AGREEMENT AND PLAN OF MERGER
AND REORGANIZATION
AGREEMENT AND PLAN OF MERGER AND REORGANIZATION, dated as of June 6, 2000
(the "Agreement"), among x-XxxXxxx.xxx, a corporation organized and existing
under the laws of the State of Nevada ("Parent"), Vidimedix Acquisition
Corporation, a corporation organized and existing under the laws of the State
of Nevada ("Merger Sub") and a direct wholly owned subsidiary of Parent, and
Vidimedix Corporation, a corporation organized and existing under the laws of
the State of Texas (the "Company");
W I T N E S S E T H:
WHEREAS, the boards of directors of Parent, Merger Sub and the Company
have each determined that it is consistent with and in furtherance of their
respective long-term business strategies and fair to and in the best interests
of their respective stockholders to combine the respective businesses of
Parent and the Company by means of a merger (the "Merger") of the Company with
and into Merger Sub upon the terms and subject to the conditions set forth
herein and in accordance with Texas and Nevada Corporation Law (the "Texas and
Nevada Corporation Law"); and
WHEREAS, for United States Federal income tax purposes, it is intended
that the Merger qualify as a tax-free reorganization under the provisions of
Section 368 of the Internal Revenue Code of 1986, as amended (together with
the rules and regulations promulgated thereunder, the "Code");
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements set forth herein, and
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto hereby agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with Texas and Nevada Corporation
Law, at the Effective Time, the Company shall be merged with and into Merger
Sub. As a result of the Merger, the separate corporate existence of the
Company shall cease and Merger Sub shall continue as the surviving corporation
of the Merger (the "Surviving Corporation").
1.2 Closing. Unless this Agreement shall have been terminated and
the Merger shall have been abandoned pursuant to Section 7.1 and subject to
the satisfaction or waiver of the conditions set forth in Article VII, the
consummation of the Merger shall take place as promptly as practicable (and in
any event within three business days) after satisfaction or waiver of the
conditions set forth in Article VII, at a closing (the "Closing") to be held
at the offices of x-XxxXxxx.xxx, 00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxx
Xxxxx, Xxxxxxxxxx 00000, unless another date, time or place is agreed to by
the Company and Parent.
1.3 Effective Time. At the time of the Closing, the parties shall
cause the Merger to be consummated by filing articles of merger (the "Articles
of Merger") with the Secretarys of State of the States of Texas and Nevada in
such form as required by, and executed in accordance with the relevant
provisions of, Texas and Nevada Corporation Law (the date and time of the
later of such filings, or such later time as may be agreed by the parties
hereto and specified in the Articles of Merger, being the "Effective Time").
1.4 Effect of the Merger. At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of Texas and Nevada
Corporation Law. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time, except as otherwise provided herein, all the
property, rights, privileges, powers and franchises of the Company and Merger
Sub shall vest in the Surviving Corporation, and all debts, liabilities and
duties of the Company and Merger Sub shall become the debts, liabilities and
duties of the Surviving Corporation, and the Parent shall own all of the
issued and outstanding stock of the Surviving Corporation and shall have full
legal control over the Surviving Corporation.
1.5 Articles of Incorporation; Bylaws; Directors and Officers of
Surviving Corporation. Unless otherwise agreed by the Company and Parent
prior to the Effective Time, at the Effective Time:
(a) the articles of incorporation and bylaws of Merger Sub, as
in effect immediately prior to the Effective Time, shall be the articles of
incorporation and bylaws of the Surviving Corporation until thereafter amended
as provided by any applicable law, rule or regulation and such articles of
incorporation or bylaws;
(b) the officers of Merger Sub immediately prior to the
Effective Time shall be the initial officers of the Surviving Corporation
until their successors are elected or appointed and qualified or until their
resignation or removal; and
(c) the directors of the Surviving Corporation shall be Xxxx X.
Xxxxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxxxxx X. Xxxxx until otherwise directed by
the Parent.
ARTICLE II
CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES
2.1 Conversion of Securities. At the Effective Time, by virtue of
the Merger and without any action on the part of Merger Sub, the Company or
the holders of any of the following securities:
(a) Each share of Company Common Stock issued and outstanding
immediately prior to the Effective Time (other than any Dissenting Shares) and
all rights in respect thereof shall forthwith cease to exist and shall be
converted into and become exchangeable for the contractual right set forth in
Section 2.2 below.
(b) Each share of Series A Preferred Stock of the Company issued
and outstanding immediately prior to the Effective Time (other than any
Dissenting Shares) and all rights in respect thereof shall forthwith cease to
exist and shall be converted into and become exchangeable for the contractual
rights set forth in Section 2.2 below.
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(c) Each share of common stock, no par value, of Merger Sub
issued and outstanding immediately prior to the Effective Time and all rights
in respect thereof shall remain issued and outstanding.
2.2 Earn-Out Shares.
(a) Subject to certain conditions set forth below, Parent shall
issue to the holders of the Company's Series A Preferred Stock and the
Company's Common Stock (collectively, the "Company Stockholders"), shares of
Parent's $.001 common ctock (the "Parent Common Stock") (the "Earn-Out
Shares") based upon the gross sales by the Parent and its affiliates of the
Company's products and services to those customers specified in the Company's
sales funnel report dated May 31, 2000, and attached hereto as Schedule 2.2(a)
(the "Milestones") for the year ended March 31, 2001 (the "Earn-Out Period")
(calculated in accordance with generally accepted accounting principals on an
accrual basis). The Earn-Out Shares shall not be cumulative with respect to
each separate Milestone listed below. For example, if the Company's gross
sales for the year ended March 31, 2001, were $11,000,000, the number of
Earn-Out Shares issuable would have a value of $6,000,000. The Earn-Out
Shares shall be calculated as follows:
Fiscal Year Ending Gross Sales Earn-Out
3/31/01 $ 9,000,000 to That number of shares of Parent
$ 9,999,999.99 Common Stock with a value equal
to $2,000,000
3/31/01 $10,000,000 to That number of shares of Parent
$10,999,999.99 Common Stock with a value equal
to $4,000,000
3/31/01 $11,000,000 or That number of shares of Parent
more Common Stock with a value equal
to $6,000,000
(b) In case of any reorganization of Parent during the Earn-out
Period, or in case that, during such period, the Company shall consolidate
with or merge into another corporation or convey all or substantially all of
its assets to another corporation, then and in each such case the Company
Stockholders, upon payment of the Earn-Out Shares as provided in this Section
2 at any time after the consummation of such reorganization, consolidation,
merger or conveyance, shall be entitled to receive, in lieu of the Earn-Out
Shares receivable prior to such consummation, the stock or other securities or
property to which the Company Stockholder would have been entitled upon such
consummation if the Company Stockholder had received the Earn-Out Shares
immediately prior thereto; in each such case, the terms of this Agreement,
shall be applicable to the shares of stock or other securities or property
receivable upon receipt of the Earn-Out Shares after such consummation. The
value of the shares of Parent Common Stock to be issued pursuant to the
Earn-Out Shares shall be determined by dividing the relevant dollar value by
the average closing price of the Parent Common Stock on the American Stock
Exchange for the six (6) trading days ending three (3) trading days after the
earlier of (i) the date that Company satisfies the relevant Milestone, or (ii)
the date of any reorganization, consolidation, merger or conveyance described
in the immediately preceding sentence; and such shares shall be deemed issued
as of such date.
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(c) The Earn-Out Shares shall be delivered to the Company
Stockholders within forty-five (45) days following achievement of the relevant
milestone. Within thirty (30) days after the end of the Earn-Out Period, the
Parent shall deliver to Xxxxxx Xxxxx ("Xxxxx"), as representative of the
Company Stockholders, a report showing the amount of sales revenues meeting
the criteria described in Section 2.2(a) above (the "Report"). Faris shall
have fifteen days to review and approve the Report. If Faris does not notify
the Parent in writing within such fifteen day period that he disputes any
matter set forth in the Report, the Report shall be deemed to have been
accepted by the Company Stockholders and Parent. If any disputes arise
regarding the Report which the Company Stockholders and Parent cannot resolve
between themselves within fifteen days, such questions shall be referred to
the independent accountants representing each of the parties, who shall have
fifteen days thereafter to attempt to resolve such questions, and any
decisions mutually agreeable to such accountants shall be binding upon the
Company Stockholders and Parent. If, after such fifteen days, the independent
accountants of the Company Stockholders and Parent are unable to arrive at a
resolution of any issue relating to the Report, such independent accountants
will appoint a third independent accounting firm satisfactory to each of them,
which shall be directed to resolve such questions within fifteen days
thereafter, and whose decisions shall be final and binding on all parties.
The cost of the accounting firm shall be borne equally by the Company
Stockholders and Parent.
(d) The Earn-Out Shares shall be allocated among the Company
Stockholders such that 27.64% of such shares go to the holders of the
Company's Common Stock pro rata and 72.36% of such shares go to the holders of
the Company's Series A Preferred Stock pro rata.
