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AGREEMENT AND PLAN OF REORGANIZATION
WILLISTON OIL CORPORATION
ACQUISITION OF
MEDCO HEALTH CORPORATION
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AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OR REORGANIZATION ("AGREEMENT") made as of this 16th
day of January, 1996, by and among Williston Oil Corporation ("Williston"), a
Nevada corporation with offices at 000 Xxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxxxx
00000, Sun Capital Corporation ("Sun Capital"), a corporation with offices at
000 Xxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxxxx 00000, and Medco Health Corporation
("Medco"), a New York corporation, with offices at 000 00xx Xxxxxx, Xxxx Xxx
Xxxx, Xxx Xxxxxx 00000, and Xxxxx Xxxxxxx (the "Sole Shareholder"), who resides
at 00X Xxxxxxxx Xxxx, Xxxxxxxxx, XX 00000.
PREMISES
The Sole Shareholder owns all of the issued and outstanding capital stock
of Medco, Williston desires to acquire all of the issued and outstanding stock
of Medco, so as to make Medco a wholly-owned subsidiary of Williston, and the
Sole Shareholder desires to make a tax-free exchange of his shares in Medco for
shares of Williston's common stock, to be exchanged as set out herein with the
said Sole Shareholder.
PLAN OF REORGANIZATION
The Reorganization will comprise the acquisition by Williston of all the
outstanding capital stock of Medco from the Sole Shareholder in exchange solely
for a part of Williston's voting stock. The Sole Shareholder is and will, as of
the Closing (as hereinafter defined), be the owner of all of the issued and
outstanding capital stock of Medco. The exchange by the Sole Shareholder of the
capital stock of Medco for voting common stock of Williston shall be made upon
and subject to the terms and conditions of this Agreement hereinafter set forth
and is intended to qualify as a tax free reorganization pursuant to the
provisions of Section 368(a) (1) (B) of the Internal Revenue Code of 1954, as
amended.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and respective agreements
hereinafter set forth, the aforementioned parties hereby agree as follows:
1. EXCHANGE OF SHARES
Williston and the Sole Shareholder agree that all of the issued and
outstanding shares of common stock of Medco ("the Medco Stock") shall be
exchanged with Williston for the issuance by Williston to the Sole Shareholder
of twenty-four million (24,000,000) shares of the Class A common stock of
Williston, $.001 par value, per share which shall upon their issuance constitute
65.40482% of the issued and outstanding shares of the Class A common stock of
Williston (the "New Williston shares"); and
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exchanged for 1.25 million shares of Class B, which represents all the issued
and outstanding shares of the voting class.
2. CLOSING
2.1 TIME AND PLACE
The closing of the transactions contemplated by Section 1 hereof shall
take place at 10:00 A.M., on January 16, 1996, at the offices of Sun Capital
Corporation, 000 Xxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxxxx 00000, or such other time
and place as the parties hereto shall agree.
2.2 ACTIONS TO BE TAKEN
A. At the Closing the Sole Shareholder shall assign, transfer, deliver and
set over to Williston all of the Medco Stock duly endorsed and with any required
documentary or stamp taxes affixed at the Sole Shareholder's expense so as to
make Williston the sole owner thereof, free and clear of all liens, claims and
encumbrances. At the closing, Williston shall issue and deliver to the Sole
Shareholder the twenty-four million (24,000,000) New Williston Share.
3. REPRESENTATIONS AND WARRANTIES OF THE SOLE
SHAREHOLDER AND MEDCO
The Sole Shareholder and Medco, hereby represent and warrant to Williston
and Sun Capital that, with respect to the Medco Stock and with respect to Medco,
effective this date, the representations listed below are true and correct, and
further covenant and agree that, as of the Closing Date, the following
representations will be true and correct.
3.1 ORGANIZATION AND STANDING
Medco is a corporation duly organized and validly existing and in good
standing under the laws of the State of New Jersey and has all requisite
corporate power and authority to own its property, to carry or its business as
now being conducted and to enter into and carry out the provisions of this
Agreement. Medco is duly licensed and qualified to do business with all Federal,
State and other governmental agencies as required to own its properties and to
conduct its business.
3.2 CAPITALIZATION
The duly authorized capital stock of Medco consists of 200 shares of
Common Stock, no par value, of which 200 shares are outstanding, validly issued,
fully paid and nonassessable and owned of record by the Sole Shareholder. There
are no other securities of Medco now outstanding or securities on which it is or
may be liable, or securities that are or may become required to be issued by
reason of any statutory requirements
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(including, without limitation, preemptive rights), or warrants, rights,
options, calls, commitments or other agreements presently outstanding.
