AGREEMENT AND PLAN OF MERGER BY AND AMONG TRIST HOLDINGS, INC., Z&Z MERGER CORPORATION AND Z&Z MEDICAL HOLDINGS, INC. Dated as of March 26, 2010
AGREEMENT
AND PLAN OF MERGER
BY
AND AMONG
Z&Z
MERGER CORPORATION
AND
Z&Z
MEDICAL HOLDINGS, INC.
Dated
as of March 26, 2010
AGREEMENT
AND PLAN OF MERGER
This
AGREEMENT AND PLAN OF MERGER (“Agreement”)
made this 26th day
of March, 2010 is entered into by and among Trist Holdings, Inc., a Delaware
corporation (“Trist”),
Z&Z Merger Corporation, a Delaware corporation and wholly-owned subsidiary
of Trist (“MergerCo”),
and Z&Z Medical Holdings, Inc., a Delaware corporation (“Z&Z”). Trist,
MergerCo and Z&Z are sometimes referred to herein individually as a “Party” and
collectively as the “Parties.”
Recitals:
A. The
Parties intend to effect the acquisition of Z&Z by Trist through the
statutory merger of MergerCo with and into Z&Z in accordance with this
Agreement and the DGCL, upon the consummation of which MergerCo will cease to
exist as a separate entity and Z&Z will survive as a wholly-owned subsidiary
of Trist. The Parties intend this transaction to be treated as a
reorganization under Section 386(a) of the Code.
B. The
respective Boards of Directors of each of the Parties have (i) determined that
this Agreement and the transactions contemplated hereby, including the Merger
(as defined below), are advisable and in the best interests of their respective
stockholders, and (ii) adopted this Agreement and the transactions contemplated
hereby.
C. The
Parties desire to make certain representations, warranties, covenants and
agreements in connection with the Merger and also to prescribe various
conditions to the Merger.
Agreement:
NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained in this Agreement, and for other good and valuable
consideration, the receipt and sufficient of which are hereby acknowledged, the
parties hereto agree as follows:
1. DEFINITIONS.
1.1 Certain
Definitions. The following terms used herein, as used in this
Agreement, shall have the following meanings:
“Affiliate”
of any specified Person means any other Person directly or indirectly
Controlling or Controlled by or under direct or indirect common Control with
such specified Person.
“Benefit
Plan” means any collective bargaining agreement or any bonus, pension,
profit sharing, deferred compensation, incentive compensation, stock ownership,
stock purchase, phantom stock, retirement, vacation, severance, disability,
death benefit, hospitalization, medical or other plan, arrangement or
understanding (whether or not legally binding) under which a Party to this
Agreement currently has an obligation to provide benefits to any current or
former employee, contractor, consultant, officer or director of such
Party.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Contracts”
shall mean all written contracts, agreements, leases, mortgages, indentures,
notes, bonds, liens, licenses, arbitration awards, judgments, decrees, orders,
documents, instruments, understandings and commitments to which a Person is a
party or by or to which any of the properties or assets of such Person may be
bound, subject or affected (including without limitation notes or other
instruments payable to such Person).
“Control,”
when used with respect to any specified Person, means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise.
“Effective
Time” means the date and time the Merger becomes effective as specified
in the Certificate of Merger or as otherwise provided in accordance with the
DGCL.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended.
“Exchange
Ratio” means a number equal to: the quotient of X divided by Y, where X
is the number of shares of Trist Super-Voting Common Stock constituting the
Merger Consideration, and Y is the number of shares of Fully Diluted Z&Z
Common Stock, as
adjusted to reflect appropriately the effect of any stock split, reverse stock
split, stock dividend (including any dividend or distribution of securities
convertible into Trist Common Stock), reorganization, recapitalization,
reclassification or other like change with respect to Trist Common Stock
occurring on or after the date hereof and prior to the Effective
Time.
“Europa”
means Europa International, Inc.
“Fully-Diluted
Z&Z Common Stock” means those shares of Z&Z Common Stock (a)
issued and outstanding at the Closing Date; (b) issuable upon the exercise of
all options to purchase Z&Z Common Stock issued and outstanding at the
Closing Date; and (c) issuable upon the exercise of all warrants to purchase
Z&Z Common Stock issued and outstanding at the Closing Date.
“GAAP”
means generally accepted accounting principles as applied in the United States
of America.
“Governmental
Entity” means any national, state, municipal, or other government or any
court, administrative or regulatory agency or organization (including without
limitation, any self-regulatory organization), or commission or other
governmental authority or agency, domestic or foreign, including without
limitation, FINRA and the NASDAQ Stock Market.
“Intellectual
Property” means any and all United States and foreign: (i) patent
registrations and patent applications (including all reissues, divisions,
continuations, continuations-in-part, extensions and reexaminations) and all
rights therein and all improvements to the inventions disclosed in each such
registration or application, (ii) trademarks, service marks, trade dress, trade
names and corporate names, whether or not registered, including but not limited
to all common law rights, and registrations and applications for registration
thereof, (iii) copyrights (including but not limited to copyrights on designs)
(registered or otherwise) and registrations and applications for registration
thereof, (iv) computer software, including, without limitation, source code,
operating systems and specifications, data, data bases, files, documentation and
other materials related thereto, data and documentation, (v) trade secrets and
confidential technical and business information (including but not limited to
formulas, compositions, and inventions reduced to practice, whether or not
patentable), (vi) confidential technology (including know-how and show-how),
manufacturing and production processes and techniques, research and development
information, drawings, specifications, designs, plans, proposals, technical
data, copyrightable works, financial, marketing and business data, pricing and
cost information, business and marketing plans and customer and supplier lists
and information, (vii) any right arising under any law providing protection to
industrial or other designs, (viii) all rights to obtain and rights to apply for
patents, and to register trademarks and copyrights, and (ix) all rights to xxx
or recover and retain damages and costs and attorneys fees for present and past
infringement of any of the foregoing.
“KOM” means
KOM Capital Management, LLC and/or its assignees.
“Licenses”
means all notifications, licenses, permits (including, without limitation,
environmental, construction and operation permits), franchises, certificates,
approvals, exemptions, classifications, registrations and other similar
documents and authorizations issued by a Governmental Entity, and applications
therefor.
“Liens”
mean all mortgages, liens, pledges, security interests, charges, claims,
restrictions and encumbrances of any nature whatsoever.
“Material Adverse
Effect” means, when used in respect to Z&Z or Trist, any change or
effect that either individually or in the aggregate with all other such changes
or effects is materially adverse to the business, assets, properties, condition
(financial or otherwise) or results of operations of such Party and its
Subsidiaries taken as a whole.
“Merger”
means the merger of MergerCo with and into Z&Z pursuant to this Agreement
and the DGCL.
“MergerCo Common
Stock” means the Common Stock of MergerCo.
“Merger
Consideration” means 108,695,707 shares of Trist Super-Voting Common
Stock, of which 91,581,633 shall be issued as of the Effective Time, and
17,114,074 shall be reserved for issuance upon (i) the exercise of all options
to purchase Z&Z Common Stock issued and outstanding at the Closing Date; and
(ii) the exercise of all warrants to purchase Z&Z Common Stock issued and
outstanding at the Closing Date.
“Person”
means any individual, corporation, partnership, limited liability company, joint
venture, trust, unincorporated organization, government or any agency or
political subdivision thereof or other entity.
“SEC” means
the United States Securities and Exchange Commission.
“Securities
Act” means the Securities Act of 1933, as amended.
“Subsidiary”
of any Person means another Person, an amount of the voting securities, other
voting ownership or voting partnership interests of another Person, which are
sufficient to elect at least a majority of such other Person’s board of
directors or other governing body (or, if there are no such voting interests,
fifty percent (50%) or more of such other Person’s equity
interests).
“Taxes”
means all taxes, assessments, charges, duties, fees, levies or other
governmental charges (including interest, penalties or additions associated
therewith), including income, franchise, capital stock, real property, personal
property, tangible, withholding, employment, payroll, social security, social
contribution, unemployment compensation, disability, transfer, sales, use,
excise, gross receipts, value-added and all other taxes of any kind for which a
Person may have any liability imposed by any Governmental Entity, whether
disputed or not, and any charges, interest or penalties imposed by any
Governmental Entity.
“Tax
Return” means any report, return, declaration or other information
required to be supplied to a Governmental Entity in connection with Taxes,
including estimated returns and reports of every kind with respect to
Taxes.
“Trist Common
Stock” means the Common Stock, par value $0.0001 per share, of
Trist.
“Trist
Super-Voting Common Stock” means the Super-Voting Common Stock, par value
$0.0001 per share, of Trist, to be designated prior to the Closing.
“Trist
Reorganization” shall mean a transaction or series of transactions as
outlined on Exhibit
B-1.
“Voting
Agreement” means the voting agreement among the Z&Z Stockholders,
Europa and Woodman in substantially the form attached hereto as Exhibit
I.
“Woodman”
means Woodman Management Corporation and/or its assignees.
“Z&Z Common
Stock” means the Common Stock of Z&Z.
“Z&Z
Stockholders” means, collectively, the holders of the Z&Z Common
Stock.
1.2 Other
Definitions. The following terms are defined in the following
sections of this Agreement:
Defined Term
|
Section
|
14c
Information Statement
|
6.15
|
14f-1
Information Statement
|
6.2
|
Acquisition
Proposal
|
6.7
|
Agreement
|
Preamble
|
Assumed
Option
|
2.9.8
|
Assumed
Option and Warrant
|
2.9.8
|
Assumed
Warrant
|
2.9.8
|
Certificate
of Merger
|
2.3
|
Certificates
|
2.10.1
|
Closing
|
2.2
|
Closing
Date
|
2.2
|
Capital
Raise
|
7.2.11
|
D&O
Information
|
6.1
|
Letter
of Transmittal
|
2.10.1
|
MergerCo
|
Preamble
|
Merger
Consideration Shares
|
2.9.1
|
Merger
Consideration Reserved Shares
|
2.9.1
|
Merger
Share Certificate
|
2.10.2
|
Securities
Purchase Agreement
|
7.2.11
|
OTC
BB
|
4.9
|
Opinion
|
9.1.2
|
Party(ies)
|
Preamble
|
Post-Closing
Covenants
|
9.1
|
Pre-Closing
Cash Obligations
|
6.11
|
Pre-Closing
Period
|
6.15
|
Press
Release
|
6.3
|
Pro
Forma Financial Statements
|
6.4
|
Questionnaires
|
6.1
|
Resignations
|
6.1
|
Reverse
Split
|
6.15.1
|
Secretary
of State
|
2.3
|
Stock
Plan
|
6.15.3
|
Stockholder
Matters
|
6.15
|
Surviving
Corporation
|
2.1
|
Transaction
Form 8-K
|
6.3
|
Transfer
Agent Authorization
|
9.1.2
|
Trist
Contracts
|
4.20
|
Trist
Disclosure Schedule
|
4
|
Trist
SEC Documents
|
4.6.1
|
Z&Z
|
Preamble
|
Z&Z
Contracts
|
3.14
|
Z&Z
Disclosure Schedule
|
3
|
Z&Z
Financial Statements
|
3.6
|
Z&Z
Intellectual Property
|
3.18
|
Z&Z
Stockholders’ Approval
|
3.26
|
Z&Z
Stock Option Agreement
|
3.3
|
Z&Z
Subsidiaries
|
3.2
|
2. THE
MERGER.
2.1 The
Merger. Upon the terms and subject to the conditions set forth
in this Agreement, and in accordance with the DGCL, MergerCo shall be merged
with and into Z&Z at the Effective Time. At the Effective Time,
the separate existence of MergerCo shall cease, and Z&Z shall continue as
the surviving corporation following the Merger (the “Surviving
Corporation”). The corporate existence of Z&Z, with all
its purposes, rights, privileges, franchises, powers and objects, shall continue
unaffected and unimpaired by the Merger and, as the Surviving Corporation, it
shall be governed by the laws of the State of Delaware. As a result
of the Merger, the outstanding shares of capital stock of Z&Z and MergerCo
shall be converted or cancelled in the manner provided in Section
2.9.
2.2 Closing. Unless
this Agreement shall have been terminated and the transactions herein
contemplated shall have been abandoned pursuant to Section 8.1 and
subject to the satisfaction or waiver (where applicable) of the conditions set
forth in Section
7, the closing of the Merger (the “Closing”)
will take place at 10:00 a.m. on the first business day after satisfaction of
the conditions set forth in Section 7 (or as soon
as practicable thereafter following satisfaction or waiver of the conditions set
forth in Section
7) (the “Closing
Date”), at the offices of Xxxxxx Xxxxxxxx & Markiles, LLP, unless
another date, time or place is agreed to in writing by the parties
hereto.