(e) After the Closing Date and at all times during the Earn-Out,
the Company shall operate pursuant to an operating budget agreed upon by
Xxxxxx X. Xxxxx, Xx., the President of the Parent's Multimedia Division, and
the Parent's CEO for the period ending March 31, 2001.
(f) Earn-Out Reduction. Schedule 2.2(f) hereto sets forth a
list of all outstanding liabilities, absolute or contingent, of the Company as
of May 31, 2000, including, without limitation, trade payables of $847,059.26
("Payables"), accrued incentive compensation ("Comp") of $601,518.75, accrued
vacation of $165,647.09 ("Accrued Vacation") interest on an employee note in
the amount of $30,457.51 ("Employee Interest"), accrued expenses ("Accruals")
of $101,471.30 and principal of $2,901,543.62 ("Bridge Loan Principal") and
interest of $259,424.61 ("Bridge Loan Interest") due with respect to a bridge
loan. Prior to the Closing (i) the Company intends to negotiate for the
reduction of each of the Payables in consideration for payment of such
Payables within five days following the Closing and the Parent agrees to make
such payment with respect to any of the Payables subject to such agreement;
(ii) the Company will offer to the employees of the Company, in full or
partial payment of the Comp, vested options to purchase 50,000 shares of
Parent Common Stock under the stock option plan of Parent at an option price
equal to the closing price of the Parent Common Stock on the American Stock
Exchange on the day immediately prior to the issuance of such options, and
Parent agrees to issue such options at the Closing; (iii) the Parent will
offer, in exchange for the Employee Interest, $15,260.50 of the Accruals,
$93,905.52 of Accrued Vacation, the Bridge Loan Principal and the Bridge Loan
Interest, shares of the Parent Common Stock having a deemed value of $10.50
per share, equal to the amount of the Employee Interest, $15,260.50 of the
Accruals, $93,905.52 of Accrued Vacation, the Bridge Loan Principal and the
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Bridge Loan Interest. Following such actions, the total value of the Earn-Out
Shares to be issued pursuant to Section 2.2 shall be reduced on a
dollar-for-dollar basis to the extent the amount of liabilities, absolute or
contingent, of the Company as of May 31, 2000, exceeds $2,223,208.91. Any
actual or contingent liabilities which are discovered by the end of the
Earn-Out Period, and which relate to matters in existence as of May 31, 2000,
will be considered as an outstanding liability as of May 31, 2000.
2.3 Exchange of Shares Other than Dissenting Shares. Subject to the
terms and conditions hereof, at or prior to the Effective Time, Parent shall
appoint an exchange agent to effect the exchange of shares of Company Common
Stock (other than Dissenting Shares) for Parent Common Stock in accordance
with the provisions of this Article II (the "Exchange Agent"). From time to
time after the Effective Time, Parent shall deposit, or cause to be deposited,
certificates representing Parent Common Stock for conversion of shares of
Company Common Stock (other than Dissenting Shares) in accordance with the
provisions of Sections 2.1 and 2.2 (such certificates being herein referred to
as the "Exchange Fund"). Commencing immediately after the Effective Time and
until the appointment of the Exchange Agent shall be terminated, each holder
of a certificate or certificates theretofore representing shares of Company
Common Stock (other than Dissenting Shares) may surrender the same to the
Exchange Agent and, after the appointment of the Exchange Agent shall be
terminated, any such holder may surrender any such certificate to Parent. Such
holder shall be entitled upon such surrender to receive in exchange therefor a
certificate or certificates representing the number of full shares of Parent
Common Stock into which the shares of Company Common Stock theretofore
represented by the certificate or certificates so surrendered shall have been
converted in accordance with the provisions of Section 2.1, in accordance with
Section 2.5, and all such shares of Parent Common Stock shall be deemed to
have been issued at the Effective Time. Until so surrendered and exchanged,
each outstanding certificate which, prior to the Effective Time, represented
issued and outstanding shares of Company Common Stock shall be deemed for all
corporate purposes of Parent to evidence ownership of the number of full
shares of Parent Common Stock into which the shares of Company Common Stock
theretofore represented thereby shall have been converted at the Effective
Time. Notwithstanding the foregoing provision of this Section 2.3, risk of
loss and title to such certificates representing shares of Company Common
Stock shall pass only upon proper delivery of such certificates to the
Exchange Agent, and neither the Exchange Agent nor any party hereto shall be
liable to a holder of shares of Company Common Stock for any Parent Common
Stock or dividends or distributions thereon delivered to a public official
pursuant to any applicable abandoned property, escheat or similar law or to a
transferee pursuant to Section 2.4. In the event Earn-Out Shares become
deliverable to the Company Stockholders pursuant to Section 2.3, such shares
shall be deposited with the Exchange Agent within five (5) business days
following final determination of the number of shares issuable, and the
Exchange Agent shall distribute to each Company Stockholder the Earn-Out
Shares issuable to such Company Stockholder pursuant to Section 2.2(d).
2.4 Stock Transfer Books. At the Effective Time, the stock transfer
books of the Company with respect to shares of Company Common Stock shall be
closed, and there shall be no further registration of transfers of shares of
Company Common Stock thereafter on the records of any such stock transfer
books. In the event of a transfer of ownership of shares of Company Common
Stock that is not registered in the stock transfer records of the Company, at
the Effective Time, a certificate or certificates representing the number of
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full shares of Parent Common Stock into which such shares of Company Common
Stock shall have been converted shall be issued to the transferee in
accordance with Section 2.3, if the certificate or certificates representing
such shares of Company Common Stock is or are surrendered as provided in
Section 2.3, accompanied by all documents required to evidence and effect such
transfer and by evidence of payment of any applicable stock transfer tax.
2.5 No Fractional Share Certificates. Unless Parent otherwise
determines, no scrip or fractional share certificates for Parent Common Stock
shall be issued upon the surrender for exchange of certificates evidencing
shares of Company Common Stock. In lieu of fractional shares, each holder of
shares of Company Common Stock who would be entitled to receive a fractional
share of Parent Common Stock shall, upon surrender of the certificate or
certificates representing shares of Company Common Stock, be entitled to
receive one full share of Parent Common Stock for any fractional share
interest.
2.6 Dissenting Shares. Notwithstanding any provision of Section 2.1
hereof to the contrary, shares of Company Common Stock which are held by
holders of such shares who have not voted in favor of the Merger, who are
entitled to dissent and who have delivered a written notice of intent to
demand payment for such shares in the manner provided in Sections 5.11 through
5.13 of the Texas Business Corporation Act ("Dissenting Shares"), shall not be
converted into or exchanged for or represent the right to receive any shares
of Parent Common Stock, unless such holder fails to perfect or effectively
withdraws or loses such rights to payment. If, after the Effective Time, such
holder fails to perfect or effectively withdraws or loses such right to
payment, then such Dissenting Shares shall thereupon be deemed to have been
converted into and exchanged pursuant to Section 2.1 hereof, as of the
Effective Time, for the right to receive shares of Parent Common Stock issued
in the Merger to which the holder of such shares of Company Common Stock is
entitled, without any interest thereon. The Company shall give Parent prompt
notice of any notices and demands received by the Company for payment for
shares of Company Common Stock, and Parent shall have the right to participate
in all negotiations and proceedings with respect to such notices and demands.
The Company shall not, except with the prior written consent of Parent, make
any payment with respect to, or settle or offer to settle, any such demands.
Prior to the Effective Time, the Company shall establish an escrow account
with a financial institution and the Company shall fund such escrow account
with cash or cash equivalents in an amount sufficient to make all payments to
holders of Dissenting Shares. Such escrow account shall survive the Merger.
All payments to holders of Dissenting Shares shall be made out of such escrow
account, and no such payments shall be made or otherwise funded by Parent.
2.7 Further Assurances. Parent agrees that if, at any time after the
Effective Time, Company considers or is advised that any further deeds,
assignments or assurances are reasonably necessary or desirable to be obtained
from Parent or its officers or directors, to consummate the Merger or to carry
out the purposes of this Agreement at or after the Effective Time, then
Company, Parent and their respect officers and directors may execute and
deliver all such proper deeds, assignments and assurances and do all other
things necessary or desirable to consummate the Merger and to carry out the
purposes of this Agreement, in the name of Parent or otherwise.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as disclosed in Schedule 3 which is attached hereto and
incorporated herein by reference, the Company hereby represents and warrants
to Parent and Merger Sub that:
3.1 Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of Texas, has all
necessary corporate powers to own its properties and to carry on its business
as now owned and operated by it, and is duly qualified to do business and is
in good standing in each of the jurisdictions where its business requires
qualification.
3.2 Capital. The authorized Common Stock of the Company consists of
10,000,000 shares of Common Stock, $0.01 par value, of which 1,782,740 are
currently issued and outstanding, and 5,000,000 shares of Preferred Stock, of
which 2,384,093 are currently issued and outstanding. All of the issued and
outstanding shares of the Company are duly authorized, validly issued, fully
paid, and nonassessable. There are no outstanding subscriptions, options,
rights, warrants, debentures, instruments, convertible securities, or other
agreements or commitments obligating the Company to issue or to transfer from
treasury any additional shares of its Common Stock of any class.