3.3 CORPORATE RECORDS
A copy of Medco's certificate of incorporation, the amendments thereto,
and the By-Laws, all of which are certified by the Secretary of Medco as of a
recent date, are attached as Schedule 3.3 hereto and each of the foregoing will
be complete, true and correct on the Closing date. The minute books of Medco
contain complete and accurate records of all corporate actions taken by the Sole
Shareholder, there having never been any other shareholders, officers, or
directors of Medco. The stock book of Medco reflects accurately the foregoing
or, in the event that there have in the past been shareholders of Medco, other
than the Sole Shareholder, the names of all persons who at any time in the past
were record shareholders of Medco, the number of shares of capital stock held by
each such shareholders and the circumstances of any past transfers or
redemptions of any shares of Medco held prior to the date hereof by any person
other than the Sole Shareholder.
3.4 SUBSIDIARIES
Medco owns no securities of any other entity.
3.5 DEFAULT UNDER LOANS
Medco is not in default in the payment of principal or interest and has
fully complied with all other covenants, obligations and conditions of all
indebtedness outstanding. Medco has no outstanding mortgages, loan agreements or
indebtedness of any kind, nature or description except as set forth on Schedule
3.5 hereto.
3.6 NO AGREEMENT OR COURT ORDERS
Neither Medco not the Sole Shareholder is a party or subject to or bound
by any agreement or any judgment, order, writ, injunction or decree of any court
or governmental body which contained any provisions which could operate to
impair the carrying out of this Agreement or any of the transactions
contemplated hereby.
3.7 AUTHORITY
The execution, delivery and performance of this Agreement by Medco has
been duly and effectively authorized by all requisite corporate action and will
not violate any provision of the Certificate of Incorporation or By-Laws of
Medco or any provision of, or result in the acceleration of any obligation
under, any agreement, indenture, instrument, lease, contract or other
undertaking to which Medco is a party or by which it is bound.
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3.8 RECENT FINANCIAL STATEMENTS
Medco and the Sole Shareholder have delivered to Williston a Balance Sheet
of the Company as of December 31, 1995, (the "Recent Balance Sheet") and the
related Statement of Earnings for the fiscal year then ended (the "Recent Income
Statement"). Such Recent Balance Sheet and Recent Income statement being
hereinafter sometimes collectively called the "Recent financial Statement" have
been audited by an independent auditor or are in form which is auditable. The
Recent Financial Statements are true, correct and complete and accurately and
truly present the financial condition of Medco as at the date thereof and the
results of its operations for the period therein specified and have been
prepared in accordance with generally accepted accounting principles applied on
a basis consistent with that of the preceding period and consistently maintained
throughout the periods involved. without limiting the generality of the
foregoing, the Recent Financial Statements, either on the face thereof or in the
notes thereto, include, reflect or disclose all periods involved. Without
limiting the generality of the foregoing, the Recent Financial Statements
disclose all debts, liabilities, commitments and obligations of every nature,
whether absolute, accrued, contingent or otherwise of Medco as at the date
thereof, including all appropriate reserves for taxes and there are no other
debts of Medco, or claims or demands with respect thereof, relating to or
arising out of any act, transaction or circumstances which occurred or existed
on or before the date of the Recent Balance Sheet, due or payable, except as
included, reflected or disclosed on the Recent Balance Sheet. the Recent Income
Statement does not contain any item of special or non recurring income or other
income not earned in the ordinary course of business except as expressly
specified therein.
3.9 OTHER FINANCIAL STATEMENTS
Medco and the Sole Shareholder will deliver to Williston copies of all
other financial statements of Medco, prepared by or for Medco as of a date
subsequent to the date of the Recent Financial Statements, all of which will be
true, complete and correct and will have been prepared in accordance with sound
generally accepted accounting principles consistently followed throughout the
period indicated.
3.10 LIABILITIES AND OBLIGATIONS
All liabilities of Medco and all obligations of Medco with respect to
contracts and commitments which arose or arise after the date of Medco's Recent
Financial Statements and prior to the Closing were or will be incurred only in
the ordinary course of business. All liabilities for taxes with respect to the
period after the date of Medco's Recent Financial Statements and prior to the
Closing were or will be incurred in the ordinary course of business. Except to
the extent reflected, included, disclosed or reserved against in Medco's recent
Balance Sheet, or specifically otherwise set forth or on Schedule 3.10, Medco
has no present knowledge of, or present reason to believe in the existence of,
any liability of any kind or nature whether accrued, absolute, contingent or
otherwise, including without limitation, tax liabilities due to or to become
due, with respect to any
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period after the date of Medco's Recent Balance Sheet and prior to the date of
this Agreement.
3.11 ABSENCE OF CHANGES
Since December 31, 1995, the business of Medco has been operated and as of
the Closing will be operated only in the ordinary course of business, and
without limiting the generality of the foregoing, Medco has not:
(a) Suffered any materially adverse change in its financial condition,
prospects, operations or business.
(b) Increased the rate of compensation payable to any officer, employee or
agent, or granted or accrued any bonus, payment or other benefit due under any
pension, incentive, deferred compensation or similar plan to any such person.