2.3 Actions and Deliveries at
Closing. An agreement of merger in the form attached hereto as
Exhibit C (the
“Certificate of
Merger”) shall be duly prepared and executed, and shall be filed with the
Secretary of State of the State of Delaware (the “Secretary of
State”) in accordance with the DGCL on the Closing Date. The
Merger shall become effective upon the filing of the Certificate of Merger with
the Secretary of State, or at such other time as is permissible in accordance
with the DGCL and as Trist and Z&Z shall agree should be specified in the
Certificate of Merger. In addition, at the Closing,
2.3.1 Z&Z
will deliver to Trist:
(a) An
officers’ certificate, substantially in the form of Exhibit D, duly
executed on Z&Z’s behalf, as to whether each condition specified in Sections 7.2.1
through 7.2.7,
has been satisfied in all respects.
(b) A
Secretary’s certificate, substantially in the form of Exhibit E, duly
executed on Z&Z’s behalf.
(c) A legal
opinion of counsel to Z&Z, substantially in the form of Exhibit F
hereto.
2.3.2 Trist
will deliver to Z&Z:
(a) An
officers’ certificate, substantially in the form of Exhibit G, duly
executed on Trist and MergerCo’s behalf, as to whether each condition specified
in Sections
7.3.1 through 7.3.6
and 7.3.9 has been
satisfied in all respects.
(b) A
Secretary’s certificate, substantially in the form of Exhibit H, duly
executed on each of Trist’s and MergerCo’s behalf.
2.4 Effects of the
Merger. Subject to the foregoing, the effects of the Merger
shall be as provided in the applicable provisions of the DGCL. At the Effective
Time all MergerCo’s property, rights, privileges, powers, and franchises will
vest in the Surviving Corporation, and all debts, liabilities, and duties of
MergerCo will become the Surviving Corporation’s debts, liabilities, and
duties.
2.5 Governing Documents of the
Surviving Corporation. As of the Effective Time, by virtue of
the Merger and without any action on the part of the Parties:
2.5.1 Certificate of
Incorporation. If approved by Z&Z and Trist, the
Certificate of Incorporation of the Surviving Corporation shall be amended and
restated in its entirety to read as set forth on Exhibit J hereto to
provide, among other things, that the name of the Surviving Corporation shall be
“Atherocare Operations, Inc.” or such other name as shall be approved by Z&Z
and Trist.
2.5.2 Bylaws. The Bylaws
of Z&Z, as in effect immediately prior to the Effective Time, will be the
Surviving Corporation’s Bylaws until thereafter amended.
2.6 Directors of Trist and the
Surviving Corporation. At the Effective Time, the Board of
Directors of each of Trist and the Surviving Corporation shall consist of (i)
Xxxxxx Xxxxxxx; (ii) Xxxxx Xxxxxxx, (iii) Xxxxxxxxx Xxxxxx, (iv) Xxxx Xxxxxxx
and (v) Xxxxx Xxxxx, who shall serve as the directors of the Surviving
Corporation, each of such directors to hold office, subject to the applicable
provisions of the Certificate of Incorporation and Bylaws of Trist or the
Surviving Corporation, as applicable, in each case, until their respective
successors shall have been elected and qualified or until otherwise provided by
law. All other directors of Z&Z immediately prior to the
Effective Time shall resign, effective as of the Effective Time.
2.7 Officers of Trist and the
Surviving Corporation. At the Effective Time the officers of
Trist and the Surviving Corporation immediately prior to the Effective Time
shall resign, effective as of the Effective Time, and shall be replaced by the
following individuals:
Xxxxxx
X. Xxxxxxx
|
President
and Chief Executive Officer
|
Xxxx
Xxxxxxxx
|
Chief
Financial Officer & Secretary
|
who shall
serve as officers of Trist and the Surviving Corporation subject to the
applicable provisions of the Certificate of Incorporation and Bylaws of Trist or
the Surviving Corporation, as applicable, in each case, until their respective
successors shall have been duly appointed or until otherwise provided by
law.
2.8 Effect on Capital Stock of
MergerCo. At the Effective Time, by virtue of the Merger
and without any action on the part of the holder thereof, each share of MergerCo
Common Stock issued and outstanding immediately prior to the Effective Time
shall automatically be converted into and become one validly issued, fully paid
and nonassessable share of Common Stock of the Surviving
Corporation.
2.9 Effect on Capital Stock of
Z&Z. At the Effective Time, by virtue of the Merger
and without any action on the part of the holder thereof:
2.9.1 Aggregate Consideration to be
Received by Z&Z Stockholders. The aggregate merger
consideration, which shall include (a) the shares to be issued at the Effective
Time to Z&Z Stockholders (the “Merger
Consideration Shares”) plus (b) the number of shares to be reserved for
issuance by Trist upon the exercise of any Assumed Options and Warrants (the
“Merger
Consideration Reserved Shares”), will be that number of fully paid,
nonassessable shares of Trist Super-Voting Common Stock constituting the Merger
Consideration. To the extent necessary, the Parties shall make
appropriate adjustment to the Exchange Ratio to ensure that the sum of the
Merger Consideration Shares and Merger Consideration Reserved Shares shall be
equal to the Merger Consideration.
2.9.2 Conversion of Z&Z Common
Stock. Each issued and outstanding share of Z&Z Common
Stock (other than shares of Z&Z Common Stock, if any, that are held by Trist
or MergerCo) shall be converted into the right to receive that number of fully
paid and nonassessable shares of Trist Super-Voting Common Stock equal to the
Exchange Ratio, subject in all respects to Section
2.9.1.
2.9.3 Cancellation of Treasury Shares and
Shares Held by Trist. Any and all shares of Z&Z Common
Stock owned by Trist or MergerCo or held in the treasury of Z&Z shall be
cancelled and cease to exist at the Effective Time, and no consideration shall
be paid with respect thereto.
2.9.4 No Fractional
Shares. No fractional shares of Trist Super-Voting Common
Stock shall be issued in the Merger. If the number of shares a holder of Z&Z
Common Stock holds immediately prior to the Closing multiplied by the applicable
exchange ratio would result in the issuance of a fractional share of Trist
Super-Voting Common Stock, that product will be rounded down to the nearest
whole number of shares of Trist Super-Voting Common Stock if it is less than the
fraction of one-half of one (0.5) share of Trist Super-Voting Common Stock or
rounded up to the nearest whole number of shares of Trist Super-Voting Common
Stock if the said product is equal to or greater than the fraction of one-half
of one (0.5) share of Trist Super-Voting Common Stock.
2.9.5 Cancellation and Retirement of
Z&Z Common Stock. As of the Effective Time, all shares of
Z&Z Common Stock issued and outstanding immediately prior to the Effective
Time shall no longer be outstanding and shall automatically be cancelled and
retired and shall cease to exist, and each holder of a certificate representing
any such shares of Z&Z Common Stock shall cease to have any rights with
respect thereto, except the right to receive the Merger Consideration per share
upon the surrender of such certificate in accordance with Section 2.10, without
any interest thereon, subject to any applicable withholding tax.
2.9.6 Stock Options and
Warrants. At the Effective Time, all options to purchase
shares of Z&Z Common Stock then outstanding and all warrants to purchase
shares of Z&Z Common Stock, in each case whether vested or unvested, shall
be assumed by Trist or replaced with Trist options and warrants on substantially
identical terms (each an “Assumed
Option” or “Assumed
Warrant” and together, each an “Assumed Option
and Warrant”) in accordance with this Section 2.9.6,
provided that options and warrants to purchase shares of Z&Z Common Stock
will be exercisable into shares of Trist Super-Voting Common Stock based on the
Exchange Ratio applicable thereto. Each Assumed Option and Warrant will continue
to have, and be subject to, the same terms and conditions of such options and
warrants immediately prior to the Effective Time (including, without limitation,
any repurchase rights or vesting provisions and provisions regarding the
acceleration of vesting on certain transactions), except that (i) each
Assumed Option and Warrant will be exercisable (or will become exercisable in
accordance with its terms) for that number of whole shares of Trist Super-Voting
Common Stock equal to the product of the number of shares of Z&Z Common
Stock that were issuable upon exercise of such Z&Z option or warrant
immediately prior to the Effective Time multiplied by the Exchange Ratio, and
(ii) the per share exercise price for the shares of Trist Super-Voting
Common Stock issuable upon exercise of each Assumed Option and Warrant will be
equal to the quotient determined by dividing the exercise price per share of
Z&Z Common Stock at which such Z&Z option or warrant was exercisable
immediately prior to the Effective Time by the Exchange Ratio.
2.10 Exchange of
Certificates.
2.10.1 Exchange
Procedures. As soon as reasonably practicable after the
Effective Time, Trist shall deliver to each holder of record of a certificate or
certificates which, immediately prior to the Effective Time represented
outstanding shares of Z&Z Common Stock (the “Certificates”) whose
shares are converted pursuant to Section 2.9 into the
right to receive Merger Consideration: (i) a letter of transmittal
(the “Letter of
Transmittal”) (which shall specify that delivery shall be effected, and
risk of loss and title to the Certificates shall pass, only upon delivery of the
Certificates to Trist or its designated agent and shall be in such form and have
such other customary provisions as Trist may reasonably specify), and (ii)
instructions for use in effecting the surrender of the Certificate in exchange
for the Merger Consideration allocable to the Z&Z Common Stock formerly
represented thereby.
2.10.2 Merger Share
Certificates. Upon surrender of a Certificate for cancellation
to Trist, or to any agent or agents as may be appointed by Trist, together with
the Letter of Transmittal, duly completed and executed in accordance with its
terms and such other documents as Trist or its agent or agents shall determine,
the holder of such Certificate shall be entitled to receive in exchange
therefor, a certificate (“Merger Share
Certificate”) representing the number of shares of Trist Super-Voting
Common Stock which such holder has the right to receive pursuant to the
provisions of Section
2.9 and the Certificate so surrendered shall forthwith be
cancelled. If any certificate for such Trist Super-Voting Common
Stock is to be issued in a name other than that in which the certificate for
Z&Z Common Stock surrendered for exchange is registered, it shall be a
condition of such exchange that the certificate so surrendered shall be properly
endorsed, with signature guaranteed, or otherwise in proper form for transfer
and that the Person requesting such exchange shall pay to Trist or its transfer
agent any transfer or other taxes or other costs required by reason of the
issuance of certificates for such Trist Super-Voting Common Stock in a name
other than that of the registered holder of the certificate surrendered, or
establish to the satisfaction of Trist or its transfer agent that all taxes have
been paid. Until surrendered as contemplated by this Section 2.10.2, each
Certificate shall be deemed at any time after the Effective Time to represent
only the right to receive upon such surrender the Merger Consideration as
contemplated by Section
2.9.
2.10.3 Lost
Certificates. If any Certificate has been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed and, if required by Trist, the
posting by such Person of a bond in such reasonable amount as Trist may direct
as indemnity against any claim that may be made against it with respect to such
Certificate, Trist shall issue in exchange for such lost, stolen or destroyed
Certificate, the Merger Consideration due to such Person as provided in Section
2.9.
2.10.4 Distributions with Respect to
Unexchanged Shares. No dividends or other distributions with
respect to Trist Super-Voting Common Stock with a record date after the
Effective Time shall be paid to the holder of any unsurrendered Certificate for
Z&Z Common Stock with respect to the shares of Trist Super-Voting Common
Stock, the right to receive which is represented thereby, until the surrender of
such Certificate in accordance with this Section
2.10.
2.10.5 No Further Ownership Rights in
Z&Z Common Stock. All shares of Trist Common Stock issued
upon the surrender of the Certificates in accordance with the terms of this
Section 2,
shall be deemed to have been issued (and paid) in full satisfaction of all
rights pertaining to Z&Z Common Stock theretofore represented by such
certificates.
2.10.6 No Liability. None
of the Parties shall be liable to any Person in respect of any shares of Trist
Common Stock (or dividends or distributions with respect thereto) delivered to a
public official pursuant to any applicable abandoned property, escheat or
similar law. If any certificates representing Z&Z Common Stock
shall not have been surrendered prior to the first (1st)
anniversary of the Closing, any such shares, dividends or distributions in
respect of such certificate shall, to the extent permitted by applicable law,
become the property of Trist, free and clear of all claims or interests of any
Person previously entitled thereto.
3. REPRESENTATIONS
AND WARRANTIES OF Z&Z.