3.3 Subsidiaries. The Company does not have any subsidiaries or own
any interest in any other enterprise (whether or not such enterprise is a
corporation).
3.4 Directors and Officers. Schedule 3 contains the names and titles
of all directors and officers of the Company as of the date of this Agreement.
3.5 Financial Statements. The Company has delivered to Parent audited
balance sheets and statements of operations for the years ended December 31,
1997 and 1998, and unaudited balance sheets and statements of operations for
the year ended December 31, 1999, and the four months ended April 30, 2000
(the "Financial Statements"). The Financial Statements fairly present the
financial condition of the Company, subject to normal adjustments, and except
that such unaudited financial statements do not include footnotes. The
Financial Statements fairly accurately set out and describe the financial
condition of the Company as of December 31, 1999 and April 30, 2000.
3.6 Absence of Changes. Since April 30, 2000, except for changes in
the ordinary course of business which have not in the aggregate been
materially adverse, to the best of the Company's knowledge, the Company has
conducted its business only in the ordinary course and has not experienced or
suffered any material adverse change in the condition (financial or
otherwise), results of operations, properties, business or prospects of the
Company or waived or surrendered any claim or right of material value.
3.7 Absence of Undisclosed Liabilities. Neither the Company nor any
of its properties or assets are subject to any material liabilities or
obligations of any nature, whether absolute, accrued, contingent or otherwise
and whether due or to become due, that are not reflected in the financial
statements presented to Parent or have otherwise been disclosed to Parent.
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3.8 Tax Returns. Within the times and in the manner prescribed by
law, the Company has filed all federal, state and local tax returns required
by law, or has filed extensions which have not yet expired, and has paid all
taxes, assessments and penalties due and payable.
3.9 Trade Names and Rights. Schedule 3 sets forth a complete and
accurate schedule of (i) all registered trademarks and service marks and all
trademark and service xxxx applications, including country of filing, filing
number, date of issue and expiration date used in the business of the Company;
and (ii) all registered copyrights owned by the Company. Except as set forth
in such schedule, to the Company's knowledge, no third party has asserted, or
threatened to assert against the Company or any of its officers or directors,
any conflicting rights to any such intellectual property and the Company has
no knowledge of facts that the Company believes could reasonably be expected
to give rise to such a claim.
3.10 Compliance with Laws. To the best of the Company's knowledge,
the Company has complied with, and is not in violation of, applicable federal,
state or local statutes, laws and regulations (including, without limitation,
any applicable building, zoning or other law, ordinance or regulation)
affecting its properties or the operation of its business, except for matters
which would not have a material affect on the Company or its properties.
3.11 Litigation. The Company is not a party to any suit, action,
arbitration or legal, administrative or other proceeding, or governmental
investigation pending or, to the best knowledge of the Company, threatened
against or affecting the Company or its business, assets or financial
condition, except for matters which would not have a material affect on the
Company or its properties. The Company is not in default with respect to any
order, writ, injunction or decree of any federal, state, local or foreign
court, department, agency or instrumentality applicable to it. The Company is
not engaged in any lawsuit to recover any material amount of monies due to it.
3.12 Authority. The Company has full corporate power and authority
to enter into this Agreement. The board of directors of the Company has taken
all action required to authorize the execution and delivery of this Agreement
by or on behalf of the Company and the performance of the obligations of the
Company under this Agreement. No other corporate proceedings, other than
stockholder approval, on the part of the Company are necessary to authorize
the execution and delivery of this Agreement by the Company and the
performance of its obligations under this Agreement. Subject to stockholder
approval, this Agreement is, when executed and delivered by the Company, and
will be a valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by general principles of equity, bankruptcy, insolvency, moratorium
and similar laws relating to creditors' rights generally.
3.13 Ability to Carry Out Obligations. Neither the execution and
delivery of this Agreement, the performance by the Company of its obligations
under this Agreement, nor the consummation of the transactions contemplated
under this Agreement will to the best of the Company's knowledge: (a)
materially violate any provision of the Company's articles of incorporation or
bylaws; (b) with or without the giving of notice or the passage of time, or
both, violate, or be in conflict with, or constitute a material default under,
or cause or permit the termination or the acceleration of the maturity of, any
debt, contract, agreement or obligation of the Company, or require the payment
of any prepayment or other penalties; (c) require notice to, or the consent
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of, any party to any agreement or commitment, lease or license, to which the
Company is bound; (d) result in the creation or imposition of any security
interest, lien, or other encumbrance upon any material property or assets of
the Company; or (e) violate any material statute or law or any judgment,
decree, order, regulation or rule of any court or governmental authority to
which the Company is bound or subject.
3.14 Full Disclosure. None the representations and warranties made
by the Company in this Agreement and the Schedules and Exhibits to this
Agreement prepared by the Company contained, contains, or will contain at the
time it was or is so furnished any untrue statement of a material fact or
omitted, omits or will omit at such time to state any material fact necessary
in order to make the statements made herein and therein, in light of the
circumstances under which they were made, not misleading. There has been no
material adverse change and no material adverse development in the business,
properties, operations, condition (financial or otherwise), assets,
liabilities or results of operations or, insofar as can reasonably be
foreseen, prospects of the Company. The Company has not taken any steps, and
does not currently expect to take any steps, to seek protection pursuant to
any bankruptcy law nor does the Company have any knowledge or reason to
believe that its creditors intend to initiate involuntary bankruptcy
proceedings.
3.15 Assets. The Company has good and marketable title to all of its
tangible properties and such tangible properties are not subject to any
material liens or encumbrances.
3.16 Material Contracts and Obligations. Attached hereto on Schedule
3 is a list of all agreements, contracts, indebtedness, liabilities and other
obligations to which the Company is a party or by which it is bound that are
material to the conduct and operations of its business and properties, which
provide for payments to or by the Company in excess of $25,000; or which
involve transactions or proposed transactions between the Company and its
officers, directors, affiliates or any affiliate thereof. Copies of such
agreements and contracts and documentation evidencing such liabilities and
other obligations have been made available for inspection by Parent and its
counsel. All of such agreements and contracts are valid, accurate, binding
and in full force and effect in all material respects, and there have been, to
the knowledge of the Company, no breaches or anticipatory repudiation of such
agreements and contracts.
3.17 Consents and Approvals. No consent, approval or authorization
of, or declaration, filing or registration with, any governmental or
regulatory authority is required to be made or obtained by the Company in
connection with: (a) the execution and delivery by the Company of this
Agreement; (b) the performance by the Company of its obligations under this
Agreement; or (c) the consummation by the Company of the transactions
contemplated under this Agreement.
3.18 Outstanding Liabilities. Set forth on Schedule 2.2(f) is a list
of all outstanding debts or liabilities, absolute or contingent, of the
Company as of May 31, 2000.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Except as disclosed in Schedule 4 which is attached hereto and
incorporated herein by reference, Parent and Merger Sub hereby jointly and
severally represent and warrant to the Company that:
4.1 Organization and Qualification; Subsidiaries.
(a) Each of Parent, Merger Sub and all other subsidiaries of
Parent (the "Parent Subsidiaries") has been duly organized and is validly
existing and in good standing (to the extent applicable) under the laws of the
jurisdiction of its incorporation or organization, as the case may be, and has
the requisite corporate power and authority and all necessary governmental
approvals to own, lease and operate its properties and to carry on its
business as it is now being conducted, except where the failure to be so
organized, existing or in good standing or to have such power, authority and
governmental approvals could not reasonably be expected to have, individually
or in the aggregate, a material adverse effect. Parent, Merger Sub and each
other Parent Subsidiary is duly qualified or licensed to do business, and is
in good standing (to the extent applicable), in each jurisdiction where the
character of the properties owned, leased or operated by it or the nature of
its business makes such qualification or licensing necessary, except for such
failures to be so qualified or licensed and in good standing that could not
reasonably be expected to have, individually or in the aggregate, a material
adverse effect.
(b) Section 4.1 of Schedule 4 sets forth, as of the date of
this Agreement, a true and complete list of each Parent Subsidiary. Except as
set forth in Section 4.1 of Schedule 4, neither Parent nor any Parent
Subsidiary owns an equity interest in any partnership or joint venture
arrangement or other business entity that is material to the financial
condition, results of operations, business or prospects of Parent and the
Parent Subsidiaries, taken as a whole.
4.2 Capitalization. The authorized Common Stock of Parent consists
of 100,000,000 shares of Common Stock of which 77,062,050 are currently issued
and outstanding, all of which are validly issued, fully paid and
nonassessable. There are no options, warrants or other rights, agreements,
arrangements or commitments of any character to which Parent is a party or by
which Parent is bound relating to the issued or unissued Common Stock of
Parent, Merger Sub or any other Parent Subsidiary or obligating Parent, Merger
Sub or any other Parent Subsidiary to issue or sell any shares of Common Stock
of, or other equity interests in, Parent, Merger Sub or any other Parent
Subsidiary. Each outstanding share of Common Stock of each Parent Subsidiary
is duly authorized, validly issued, fully paid and nonassessable and each such
share owned by Parent or another Parent Subsidiary is free and clear of all
security interests, liens, claims, pledges, options, rights of first refusal,
agreements, limitations on Parent's or such other Parent Subsidiary's voting
rights, charges and other encumbrances of any nature whatsoever, except where
the failure to own such shares free and clear could not reasonably be expected
to have, individually or in the aggregate, a material adverse effect.