(c) Incurred any labor dispute, work stoppage, sabotage, formal or
informal complaint of unfair labor practices, or had any representational
proceedings initiated, demand made for the recognition of any union as
bargaining agent or any other similar event or condition which has materially
and adversely affected its business.
(d) Incurred any obligation or liability (absolute or contingent) except
current liabilities under contracts entered into in the ordinary course of
business, none or which materially adversely affects the business or prospects
of Medco.
(e) Discharged or satisfied any lien, encumbrance, obligation or liability
(absolute or contingent) other than current liabilities and obligations shown on
the Recent Financial Statements or incurred since the date of the Recent
Financial statements in the ordinary course of business.
(f) Mortgaged, pledged, or subjected to lien, charge or other encumbrances
any of its assets
(g) Sold, transferred, mortgaged, pledged, or subjected to lien, charge or
other encumbrances any of its assets.
(h) Suffered any extraordinary losses or waived any rights of substantial
value.
(i) Made or declared any distribution or divided to its shareholders with
respect to its capital stock, or otherwise.
(j) Entered into any transaction not in the ordinary course of business
other than this Agreement.
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3.12 TAXES
All required federal, states, municipal and local tax returns of Medco
have been accurately prepared and duly and timely filed, and all federal, state
and local taxes required to be paid with respect to the periods covered by such
returns have been paid. All federal, state, municipal and local taxes required
to be paid with respect to any period prior to the date of Medco's Recent
Balance Sheet have been reflected and fully reserved for on Medco's Recent
Financial Statements. Medco has no tax deficiency outstanding, proposed or
assessed against it and has not executed any waiver of any statute of
limitations on the assessment or collection of any tax. Medco's federal income
tax returns have not been audited by the Internal Revenue Service.
3.13 TITLE TO PROPERTIES
Medco has good and marketable title to all the properties and assets its
purports to own, including, without limitation, those reflected in its books and
records and in its Recent Financial statements (except assets thereafter sold in
the ordinary course of business). Such properties and assets are not subject to
any mortgage, pledge, lien, charge, security interest, encumbrance, restriction,
lease, license, easement, charge, liability or claim of any nature whatsoever,
direct or indirect, whether accrued, absolute, contingent or otherwise, except
those which are included, reflected or expressly set forth in its Recent
Financial Statements. All of such properties and assets are in good operating
condition and repair and conform with all applicable ordinances, regulations and
other laws or requirements. all of Medco's fixtures and improvements to real
property, and its use of real property, conform in all material respects with
all applicable building, zoning and other laws, ordinances, orders and
regulations and applicable public and private covenants or restrictions.
3.14 TITLE TO STOCK
The Sole Shareholder is the sole owner of the Medco Stock, which stock
constitutes all of the capital stock of Medco, issued and outstanding, and all
of which stock will be delivered by him hereunder, free and clear of all liens,
pledges, encumbrances, charges, agreements or claims by or on the part of any
persons, firm or corporation, and the Sole Shareholder has good and marketable
title thereto with full right and unrestricted power to assign , transfer and
deliver such stock to Williston as provided in this Agreement. No right or
option to purchase any of the Medco Stock or any other securities of Medco
exists in favor of any person, firm or corporation.
3.15 AGREEMENTS
Medco is not in default under any contract, agreement or commitment. No
consent of third parties to any contract, agreement or commitment of Medco is
required for the execution or consummation of this Agreement.
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3.16 INDEBTEDNESS OF OFFICERS AND DIRECTORS
Medco is not indebted to the Sole Shareholder or to any other person who
is or has been an officer, director, or stockholder of Medco, or to any member
of the immediate family of any such person.
3.17 LITIGATION
There are no claims, legal actions, suits, arbitrations, governmental
investigations or other legal or administrative proceedings in progress or
pending or to the knowledge of Medco or the Sole Shareholder threatened against
or relating to Medco, its properties, assets or business and neither Medco nor
the Sole Shareholder knows or has reason to be aware of any facts which might
result in any such claim, action, suit, arbitration or other proceeding.
3.18 PENSION OR BENEFIT PLANS
Medco has no formal or informal written or unwritten pension,
profit-sharing, stock option, bonus plan or employee benefit or welfare plans of
any kind whatsoever, or agreements with any persons for the making or granting
of any pension, profit sharing or bonus payments or benefits or any stock
options.
3.19 RELATIONS AND LABOR
Medco is not a party to any collective bargaining agreements and there is
no union or collective bargaining agent for Medco's employees. Medco has no
employment grievances, disputes, or controversies and there are no threats of
strikes or work stoppage or demand for the recognition of any union or
bargaining agent for any employees.
3.20 PATENTS
Medco is not infringing upon or otherwise acting adversely to any
copyrights, trademarks, trademark rights, patents, patent rights or licenses
owned by any person or persons, and there is no such claim or action pending or
threatened, with respect thereto.