Except as
set forth in the disclosure schedule delivered by Z&Z to Trist at the time
of execution of this Agreement and attached hereto (the “Z&Z
Disclosure Schedule”), Z&Z represents and warrants to Trist as
follows:
3.1 Organization, Standing and
Corporate Power. Z&Z is a corporation validly existing and
in good standing under the laws of the State of Delaware and has the requisite
corporate power and authority to carry on its business as now being conducted
and currently contemplated to be conducted. Z&Z is duly qualified
or licensed to do business and is in good standing in each jurisdiction in which
the nature of its business or the ownership or leasing of its properties makes
such qualification or licensing necessary, other than in such jurisdictions
where the failure to be so qualified or licensed (individually or in the
aggregate) would not have a Material Adverse Effect on Z&Z.
3.2 Subsidiaries. The
only direct or indirect Subsidiaries of Z&Z are listed in the Z&Z
Disclosure Schedule (the “Z&Z
Subsidiaries”). All the outstanding shares of capital stock of
each Z&Z Subsidiary which is a corporation have been validly issued and are
fully paid and nonassessable and, except as set forth in the Z&Z Disclosure
Schedule, are owned (of record and beneficially) by Z&Z, free and clear of
all Liens. Except for the capital stock of the Z&Z Subsidiaries,
which are corporations, Z&Z does not own, directly or indirectly, any
capital stock or other ownership interest in any corporation, limited liability
company, partnership, business association, joint venture or other
entity.
3.3 Capital
Structure. The authorized capital stock of Z&Z consists of
20,000,000 shares, all of which are designated as Z&Z Common Stock, with par
value $0.0001 per share. Of the authorized capital stock of Z&Z,
9,873,050 shares of Z&Z Common Stock are issued and
outstanding. The Z&Z Board of Directors has reserved for issuance
245,000 shares of common stock pursuant to a standalone stock option agreement
(the “Z&Z Stock
Option Agreement”). No shares of Z&Z Common Stock have
been issued upon the exercise of options granted under the Z&Z Stock Option
Agreement and options to purchase an aggregate of 245,000 shares of Z&Z
Common Stock under the Z&Z Stock Option Agreement are currently
outstanding. Warrants to purchase an aggregate of 1,600,000 shares of
Z&Z Common Stock are currently outstanding. In addition, Z&Z
has not committed to issue, or caused a merger partner to issue, warrants to
purchase Z&Z Common Stock, or warrants to purchase the common stock of such
merger partner. Except as set forth above, no shares or other equity
securities of Z&Z are issued, reserved for issuance or
outstanding. All outstanding shares of Z&Z are duly authorized,
validly issued, fully paid and nonassessable and not subject to preemptive
rights. There are no outstanding bonds, debentures, notes or other
indebtedness or other securities of Z&Z having the right to vote (or
convertible into, or exchangeable for, securities having the right to vote) on
any matters on which stockholders of Z&Z may vote. The Z&Z
Disclosure Schedule sets forth the outstanding capitalization of Z&Z,
including a list of all holders of Z&Z Common Stock and their respective
holdings. Except as set forth on the Z&Z Disclosure Schedule,
there are no outstanding securities, options, warrants, calls, rights,
commitments, agreements, arrangements or undertakings of any kind to which
Z&Z is a party or by which it is bound obligating Z&Z to issue, deliver
or sell, or cause to be issued, delivered or sold, additional shares or other
equity or voting securities of Z&Z or obligating Z&Z to issue, grant,
extend or enter into any such security, option, warrant, call, right,
commitment, agreement, arrangement or undertaking. There are no
outstanding contractual obligations, commitments, understandings or arrangements
of Z&Z or any Z&Z Subsidiaries to repurchase, redeem or otherwise
acquire or make any payment in respect of any securities of
Z&Z. There are no agreements or arrangements pursuant to which
Z&Z is or could be required to register Z&Z Common Stock or other
securities under the Securities Act, or other agreements or arrangements with or
among any security holders of Z&Z with respect to securities of
Z&Z.
3.4 Authority. Z&Z
has the requisite corporate and other power and authority to enter into this
Agreement and, subject to obtaining the Z&Z Stockholders’ Approval, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by
Z&Z and the consummation by Z&Z of the transactions contemplated hereby
have been duly authorized by the Board of Directors of Z&Z; the Board of
Directors has recommended adoption of this Agreement by the stockholders of
Z&Z; and no other corporate proceedings on the part of Z&Z or its
stockholders are necessary to authorize the execution, delivery and performance
of this Agreement by Z&Z and the consummation by Z&Z of the transaction
contemplated hereby, other than obtaining the Z&Z Stockholders’
Approval. This Agreement has been duly executed and delivered by
Z&Z and constitutes a valid and binding obligation of Z&Z, enforceable
against Z&Z in accordance with its terms, subject to applicable bankruptcy,
insolvency and other similar laws affecting the enforceability of creditors’
rights generally, general equitable principles and the discretion of courts in
granting equitable remedies.
3.5 Non-Contravention. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated by this Agreement and compliance with the provisions
hereof will not, conflict with, or result in any breach or violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancellation or acceleration of or “put” right with
respect to any obligation or to loss of a material benefit under, or result in
the creation of any Lien upon any of the properties or assets of Z&Z under,
(i) the Certificate of Incorporation or Bylaws of Z&Z, (ii) any loan or
credit agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to Z&Z, its
properties or assets, or (iii) subject to the governmental filings and other
matters referred to in the following sentence, any judgment, order, decree,
statute, law, ordinance, rule, regulation or arbitration award applicable to
Z&Z, its properties or assets. No consent, approval, order or
authorization of, or registration, declaration or filing with, or notice to, any
Governmental Entity is required by or with respect to Z&Z in connection with
the execution and delivery of this Agreement by Z&Z or the consummation by
Z&Z of the transactions contemplated hereby, except, with respect to this
Agreement, for the filing of the Certificate of Merger and other appropriate
merger documents required by the DGCL with the Secretary of State and
appropriate documents with the relevant authorities of other states in which
Z&Z is qualified to do business.
3.6 Financials
Statements. Set forth on the Z&Z Disclosure Schedule are
the following financial statements of Z&Z (collectively the “Z&Z Financial
Statements”): audited consolidated balance
sheets and statements of income, changes in stockholders’ equity, and cash flow
as of and for the fiscal years ended December 31, 2008 and December 31,
2009. The Z&Z Financial Statements shall have been prepared in
accordance with GAAP applied on a consistent basis throughout the periods
covered thereby, shall present fairly the financial condition of Z&Z as of
such dates and the results of operations of Z&Z for such periods, are
correct and complete, and shall be consistent with the books and records of
Z&Z; provided,
however, that the
unaudited interim financial statements shall be subject to normal year-end
adjustments (which will not be material individually or in the aggregate) and
lack footnotes and other presentation items. Since December 31, 2009, Z&Z
has not effected any change in any method of accounting or accounting practice,
except for any such change required because of a concurrent change in
GAAP.
3.7 No Undisclosed
Liabilities. Z&Z does not have any liabilities or
obligations required by applicable accounting rules to be shown in such
financial statements (whether absolute, contingent or otherwise), which are not
adequately reflected or provided for in the Z&Z Financial Statements, except
for liabilities and obligations (i) that have been incurred since the date of
the most recent balance sheet included in the Z&Z Financial Statements in
the ordinary course of business and are not (singly or in the aggregate)
material to Z&Z’s business, and (ii) not due and payable or to be performed
or satisfied after the date hereof under Z&Z Contracts in accordance with
their terms, in each case which are not (singly or in the aggregate) material to
Z&Z’s business.
3.8 Absence of Certain Changes
or Events. Since September 30, 2009, Z&Z has conducted its
business only in the ordinary course consistent with past practice, and there is
not and has not been: (i) any Material Adverse Effect with respect to Z&Z;
(ii) any condition, event or occurrence which individually or in the aggregate
could reasonably be expected to have or give rise to Material Adverse Effect
with respect to Z&Z; (iii) any event which, if it had taken place following
the execution of this Agreement, would not have been permitted by Section 5.1 without
prior consent of Trist; or (iv) any condition, event or occurrence which could
reasonably be expected to prevent, hinder or materially delay the ability of
Z&Z to consummate the transactions contemplated by this
Agreement.
3.9 Legal Proceedings.
There is no suit, action, claim, arbitration, proceeding or investigation
pending or, to the knowledge of Z&Z, threatened against, relating to or
involving Z&Z, or real or personal property of Z&Z, before any
Governmental Entity or other third party. To the knowledge of
Z&Z, there is no basis for any such suit, action, proceeding or
investigation.
3.10 Compliance with
Law. To the knowledge of Z&Z, Z&Z is in compliance in
all material respects with all applicable laws (including, without limitation,
applicable laws relating to zoning, environmental matters and the safety and
health of employees), ordinances, regulations and orders of all Governmental
Entities. Z&Z has not been charged with and, to the knowledge of
Z&Z, is not now under investigation with respect to, a violation of any
applicable law, regulation, ordinance, order or other requirement of a
Governmental Entity. Z&Z is not a party to or bound by any order,
judgment, decree or injunction of any Governmental Entity.
3.11 Benefit
Plans. The Z&Z Disclosure Schedule contains a true and
complete list of each Benefit Plan currently sponsored, maintained or
contributed to by Z&Z. Z&Z’s records accurately reflect the
service histories of its employees, contractors and consultants, including their
hours of service, and all such data is maintained in a usable form.
3.12 Certain Service Provider
Payments. Z&Z is not a party to any employment, contractor
or consultant agreement which could result in the payment to any current, former
or future director, employee, contractor or consultant of Z&Z of any money
or other property or rights or accelerate or provide any other rights or
benefits to any such director, employee, contractor or consultant as a result of
the transactions contemplated by this Agreement, whether or not (i) such
payment, acceleration or provision would constitute a “parachute payment”
(within the meaning of Section 280G of the Code), or (ii) some other subsequent
action or event would be required to cause such payment, acceleration or
provision to be triggered.
3.13 Tax Returns and Tax
Payments. Z&Z is not subject to any liabilities or claims
for Taxes, including Taxes relating to prior periods, other than those set forth
or adequately reserved against in the Z&Z Financial Statements or those
incurred since the date of the most recent balance sheet included in the Z&Z
Financial Statements in the ordinary course of business. Z&Z has duly filed
when due all Tax Returns in connection with and in respect of its business,
assets, employees, contractors and consultants, and has timely paid and
discharged all amounts shown as due thereon. Z&Z has made available to Trist
accurate and complete copies of all of its Tax Returns for all periods, except
those periods for which returns are not yet due. Z&Z has not received any
notice of any Tax deficiency outstanding, proposed or assessed against or
allocable to it, and has not executed any waiver of any statute of limitations
on the assessment or collection of any Tax or executed or filed with any
Governmental Entity any contract or other agreement now in effect extending the
period for assessment or collection of any Taxes against it. There
are no Liens for Taxes upon, pending against or threatened against, any asset of
Z&Z, other than Liens for Taxes not yet due and payable. Z&Z is not
subject to any Tax allocation or sharing agreement.
3.14 Contracts and
Commitments. Z&Z has made available to Trist true, correct
and complete copies of each of the following Contracts to which Z&Z is a
party or by which any of its assets or properties are bound (together the “Z&Z
Contracts”):
3.14.1 all
bonds, debentures, notes, loans, credit or loan agreements or loan commitments,
mortgages, indentures, guarantees or other contracts relating to the borrowing
of money or binding upon any properties or assets (real, personal or mixed,
tangible or intangible) of Z&Z;
3.14.2 all
rental or use agreements, contracts, covenants or obligations which may involve
the payment by or to Z&Z of more than $25,000;
3.14.3 any
contract, agreement, commitment or obligation to make any capital expenditures
in excess of $25,000;
3.14.4 contracts,
agreements, commitments or other obligations with any Person containing any
provision or covenant limiting the ability of Z&Z to engage in any line of
business or to compete with or to obtain products or services from any Person or
limiting the ability of any Person to compete with or to provide products or
services to, or obtain products or services from, Z&Z, or covering
indemnification of another Person other than in the ordinary course of
business;
3.14.5 any
profit-sharing or similar contract, agreement, understanding or obligation with
any Person;
3.14.6 contracts,
agreements, commitments or other obligations with respect to the purchase or
sale by or to Z&Z of any product, equipment, facility, or similar item that
by their respective terms do not expire or terminate or are not terminable by
Z&Z, without penalty, premium or other liability within 30 days or may
involve the payment by or to Z&Z of more than $25,000;
3.14.7 contracts,
agreements, commitments or other obligations to provide services or facilities
by or to Z&Z or to or by another Person which is not terminable by Z&Z
within 30 days without penalty, premium or other liability or involving payment
by Z&Z or the other Person of more than $25,000;
3.14.8 any
contract that provides for an increased payment or benefit, or accelerated
vesting, upon the execution of this Agreement or in connection with the
transactions contemplated hereby;
3.14.9 any
contract or agreement granting any Person a Lien on all or any part of any asset
of Z&Z;
3.14.10 any
contract providing for the indemnification or holding harmless by Z&Z of any
of its stockholders, officers, directors, employees, contractors, consultants or
representatives;
3.14.11 all
other contracts, agreements, commitments or other obligations whether or not
made in the ordinary course of business which may involve the expenditure by
Z&Z of funds in excess of $25,000 per commitment (or under a group of
similar commitments), or are otherwise material to Z&Z; or
3.14.12 all
other contracts, agreements, commitments, or other obligations of any kind that
involve or relate to any Z&Z Stockholder, officer, director, employee,
contractor or consultant of Z&Z or any Affiliate or relative
thereof.