4.3 Directors and Officers. Schedule 4 contains the names and titles
of all directors and officers of Parent and Merger Sub as of the date of this
Agreement.
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4.4 Financial Statements. Parent has delivered to the Company its
audited balance sheet and statements of operations and cash flows as of and
for the period ended March 31, 1999, and its unaudited balance sheet and
statements of operations and cash flows as of and for the period ended
December 31, 1999 (collectively the "Financial Statements"). The Financial
Statements are complete and correct in all material respects and have been
prepared in accordance with generally accepted accounting principles applied
on a consistent basis throughout the periods indicated. The Financial
Statements accurately set out and describe the financial condition and
operating results of the Company as of the dates, and for the periods,
indicated therein.
4.5 Absence of Changes. Since December 31, 1999, except for changes
in the ordinary course of business which have not in the aggregate been
materially adverse, to the best of Parent's knowledge, Parent has not
experienced or suffered any material adverse change in its condition
(financial or otherwise), results of operations, properties, business or
prospects or waived or surrendered any claim or right of material value.
4.6 Absence of Undisclosed Liabilities. Neither Parent nor any of
its properties or assets are subject to any liabilities or obligations of any
nature, whether absolute, accrued, contingent or otherwise and whether due or
to become due, that are not reflected in the financial statements presented to
the Company.
4.7 Tax Returns. Within the times and in the manner prescribed by
law, Parent has filed all federal, state and local tax returns required by law
and has paid all taxes, assessments and penalties due and payable.
4.8 Trade Names and Rights. Parent does not use any trademark,
service xxxx, trade name, or copyright in its business, or own any trademarks,
trademark registrations or applications, trade names, service marks,
copyrights, copyright registrations or applications.
4.9 Compliance with Laws. To the best of Parent's knowledge, Parent
has complied with, and is not in violation of, applicable federal, state or
local statutes, laws and regulations (including, without limitation, any
applicable building, zoning, or other law, ordinance, or regulation) affecting
its properties or the operation of its business or with which it is otherwise
required to comply.
4.10 Litigation. There is no legal action, suit, arbitration or
other legal, administrative or other governmental investigation, inquiry or
proceeding (whether federal, state, local or foreign) pending or threatened
against or affecting (i) Parent or any of its subsidiaries or any of their
respective properties, assets or business (existing or contemplated) or (ii)
any employee of Parent or any such subsidiary, before any court or
governmental department, commission, board, bureau, agency or instrumentality
or any arbitrator, except for suits, arbitrations, investigations, inquiries
and proceedings which, if decided adversely to Parent would not a have
material adverse effect on Parent, its operations, assets or prospects. After
reasonable investigation, neither Parent nor any employee or agent of nor
attorney for Parent is aware of any fact that might result in or form the
basis for any such action, suit, arbitration, investigation, inquiry or other
proceeding. Neither Parent nor any employee is in default with respect to any
order, writ, judgment, injunction, decree, determination or award of any court
or of any governmental agency or instrumentality (whether federal, state,
local or foreign).
11
4.11 No Pending Investigation. Parent is not aware of any pending
investigations or legal proceedings by the SEC, any state securities
regulatory agency, or any other governmental agency regarding Parent or any
officers or directors of Parent or any shareholders or controlling persons of
such shareholders.
4.12 Authority Relative to this Agreement. Parent and Merger Sub
have all necessary corporate power and authority to execute and deliver this
Agreement, to perform their respective obligations hereunder and to consummate
the transactions contemplated hereby. The execution and delivery of this
Agreement by Parent and Merger Sub and the consummation by Parent and Merger
Sub of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action, and no other corporate
proceedings on the part of Parent or Merger Sub are necessary to authorize
this Agreement or to consummate such transactions (other than the filing and
recordation of the Articles of Merger as required by Texas and Nevada
Corporation Law). This Agreement has been duly executed and delivered by
Parent and Merger Sub and, assuming the due authorization, execution and
delivery by the Company, constitutes the legal, valid and binding obligation
of Parent and Merger Sub, enforceable against Parent and Merger Sub in
accordance with its terms.
4.13 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by Parent and
Merger Sub do not, and the performance by Parent and Merger Sub of their
obligations hereunder and the consummation of the Merger will not, (i)
conflict with or violate any provision of the certificate or articles of
incorporation, as the case may be, or bylaws of Parent or Merger Sub or any
equivalent organizational documents of any other Parent Subsidiary, (ii)
assuming that all consents, approvals, authorizations and permits described in
Section 4.14(b) have been obtained and all filings and notifications described
in Section 4.14(b) have been made, conflict with or violate any Law applicable
to Parent or any other Parent Subsidiary or by which any property or asset of
Parent, Merger Sub or any other Parent Subsidiary is bound or affected or
(iii) except as set forth in Section 4.14(a) of the Schedule 4, result in any
breach of or constitute a default (or an event which with the giving of notice
or lapse of time or both could reasonably be expected to become a default)
under, or give to others any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or other encumbrance on
any property or asset of Parent, Merger Sub or any other Parent Subsidiary
pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation, except, with
respect to clauses (ii) and (iii), for any such conflicts, violations,
breaches, defaults or other occurrences which could not reasonably be
expected, individually or in the aggregate, (A) to have a material adverse
effect or (B) to prevent or materially delay the performance by Parent or
Merger Sub of its obligations pursuant to this Agreement or the consummation
of the Merger.
(b) The execution and delivery of this Agreement by Parent and
Merger Sub do not, and the performance by Parent and Merger Sub of their
respective obligations hereunder and the consummation of the Merger will not,
require any consent, approval, authorization or permit of, or filing by Parent
or Merger Sub with or notification by Parent or Merger Sub to, any
Governmental Entity, except (i) pursuant to applicable requirements of the
Exchange Act, the Securities Act, Blue Sky Laws, the rules and regulations of
12
the American Stock Exchange, and the filing and recordation of the Articles of
Merger as required by Texas and Nevada Corporation Law and (ii) where failure
to obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, could not reasonably be expected, individually or in
the aggregate, (A) to have a material adverse effect or (B) to prevent or
materially delay the performance by Parent or Merger Sub of its obligations
pursuant to this Agreement or the consummation of the Merger.
4.14 Validity of Parent Shares. The shares of Parent Common Stock to
be delivered pursuant to this Agreement, when issued in accordance with the
provisions of this Agreement, will be duly authorized, validly issued, fully
paid and nonassessable.
4.15 Full Disclosure. None the representations and warranties made by
Parent in this Agreement, the Schedules and Exhibits to this Agreement
prepared by Parent, any filings made by Parent with the Securities and
Exchange Commission (the "Commission") (including all the exhibits and
appendixes thereto) (the "SEC Documents") contained, contains, or will contain
at the time it was or is so furnished any untrue statement of a material fact
or omitted, omits or will omit at such time to state any material fact
necessary in order to make the statements made herein and therein, in light of
the circumstances under which they were made, not misleading. Except as
disclosed in any SEC Document filed on XXXXX at least five (5) business days
prior to the date hereof, since January 1, 1999, there has been no material
adverse change and no material adverse development in the business,
properties, operations, condition (financial or otherwise), assets,
liabilities or results of operations or, insofar as can reasonably be
foreseen, prospects of Parent or any of its subsidiaries. Parent has not
taken any steps, and does not currently expect to take any steps, to seek
protection pursuant to any bankruptcy law nor does Parent or any of its
subsidiaries have any knowledge or reason to believe that their respective
creditors intend to initiate involuntary bankruptcy proceedings. No event,
liability, development or circumstance has occurred or exists, or is
contemplated to occur, with respect to the Parent or its subsidiaries or their
respective businesses, properties, operations, condition (financial or
otherwise), assets, liabilities or results of operations or, insofar as can
reasonably be foreseen, prospects, that would be required to be disclosed by
Parent under applicable securities laws on a registration statement (including
by way of incorporation by reference) filed with the Commission, on the date
this representation is made or deemed to be made, relating to an issuance and
sale by Parent of the Common Stock and which has not been publicly disclosed.
4.16 Assets. Parent has good and marketable title to all of its
tangible properties and such tangible properties are not subject to any liens
or encumbrances except as disclosed in Parent's Financial Statements.
ARTICLE V
COVENANTS
5.1 Investigative Rights. From the date of this Agreement until the
Closing Date, each party shall provide to the other party, and such other
party's counsels, accountants, auditors, and other authorized representatives,
full access during normal business hours and upon reasonable advance written
notice to all of each party's properties, books, contracts, commitments, and
records for the purpose of examining the same. Each party shall furnish the
other party with all information concerning each party's affairs as the other
party may reasonably request. If the transaction contemplated hereby is not
13
completed, all documents received by each party and/or its attorneys and
accountants, auditors or other authorized representatives shall be returned to
the other party who provided same upon request. The parties hereto, their
directors, employees, agents and representatives shall not disclose any of the
information described above unless such information is already disclosed to
the public, without the prior written consent of the party to which the
confidential information pertains. Each party shall take such steps as are
necessary to prevent disclosure of such information to unauthorized third
parties.
