in accordance with the provisions of this
Section, such notice shall be conclusively deemed given seven days after deposit
thereof in the United States mail.
C. ENTIRE AGREEMENT
This Agreement, together with any schedules and exhibits hereto, sets
forth the entire agreement and understanding of the Parties hereto with respect
to the transactions contemplated hereby, and supersedes all prior agreements,
arrangements and understandings related to the subject matter hereof. No
understanding, promise, inducement, statement of intention, representation,
warranty, covenant, or condition, written or oral, express or implied, whether
by statute or otherwise, has been made by any party hereto which is not embodied
in this Agreement, or in the schedules or exhibits hereto or the written
statements, certificates, or other documents delivered pursuant hereto or in
connection with the transactions contemplated hereby, and no party hereto shall
be bound by or liable for any alleged understanding, promise, inducement,
statement, representation, warranty, covenant, or condition not so set forth.
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D. SURVIVIAL OF REPRESENTATIONS
All statements of fact (including financial statements) contained in
the schedules, the exhibits, the certificates, or any other instrument delivered
by or on behalf of the Parties hereto, or in connection with the transactions
contemplated hereby, shall be deemed representations and warranties by the
respective Party hereunder. All representations, warranties, agreements, and
covenants hereunder shall survive the Closing and remain effective for a period
of two-years following the Closing Date, regardless of any investigation or
audit at any time made by or on behalf of the Parties or of any information a
party may have in respect hereto. Consummation of the transactions contemplated
hereby shall not be deemed or construed to be a waiver of any right or remedy
possessed by any party hereto, notwithstanding that such party knew or should
have known at the time of Closing that such right or remedy existed.
E. INCORPORATION BY REFERENCE
The schedules, exhibits, and all documents (including, without
limitation, all financial statements) delivered as part hereof or incident
hereto are incorporated as a part of this Agreement by reference.
F. REMEDIES CUMULATIVE
No remedy herein conferred upon the Parties is intended to be exclusive
of any other remedy and each and every such remedy shall be cumulative and shall
be in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute or otherwise.
G. EXECUTION OF ADDITIONAL DOCUMENTS
Each Party hereto shall make, execute, acknowledge, and deliver such
other instruments and documents, and take all such other actions as may be
reasonably required in order to effectuate the purposes of this Agreement and to
consummate the transactions contemplated hereby.
H. GOVERNING LAW
This Agreement has been negotiated in the State of California and shall
be construed and enforced in accordance with the laws of such state.
I. FORUM
Each of the Parties hereto agrees that any action or suit which may be
brought by any party hereto against any other party hereto in connection with
this Agreement or the transactions contemplated hereby may be brought only in a
federal or state court in Los Angeles County, California.
J. PROFESSIONAL FEES
In the event any Party hereto shall commence legal proceedings against
the other to enforce the terms hereof, or to declare rights hereunder, as the
result of a breach of any covenant or condition of this Agreement, the
prevailing party in any such proceeding shall be entitled to recover from the
losing party its costs of suit, including reasonable attorneys' fees,
accountants' fees, and experts' fees.
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K. BINDING EFFECT AND ASSIGNMENT
This Agreement shall inure to the benefit of and be binding upon the
Parties hereto and their respective heirs, executors, administrators, legal
representatives, and assigns.
L. COUNTERPARTS; FACSIMILE SIGNATURES
This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The Parties agree that
facsimile signatures of this Agreement shall be deemed a valid and binding
execution of this Agreement.
This PLAN OF REORGANIZATION AND ACQUISITION is executed on behalf of
each Party by its duly authorized representatives, and attested to, pursuant to
the laws of its respective place of incorporation and in accordance with its
constituent documents as of the date first written above.
Treasury International, Inc.,
a Delaware corporation
/s/ Xxxx Xxxxx
--------------------------------
BY: Xxxx Xxxxx
ITS: President
AMERICAN SPORTS ACADEMY, LLC AMERICAN SPORTS HISTORY, INC.
/s/ Xxxxxx Xxxxxxxxxxxx /s/ Xxxxxx Xxxxxxxxxxxx
-------------------------------- ----------------------------------
BY: Xxxxxx Xxxxxxxxxxxx BY: Xxxxxx Xxxxxxxxxxxx
ITS: President ITS: President
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