The
Z&Z Contracts are legal, valid, binding and enforceable in accordance with
their respective terms with respect to Z&Z and each other party to such
Z&Z Contracts. There are no existing defaults or breaches of
Z&Z under any Z&Z Contract (or events or conditions which, with notice
or lapse of time or both would constitute a default or breach) and, to the
knowledge of Z&Z, there are no such defaults (or events or conditions which,
with notice or lapse of time or both, would constitute a default or breach) with
respect to any third party to any Z&Z Contract. Except as set
forth on the Z&Z Disclosure Schedule, Z&Z is not participating in any
discussions or negotiations regarding modification of or amendment to any
Z&Z Contract or entry in any new material contract applicable to Z&Z or
the real or personal property of Z&Z. The Z&Z Disclosure Schedule
specifically identifies each Z&Z Contract set forth therein that requires
the consent of or notice to the other party thereto to avoid any breach, default
or violation of such contract, agreement or other instrument in connection with
the transactions contemplated by this Agreement.
3.15 Receivables. Z&Z
has no receivables as reflected in the Z&Z Financial Statements and no
receivables have arisen subsequent to the date thereof as reflected on the books
and records of Z&Z. To Z&Z’s knowledge, no customer or
supplier of Z&Z has any reasonable basis to believe that it has or would be
entitled to any payment terms other than terms in the ordinary course of
business, including any prior course of conduct.
3.16 Personal
Property. Z&Z has good, clear and marketable title to all
the tangible properties and tangible assets reflected in Z&Z’s latest
balance sheet as being owned by Z&Z or acquired after the date thereof which
are, individually or in the aggregate, material to Z&Z’s business (except
properties sold or otherwise disposed of since the date thereof in the ordinary
course of business), free and clear of all Liens. All equipment and
other items of tangible personal property and assets of Z&Z (a) are in good
operating condition and in a state of good maintenance and repair, ordinary wear
and tear excepted, and (b) are usable in the regular and ordinary course of
Z&Z’s business.
3.17 Real Property.
Z&Z does not own any real property. The Z&Z Disclosure
Schedule sets forth all real property leases to which Z&Z is a
party. Z&Z has a valid leasehold interest in such leased real
property, and such leases are in full force and effect. The
improvements and fixtures on such real property leased by Z&Z are in good
operating condition and in a state of good maintenance and repair, ordinary wear
and tear excepted.
3.18 Intellectual Property
Rights.
3.18.1 Z&Z
owns or has the right to use pursuant to an enforceable contract all
Intellectual Property necessary or desirable to operate the Z&Z businesses
as currently conducted and as currently proposed to be conducted (the “Z&Z
Intellectual Property”). Each item of Z&Z Intellectual Property owned
or used immediately prior to the Closing will be owned or available for use by
the Surviving Corporation on identical terms and conditions immediately
subsequent to the Closing. Z&Z has taken all necessary and desirable action
to maintain and protect each item of Z&Z Intellectual Property.
3.18.2 Z&Z
has delivered to Trist correct and complete copies of all written documentation
evidencing ownership and prosecution (if applicable) of each item of any Z&Z
Intellectual Property. With respect to each such item of Z&Z Intellectual
Property:
(a) Z&Z
possesses all right, title, and interest in and to the item, free and clear of
any Encumbrance;
(b) the item
is not subject to any order, judgment, decree or injunction of any Governmental
Entity;
(c) no action
or proceeding is pending or, to the best of Z&Z’s knowledge, threatened (and
to the best of Z&Z’s knowledge there is no basis therefor) which challenges
the enforceability, use, or ownership of the item; and
(d) Z&Z
has never agreed to indemnify any Person for or against any interference,
infringement, misappropriation, or other conflict with respect to the
item.
3.18.3 To the
best of Z&Z's knowledge, the Z&Z Intellectual Property does not
interfere with, infringe upon, misappropriate, or otherwise violate or come into
conflict with any other Person’s Intellectual Property, and Z&Z has never
received any notice alleging any such interference, infringement,
misappropriation, violation, or conflict (including any claim that Z&Z must
license or refrain from using any other Person’s Intellectual Property). No
third Person has any Intellectual Property that interferes or would be likely to
interfere with Z&Z’s use of any Z&Z Intellectual
Property. The Z&Z Intellectual Property will not interfere with,
infringe upon, misappropriate, or otherwise come into conflict with, any
Intellectual Property rights of any other Person as a result of the continued
operation by Z&Z of its businesses as currently conducted and as currently
proposed to be conducted. No other Person has interfered with, infringed
upon, misappropriated, or otherwise come into conflict with any Z&Z
Intellectual Property.
3.18.4 The
Z&Z Disclosure Schedule identifies each Contract pursuant to which Z&Z
has granted to a third party rights under or with respect to any Z&Z
Intellectual Property (together with any exceptions). Z&Z has made
available to Trist correct and complete copies of all Contracts with respect to
such use as amended to date. With respect to the Contracts (1) related to
each item of Z&Z Intellectual Property, the statements in clauses (a)
through (h) below are true and correct, and (2) in the Z&Z Disclosure
Schedule, the statements in clauses (a) through (d) below are true and
correct:
(a) the
Contract is enforceable against each of the parties thereto in accordance with
its terms;
(b) the
Contract will continue to be enforceable on identical terms following the
consummation of the Merger;
(c) Z&Z
(and no counter-party) is in breach of such Contract, and no event has occurred
that with notice or lapse of time would constitute a breach
thereunder;
(d) no party
to the Contract has repudiated any provision thereof;
(e) with
respect to each sublicense Contract, the representations and warranties set
forth in (a) – (d) are true and correct with respect to the underlying license
Contract;
(f) the
underlying item of Z&Z Intellectual Property is not subject to any
outstanding order, judgment, decree or injunction of any Governmental
Entity;
(g) no action
or proceeding is pending or threatened (and there is no basis therefor) that
challenges the enforceability of the underlying item of Intellectual Property;
and
(h) Z&Z has
not granted any sublicense or similar Contract with respect to the
Contract.
3.18.5 Except as
set forth in the Z&Z Disclosure Schedule, all former and current employees,
contractors and consultants of Z&Z have executed written Contracts with
Z&Z that assign to Z&Z all rights to any inventions, improvements,
discoveries or information relating to Z&Z’s business. No employee,
contractor or consultant of Z&Z has entered into any Contract that restricts
or limits in any way the scope or type of work in which the employee, contractor
or consultant may be engaged or requires the employee, contractor or consultant
to transfer, assign, or disclose information concerning his or her work to any
Person other than Z&Z.
3.18.6 To
Z&Z’s knowledge, there are no new products, inventions, procedures, or
methods of manufacturing or processing that any competitors or other Person have
developed which reasonably could be expected to supersede or make obsolete any,
or any planned, product or process of Z&Z.
3.19 Transactions with Related
Parties. Z&Z is not a party to any contract, lease,
license, commitment or arrangement, written or oral, which, were Z&Z a
“registrant” under the Exchange Act, would be required to be disclosed pursuant
to Item 404(a) or (c) of Regulation S-K as promulgated by the SEC, and there are
no loans outstanding to or from any Person specified in Item 404(a) of
Regulation S-K from or to Z&Z.
3.20 No
Guaranties. None of the obligations or liabilities of Z&Z
incurred in connection with the operation of its business is guaranteed by or
subject to a similar contingent obligation of any other
Person. Z&Z has not guaranteed or become subject to a similar
contingent obligation in respect of the obligations or liabilities of any other
Person. There are no outstanding letters of credit, surety bonds or
similar instruments of Z&Z or any of its Affiliates.
3.21 Licenses. Z&Z
owns or possesses all of the material Licenses which are necessary to enable it
to carry on its business as presently conducted. All such Licenses
are valid, binding, and in full force and effect. The execution,
delivery, and performance of this Agreement and the consummation of the
transactions contemplated hereby will not adversely affect any such
License.
3.22 Records. The
books of account, corporate records and minute books of Z&Z are complete and
correct in all material respects. Complete and accurate copies of all
such books of account, corporate records and minute books and of the stock
register of Z&Z have been made available to Trist.
3.23 No Brokers or
Finders. Except as disclosed on the Z&Z Disclosure
Schedule, Z&Z has not, and its Affiliates, officers, directors, employees,
contractors and consultants have not, employed any broker or finder or incurred
any liability for any brokerage or finder’s fee or commissions or similar
payment in connection with any of the transactions contemplated
hereby.
3.24 Board
Recommendation. The Board of Directors of Z&Z has
unanimously determined that the terms of the Merger are fair to and in the best
interests of the Z&Z Stockholders and recommended that the Z&Z
Stockholders approve the Merger.
3.25 Disclosure. Neither
this Agreement, nor any Schedule or Exhibit to this Agreement, nor any other
statements, documents or certificates made or delivered in connection herewith
or therewith contains any untrue statement of a material fact or omits to state
a material fact necessary to make the statements contained herein and therein
not misleading in light of the circumstances under which such statements were
made.
3.26 Required Z&Z
Vote. The affirmative
vote of the holders of a majority of the shares of Z&Z Common Stock voting
together as one class on an as-converted basis is the only vote of the holders
of any class or series of Z&Z’s securities necessary to approve the Merger
(the “Z&Z
Stockholders’ Approval”).
3.27 Regulatory
Permits. Z&Z possess all certificates, authorizations and
permits issued by the appropriate Governmental Agencies necessary to conduct its
business, except where the failure to possess such permits could not have or
reasonably be expected to result in a Material Adverse Effect ("Material
Permits"), and Z&Z has not received any notice of proceedings relating to
the revocation or modification of any Material Permit
4. REPRESENTATIONS
AND WARRANTIES OF TRIST AND MERGERCO.
Except as
set forth in the disclosure schedule delivered by Trist to Z&Z at the time
of execution of this Agreement and attached hereto (the “Trist Disclosure
Schedule”), Trist and MergerCo, jointly and severally, represent and
warrant to Z&Z as follows:
4.1 Organization, Standing and
Corporate Power. Trist is validly existing and in good
standing under the laws of the State of Delaware, and has the requisite
corporate power and authority to carry on its business as now being conducted.
MergerCo is duly organized, validly existing and in good standing under the laws
of the State of Delaware, and has the requisite corporate power and authority to
carry on its business as now being conducted.
4.2 No
Subsidiaries. Other than MergerCo, Trist does not currently
own, directly or indirectly, any capital stock or other equities, securities or
interests in any other corporation or in any limited liability company,
partnership, joint venture or other association.
4.3 Capital
Structure.