5.2 Conduct of Business. Prior to the Closing, Parent and the
Company shall each conduct its business in the normal course, and shall not
sell, pledge, or assign any assets, without the prior written approval of the
other party, except in the regular course of business or as contemplated in
previously disclosed contractual obligations. Neither Parent nor the Company
shall amend its Articles of Incorporation or Bylaws, declare dividends, redeem
or sell stock or other securities, incur additional or newly-funded
liabilities, acquire or dispose of fixed assets, change employment terms,
enter into any material or long-term contract, guarantee obligations of any
third party, settle or discharge any balance sheet receivable for less than
its stated amount, pay more on any liability than its stated amount, or enter
into any other transaction other than in the regular course of business except
as otherwise contemplated herein.
5.3 Plan of Reorganization. This Agreement is intended to constitute
a "plan of reorganization" within the meaning of Section 1.368-2(g) of the
income tax regulations promulgated under the Code. From and after the date of
this Agreement, each party hereto shall use all reasonable efforts to cause
the Merger to qualify, and shall not, without the prior written consent of the
other parties hereto, knowingly take any actions or cause any actions to be
taken which could reasonably be expected to prevent the Merger from qualifying
as a tax-free reorganization under the provisions of Section 368 of the Code.
In the event that the Merger shall fail to qualify as a tax-free
reorganization under the provisions of Section 368 of the Code, then the
parties hereto agree to negotiate in good faith to restructure the Merger in
order that it shall qualify as tax-free transaction under the Code. Following
the Effective Time, and consistent with any such consent, neither the
Surviving Corporation nor Parent nor any of their respective affiliates
knowingly and voluntarily shall make any elections under the Code or take any
other action or cause any action to be taken which could reasonably be
expected to cause the Merger to fail to qualify as a reorganization under
Section 368 of the Code.
ARTICLE VI
CONDITIONS TO THE MERGER
6.1 Conditions to the Obligations of Each Party to Consummate the
Merger. The obligations of the parties hereto to consummate the Merger, or to
permit the consummation of the Merger, are subject to the satisfaction or, if
permitted by applicable Law, waiver of the following conditions:
(a) this Agreement and the Merger shall have been duly approved by
the requisite vote of stockholders of the Company and of Merger Sub in
accordance with the Texas and Nevada Corporation Law;
14
(b) no court of competent jurisdiction shall have issued or
entered any order, writ, injunction or decree, and no other governmental
entity shall have issued any order, which is then in effect and has the effect
of making the Merger illegal or otherwise prohibiting its consummation;
(c) all consents, approvals and authorizations legally required to
be obtained to consummate the Merger shall have been obtained from all
governmental entities, except where the failure to obtain any such consent,
approval or authorization could not reasonably be expected to result in a
change in or have an effect on the business of the Company or Parent that is
materially adverse to the business, assets, liabilities (contingent or
otherwise), condition (financial or otherwise) or results of operations of
Parent and its subsidiaries, taken as a whole;
(d) the outstanding principal balance and accrued interest on each
bridge note outstanding as of the Effective Time shall have been exchanged for
shares of the Parent's Common Stock having a value of $3,160,968.43 to be
determined by dividing the dollar amount by $10.50;
(e) the $30,457.51 of Employee Note Interest on Schedule 2.2(f),
$15,260.50 of Accrued Expenses and $93,905.52 of Accrued Vacation on Schedule
2.2(f) shall be exchanged for shares of the Parent's Common Stock valued at
$10.50 per share; and
(f) the shares of Parent Common Stock which are to be issued on
the Closing shall have been authorized for listing on the American Stock
Exchange.
6.2 Conditions to the Obligations of the Company. The obligations of
the Company to consummate the Merger, or to permit the consummation of the
Merger, are subject to the satisfaction or, if permitted by applicable Law,
waiver of the following further conditions:
(a) each of the representations and warranties of Parent contained
in this Agreement shall be true, complete and correct on and as of the
Effective Time as if made at and as of the Effective Time and the Company
shall have received a certificate of the President and Chief Financial Officer
of Parent to such effect;
(b) Parent shall have performed or complied in all material
respects with all material agreements and covenants required by this Agreement
to be performed or complied with by it on or prior to the Effective Time and
the Company shall have received a certificate of the President and Chief
Financial Officer of Parent to that effect;
(c) Employment Agreements. Parent and each of Xxxxxx X. Xxxxx,
Xx. and Xxxx Xxxxxxxxx shall have entered into employment agreements mutually
agreeable to the parties.
6.3 Conditions to the Obligations of Parent. The obligations of
Parent to consummate the Merger, or to permit the consummation of the Merger,
are subject to the satisfaction or, if permitted by applicable Law, waiver of
the following further conditions:
15
(a) each of the representations and warranties of the Company
contained in this Agreement shall be true, complete and correct on and as of
the Effective Time as if made at and as of the Effective Time and Parent shall
have received a certificate of the Chairman or President and Chief Financial
Officer of the Company to such effect;
(b) the Company shall have performed or complied in all material
respects with all material agreements and covenants required by this Agreement
to be performed or complied with by it on or prior to the Effective Time and
Parent shall have received a certificate of the Chairman or President and
Chief Financial Officer of the Company to that effect;
(c) there shall not be pending or threatened any action,
proceeding, claim or counterclaim which seeks to or would, or any order,
decree or injunction (whether preliminary, final or appealable) which would,
require Parent to hold separate or dispose of any of the stock or assets of
the Company or the Company Subsidiaries or imposes material limitations on the
ability of Parent to control in any material respect the business, assets or
operations of either Parent or the Company;
(d) The Company shall provide a letter from its auditors stating
that its financial statements for the period from inception through December
31, 1999, can be audited in accordance with SEC rules and that the audit can
be completed within 75 days after the Closing.
(e) Parent shall have received evidence that all of the Company's
outstanding bridge loans have been exchanged into common stock of the Company
or the holders have agreed that their securities would be exchanged for shares
of the Parent's common stock.
(f) Parent shall have received evidence that all of the Company's
outstanding warrants have been exercised or will be cancelled on the merger of
the Company with the Merger Sub.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated and the Merger
may be abandoned at any time prior to the Effective Time, notwithstanding any
requisite adoption and approval of this Agreement, as follows:
(a) by mutual written consent duly authorized by the boards of
directors of each of Parent and the Company;
(b) by either Parent or the Company, if the Effective Time shall
not have occurred on or before June 12, 2000; provided, however, that the
right to terminate this Agreement under this Section 7.1(b) shall not be
available to any party whose failure to fulfill any obligation under this
Agreement shall have caused, or resulted in, the failure of the Effective Time
to occur on or before such date;
(c) by Parent, upon a breach of any representation, warranty,
covenant or agreement on the part of the Company set forth in this Agreement,
or if any representation or warranty of the Company shall have become untrue,
incomplete or incorrect, in either case such that the conditions set forth in
Section 6.3 would not be satisfied (a "Terminating Company Breach"); provided,
16
however, that if such Terminating Company Breach is curable by the Company
through the exercise of its reasonable efforts within 10 days and for so long
as the Company continues to exercise such reasonable efforts, Parent may not
terminate this Agreement under this Section 7.1(c); and provided further that
the preceding proviso shall not in any event be deemed to extend any date set
forth in paragraph (b) of this Section 7.1;
(d) by the Company, upon a breach of any representation,
warranty, covenant or agreement on the part of the Parent set forth in this
Agreement, or if any representation or warranty of the Parent shall have
become untrue, incomplete or incorrect, in either case such that the
conditions set forth in Section 6.2 would not be satisfied (a "Terminating
Parent Breach"); provided, however, that if such Terminating Parent Breach is
curable by the Parent through the exercise of its reasonable efforts within 10
days and for so long as the Parent continues to exercise such reasonable
efforts, the Company may not terminate this Agreement under this Section
7.1(d); and provided further that the preceding proviso shall not in any event
be deemed to extend any date set forth in paragraph (b) of this Section 7.1.
7.2 Effect of Termination. In the event of termination of this
Agreement pursuant to Section 7.1, this Agreement shall forthwith become void,
there shall be no liability under this Agreement on the part of any party
hereto or any of its affiliates or any of its or their officers or directors,
and all rights and obligations of each party hereto shall cease; provided,
however, that nothing herein shall relieve any party hereto from liability for
the willful or intentional breach of any of its representations and warranties
or the willful or intentional breach of any of its covenants or agreements set
forth in this Agreement.
7.3 Amendment. This Agreement may be amended by the parties hereto
by action taken by or on behalf of their respective boards of directors at any
time prior to the Effective Time. This Agreement may not be amended except by
an instrument in writing signed by the parties hereto.