3.21 GOOD STANDING
Each License, permit, franchise and authorization of Medco from any
federal, state or local governmental or other regulatory authority is in good
standing and in full force and effect. Medco and the Sole Shareholder do not
know of any reason which could cause any of the above to be terminated. there
shall not be any termination or suspension after the Closing date of any or all
of the above arising out of, relating to, or caused by (I) any failure to file,
or any inadequacy in filing of, any documents, reports and disclosures required
under applicable rules and regulations of any federal, state or local law or
agency to be filed by Medco prior to the Closing Date, (ii) activities of
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Medco or its personnel prior to the Closing date, (iii) any other failure to
comply with applicable rules and regulations prior to the Closing date, or (iv)
this Agreement or the transactions contemplated by this Agreement.
3.22 COMPLIANCE WITH LAW
Medco has complied with all federal, state and local applicable laws,
rules, regulations, ordinances and orders applicable to its business or
properties including, without limitation, those of any agency or subdivision
thereof. Medco has duly filed all returns, reports, registration statements and
other documents and furnished all information required or requested by any
federal, state or local governmental agency having jurisdiction with respect to
Medco or its business or properties and all of the foregoing are true and
complete in all respects and all payments, fees and charges reflected therein as
due, or upon any deficiency notice with respect thereto, have been paid. No act
of Medco, including without limitations the issuance and transfers of the
capital stock of Medco, required registration under the Securities Act of 1933,
as amended.
3.23 CONTINUANCE OF BUSINESS
The businesses now conducted by Medco are substantially the same as the
respective businesses conducted by it throughout the periods covered by its
respective financial statements referred to in Section 3.8 and 3.9 hereof, and
there has been no material change during any of such periods in the type or
nature of its respective services, products, customers, suppliers or methods of
operation. Neither Medco nor the Sole Shareholder have not received any
notification and have no reason to believe that any persons or businesses with
whom Medco does business will cease doing business, or any portion of any
business, with Medco.
3.24 ADVERSE FACTS
No facts are known to Medco or the Sole Shareholder which would materially
and adversely affect future operations of Medco.
3.25 BROKERS
The Sole Shareholder and Medco's negotiations relative to this Agreement
and the transactions contemplated hereby have been carried on by the Sole
Shareholder directly with Williston and Sun Capital in such manner, without the
intervention of any third parties so as not to give rise to any valid claims
against any of the parties hereto for a brokerage commission or other like
payment.
3.26 No Misrepresentation or warranty by Medco or the Sole Shareholder in
this Agreement or any statement or certification furnished or to be furnished to
Williston pursuant to this Agreement or in connection with the transaction
contemplated hereby,
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contains or will contain any untrue statement of material facts or omits or will
omit a materiel fact necessary to make the statements contained herein true and
correct.
4. REPRESENTATION AND WARRANTIES BY WILLISTON AND
SUN CAPITAL
Williston and Sun Capital hereby represent and warrant as follows:
4.1 ORGANIZATION AND STANDING
Williston is a corporation duly organized and validly existing and in good
standing under the laws of the State of Nevada, and Williston has all requisite
corporate power and authority to enter into and carry out the provisions of this
Agreement. Williston owns no property and neither conducts nor carries on any
business.
4.2 CAPITALIZATION
The duly authorized capital stock of Williston consists of one hundred
fifty million (150,000,000) shares, par value $.001 per share, consisting of:
(i) one hundred million (100,000,000) shares of Class A Common Stock, of which a
total of twelve million, six hundred ninety-four thousand, five hundred
forty-three (12,694,543) shares are outstanding, validly issued, fully paid and
non assessable and owned or record by the Shareholders in those amounts
indicated on a shareholder list, as of a date not more than thirty (30) days
prior to the date of this Agreement, certified as accurate by the duly appointed
transfer agent of Williston, and annexed hereto as Exhibit 4.2 hereof; (ii)
Twenty-five million (25,000,000) shares of Class B Common Stock, of which one
million, two hundred fifty thousand (1,250,000) shares are validly issued, fully
paid and non assessable and owned or controlled by Sun Capital (each share of
Class B Common stock can be converted, at any time, at the option of the
shareholder to one share of Class A Common Stock); and (iii) twenty-five million
(25,000,000) shares of Preferred Stock, none of which are issued or outstanding.
Except as otherwise noted by Williston and/or Sun Capital on the said
shareholder list, neither Williston nor Sun Capital knows of any beneficial
interests in the said outstanding common stock other than the interests of
record set forth on such list or on Schedule 4.2 hereto. There are no other
securities of Williston now outstanding or securities on which it is or may
become liable, or securities on which it is or may become liable, or securities
that are or may become required to be issued by reason of any statutory
requirements (including, without limitation, preemptive right(s), or warrants,
rights, options, calls, commitments or other agreements presently outstanding.
4.3 CORPORATE RECORDS
A copy of Williston's certificate of incorporation, all amendments
thereto, and the By-Laws, all of which are certified by the Secretary of
Williston as of a recent date are attached as Schedule 4.3 hereto and each of
the foregoing will be complete, true and
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correct on the Closing date. The minute books of Williston contain complete and
accurate records of all meetings of its stockholders and directors and of all
corporate action taken by them to the extent available as at the present date.