4.3.1 The
authorized capital stock of Trist consists of 2,000,000,000 shares of Trist
Common Stock, $0.0001 par value, of which, 89,239,920 shares of Trist Common
Stock are issued and outstanding as of the date of this Agreement. As
of the Closing Date, 108,695,707 shares shall be designated Trist Super-Voting
Common Stock, and 110,913,987 shares of Trist Common Stock and 91,581,633 shares
of Trist Super-Voting Common Stock shall be issued and
outstanding. All outstanding shares of capital stock of Trist are,
and all shares which may be issued pursuant to this Agreement and in connection
with the Capital Raise, will be, when issued, duly authorized, validly issued,
fully paid and nonassessable and, not subject to preemptive rights, and issued
in compliance with all applicable state and federal laws concerning the issuance
of securities. Immediately prior to the Closing, there are no
outstanding bonds, debentures, notes or other indebtedness or other securities
of Trist having the right to vote (or convertible into, or exchangeable for,
securities having the right to vote) on any matters on which holders of Trist
Common Stock may vote. Except as set forth on the Trist Disclosure
Schedule, there are no outstanding securities, options, warrants, calls, rights,
commitments, agreements, arrangements or undertakings of any kind to which Trist
is a party or by which any of them is bound obligating Trist to issue, deliver
or sell, or cause to be issued, delivered or sold, additional shares of capital
stock or other equity securities of Trist or obligating Trist to issue, deliver
or sell, or cause to be issued, delivered or sold, additional shares of capital
stock or other equity securities of Trist or obligating Trist to issue, grant,
extend or enter into any such security, option, warrant, call, right,
commitment, agreement, arrangement or undertaking. There are no
outstanding contractual obligations, commitments, understandings or arrangements
of Trist to repurchase, redeem or otherwise acquire or make any payment in
respect of any shares of capital stock of Trist. Except as set forth
on the Trist Disclosure Schedule and except for the transaction documents
executed in connection with the Capital Raise (including, but not limited to the
Securities Purchase Agreement), there are no agreements or arrangements pursuant
to which Trist is or could be required to register shares of Trist Common Stock
or other securities under the Securities Act or other agreements or arrangements
with or among any holder of Trist securities with respect to securities of
Trist. Upon the Closing, and giving effect to the Capital Raise,
Trist’s capital structure shall be as described on Exhibit K
hereto.
4.3.2 The
authorized capital stock of MergerCo consists of one thousand (1,000) shares of
Common Stock, one hundred (100) of which are issued and outstanding as of the
date of this Agreement and held by Trist. All outstanding shares of
capital stock of MergerCo are duly authorized, validly issued, fully paid and
nonassessable. There are no outstanding bonds, debentures, notes or
other indebtedness or other securities of MergerCo having the right to vote (or
convertible into, or exchangeable for, securities having the right to vote) on
any matters on which holders of MergerCo Common Stock may vote. Other
than as provided in this Agreement, there are no outstanding securities,
options, warrants, calls, rights, commitments, agreements, arrangements or
undertakings of any kind to which MergerCo is a party or by which MergerCo is
bound obligating MergerCo to issue, deliver or sell, or cause to be issued,
delivered or sold, additional shares of capital stock or other equity securities
of MergerCo or obligating MergerCo to issue, deliver or sell, or cause to be
issued, delivered or sold, additional shares of capital stock or other equity
securities of MergerCo or obligating MergerCo to issue, grant, extend or enter
into any such security, option, warrant, call, right, commitment, agreement,
arrangement or undertaking.
4.4 Authority. Each
of Trist and MergerCo has the requisite corporate and other power and authority
to enter into this Agreement and to perform its obligations hereunder and to
consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by each of Trist and MergerCo and the consummation by
Trist and MergerCo of the transactions contemplated hereby have been duly
authorized by the Board of Directors of Trist and MergerCo and Trist as the sole
stockholder of MergerCo; and no other corporate proceedings on the part of Trist
or MergerCo are necessary to authorize the execution, delivery and performance
of this Agreement by Trist and the consummation by Trist and MergerCo of the
transactions contemplated hereby. This Agreement has been duly
executed and delivered by each of Trist and MergerCo and constitutes a valid and
binding obligation of each of Trist and MergerCo, enforceable against such Party
in accordance with its terms, subject to applicable bankruptcy, insolvency and
other similar laws affecting the enforceability of creditors’ rights generally,
general equitable principles and the discretion of courts in granting equitable
remedies.
4.5 Non-Contravention. The
execution and delivery of this Agreement do not, and the consummation of the
transactions contemplated by this Agreement and compliance with the provisions
hereof will not, conflict with, or result in any breach or violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancellation or acceleration of or “put” right with
respect to any obligation or to loss of a material benefit under, or result in
the creation of any Lien upon any of the properties or assets of either Trist or
MergerCo under, (i) the Certificate of Incorporation or Bylaws of Trist or
MergerCo, (ii) any loan or credit agreement, note, bond, mortgage, indenture,
lease or other agreement, instrument, permit, concession, franchise or license
applicable to Trist or MergerCo, their respective properties or assets, or (iii)
subject to the governmental filings and other matters referred to in the
following sentence, any judgment, order, decree, statute, law, ordinance, rule,
regulation or arbitration award applicable to Trist or MergerCo, their
respective properties or assets, other than, in the case of clauses (ii) and
(iii), any such conflicts, breaches, violations, defaults, rights, losses or
Liens that individually or in the aggregate could not have either a Material
Adverse Effect on Trist or MergerCo or could not prevent, hinder or delay the
ability of Trist or MergerCo to consummate the transactions contemplated by this
Agreement. No consent, approval, order or authorization of, or
registration, declaration or filing with, or notice to, any Governmental Entity
is required by or with respect to Trist or MergerCo in connection with the
execution and delivery of this Agreement by Trist or MergerCo or the
consummation by Trist and MergerCo of the transactions contemplated hereby,
except, with respect to this Agreement, for the filing of the Transaction 8-K,
14f-1 Information Statement, 14c Information Statement and other appropriate
documents with the SEC, the filing of the Certificate of Merger and other
appropriate merger documents required by the DGCL with the Secretary of State
and appropriate documents with the relevant authorities of other states in which
Trist is qualified to do business.
4.6 SEC Documents; Undisclosed
Liabilities.
4.6.1 For all
periods subsequent to December 31, 2008, Trist has filed all reports, schedules,
forms, statements and other documents as required by the SEC in a timely basis
(or has received a valid extension of such time of filing and has filed any such
reports or other documents prior to the expiration of any such extension), and
Trist has delivered or made available to Z&Z all reports, schedules, forms,
statements and other documents filed with or furnished to the SEC during such
period (collectively, and in each case including all exhibits and schedules
thereto and documents incorporated by reference therein, the “Trist SEC
Documents”). As of their respective dates (or, if amended, supplemented
or superseded by a filing prior to the date hereof, then as of the date of such
amendment, supplement or superseding filing) the Trist SEC Documents complied in
all material respects with the requirements of the Securities Act or the
Exchange Act, as the case may be, and the rules and regulations of the SEC
promulgated thereunder applicable to such Trist SEC Documents, and none of the
Trist SEC Documents (including any and all consolidated financial statements
included therein) as of such date contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. The consolidated
financial statements of Trist included in such Trist SEC Documents comply as to
form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto, have been
prepared in accordance with GAAP (except, in the case of unaudited consolidated
quarterly statements, as permitted by Form 10-Q of the SEC) applied on a
consistent basis during the periods involved (except as may be indicated in the
notes thereto), have been reviewed by an independent accountant registered with
the Public Company Accounting Oversight Board and fairly and accurately present
the consolidated financial position of Trist as of the dates thereof and the
consolidated results of operations and changes in cash flows for the periods
covered thereby (subject, in the case of unaudited quarterly statements, to
normal year-end audit adjustments as determined by Trist’s independent
accountants, which are not expected to have a material adverse effect on Trist
and its business).
4.6.2 Except as
set forth in the Trist SEC Documents, at the date of the most recent financial
statements of Trist included in the Trist SEC Documents, Trist did not have, and
since such date Trist has not incurred, any liabilities or obligations of any
nature (whether accrued, absolute, contingent or otherwise) except for
liabilities and obligations that have been incurred since the date of the most
recent balance sheet included in the Trist Financial Statements in the ordinary
course of business and are not (singly or in the aggregate) material to Trist’s
business, all of which are listed on the Trist Disclosure Schedule.
4.6.3 The Trist
SEC Documents include all certifications and statements required of it, if any,
by (i) Rule 13a-14 or 15d-14 under the Exchange Act, and (ii) 18 U.S.C. Section
1350 (Section 906 of the Xxxxxxxx-Xxxxx Act of 2002), and each of such
certifications and statements contain no qualifications or exceptions to the
matters certified therein other than a knowledge qualification, permitted under
such provision, and have not been modified or withdrawn and neither Trist nor
any of its officers has received any notice from the SEC or any other
Governmental Entity questioning or challenging the accuracy, completeness, form
or manner of filing or submission of such certifications or
statements.
4.6.4 Trist is
in compliance in all material respects with all of the provisions of the
Xxxxxxxx-Xxxxx Act of 2002, and the provisions of the Exchange Act and the
Securities Act relating thereto which under the terms of such provisions
(including the dates by which such compliance is required) have become
applicable to Trist.
4.7 Interested Party
Transactions Except as set forth in the Trist Disclosure
Schedule or in Trist’s SEC Documents, no employee, contractor, consultant,
officer, director or stockholder of Trist or a member of his or her immediate
family is indebted to Trist, nor is Trist indebted (or committed to make loans
or extend or guarantee credit) to any of them, other than (i) for payment of
salary for services rendered, (ii) reimbursement for reasonable expenses
incurred on behalf of Trist, and (iii) for other employee benefits made
generally available to all employees, contractors and consultants. To
Trist’s knowledge, none of such individuals has any direct or indirect ownership
interest in any Person with whom Trist is affiliated or with whom Trist has a
material contractual relationship, or any Person that competes with
Trist. To Trist’s knowledge, no officer, director or stockholder or
any member of their immediate families is, directly or indirectly, interested in
any material contract with Trist (other than such contracts as relate to any
such individual ownership of capital stock or other securities of
Trist).
4.8 Indebtedness; Trist
Assets. Immediately prior to the Closing, Trist will have no
indebtedness for borrowed money. Immediately prior to the Closing,
Trist will have no assets, except for cash reserves earmarked for the payment of
certain accounts payable and accrued expenses of Trist with respect to the
period prior to Closing which remain unpaid.
4.9 Over-the-Counter Bulletin
Board Quotation. Trist Common Stock is quoted on the
Over-the-Counter Bulletin Board (“OTC
BB”). There is no action or proceeding pending or, to Trist’s
knowledge, threatened against Trist by NASDAQ or FINRA with respect to any
intention by such entities to prohibit or terminate the quotation of Trist
Common Stock on the OTC BB.
4.10 Compliance with
Law. To the knowledge of Trist, Trist is in compliance in all
material respects with all applicable laws (including, without limitation,
applicable laws relating to zoning, environmental matters and the safety and
health of employees), ordinances, regulations and orders of all Governmental
Entities. Trist has not been charged with and, to the knowledge of
Trist, is not now under investigation with respect to, a violation of any
applicable law, regulation, ordinance, order or other requirement of a
Governmental Entity. Trist is not a party to or bound by any order,
judgment, decree or injunction of any Governmental Entity.
4.11 Absence of Certain Changes
or Events. Except as disclosed in the Trist SEC Documents,
since the date of the most recent financial statements included in the Trist SEC
Documents, Trist has conducted its business only in the ordinary course
consistent with past practice in light of its current business circumstances,
and there is not and has not been: (i) any Material Adverse Effect with respect
to Trist; (ii) any condition, event or occurrence which, individually or in the
aggregate, could reasonably be expected to have or give rise to a Material
Adverse Effect with respect to Trist; (iii) any event which, if it had taken
place following the execution of this Agreement, would not have been permitted
by Section 5.1
without the prior consent of Z&Z; or (iv) any condition, event or occurrence
which could reasonably be expected to prevent, hinder or materially delay the
ability of Trist to consummate the transactions contemplated by this
Agreement.
4.12 Information
Supplied. None of the information included or
incorporated by reference in any documents to be filed by Trist with the SEC or
any other Governmental Entity in connection with the Merger and the other
transactions contemplated hereby will, on the date of its filing or, in the case
of any information to be mailed to the Stockholders of Trist, at the date it is
mailed to Stockholders of Trist, contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they are made, not misleading or necessary to correct any statement in any
earlier communication which shall have become false or misleading, except that
no representation is made by Trist with respect to information supplied in
writing by or on behalf of Z&Z for inclusion therein. The 14f-1
Information Statement filed by Trist with the SEC under the Exchange Act
relating to the transactions contemplated hereby, and any other documents to be
filed with the SEC in connection with the Merger, will comply as to form in all
material respects with the Exchange Act.
4.13 Certain Service Provider
Payments. Trist is not a party to any agreement which could
result in the payment to any current, former or future director, employee,
contractor or consultant of Trist of any money or other property or rights or
accelerate or provide any other rights or benefits to any such director,
employee, contractor or consultant as a result of the transactions contemplated
by this Agreement, whether or not (i) such payment, acceleration or provision
would constitute a “parachute payment” (within the meaning of Section 280G of
the Code), or (ii) some other subsequent action or event would be required to
cause such payment, acceleration or provision to be triggered.