7.4 Waiver. At any time prior to the Effective Time, any party
hereto may (a) extend the time for or waive compliance with the performance of
any obligation or other act of any other party hereto or (b) waive any
inaccuracy in the representations and warranties contained herein or in any
document delivered pursuant hereto. Any such extension or waiver shall be
valid if set forth in an instrument in writing signed by the party or parties
to be bound thereby.
7.5 Expenses. All Expenses incurred in connection with this
Agreement and the Merger shall be paid by the party incurring such Expenses,
whether or not the Merger is consummated.
ARTICLE VIII
GENERAL PROVISIONS
8.1 Non-survival of Representations and Warranties. The
representations and warranties in this Agreement shall terminate at the
Effective Time or upon the termination of this Agreement pursuant to Section
7.1, as the case may be. Each party agrees that, except for the
representations and warranties contained in this Agreement and the Disclosure
Schedules, no party hereto has made any other representations and warranties,
and each party hereby disclaims any other representations and warranties made
17
by itself or any of its officers, directors, employees, agents, financial and
legal advisors or other representatives, with respect to the execution and
delivery of this Agreement or the Merger contemplated herein, notwithstanding
the delivery or disclosure to any other party or any party's representatives
of any documentation or other information with respect to any one or more of
the foregoing.
8.2 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by
telecopy or facsimile, by registered or certified mail (postage prepaid,
return receipt requested) or by a nationally recognized courier service to the
respective parties at their addresses set forth on the signature pages to this
Agreement (or at such other address for a party as shall be specified in a
notice given in accordance with this Section 8.2).
8.3 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of Law or
public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the Merger is not affected in any manner materially adverse to
any party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner
to the fullest extent permitted by applicable Law in order that the Merger may
be consummated as originally contemplated to the fullest extent possible.
8.4 Assignment; Binding Effect; Benefit. Neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by any
of the parties hereto (whether by operation of Law or otherwise) without the
prior written consent of the other parties hereto. Subject to the preceding
sentence, this Agreement shall be binding upon and shall inure to the benefit
of the parties hereto and their respective successors and permitted assigns.
Notwithstanding anything contained in this Agreement to the contrary, nothing
in this Agreement, expressed or implied, is intended to confer on any person
other than the parties hereto or their respective successors and permitted
assigns any rights or remedies under or by reason of this Agreement.
8.5 Incorporation of Exhibits. The Disclosure Schedules and all
Exhibits attached hereto and referred to herein are hereby incorporated herein
and made a part of this Agreement for all purposes as if fully set forth
herein.
8.6 Choice of Law. This Agreement shall be construed and governed by
the laws of the State of California without regard to conflicts of interest
principles. The parties hereto consent to the jurisdiction of the federal and
state courts located in Los Angeles, California, for any action or suit
arising out of this Agreement, and waive any defense to such jurisdiction,
including, without limitation, any defense based on venue or inconvenient
forum.
8.7 Headings. The descriptive headings contained in this Agreement
are included for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
18
8.8 Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when executed
and delivered shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
8.9 Entire Agreement. This Agreement (including the Exhibits, the
Disclosure Schedules) constitute the entire agreement among the parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings among the parties with respect thereto. No addition to or
modification of any provision of this Agreement shall be binding upon any
party hereto unless made in writing and signed by all parties hereto.
8.10 Further Assurances. Each party shall do and perform or cause to
be done or performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other parties may reasonably request in order to carry out the intent and
accomplish the purpose of this Agreement and the consummation of the
transactions contemplated hereby; provided, however, that no party shall be
obligated in any way to do anything that would conflict with, contradict or
otherwise contravene any term or condition set forth prior to this Section
8.10.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.
AGREED TO AND ACCEPTED as of the date first above written.
X-XXXXXXX.XXX VIDIMEDIX CORPORATION
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxxx, Xx.
Xxxx X. Xxxxxxx, President Xxxxxx X. Xxxxx, Xx., President
0000 Xxxxx Xxxxxxx Xxxxxxx 0000 Xxxxxxx xx Xxxxx Xxxxxxx Xxxxx
Xxxxx 000 Building Two, Suite 540
Jacksonville, Florida 32250 Xxxxxx, Xxxxx 00000
VIDIMEDIX ACQUISITION CORPORATION
By: /s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx, President
0000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxxxx, Xxxxxxx 00000
19
Schedule 2.2(f)
Total Liability
Category
Employee Expenses $ 250,815.01
401 Payable $ 24,751.35
Accrued Salaries $ 263,317.01
Accrued Payroll Taxes $ 19,799.07
Payroll Tax Payable $ 62,549.44
Accrued Vacation $ 165,647.09
Accrued Incentive Comp $ 601,518.75
Employee Comp Notes Payable $ 157,329.61
Emp Note Interest $ 30,457.51
SVB $ 174,212.70
Trade Payables $ 847,059.26
Sales Tax Payable $ 6,233.44
Deferred Sales Taxes Payable $ 30,443.67
Accrued Expenses $ 101,471.30
Bank of America Operating acc't $ 85,745.28
Short Term Debt Other $ 229,958.91
Short Term Debt Interest $ 5,508.02
Other Notes Payable $ 23,047.32
Bridge Financing Principal $2,901,543.82
Bridge Note Interest $ 259,424.61
SVB A/R Note $ -
-------------
$6,240,833.17
=============
1. The Company has not paid property taxes nor rendered any property taxes
in prior years in San Diego County (1998) and Xxxxxx County (1996-1997).
2. Penalties are due to the California State Board of Equalization in the
amount of $1,294.56 for 1999.
3. An amended tax return to be filed with the Hawaii Department of Taxation
will result in additional tax liability of $2,301.71 and penalties.
Schedule 3
3.4 Directors and Officers of the Corporation as of the date hereof:
Xxxxxxx X. Xxxxx, Xx. President, Chief Executive Officer and
Director
J. Xxxxxx Xxxx, MD Director
Xxxxxx Xxxxxx Director
Xxxx XxXxxxxx Director
Xxxx Xxxxxxxx, MD, FACP Director, Chairman of the Board of
Directors
Xxxx Xxxxx Xxxxx Director
Xxx X. Xxxxx III Secretary
Xxxxxxxx X. Xxxxx Assistant Secretary, Manager,
Administrative and Legal Services
Xxxxxx X. Best Vice President, Sales Operations
Xxxxxxx Xxxxx Vice President, Business Development
Xxxx Xxxxxxxxx Vice President, Engineering and Product
Development
3.9 Trade Names and Rights:
(i) Trademarks and Service Marks:
Filing Number/
Registration Filing Date/ Expiration
Xxxx Country of Filing Number Date of Issue Date Status
---- ----------------- -------------- ------------- ----------- ------
XxxxXxxxx Xxxxxx 000000 Jan. 31, 2000 Registered
VidiMedix Mexico 390151 Sept. 8, 0000 X/X Xxxxxxx
Xxxxxx
Xxxx
XxxxXxxxx Xxxxxx Xxxxxx of 2,293,982 Nov. 23, 1999 Nov. 22, 0000 Xxxxxxxxxx
Xxxxxxx
XxxxXxxxx Xxxxxx Xxxxxx of 2,305,244 Jan. 4, 2000 Jan. 3, 2010 Registered
Design America
Logo
VidiMedix Australia 806248 Sept. 6, 0000 X/X Xxxxxxx
XxxxXxxxx Xxxxxx 880,972 June 10, 1998 N/A Pending
VidiMedix Canada 1028450 Sept. 10, 1999 N/A Pending
Design
Logo
VidiMedix European Union 1348499 Oct. 18, 1999 N/A Pending
VidiMedix European Union 1350248 Oct. 18, 1999 N/A Pending
Design
Logo
VidiMedix Japan 81507/99 Sept. 10, 1999 N/A Pending
(ii) Copyrights:
None
(iii) U.S. Patent Pending for METHOD OF AND APPARATUS FOR DYNAMICALLY
GENERATING A USER PRESENTATION BASED ON DATABASE STORED RULES
PCT Patent Pending B - METHOD OF AND APPARATUS FOR DYNAMICALLY
GENERATING A USER PRESENTATION BASED ON DATABASE STORED RULES
3.16 Material Contracts and Obligations:
(a) Secured Convertible Promissory Note (undated) executed by
VidiMedix Corporation as Borrower and Windamere, LLC as
Lender
(b) Security Agreement dated May 2, 2000, executed by VidiMedix
Corporation as Borrower and Windamere, LLC as Lender
(c) Loan and Security Agreement dated November 11, 1999, by and
between Silicon Valley Bank as Bank and VidiMedix Corporation
as Borrower, as amended
(d) Lease Agreement dated February 25, 2000 (Lease #235564.02),
between VidiMedix Corporation as Lessee and XxxxxxxxXxxxxxx.xxx,
successor-in-interest to Premier Funding Group, Inc., as Lessor
(equipment lease)
(e) Lease Agreement dated February 25, 2000 (Lease #235564.01),
between VidiMedix Corporation as Lessee and XxxxxxxxXxxxxxx.xxx,
successor-in-interest to Premier Funding Group, Inc., as Lessor
(equipment lease)
(f) Lease Agreement dated February 18, 2000, between VidiMedix
Corporation as Lessee and Premier Funding Group, Inc., as Lessor
(equipment lease)
(g) Master Lease Agreement dated April 28, 1998 (Lease
#5440-83167-000), between VidiMedix Corporation as Lessee and
Rockford Industries, Inc., as Lessor (equipment lease), as
assigned to Oux Credit Alliance, Inc.