The shareholder records of Williston reflect accurately the names of the record
shareholders of Williston and the number of shares of capital stock held by each
stockholder.
4.4 SUBSIDIARIES
Williston owns no security of any other entity.
4.5 INACTIVE CORPORATION
Williston (i) has been totally inactive since 1992, (ii) has no business
and no assets, (iii) emerged from Chapter 7 Bankruptcy proceedings in 1986; and
(iv) has post bankruptcy liabilities and federal tax liabilities not exceeding
$-0- in the aggregate.
4.6 TRADABLE STOCK
All or some of Williston's Class A Common Stock is presently traded or is
eligible to be traded publicly in the over-the-counter market in accordance with
applicable SEC rules and regulations.
4.7 SEC REPORTING OBLIGATIONS
The Class A Common Stock of Williston is registered under Section 12(g) of
the Securities Exchange Act of 1934, as amended (the "34 Act") and Williston is
therefore required to comply with the reporting requirements of Section 13 of
the said 34 Act, all of which reporting operations have, to the best knowledge
of Williston and Sun Capital, been fulfilled except that the Williston is
delinquent in the filing of the SEC of its annual reports on Form 10-K (or
10-KSB) for the fiscal years ended 1982 through 1996 and its quarterly reports
on Form 10-Q (or 10-QSB) for the fiscal quarters ended 1982 through 1996.
4.8 DEFAULT UNDER LOANS
Williston has no outstanding mortgages, loan agreements or indebtedness of
any kind, nature or description except as set forth on Exhibit 4.8 hereto.
4.9 NO AGREEMENTS OR COURT ORDERS
Williston is not a party to or subject to or bound by any agreement or any
judgment, order, writ, injunction or decree of any court or governmental body
which contains any provisions which could operate to impair the carrying out of
this Agreement or any of the transactions contemplated hereby.
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4.10 AUTHORITY
The execution, delivery and performance of this Agreement by Williston and
Sun Capital have been duly and effectively authorized by all requisite corporate
action and will not violate any provision of the Certificate of Incorporation or
By-Laws of Williston or any provision of, or result in the acceleration of any
obligation under, any agreement, indenture, instrument, lease, contract or other
undertaking to which Williston is a party or by which it is bound.
4.11 AUDITED FINANCIAL STATEMENTS
Prior to the Closing Date, Williston will deliver to Medco and the Sole
Shareholder audited financial statements (the "Williston Financial Statements")
through its last fiscal year and any subsequent interim periods, as the SEC
shall require in order to bring Williston into full compliance with its
reporting requirements under the "34 Act", which financial statements will show
that Williston has no assets and has post bankruptcy liabilities and federal tax
liabilities not exceeding $-0- in the aggregate.
Financial Statements will be true, correct and complete and will
accurately and truly present the financial condition of Williston as at the date
thereof and the results of its operations for the period therein specified and
will be prepared in accordance with generally accepted accounting principles
applied on a basis consistent with that of the preceding period and consistently
maintained throughout the periods involved. Without limiting the generality of
the foregoing, the Williston Financial statements will disclose all debts,
liabilities, commitments and obligations of every nature, whether absolute,
accrued, contingent or otherwise of Williston as at the date thereof, and there
will be no other debts, claims, or demands relating to or arising out of any
act, transaction or circumstances which will have occurred or existed on or
before the date of the Williston Financial Statements.
4.12 AGREEMENTS
Williston is not a party to any contract, agreement or commitment and no
consent of any third party is required for the execution or consummation of this
Agreement.
4.13 COMPETING INTERESTS
None of Williston's principal shareholders (owning 5% or more of its
issued and outstanding common stock), officers or directors, own, directly or
indirectly, a material interest in any corporation, partnership, firm or
association which is a competitor or potential competitor of Medco.
4.14 INDEBTEDNESS OF OFFICERS AND DIRECTORS
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Williston is not indebted to any person who is or has been an officer,
director or stockholder of Williston or Sun Capital, or to any member of the
immediate family of any such person.
4.15 LITIGATION
There are no claims, legal actions, suits, arbitrations, governmental
investigations or other legal or administrative proceedings in progress or
pending or to the knowledge of Williston or Sun Capital threatened against or
relating to Williston, its assets of activities and Williston and Sun Capital
neither knows nor has any reason to be aware of any facts which might result in
any such claim, action, suit, arbitration or other proceeding.
4.16 ADVERSE FACTS
No facts are known to either Williston or Sun Capital which would
materially and adversely affect future activities of Williston.
4.17 BROKERS
Williston's and Sun Capital's negotiations relative to this Agreement and
the transaction contemplated hereby have been carried on by it directly with
Medco and the Sole shareholder in such manner, without the intervention of any
third parties, as not to give rise to any valid claims against any of the
parties hereto for a brokerage commission or other like payments.