4.14 Tax Returns and Tax
Payments. Trist is not subject to any liabilities or claims
for Taxes, including Taxes relating to prior periods, other than those set forth
or adequately reserved against in the financial statements included in the Trist
SEC Documents or those incurred since the date of the most recent balance sheet
included in the Trist SEC Documents in the ordinary course of business. Trist
has duly filed when due all Tax Returns in connection with and in respect of its
business, assets, employees, contractors and consultants, and has timely paid
and discharged all amounts shown as due thereon. Trist has made available to
Z&Z accurate and complete copies of all of its Tax Returns for all periods,
except those periods for which returns are not yet due. Trist has not received
any notice of any Tax deficiency outstanding, proposed or assessed against or
allocable to it, and has not executed any waiver of any statute of limitations
on the assessment or collection of any Tax or executed or filed with any
Governmental Entity any contract or other agreement now in effect extending the
period for assessment or collection of any Taxes against it. There
are no Liens for Taxes upon, pending against or threatened against, any asset of
Trist. Trist is not subject to any Tax allocation or sharing
agreement.
4.15 Records. The
books of accounts, corporate records and minute books of Trist and MergerCo are
complete and correct in all material respects. Complete and accurate
copies of all such books of account, corporate records and minute books of Trist
and MergerCo have been provided to Z&Z.
4.16 MergerCo. MergerCo
has been formed for the sole purpose of effecting the Merger and, except as
contemplated by this Agreement, MergerCo has not conducted any business
activities and does not have any material liabilities.
4.17 No Brokers or
Finders. Neither Trist, MergerCo, nor their respective
Affiliates, officers, directors, employees, contractors or consultants have,
employed any broker or finder or incurred any liability for any brokerage or
finder’s fee or commissions or similar payment in connection with any of the
transactions contemplated hereby.
4.18 Board
Recommendation. The Board of Directors of Trist has
unanimously determined that the terms of the Merger are fair to and in the best
interests of the Stockholders of Trist and no vote of the holders of shares of
Trist Common Stock or any other Trist security holder is necessary to approve
the Merger. In addition, the Board of Directors of Trist has
unanimously determined that the terms of the Capital Raise are fair to and in
the best interests of the Stockholders of Trist and no vote of the holders of
shares of Trist Common Stock or any other Trist security holder is necessary to
approve the Capital Raise.
4.19 Legal Proceedings.
There is no suit, action, claim, arbitration, proceeding or investigation
pending or, to the knowledge of Trist, threatened against, relating to or
involving Trist, or real or personal property of Trist, before any Governmental
Entity or other third party. To the knowledge of Trist, there is no
basis for any such suit, action, proceeding or investigation.
4.20 Contracts and
Commitments. All material Contracts to which Trist is a party
or by which any of its assets or properties are bound have been disclosed in the
Trist SEC Documents (together the “Trist
Contracts”). True and correct of all Trist Contracts are
available in the Trist SEC Documents, subject to the removal of any schedules,
exhibit and similar items not required to be filed with the SEC. To
the knowledge of Trist, the Trist Contracts are legal, valid, binding and
enforceable in accordance with their respective terms with respect to Trist and
each other party to such Trist Contracts. There are no existing
defaults or breaches of Trist under any Trist Contract (or events or conditions
which, with notice or lapse of time or both would constitute a default or
breach) and, to the knowledge of Trist, there are no such defaults (or events or
conditions which, with notice or lapse of time or both, would constitute a
default or breach) with respect to any third party to any Trist
Contract. Except as set forth on the Trist Disclosure Schedule, Trist
is not participating in any discussions or negotiations regarding modification
of or amendment to any Trist Contract or entry in any new material contract
applicable to Trist or the real or personal property of Trist. The Trist
Disclosure Schedule specifically identifies each Trist Contract set forth
therein that requires the consent of or notice to the other party thereto to
avoid any breach, default or violation of such contract, agreement or other
instrument in connection with the transactions contemplated by this
Agreement.
4.21 Title to
Property. Trist does not own or lease any real property or
personal property. There are no options or other contracts under
which Trist has a right or obligation to acquire or lease any interest in real
property or personal property.
4.22 Intellectual Property
Rights. Trist does not own, license or otherwise have any
right, title or interest in any Intellectual Property.
4.23 Insurance. Trist
does not maintain any insurance policies.
4.24 Benefit
Plans. Trist does not currently sponsor, maintain or
contribute to any Benefit Plan or “employee benefit plan” as defined in Section
3(3) of ERISA.
5. COVENANTS
RELATING TO CONDUCT OF BUSINESS PRIOR TO MERGER.
5.1 Conduct of Z&Z, Trist
and MergerCo. Except as expressly permitted by this Agreement,
between the date of this Agreement and the Effective Time, each of Trist and
Z&Z shall conduct its business only in the ordinary course in substantially
the same manner as heretofore conducted, and use all its reasonable efforts to
preserve intact its present business organization and employees, contractors and
consultants and to preserve the goodwill of Persons with which it has business
relations. Without limiting the generality of the foregoing, except
as otherwise expressly provided in this Agreement, between the date of this
Agreement and the Effective Time, (i) each of Trist and Z&Z shall pay
accounts payable and pay and perform other obligations of its business when they
become due and payable in the ordinary course of business consistent with past
practice, or when required to be performed, as the case may be, and (ii) each of
Trist, MergerCo and Z&Z shall (unless otherwise mutually agreed to in
writing):
5.1.1 not amend
or alter its certificate of incorporation, bylaws, or similar charter documents,
except as required by the Trist Reorganization (and in accordance with the terms
outlined on Exhibit
B-1);
5.1.2 not
engage in any transaction, except in the normal and ordinary course of business
except for (a) those transactions contemplated by the Capital Raise, or (b) the
Trist Reorganization, or create or suffer to exist any Lien or other encumbrance
upon any of its assets or which will not be discharged in full prior to the
Effective Time;
5.1.3 not sell,
exchange, lease, assign or otherwise transfer any of its assets, or cancel or
compromise any debts or claims relating to their assets, other than for fair
value, in the ordinary course of business, and consistent with past
practice;
5.1.4 not (i)
declare, set aside or pay any dividends on or make other distributions in
respect of any of its capital shares, (ii) split, combine, reclassify or take
similar action with respect to any of its capital shares or issue or authorize
or propose the issuance of any other securities in respect of, in lieu of or in
substitution for its capital shares, (iii) adopt a plan of complete or partial
liquidation or resolutions providing for or authorizing such liquidation or a
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization, or (iv) directly or indirectly redeem, repurchase or otherwise
acquire any capital shares or any option with respect thereto, except for
repurchases in connection with an existing option plan or warrant agreement that
result from a participant’s use of such Party’s Common Stock to exercise options
or warrants or pay withholding taxes in connection with such
exercise;
5.1.5 not sell,
issue, grant or authorize the issuance or grant of any capital stock, other
security (including the sale, transfer or grant of any treasury shares) or any
obligation convertible or exchangeable for capital stock or any other security,
except that (i) Trist may contract for the issuance of up to 1,184,153,515
shares of Trist Common Stock pursuant to the terms of the convertible promissory
notes and warrants sold in the Capital Raise, (ii) Z&Z may issue Z&Z
Common Stock upon the valid exercise of stock options and warrants outstanding
as of the date of this Agreement, (iii) Z&Z may grant options to purchase
shares of Z&Z Common Stock at fair market value in the ordinary course of
business consistent with past practice to its employees, officers, directors,
contractors and consultants, and (iv) Z&Z may issue Z&Z Common Stock in
connection with a bona fide financing transaction; provided, however, that
Z&Z acknowledges and agrees that issuance of such shares shall not result in
a change to the number of shares of Trist Super-Voting Common Stock constituting
the Merger Consideration, and accordingly the issuance of such shares shall
result in a decrease in the Exchange Ratio.
5.1.6 not fail
to use reasonable efforts to preserve intact its present business organizations,
keep available the services of its employees, contractors and consultants
(except as expressly provided herein) and preserve its material relationships
with customers, suppliers, licensors, licensees, distributors and others, to the
end that its good will and on-going business not be impaired prior to the
Effective Time;
5.1.7 not
organize any subsidiary or acquire any capital stock or other equity securities
of any Person or any equity or ownership interest in any business;
5.1.8 with
respect to Z&Z, not enter into any instrument which would constitute a
Z&Z Contract, as applicable, or enter into any material amendment,
supplement or waiver in respect of any Z&Z Contract, in each case except in
the ordinary course of business consistent with past practice and except for
contracts, agreements and instruments entered into or executed in connection
with the Capital Raise;
5.1.9 with
respect to Trist, not enter into any instrument which would constitute a Trist
Contract, as applicable, or enter into any material amendment, supplement or
waiver in respect of any Trist Contract, in each case except in the ordinary
course of business consistent with past practice and except for contracts,
agreements and instruments entered into or executed in connection with the
Capital Raise or in connection with the Trist Reorganization (but only if they
are described on Exhibit B-1
hereto);
5.1.10 not incur
any severance pay obligation by reason of this Agreement or the transactions
contemplated hereby;
5.1.11 not grant
or extend any power of attorney other than in the ordinary course of business
which does not affect a material part of its business;
5.1.12 keep in
full force and effect insurance comparable in amount and scope of coverage to
insurance now carried by it;
5.1.13 not make
any material change with respect to their business in accounting or bookkeeping
methods, principles or practices, except as required by GAAP;
5.1.14 promptly
advise the other Party in writing of any Material Adverse Effect with respect to
it;
5.1.15 not agree
or otherwise commit, whether in writing or otherwise, to do, or take any action
or omit to take any action that would result in, any of the
foregoing;
5.1.16 not
acquire or agree to acquire, by merging or consolidating with, by purchasing an
equity interest in or a portion of the assets of, by licensing or by any other
manner, any business or any corporation, partnership, association or other
business organization or division thereof, or otherwise acquire or agree to
acquire any assets of any other Person, except for the purchase of assets from
suppliers or vendors in the ordinary course of business; or
5.1.17 not make
any expenditure or enter into any commitment or transaction exceeding $25,000
other than purchases in the ordinary course of business consistent with past
practices.
5.2 Advice of
Changes. Each Party shall promptly advise the other Party in
writing of (a) any event occurring subsequent to the date of this Agreement that
would render any representation or warranty of Z&Z contained in Section 3 or Trist or
MergerCo contained in Section 4 untrue or
inaccurate such that the conditions set forth in Sections 7.2 or
7.3 would not
be satisfied, (b) any breach of any covenant or obligation of Z&Z or Trist
or MergerCo pursuant to this Agreement such that the condition set forth in
Sections 7.2 and
7.3 would not
be satisfied, (c) any Material Adverse Effect in Z&Z or Trist, or (d) any
change, event, circumstance, condition or effect that would reasonably be
expected to result in a Material Adverse Effect on Z&Z or Trist or cause any
of the conditions set forth in Sections 7.2 or 7.3 not to be
satisfied, provided,
however, that the
delivery of any notice pursuant to this Section 5.2
shall not be deemed to amend or supplement the Z&Z or Trist Disclosure
Schedule.
5.3 SEC
Reports. Trist shall (a) cause the forms, reports, schedules,
statements and other documents required to be filed with the SEC by Trist
between the date of this Agreement and the Effective Time to be filed in a
timely manner, (b) submit to Z&Z all such forms, reports, schedules,
statements and other documents at least two (2) days prior to filing for its
review, and (c) remain a “reporting person” for the purposes of the Exchange
Act. Except for forms, reports, schedules, statements and other
documents required to be filed with the SEC by Trist between the date of this
Agreement and the Effective Time, Trist shall not file or cause to be filed
with, or furnish or cause to be furnished to, the SEC any forms, reports,
schedules, statement or any other documents, without the prior express written
approval of Z&Z.
6. ADDITIONAL
AGREEMENTS.
6.1 Board of Directors of
Trist. At Closing, the current board of directors of Trist
shall deliver duly adopted resolutions to: (a) set the size of Trist’s board of
directors to seven (7) members effective as of the Closing; (b) appoint (i)
Xxxxxx Xxxxxxx; (ii) Xxxxx Xxxxxxx, (iii) Xxxxxxxxx Xxxxxx, (iv) Xxxx Xxxxxxx
and (v) Xxxxx Xxxxx, to serve as directors of Trist; and (c) accept the
resignations of the current officers of Trist and the directors of Trist
effective as of the Closing. The two independent “Joint Directors”
shall be appointed within 180 days following the Closing Date as provided in the
Voting Agreement. At Closing, the current officers of Trist and the
directors of Trist shall deliver their resignations, as appropriate,
as officers and directors of Trist to be effective upon the Closing (the “Resignations”). Prior
to Closing, Z&Z and Woodman shall deliver or cause to be delivered to Trist
completed and signed director and officer questionnaires (“Questionnaires”)
for board members appointed by Z&Z and the investors participating in the
Capital Raise following Closing. The foregoing designations of the
board of directors (and the officers to be appointed following the Closing)
shall be subject to Trist’s receipt of the completed and signed Questionnaires
(“D&O
Information”).