(h) Lease Agreement dated June 29, 1998 (Lease #5440-83167-003),
between VidiMedix Corporation as Lessee and Rockford Industries,
Inc., as Lessor (equipment lease)
(i) Lease Agreement dated May 27, 1998 (Lease #5440-83167-001),
between VidiMedix Corporation as Lessee and Rockford Industries,
Inc., as Lessor (equipment lease), as assigned to American Express
Business Finance
(j) Lease Agreement dated January 29, 2000 (Lease #X100040; Schedule
#00010), between VidiMedix Corporation as Lessee and Newcourt
Leasing Corporation as Lessor (equipment lease), as assigned to
Commercial Investment Trust
(k) Lease Agreement dated January 29, 2000 (Lease #X100040; Schedule
#00020), between VidiMedix Corporation as Lessee and Newcourt
Leasing Corporation as Lessor (equipment lease), as assigned to
Commercial Investment Trust
(l) Master Lease Agreement dated October 29, 1997 (Lease #73717;
Schedules #000, #000, #000 and #004), between VidiMedix
Corporation as Lessee and Newcourt Financial USA Inc., dba
Fujitsu Financial Services, as Lessor (equipment lease)
(m) Letter Agreement dated February 15, 2000, by and between HillCo
Partners and VidiMedix Corporation (legislative services,
regulatory services and public relations services)
(n) Consulting Agreement executed on December 1, 1999, by N-Space
Technology, Inc., as Consultant and VidiMedix Corporation
(o) Consulting Agreement executed on July 18, 1997, by Xxx X. Xxxxx,
III, as Consultant and VidiMedix Corporation
(p) Consulting Agreement executed on April 18, 1997, by Xxxx Xxxxx
Xxxxx as Consultant and VidiMedix Corporation
(q) Consulting Agreement executed on July 10, 1997 and July 22, 1997,
by Xxxxxxx Xxxxxx as Consultant and VidiMedix Corporation,
respectively, to commence on August 1, 1997
(r) Consulting Agreement executed on April 1, 199, by Xxxxxx X.
Xxxxxx as Consultant and VidiMedix Corporation
(s) Standard Industrial Sublease dated December 1, 1997, by and
between VidiMedix Corporation as Sublessee and Copper Mountain
Networks Inc. as Sublessor (real property lease)
(t) Lease dated December 1, 1997, by and between VidiMedix
Corporation as Sublessee and Copper Mountain Networks Inc. as
Sublessor (real property lease)
(u) Office Lease dated October 8, 1997, by and between VidiMedix
Corporation as Tenant and JMB Group Trust III as Landlord (real
property lease)
(v) Software License Agreement dated September 1, 1998, by and
between VidiMedix Corporation and KLT Telecom, Inc.
(w) Distribution and Service Agreement dated January 12, 2000, by and
between VidiMedix Corporation and Superior Consultant Company,
Inc.
(x) Term Plan Agreement dated August 24, 1999, by and between
VidiMedix Corporation and Lone Star (AT&T Business Service Simply
Better Pricing Option)
(y) Dedicated Transport Service Agreement dated October 10, 1997, by
and between VidiMedix Corporation and Time Warner Communications
(z) Switched Service Agreement dated October 10, 1997, by and between
VidiMedix Corporation and Time Warner Communications
(aa) Sales Agreement dated August 23, 1999, by and between VidiMedix
Corporation and Pacific Xxxx Internet Services
(bb) Copy Management Program Agreement dated January 23, 1998
(Agreement Number 359591), by and between VidiMedix Corporation
and IKON Office Solutions, Inc.
(cc) Lease Agreement dated December 9, 1997 (Lease Number 347924), by
and between VidiMedix Corporation and IKON Office Solutions, Inc.
(dd) Maintenance Agreement accepted on July 2, 1999, by and between
VidiMedix Corporation and FUJITSU Business Communication Systems,
Inc.
(ee) Maintenance Agreement accepted on July 1, 1999 (Agreement Number
260699-A), by and between VidiMedix Corporation and FUJITSU
Business Communication Systems, Inc.
(ff) Estimate/Contract for Maintenance Service dated December 15, 1997,
by and between VidiMedix Corporation and Best Maintenance
(gg) Employment Agreement dated August 15, 1997, by and between
VidiMedix Corporation and Xxxxx Xxxxxxxx
(hh) Employment Agreement dated April 1, 1997, by and between VidiMedix
Corporation and Xxx X. Xxxxx, III
(ii) Employment Agreement dated October 6, 1997, by and between
VidiMedix Corporation and Xxxxxxxx X. Xxxxx, as amended by
Amendment 1 dated Xxxxx 00, 0000
(xx) Employment Agreement dated October 1, 1997, by and between
VidiMedix Corporation and Xxxxx Xxxxxx
(kk) Employment Agreement dated June 8, 1998, by and between VidiMedix
Corporation and Xxxxxx X. Xxxxxxxx
(ll) Employment Agreement dated April 1, 1997, by and between VidiMedix
Corporation and Xxxxxxx Xxxxx
(mm) Employment Agreement dated April 1, 1997, by and between VidiMedix
Corporation and Xxxxxxx Xxxxxxx
(nn) Employment Agreement dated July 28, 1997, by and between VidiMedix
Corporation and Xxxxxx X. Best
(oo) Employment Agreement dated March 31, 1997, by and between
VidiMedix Corporation, formerly Secure Digital Communications,
Inc., and Xxxxxx X. Xxxxx, Xx.
(pp) Employment Agreement dated September 1, 1997, by and between
VidiMedix Corporation and Xxxx X. Xxxxxxxxx
(qq) Employment Agreement dated June 2, 1998, by and between VidiMedix
Corporation and Xxxx Xxxxxxx III
(rr) VidiMedix Telemedicine System Purchase Agreement accepted on
August 5, 1999, by and between VidiMedix Corporation and St.
Xxxxxxx Healthcare System of Hawaii
(ss) Hawaii Health Systems Corporation Agreement for Goods or Services
Based Upon Competitive Sealed Proposals dated December 1, 1999, by
and between VidiMedix Corporation and Hawaii Health Systems
Corporation
(tt) Letter Agreement dated April 26, 2000 (accepted on April 28,
2000), by and between VidiMedix Corporation and Xxxxx & White
Hospital and Clinic
(uu) Second Amended and Restated Warrant to Purchase Stock issued by
VidiMedix Corporation on November 11, 1999, granting to Silicon
Valley Bank the right to purchase 27,815 shares (subject to
adjustment) of Series B Convertible Preferred Stock at an initial
exercise price of $1.06 per share
(vv) Common Stock Warrant of VidiMedix Corporation (Warrant No. WM-1)
issued by VidiMedix Corporation on January 14, 2000, granting to
Superior Consultant Holdings Corporation the right to purchase
1,661,865 shares (subject to adjustment) of the common stock of
VidiMedix Corporation at an initial exercise price of $.77 per
share
(ww) Common Stock Purchase Warrant (Warrant No. WA-1) issued by
VidiMedix Corporation on July 3, 1997, granting to Xxx X. Xxxxx,
III, the right to purchase 4,125 shares (subject to adjustment)
of the common stock of VidiMedix Corporation at an initial
exercise price of $1.75 per share
(xx) Common Stock Purchase Warrant (Warrant No. WA-2) issued by
VidiMedix Corporation on July 3, 1997, granting to Xxxxx
Xxxxxxxxxx the right to purchase 1,500 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.75 per share
(yy) Common Stock Purchase Warrant (Warrant No. WA-3) issued by
VidiMedix Corporation on July 3, 1997, granting to Xxxxxxx X.