4.18 CONFIDENTIAL INFORMATION
Neither Williston nor Sun Capital shall prior to or after the Closing
divulge to third parties any confidential information received from Medco or the
Sole Shareholder.
CONDUCT OF MEDCO'S BUSINESS PRIOR TO THE CLOSING
5.1 NEGATIVE COVENANTS
Medco and the Sole Shareholder agree that between the date hereof and the
Closing, and except as permitted by the prior written consent of Williston,
Medco will not take, or permit to be taken, any of the following actions:
(a) Alter or amend its Certificate of Incorporation or By-Laws.
(b) Issue or become obligated to issue any securities of any kind
including without limitation any notes or capital stock.
(c) Enter into any option, call or commitment with respect to its stock.
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(d) Declare or pay any dividend or other distribution with respect to its
capital stock.
(e) Incur any liability or obligation, except current liabilities in the
ordinary course of business and obligations under contracts entered into in the
ordinary course of business.
(f) Pay or accrue any salaries, fees, commissions or other compensation to
its officers or directors at a rate in excess of the rate of compensation in
effect as to such individual, respectively, on the date hereof.
(g) Enter into any contract or commitment which is not the ordinary course
of business of Medco or which does, or could be expected to, materially
adversely affect Medco's business.
(h) Borrow funds or incur any indebtedness of any nature except in the
ordinary court of business.
(i) Change its banking and safe deposit arrangements
(j) Accept, amend or grant any license, patent or trademark, or settle the
infringement of any trademark or patent.
(k) Compromise or settle any litigation, proceeding or governmental
investigation against it or its properties or business, except settlements made
by insurers.
5.2 AFFIRMATIVE COVENANTS
Medco and the Sole Shareholder agree that between the date hereof and the
Closing, Medco will:
(a) Conduct its business only in the ordinary course and at the place or
places said business is conducted.
(b) Maintain in force the insurance policies presently in force or
insurance policies providing substantially the same coverage, under which Medco
is the insured or the beneficiary.
(c) Preserve its business organization taken as a whole substantially
intact, keep available the services of its present officers and employees and
preserve the good will of its suppliers, customers and others having business
relations with any of them.
(d) Afford to Williston and its counsel, accountants, and other
representatives full access during normal business hours throughout the period
prior to the Closing to all
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of Medco's properties, books, contracts, commitments and records, and during
said period furnish all information which Williston may reasonably request.
6. CONDUCT OF WILLISTON'S CORPORATE AFFAIRS PRIOR TO THE CLOSING
6.1 NEGATIVE COVENANTS
Williston agrees that between the date hereof and the Closing, and except
as permitted by the prior written consent of Medco and the Sole Shareholder,
Williston will not take, or permit to be taken, any of the following actions:
(a) Initiate or engage in any business activities of any kind whatsoever.
(b) Alter or amend its Certificate of Incorporation or By-Laws.
(c) Issue or become obligated to issue and securities of any kind
including without limitation any notes or capital stock.
(d) Enter into any option, call or commitment with respect to its capital
stock.
(e) Declare or pay any dividend or other distribution with respect to its
capital stock.
(f) Incur any liability or obligation, except current liabilities in the
ordinary course of its activities.
(g) Pay or accrue any salaries, fees, commissions or other compensation to
its officers or directors.
(h) Make any profit sharing, incentive, pension or retirement payment.
(i) Enter into any contract of commitment.
(j) Borrow funds or incur any indebtedness.
(k) Compromise or settle any litigation, proceeding or governmental
investigation against it or its properties or business.
6.2 AFFIRMATIVE COVENANTS
Williston agrees that between the date hereof and the Closing, Williston
will:
(a) Preserve its organizations taken as a whole substantially intact, keep
available the services of its present officers and personnel.
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(b) Afford to Medco and the Sole Shareholder and their counsel,
accountants, and other representatives full access during normal business hours
throughout the period prior to the Closing to all of Williston's properties,
books, contracts, commitments and records, and during said period furnish all
information which Medco and the Sole Shareholder may reasonably request.
7. REPRESENTATIONS, WARRANTIES, AND COVENANTS
OF THE SOLE SHAREHOLDER WITH RESPECT TO
THE NEW WILLISTON SHARES
7.1 RESTRICTIONS ON TRANSFERABILITY
The Sole Shareholder hereby agrees and acknowledges that the New Williston
Shares to be issued and delivered to him pursuant to the terms of this
Agreement, will not be registered under the Securities Act of 1933, as amended
(the "'33 Act"), on the basis of the Statutory exemption provided under in
Section 4(2) thereof and on the representations made by him in this article 7,
as follows:
The Sole Shareholder hereby represents to Williston that he will acquire
the New Williston Shares for investment for his own account and not with a view
to the resale or distribution thereof, and that he does not intend to divide his
participation with others or to resell or otherwise dispose of all or any part
of the New Williston Shares unless and until they are subsequently registered
under the Act, or an exemption from such registration is available. In making
these representations, the sole Shareholder understands that, in the view of the
Securities and Exchange Commission (The "Commission"), the statutory exemption
referred to above would not be available, if notwithstanding his
representations, he had in mind merely acquiring the New Williston shares for
resale upon the occurrence or nonoccurrence of some pre-determined event.