6.2 Schedule 14f-1 Information
Statement. Trist shall prepare the information statement
required by Rule 14f-1 promulgated under the Exchange Act (“14f-1 Information
Statement”) in connection with the change of control to be effectuated by
the appointment of new officers and directors at Closing, and, at least ten (10)
days prior to Closing, Trist shall file the 14f-1 Information Statement with the
SEC and mail the same to each of Trist’s Stockholders.
6.3 Transaction Form
8-K. At least five (5) days prior to Closing, the Parties
shall prepare the Form 8-K announcing the Closing, which shall include all
information required by such form, including the information required by Form 10
with respect to the Parties, any other information required in connection with
Trist ceasing to be a shell company as a result of the Transactions, the Z&Z
Financial Statements and the Pro Forma Financial Statements (as defined below)
(“Transaction Form
8-K”), which shall be in a form reasonably acceptable to Trist and in a
format acceptable for XXXXX filing. Prior to Closing, the Parties
shall prepare the press release announcing the consummation of the Transaction
hereunder (“Press
Release”). At the Closing, Trist shall file the Transaction
Form 8-K with the SEC and distribute the Press Release.
6.4 Pro Forma Consolidated
Financial Statements. At least ten (10) days prior to the
Closing, the Parties shall deliver to Trist pro forma consolidated financial
statements for the Parties, and pro forma consolidated financial statements for
the Parties and Trist giving effect to the Transaction, for such periods as
required by the SEC to be included in the Transaction Form 8-K or any other
report or form required to be filed with the SEC at or after Closing with
respect to the Transaction, all prepared in all material respects with the
published rules and regulations of the SEC and in accordance with U.S. GAAP
applied on a consistent basis throughout the periods involved (the
“Pro Forma
Financial Statements”). The Pro Forma Financial Statements
shall have been reviewed by an independent accountant registered with the Public
Company Accounting Oversight Board retained by Trist and shall be in a format
acceptable for inclusion on the Transaction 8-K.
6.5 Required
Information. In connection with the preparation of the
Transaction Form 8-K, 14c Information Statement, 14f-1 Information Statement,
and Press Release, and for such other reasonable purposes, each Party shall,
upon request by the other, furnish the other with all information concerning
themselves, their respective subsidiaries, directors, officers, managers,
managing members, stockholders and members (including the directors of Trist to
be elected effective as of the Closing pursuant to Section 6.1 hereof
any officers appointed by such directors thereafter) and such other matters as
may be reasonably necessary or advisable in connection with the Transaction, or
any other statement, filing, notice or application made by or on behalf of each
Party and Trist to any third party and/or any Governmental Entity in connection
with the Transaction and the other transactions contemplated
hereby. Each party warrants and represents to the other party
that all such information shall be true and correct in all material respects and
will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
contained therein, in light of the circumstances under which they were made, not
misleading.
6.6 Confidentiality; Access to
Information.
6.6.1 Confidentiality. Any
confidentiality agreement or letter of intent previously executed by the parties
shall be superseded in its entirety by the provisions of this
Agreement. Each party agrees to maintain in confidence any non-public
information received from the other party, and to use such non-public
information only for purposes of consummating the transactions contemplated by
this Agreement. Such confidentiality obligations will not apply to
(i) information which was known to the one party or their respective agents
prior to receipt from the other party; (ii) information which is or becomes
generally known; (iii) information acquired by a party or their respective
agents from a third party who was not bound to an obligation of confidentiality;
and (iv) disclosure required by law. In the event this Agreement is
terminated as provided in Section 8 hereof,
each party will return or cause to be returned to the other all documents and
other material obtained from the other in connection with the Transaction
contemplated hereby.
6.6.2
|
Access to
Information.
|
(a) Z&Z
will afford Trist and its financial advisors, accountants, counsel and other
representatives reasonable access during normal business hours, upon reasonable
notice, to the properties, books, records and personnel of Z&Z during the
period prior to the Closing to obtain all information concerning the business,
including the status of product development efforts, properties, results of
operations and personnel of Z&Z, as Trist may reasonably
request. No information or knowledge obtained by Trist in any
investigation pursuant to this Section 6.6.2 will
affect or be deemed to modify any representation or warranty contained herein or
the conditions to the obligations of the Parties to consummate the
Transaction.
(b) Trist
will afford Z&Z and its financial advisors, underwriters, accountants,
counsel and other representatives reasonable access during normal business
hours, upon reasonable notice, to the properties, books, records and personnel
of Trist during the period prior to the Closing to obtain all information
concerning the business of Trist, as Z&Z may reasonably
request. No information or knowledge obtained by Z&Z in any
investigation pursuant to this Section 6.6 will
affect or be deemed to modify any representation or warranty contained herein or
the conditions to the obligations of the Parties to consummate the
Transaction.
6.7 No
Solicitation. Other than with respect to the Transaction, each
Party agrees that neither of them nor any of their officers, directors,
managers, or managing members shall, and that they shall direct and use their
reasonable best efforts to cause their agents and other representatives
(including any investment banker, attorney or accountant retained by it) not to,
directly or indirectly, initiate, solicit, encourage or otherwise facilitate any
inquiries or the making of any proposal or offer with respect to (i) a merger,
reorganization, share exchange, consolidation or similar transaction involving
them, (ii) any sale, lease, exchange, mortgage, pledge, transfer or purchase of
all or substantially all of the assets or equity securities of them, taken as a
whole, in a single transaction or series of related transactions or (iii) any
tender offer or exchange offer for 20% or more of the outstanding shares of
Trist Common Stock (any such proposal or offer being hereinafter referred to as
an “Acquisition
Proposal”). Each Party further agrees that neither of them nor
any of their officers, directors, managers, or managing members shall, and that
they shall direct and use their reasonable best efforts to cause their agents
and representatives not to, directly or indirectly, engage in any negotiations
concerning, or provide any confidential information or data to, or have any
discussions with, any person relating to an Acquisition Proposal, or otherwise
facilitate any effort or attempt to make or implement an Acquisition Proposal.
Each Party agrees that they will immediately cease and cause to be terminated
any existing discussions or negotiations with any parties conducted heretofore
with respect to any Acquisition Proposal. Each Party agrees that they
will take the necessary steps to promptly inform the individuals or entities
referred to in the first sentence hereof of the obligations undertaken in this
Section
6.7.
6.8 Public
Disclosure. Except to the extent previously disclosed or to
the extent the parties believe that they are required by applicable law or
regulation to make disclosure, prior to Closing, no party shall issue any
statement or communication to the public regarding the Transaction without the
consent of the other party, which consent shall not be unreasonably
withheld. To the extent a party hereto believes it is required by law
or regulation to make disclosure regarding the Transaction, it shall, if
possible, immediately notify the other party prior to such
disclosure. Notwithstanding the foregoing, the parties hereto agree
that Trist will prepare and file the Transaction Form 8-K pursuant to the
Exchange Act reasonably acceptable to each Party to report the execution of this
Agreement and that any party hereto may file any reports as required by the
Exchange Act including, without limitation, any reports on Schedule
13D.
6.9 Reasonable Efforts;
Notification.
6.9.1 Upon the
terms and subject to the conditions set forth in this Agreement, each of the
Parties agrees to use its commercially reasonable efforts to take, or cause to
be taken, all actions, and to do, or cause to be done, and to assist and
cooperate with the other parties in doing, all things necessary, proper or
advisable to consummate and make effective, in the most expeditious manner
practicable, the Transaction and the other transactions contemplated by this
Agreement, including using commercially reasonable efforts to accomplish the
following: (i) the taking of all reasonable acts necessary to cause the
conditions precedent set forth in Section 7 to be
satisfied, (ii) the obtaining of all necessary actions or nonactions, waivers,
consents, approvals, orders and authorizations from Governmental Entities and
the making of all necessary registrations, declarations, notices and filings
(including registrations, declarations, notices and filings with Governmental
Entities, if any) and the taking of all reasonable steps as may be necessary to
avoid any suit, claim, action, investigation or proceeding by any Governmental
Entity, (iii) the obtaining of all consents, approvals or waivers from third
parties required as a result of the transactions contemplated in this Agreement,
(iv) the defending of any suits, claims, actions, investigations or proceedings,
whether judicial or administrative, challenging this Agreement or the
consummation of the transactions contemplated hereby, including seeking to have
any stay or temporary restraining order entered by any court or other
Governmental Entity vacated or reversed, and (v) the execution or delivery of
any additional instruments reasonably necessary to consummate the transactions
contemplated by, and to fully carry out the purposes of, this
Agreement. In connection with and without limiting the foregoing,
Each Party, and its respective board of directors and each Party and its
managers, members, directors, officers and Stockholders shall, if any state
takeover statute or similar statute or regulation is or becomes applicable to
the Transaction, this Agreement or any of the transactions contemplated by this
Agreement, use their commercially reasonable efforts to enable the Transaction
and the other transactions contemplated by this Agreement to be consummated as
promptly as practicable on the terms contemplated by this
Agreement. Notwithstanding anything herein to the contrary, nothing
in this Agreement shall be deemed to require any of the Parties to agree to any
divestiture by itself or any of its affiliates of shares of capital stock,
membership interests or ownership interest or of any business, assets or
property, or the imposition of any material limitation on the ability of any of
them to conduct their business or to own or exercise control of such assets,
properties and stock.
6.9.2 Z&Z
shall give prompt notice to Trist upon becoming aware that any representation or
warranty made by them contained in this Agreement has become untrue or
inaccurate, or of any failure of Z&Z to comply with or satisfy in any
material respect any covenant, condition or agreement to be complied with or
satisfied by them under this Agreement, in each case, such that the conditions
set forth in Section
7 would not be satisfied; provided, however, that no such notification
shall affect the representations, warranties, covenants or agreements of the
parties or the conditions to the obligations of the parties under this
Agreement.
6.9.3 Trist
shall give prompt notice to Z&Z upon becoming aware that any representation
or warranty made by it contained in this Agreement has become untrue or
inaccurate, or of any failure of Trist to comply with or satisfy in any material
respect any covenant, condition or agreement to be complied with or satisfied by
it under this Agreement, in each case, such that the conditions set forth in
Section 7 would
not be satisfied; provided, however, that no such notification shall affect the
representations, warranties, covenants or agreements of the parties or the
conditions to the obligations of the parties under this Agreement.
6.10 Treatment as a Reorganization. Consistent
with the intent of the parties hereto, each of Z&Z and Trist shall treat,
and cause its Affiliates to so treat, the Merger as a reorganization under
Section 368(a) of the Code with respect to all Tax Returns, to the extent
consistent with law.