Xxxxxx the right to purchase 3,000 shares (subject to adjustment)
of the common stock of VidiMedix Corporation at an initial
exercise price of $1.75 per share
(zz) Common Stock Purchase Warrant (Warrant No. WA-4) issued by
VidiMedix Corporation on July 3, 1997, granting to Xxx X. Xxxxx,
Xx. and Xxx X. Xxxxx the right to purchase 2,250 shares (subject
to adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.75 per share
(aaa) Common Stock Purchase Warrant (Warrant No. WA-5) issued by
VidiMedix Corporation on July 3, 1997, granting to Xxxx Xxxxx
Xxxxx the right to purchase 4,125 shares (subject to adjustment)
of the common stock of VidiMedix Corporation at an initial
exercise price of $1.75 per share
(bbb) Common Stock Purchase Warrant (Warrant No. WA-6) issued by
VidiMedix Corporation on July 3, 1997, granting to X. Xxxxxxxx,
M.D., the right to purchase 30,000 shares (subject to adjustment)
of the common stock of VidiMedix Corporation at an initial
exercise price of $1.75 per share
(ccc) Common Stock Purchase Warrant (Warrant No. WB-1) issued by
VidiMedix Corporation on November 21, 1997, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 22,500 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(ddd) Common Stock Purchase Warrant (Warrant No. WC-4) issued by
VidiMedix Corporation on March 9, 1998, granting to Xxx X. Xxxxx,
III, the right to purchase 6,750 shares (subject to adjustment) of
the common stock of VidiMedix Corporation at an initial exercise
price of $1.92 per share
(eee) Common Stock Purchase Warrant (Warrant No. WE-1) issued by
VidiMedix Corporation on February 17, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 4,500 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(fff) Common Stock Purchase Warrant (Warrant No. WE-2) issued by
VidiMedix Corporation on February 18, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 5,400 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(ggg) Common Stock Purchase Warrant (Warrant No. WE-3) issued by
VidiMedix Corporation on February 27, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 3,600 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(hhh) Common Stock Purchase Warrant (Warrant No. WE-4) issued by
VidiMedix Corporation on March 9, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 2,250 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(iii) Common Stock Purchase Warrant (Warrant No. WE-5) issued by
VidiMedix Corporation on June 10, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 30,000 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(jjj) Common Stock Purchase Warrant (Warrant No. WE-6) issued by
VidiMedix Corporation on March 9, 1998, granting to Xxx Xxxxxx
Xxxxx, III, the right to purchase 28,843 shares (subject to
adjustment) of the common stock of VidiMedix Corporation at an
initial exercise price of $1.92 per share
(kkk) VidiMedix Corporation 1997 Stock Option Plan
(lll) Incentive Stock Option Agreement dated July 1, 1997, whereby
VidiMedix Corporation granted to Xxxxxx X. Best the right to
purchase 2,087 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $0.85 per share
(mmm) Incentive Stock Option Agreement dated April 1, 1997, whereby
VidiMedix Corporation granted to Xxxxxxx X. Xxxxx the right to
purchase 4,173 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $0.85 per share
(nnn) Stock Option Agreement dated October 24, 1997, whereby VidiMedix
Corporation granted to X. Xxxxxxx Xxxxxx the right to purchase
26,042 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $1.92 per share
(ooo) Stock Option Agreement dated April 1, 1997, whereby VidiMedix
Corporation granted to Xxxxxx X. Xxxxx, Xx., the right to purchase
20,866 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $0.85 per share
(ppp) Stock Option Agreement dated October 24, 1997, whereby VidiMedix
Corporation granted to Xxxx Xxxxx Xxxxx the right to purchase
39,063 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $1.92 per share
(qqq) Stock Option Agreement dated April 1, 1997, whereby VidiMedix
Corporation granted to Xxxxx Xxxxxxxxxx the right to purchase
5,214 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $0.085 per share
(rrr) Stock Option Agreement dated October 24, 1997, whereby VidiMedix
Corporation granted to Xxx Xxxxxx Xxxxx III the right to purchase
39,063 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $1.92 per share
(sss) Stock Option Agreement dated September 15, 1997, whereby VidiMedix
Corporation granted to Xxxx X. Xxxxxxxxx the right to purchase
41,730 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1997 Stock Option Plan at an
initial exercise price of $0.10 per share
(ttt) VidiMedix Corporation 1998 Stock Option Agreement dated to be
effective as of April 28, 1998
(uuu) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxx the right to
purchase 35,477 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(vvv) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxx Xxxxxx the right to
purchase 4,730 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(www) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxxx the right to
purchase 23,651 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(xxx) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxx Xxxxxxx, III the right to
purchase 18,921 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(yyy) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxxx the right to
purchase 23,651 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(zzz) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxx Xxxxx the right to purchase
7,095 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(aaaa) Incentive Stock Option Agreement dated August 15, 1998, whereby
VidiMedix Corporation granted to Xxxx Xx the right to purchase
7,095 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(bbbb) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxx X. Xxxxxxxxx the right to
purchase 29,222 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(cccc) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxx X. Best the right to
purchase 61,913 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(dddd) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxxx Xxxxxxx Xxxxxxx the right
to purchase 23,651 shares (subject to adjustment) of the common
stock of VidiMedix Corporation under the 1998 Stock Option Plan at
an initial exercise price of $0.77 per share
(eeee) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxxx Xxxxx the right to
purchase 17,396 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(ffff) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Young Cho the right to purchase
9,461 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(gggg) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxx Xxxxxx the right to
purchase 23,651 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(hhhh) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxx X. Xxxxx the right to
purchase 59,128 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(iiii) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxxxx X. Xxxxx the right to
purchase 18,921 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(jjjj) Incentive Stock Option Agreement dated April 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxx X. Xxxxx the right to
purchase 75,815 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(kkkk) Incentive Stock Option Agreement dated November 17, 1998, whereby
VidiMedix Corporation granted to Xxxx Xxxxxx the right to purchase
2,365 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(llll) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxx the right to
purchase 7,095 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(mmmm) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxx Xxxxx the right to purchase
7,095 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(nnnn) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxxx Xxxxxxxx the right to
purchase 5,000 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(oooo) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxxx the right to
purchase 5,000 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(pppp) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxxx Xxxxxxx the right to
purchase 4,730 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(qqqq) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxxxxx Xxxx the right to
purchase 4,730 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(rrrr) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxx the right to
purchase 7,095 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(ssss) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxx Xxxxxxxx the right to
purchase 4,730 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(tttt) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Juvy Xxx Xxxxx the right to
purchase 9,460 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(uuuu) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxxxx Xxxxxxx the right to
purchase 18,291 shares (subject to adjustment) of the common stock
of VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(vvvv) Incentive Stock Option Agreement dated January 17, 2000, whereby
VidiMedix Corporation granted to Xxxxx Xxxxx the right to purchase
2,500 shares (subject to adjustment) of the common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(wwww) Incentive Stock Option Agreement dated May 28, 1998, whereby
VidiMedix Corporation granted to Xxxxxx X. Xxxxxxxx the right to
purchase 35,477 shares (subject to adjustment) of common stock of
VidiMedix Corporation under the 1998 Stock Option Plan at an
initial exercise price of $0.77 per share
(xxxx) Master Lease Agreement dated August 10, 1998, between VidiMedix
Corporation, as Lessee, and The Republic Group LLC, as Lessor, as
assigned to Old Kent Leasing Services
(yyyy) Equipment Lease No. 00000-00000-000 between Rockford Industries,
Inc., as Lessee, and VidiMedix Corporation, as Lessor
(zzzz) Equipment Lease dated July 7, 1999, between Textron Financial
Corporation, as Lessor, and VidiMedix Corporation, as Lessee
(aaaaa) Accounts Receivable Purchase Agreement dated December 29, 1998,
between Silicon Valley Financial Services and VidiMedix
Corporation
(bbbbb) Access Service Agreement and Service Order dated June 1, 1999,
between VidiMedix Corporation and Verio
SCHEDULE 4
x-XxxXxxx.xxx
("e-Med")
4.1 Subsidiaries.
E-Net Technologies LTD and its wholly-owned UK subsidiaries
Illumea Corporation
VirTx, Inc.
X0X.xxx Ltd., a 45% owned Australian subsidiary
4.2 Capitalization:
Schedule of Warrants and Options Outstanding
as of March 31, 2000
Price
Number of Number Date of Per
Warrant Holder Warrants of Shares Issue Share Term
-------------- ---------- --------- -------- ----- ------
Magnum Financial 50,000 50,000 1/11/99 $0.25 5 Years
Xxxxxxx Investors 250,000 250,000 3/19/99 $3.85 5 Years
Xxx Xxxxx 250,000 250,000 3/19/99 $3.85 5 Years
Sutro & Co. 350,000 350,000 5/23/99 $5.00 5 Years
Sutro & Co. 1,300,000 1,300,000 5/23/99 $0.01 5 Years
Warrants in
December private
offering 3,568,000 3,568,000 12/31/99 $4.00 5 Years
Cypher Comm 1,000,000 1,000,000
--------- ---------
Outstanding 6,768,000 6,768,000
Price
Number of Number Date of Per
Option Holder Options of Shares Issue Share
-------------- ---------- --------- -------- -----
Xxx XxXxxxxxx 100,000 100,000 8/31/99 $1.00
UK employees 202,500 202,500 various $1.00
Stock Option Plan 426,000 426,000 various various
---------- ---------
Outstanding 728,500 728,500
Earn-Outs
Illumea ____________
VirTx ____________
4.4 Directors and Officers of e-Med:
Name Position
---- --------
Xxxx X. Xxxxxxx Chairman, President and Chief Executive Officer
Xxxxxxxx X. Xxxxxx Chief Financial Officer
Xxx XxXxxxxxx Managing Director, e-Net Technology Limited
Xxxxxxxx Xxxxx Chief Technology Officer and Executive Vice
President
Xxxxxx Xxxxxxxxx President of Multimedia Division
Xxxxxx Xxxxxx Director
San X.X. Xxxxx Director
Xxxxxxxx X. Xxxxx Director
Xxxxxx X. Xxxxx Director