The Sole Shareholder hereby accepts the condition that before any transfer
of any of the New Williston Shares may be made by him, written approval must
first be obtained from Williston's counsel. The basis of such approval, which
shall not be unreasonably withheld, shall be compliance with requirements of the
federal and state statutes regulating securities. The Sole Shareholder
understands that a legend to this effect will be placed on the certificate or
certificates representing the New Williston Shares, and stop-transfer
instructions to Williston's transfer agent will be issued.
The Sole Shareholder understands that the New Williston Shares must be
held indefinitely until registered under the Act, or an exemption from such
registration is available. In the event Rule 144 of the Commission hereafter
becomes applicable to the New Williston Shares, the sole Shareholder understands
that any routine sales of the New Williston Shares made thereunder can be made
only in limited amounts in accordance with the terms and conditions of that
Rule. The Sole Shareholder understands that Williston has no obligation to
register the New Williston Shares.
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8. CONDITIONS PRECEDENT TO WILLISTON'S OBLIGATIONS
Williston's obligations under this Agreement are subject to the
fulfillment prior to the Closing of each of the following conditions:
8.1 Medco's and the Sole Shareholder's representations and warranties
contained in this Agreement and in any certificate or document delivered to
Williston pursuant hereto shall be deemed to have been made again at and as of
the time of the Closing and shall then be true in all materiel respect; Medco
and the Sole Shareholder shall have performed and complied with all agreements
and conditions required by this Agreement to be performed or complied with by
them prior to or at the Closing.
8.2 Neither Medco nor the Sole Shareholder shall be a defendant in any
suit or proceeding or governmental investigation pending or threatened against
Medco or the Sole Shareholder which would materially affect the carrying out of
this Agreement.
8.3 Medco shall have been furnished with an opinion dated the Closing date
of counsel to Medco and the Sole Shareholder to the effect that:
(a) Medco is a corporation duly organized, validly existing and in good
standing under the laws of the state of New York.
(b) The authorized and issued capital stock of Medco consists of the
number of shares stated in Section 3.2 of this Agreement and the sole record and
beneficial owner of all such stock is the Sole Shareholder.
(c) The execution, delivery and performance of this Agreement have been
duly authorized by all necessary corporate action and this Agreement has been
duly executed and delivered by Medco and constitutes the valid and binding
obligation of Medco in accordance with its terms.
(d) To the best of counsel's knowledge, there are no agreements,
judgments, orders, writs, injunctions or decrees of any court or governmental
body which would prevent the transactions contemplated by this Agreement.
(e) Medco's stock to be delivered to Williston by the Sole Shareholder
under this Agreement will, when so delivered, be validly issued and outstanding
and fully paid and non-assessable.
(f) Except as may be specified by said counsel, he does not know of any
litigation, proceeding or governmental investigation pending or threatened
against or relating to Medco or its properties or businesses, or the
transactions contemplated by this Agreement.
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8.4 Medco has not incurred any material adverse change in its assets,
liabilities, financial condition, business, prospects or operations since the
execution of this Agreement.
8.5 Medco shall deliver to Williston a certified copy of the resolution of
its Board of Directors approving this Agreement and the transaction contemplated
hereby.
8.6 All documents required to be delivered to Williston at or prior to the
Closing shall have been so delivered.
9. CONDITIONS PRECEDENT TO THE SOLE SHAREHOLDER
AND MEDCO'S OBLIGATIONS
The Sole Shareholder's and Medco's obligations under this Agreement are
subject to the fulfillment prior to the Closing of each of the following
conditions:
9.1 Williston's and Sun Capital's representation and warranties contained
in this Agreement and in any certificate of document delivered to the Sole
Shareholder and Medco pursuant hereto shall be deemed to have been made again at
and as of the time of the Closing and shall then be true in all material
respects; Williston shall have performed and complied with all agreements and
conditions required by this Agreement to be performed or complied with by it
prior to or at the Closing; and the Sole Shareholder and Medco shall have been
furnished with a certificate of Williston dated the Closing date, certifying in
such detail as the Sole shareholder and Medco may reasonably request to the
fulfillment of the foregoing conditions.
9.2 Williston shall not be a defendant in any suit or proceeding or
governmental investigation pending or threatened against Williston which would
materially affect the carrying out of this Agreement.
9.3 The Sole Shareholder and Medco shall have been furnished with an
opinion dated the Closing date of counsel for Williston, to the effect that:
(a) Williston is a corporation duly organized, validly existing and in
good standing under the laws of the State of Nevada.
(b) The authorized and issued capital stock of Williston consists of the
number of shares stated in Section 4.2 of this Agreement.
(c) The execution, delivery and performance of this Agreement have been
duly authorized by all necessary corporate action and this Agreement has been
duly executed and delivered by Williston and constitutes the valid and binding
obligation of Williston in accordance with its terms.
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(d) To the best of counsel's knowledge, there are no agreements,
judgments, order, writs, injunctions or decrees of any court or governmental
body which would prevent the transactions contemplated by this Agreement.
(e) The New Williston Shares to be delivered to the Sole Shareholder by
Williston under this Agreement will, when so delivered, be validly issued and
outstanding and fully paid and non-assessable.
(f) Except as may be specified by said counsel, they do not know of any
litigation, proceeding or governmental investigation pending or threatened
against or relating to Williston or its activities or assets, or the
transactions contemplated by this Agreement.
9.4 Williston shall not have incurred any adverse change in its assets,
liabilities, financial condition, activities, prospects or operations.
9.5 Williston shall deliver to the Sole Shareholder and Medco a certified
copy of the resolutions of its Board of Directors approving this Agreement and
the transactions contemplated hereby.
9.6 All documents required to be delivered to the Sole Shareholder and
Medco at or prior to the Closing shall have been so delivered.
10. MISCELLANEOUS
10.1 SURVIVAL
All representations, warranties, covenants and agreements made by any of
the parties hereto in this Agreement or in any certificate or instrument
delivered by or on behalf of any of them pursuant hereto shall survive the
execution and delivery of this Agreement, any investigation that may have been
made or may be made at any time by or on behalf of any party hereto, and the
consummation of this Agreement.
10.2 PARTIES IN INTEREST
This Agreement shall be binding upon and inure to the benefit of and be
enforceable by each corporate party hereto and its successors and each
individual party hereto and his heirs, personal representatives and successors.
This Agreement shall not be assigned by any party hereto (except by operation of
law) and any such prohibited assignment shall be null and void.
10.3 EXPENSES AND REORGANIZATION
Each of the parties to this Agreement shall bear their respective expenses
relating to this Agreement.
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10.4 GOVERNING LAW
This Agreement shall be governed by and construed and enforced under the
laws of the state of New Jersey.
10.5 ENTIRE AGREEMENT
This Agreement contains the entire understanding of the parties hereto
with respect to the subject mater herein contained and no amendment,
modification or termination of this Agreement shall be valid unless expressed in
a written instrument executed by the parties hereto or their respective
successors.
10.6 EXHIBITS
All Exhibits and Schedules to this Agreement or other certificates or
documents delivered pursuant to this Agreement shall be deemed to be a part of
this Agreement, whether or not required to be annexed hereto, and shall be
initialed by the party required to deliver such Exhibit, certificate or
document.
10.7 WAIVER
No waiver or any provision of, or any breach or default of this Agreement,
shall be considered valid unless in writing and signed by the party giving such
waiver and no waiver shall be deemed a waiver of any other provisions or any
subsequent breach or default of a similar nature.
10.8 FURTHER ASSURANCES
Each party to this Agreement will, at the request of the other, execute
and deliver to such other party all further endorsements and documents as such
other party may reasonably request in order to consummate and perfect the
transactions contemplated by this Agreement.
10.9 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, and all of which taken together shall constitute
one and the same instrument.
10.10 HEADINGS
Section headings are contained on this Agreement only for purposes of
convenience of reference and shall not affect the interpretation of this
Agreement or modify any of its terms or provisions.
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10.11 NOTICES
Any notice or other communication permitted or required to be given
hereunder shall be in writing and shall be deemed to have been given upon
receipt by first class registered mail, certified mail, recognized over-night
courier, in all class and written confirmation of receipt required, addresses to
the parties as set forth below:
TO: WILLISTON OIL
000 XXXXXXX XXXXXX
XXXXXXX, XX 00000
TO: SUN CAPITAL CORPORATION
000 XXXXXXX XXXXXX
XXXXXXX, XX 00000
TO: FAHIM SHARAIE
000 XXXXXX XXXXXX
XXXXXXXXX XXXXXX, XX
TO: MEDCO HEALTH CORPORATION
000 XXXXXX XXXXXX
XXXXXXXXX XXXXXX, XX
EACH OF THE FOREGOING SHALL BE ENTITLED TO SPECIFY A DIFFERENT ADDRESS BY
GIVING NOTICE AS AFORESAID TO THE OTHER PARTIES.
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS AGREEMENT TO BE
DULY EXECUTED AS OF THE DAY AND YEAR FIRST WRITTEN ABOVE.
WILLISTON CORPORATION
BY:___________________________
XXXXXXX XXXXXXX, XX., PRESIDENT
SUN CAPITAL CORPORATION
BY:___________________________
XXXX X. XXXXXXX, PRESIDENT
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MEDCO INCORPORATED
BY____________________________
FAHIM SHARAIE, PRESIDENT
______________________________
FAHIM SHARAIE, SOLE SHAREHOLDER
OF MEDCO INCORPORATED