6.11 Absence of Material
Liabilities; Merger Expenses. Immediately prior to Closing,
Trist shall have no liabilities or obligations requiring the payment of monies,
other than obligations under or with respect to: (i) any agreement with its
transfer agent, (ii) Trist Contracts disclosed under Section 4.20 hereto,
(iii) accounts payable and accrued expenses of Trist with respect to the period
between the date hereof and the Closing, and (iv) the Outstanding Debt (of which
all amounts in excess of $250,000 shall be converted into shares of Trist Common
Stock pursuant to the Reorganization prior to Closing) (collectively, the “Pre-Closing Cash
Obligations”). Upon the closing of the Capital Raise, to the
extent not satisfied by Trist prior to the Closing or otherwise converted into
shares of Trist Common Stock pursuant to the Trist Reorganization, the
Pre-Closing Cash Obligations will be paid as follows: (i) $125,000 to
be paid to each of Europa and Woodman from the proceeds of the Capital Raise,
which shall constitute full payment of the Outstanding Debt and any other
amounts owed by Trist to Europa or Woodman (other than as investors in the
Capital Raise), (ii) Woodman shall advance (x) all legal fees incurred by Trist
and Woodman in connection with this Agreement and the Merger, the 14f-1
Information Statement and the Transaction Form 8-K and (y) all auditor’s fees
payable in respect of the audit of Z&Z performed to prepare the Z&Z
Financial Statements, up to a maximum of $150,000 (in the aggregate for all fees
included in (x) and (y)), which fees will be repaid in full by Trist upon the
closing of the Capital Raise from the proceeds thereof, and (iii) Woodman shall
advance all legal fees incurred by Trist and Woodman in connection with the
Capital Raise, which fees will be repaid in full by Trist upon the closing of
the Capital Raise from the proceeds thereof, up to a maximum of
$35,000. Subject to the foregoing, Woodman and KOM will be
responsible for all of their own legal fees in connection with intellectual
property due diligence conducted in connection with Z&Z and the Merger, as
well as all of their own legal fees in connection with the preparation,
execution and delivery of this Agreement, the Merger and the Capital
Raise. Z&Z will be responsible for all of its own legal fees in
connection with the preparation, execution and delivery of this Agreement, the
Merger and the Capital Raise. Except as expressly provided above,
each of the Parties shall be responsible for such Party’s legal fees and all
other expenses incurred with in connection with the Merger and the transactions
contemplated hereby. Subject to Section 10 of this Agreement, (i)
Woodman and Europa agree, jointly and severally to indemnify and hold harmless
Trist and Z&Z against and from any losses, liabilities, claims, costs and
expenses (including reasonable attorney's fees) which are raised by any third
party against Trist or Z&Z as a result of the inaccuracy of any warranty
made in or breach of Section 4 or this Section 6.11, and (ii) Trist and Z&Z
agree, jointly and severally to indemnify and hold harmless Woodman and Europa
against and from any losses, liabilities, claims, costs and expenses (including
reasonable attorney's fees) which are raised by any third party against Woodman
or Europa as a result of the inaccuracy of any warranty made in or breach of
Section 3 or this Section 6.11; provided, however, that (A) the aggregate
liability under this sentence of Woodman and Europa, collectively, to Trist and
Z&Z, collectively, shall not exceed $125,000, and (B) the
aggregate liability under this sentence of Trist and Z&Z, collectively, to
Woodman and Europa, collectively, shall not exceed $125,000.
6.12 Business
Records. At Closing, Trist shall cause to be delivered to the
Parties all records and documents relating to Trist, which Trist possesses,
including, without limitation, books, records, government filings, Returns,
charter documents, corporate records, stock records, consent decrees, orders,
and correspondence, director and Stockholder minutes and resolutions, stock
ownership records, financial information and records, electronic files
containing any financial information and records, and other documents used in or
associated with Trist.
6.13 Z&Z Stockholder
Approval. Z&Z shall, as promptly as practicable, duly
submit this Agreement and the transactions contemplated by this Agreement to the
Z&Z Stockholders for approval and adoption. In connection with
the Merger, this Agreement and the other transactions contemplated hereby, the
Board of Directors of Z&Z shall (i) recommend to the Z&Z Stockholders
that they consent to, and use all commercially reasonable efforts to obtain the
approvals by the Z&Z Stockholders, of the Merger, this Agreement and the
other transactions contemplated hereby, and (ii) otherwise comply with all
requirements of applicable law and Z&Z’s Certificate of Incorporation and
Bylaws in connection with obtaining the Z&Z Stockholders’
Approval. Z&Z shall prepare and distribute to the Z&Z
Stockholders a consent solicitation disclosure statement in connection with the
solicitation of consents to obtain the Z&Z Stockholders’ Approval, and shall
provide Trist a reasonable period of time to review the disclosure statement
prepared in connection with such consent solicitation prior to the delivery of
such disclosure statement to the Z&Z Stockholders.
6.14 Registration Statements;
Registration Rights. In addition to any registration rights
agreements currently in existence between Trist and any current stockholder of
Trist as set forth in Trist Disclosure Schedule, Z&Z and Trist hereby agree
that, effective as of the closing of the Capital Raise, all shares of Trist
Common Stock and/or Trist Super-Voting Common Stock issued or issuable upon
conversion of the convertible promissory notes and warrants to be issued in the
Capital Raise will be granted certain registration rights, including piggyback
registration rights. Such subscribers of the Capital Raise shall be a
third-party beneficiary of the provisions of this Section and may enforce the
same as if it was a party to this Agreement.
6.15 Information
Statement. As soon as practicable after the date of this
Agreement, and in no event later than five (5) business days prior to the
Closing, Trist shall prepare and deliver to Z&Z, an information statement
pursuant to Rule 14(c) promulgated under Section 14A of the Exchange Act
(together with any amendments or supplements thereto, the “14c Information
Statement”) in connection with the approval and adoption of the following
matters (the “Stockholder
Matters”):
6.15.1 To
approve a 1 for 200 reverse stock split with special treatment for certain of
Trist’s stockholders to preserve round lot stockholders (“Reverse
Split”);
6.15.2 To
approve an adjustment in the number of authorized common stock of Trist as
recommended by the Board of Directors;
6.15.3 To
approve the authorization of “blank check” preferred stock as recommended by the
Board of Directors;
6.15.4 To
approve the adoption of a stock incentive plan (“Stock
Plan”); and
6.15.5 All such
other actions as shall be necessary or desirable in connection with or related
to the foregoing actions in Sections 6.15.1 –
6.15.4 above.
The 14c
Information Statement shall comply as to form and substance in all material
respects with the provisions of the Exchange Act and the rules and regulations
promulgated thereunder. Z&Z shall provide such information as may be
necessary or required, in the reasonable determination of counsel to Z&Z and
Trist, for Trist to prepare and deliver the 14c Information Statement
(including, without limitation, all information, proposals and documentation
related to the Stock Plan).
As soon as practicable following the
Closing, Trist shall obtain the written consent of each party to the Voting
Agreement approving the Stockholder Matters, such consent to be effective twenty
(20) days following the filing of the definitive 14c Information Statement with
the SEC. Upon receipt of such written consent, Trist will file the
Information Statement with the SEC and shall cause such Information Statement to
become definitive and to be mailed to the holders of Trist’s securities entitled
to vote at a meeting of stockholders.
In the event the 14c Information
Statement is reviewed by the SEC, Trist shall respond promptly to any comments
of the SEC or its staff with respect to the 14c Information Statement and use
its commercially reasonable efforts to have the 14c Information Statement
cleared by the SEC as soon as practicable after its filing, provided, however,
in the event that the substance of any review by the SEC involves or inquires
with respect to information, filings, reports, financial statements or other
circumstances of Trist occurring, reported or filed prior to the Closing (the
“Pre-Closing
Period”), Europa and Woodman shall, upon request of Z&Z and Trist,
use their commercially reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and cooperate with the
Z&Z and Trist in doing, all things necessary, proper or advisable to
consummate and make effective, in the most expeditious manner practicable, the
14c Information Statement, including, without limitation, providing such
information, addressing such comments, and otherwise resolving such matters as
may relate to the Pre-Closing Period and any SEC comments relating thereto or
any SEC inquiry thereof.
7. CONDITIONS
PRECEDENT.
7.1 Conditions to Each Party’s
Obligation to Effect the Merger. The respective obligations of
each Party to effect the Merger is subject to the satisfaction or waiver on or
prior to the Closing Date of the following conditions:
7.1.1 No Injunctions or
Restraints. No temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent
jurisdiction or other legal restraint or prohibition preventing the consummation
of the Merger shall be in effect.
7.1.2 Directors and Officers Liability
Insurance. Trist shall have obtained a directors and officers
liability insurance policy covering its officers and directors providing at
least $5 million of coverage.
7.1.3 Voting
Agreement. The Z&Z Stockholders, Europa and Woodman shall
have executed and delivered the Voting Agreement by and among them, in the form
attached hereto as Exhibit
I.
7.2 Conditions to Obligations of
Trist. The obligations of Trist to effect the Merger are
further subject to the following conditions:
7.2.1 Representations and
Warranties. The representations and warranties of Z&Z set
forth in this Agreement shall be true and correct in all material respects, in
each case as of the date of this Agreement and as of the Closing Date as though
made on and as of the Closing Date, unless made as of another date, in which
case they shall be true and correct in all material respects as of such
date.
7.2.2 Performance of Obligations of
Z&Z. Z&Z shall have performed in all material respects
all obligations required to be performed by it under this Agreement at or prior
to the Closing Date.
7.2.3 No Material Adverse
Effect. Since the date hereof there must have been no event,
series of events or the lack of occurrence thereof which, singularly or in the
aggregate, could reasonably be expected to have a Material Adverse Effect on
Z&Z.
7.2.4 Consents,
etc. Trist shall have received evidence, in form and substance
reasonably satisfactory to it, that such licenses, permits, consents, approvals,
authorizations, qualifications and orders of Governmental Entities and other
third parties as necessary in connection with the transactions contemplated
hereby have been obtained.
7.2.5 Stockholder
Approval. The Z&Z Stockholders’ Approval shall have been
obtained by a vote of holders at least 90% of the issued and outstanding Z&Z
Common Stock.
7.2.6 No Dissenters. No
Z&Z Stockholders shall have dissented to the Merger or be entitled to
exercise dissenters’ rights in connection with the Merger.
7.2.7 No
Litigation. There shall not be pending or threatened by any
Governmental Entity any suit, action or proceeding (or by any other Person any
suit, action or proceeding which has a reasonable likelihood of success)
challenging or seeking to restrain or prohibit the consummation of the
Merger.
7.2.8 Reserved.
7.2.9 Audited Financial
Statements. Z&Z shall have delivered final approval of the
Z&Z Financial Statements from its auditors.
7.2.10 D&O
Information. Z&Z and Woodman shall have caused the
director nominees to deliver the Questionnaires in a timely manner, and the
D&O Information shall be acceptable to Trist.
7.2.11 Capital Raise. A
signed purchase agreement shall have been received to purchase senior
convertible promissory notes and warrants to purchase shares of Trist Common
Stock, in a private placement offering exempt from registration under the
Securities Act pursuant to Regulation D promulgated thereunder and otherwise
pursuant to the terms outlined on Exhibit A-1 (“Capital
Raise”), representing gross proceeds of not less than $1,500,000, with
such gross proceeds having been fully funded into an escrow account established
for the Capital Raise the release of which to Trist is conditioned only upon the
Closing of the Merger and subject to the conditions of Section 6.11 hereof,
and Trist’s acceptance of such agreement simultaneous to or after the
Closing. The Securities Purchase Agreement executed and delivered in
connection with the Capital Raise shall be substantially in the form attached
hereto as Exhibit
A-2 (the “Securities
Purchase Agreement”), and all other agreements, documents and instruments
contemplated by the Securities Purchase Agreement shall have been executed and
delivered, as provided therein.
7.2.12 Legal
Opinion. Trist shall have received the legal opinion of
counsel to Z&Z, in substantially the form of Exhibit F
hereto.
7.2.13 Officer’s
Certificate. Trist shall have received an officer’s
certificate, substantially in the form of Exhibit D, duly
executed on Z&Z’s behalf.
7.2.14 Secretary’s
Certificate. Trist shall have received a Secretary’s
certificate, substantially in the form of Exhibit E, duly
executed on Z&Z’s behalf.
7.3 Conditions to Obligation of
Z&Z. The obligation of Z&Z to effect the Merger is
further subject to the following conditions:
7.3.1 Representations and
Warranties. The representations and warranties of Trist set
forth in this Agreement shall be true and correct in all material respects, in
each case as of the date of this Agreement and as of the Closing Date as though
made on and as of the Closing Date, unless made as of another date, in which
case they shall be true and correct in all material respects as of such
date.
7.3.2 Due Diligence
Items. Trist shall have provided to Z&Z copies of all
agreements and documents requested by Z&Z before the Closing, including,
without limitation, copies of material agreements previously filed as exhibits
to reports and documents filed with, or furnished to, the SEC and satisfactory
evidence of termination of all such material agreements filed with, or furnished
to, the SEC.
7.3.3 Performance of Obligations of
Trist. Trist shall have performed in all material respects all
obligations required to be performed by it under this Agreement at or prior to
the Closing Date.
7.3.4 No Material Adverse
Effect. Since the date hereof there must have been no event,
series of events or the lack of occurrence thereof which, singularly or in the
aggregate, could reasonably be expected to have a Material Adverse Effect on
Trist.
7.3.5 Consents,
etc. Z&Z shall have received evidence, in form and
substance reasonably satisfactory to it, that such licenses, permits, consents,
approvals, authorizations, qualifications and orders of Governmental Entities
and other third parties as necessary in connection with the transactions
contemplated hereby have been obtained.
7.3.6 No
Litigation. There shall not be pending or threatened by any
Governmental Entity any suit, action or proceeding (or by any other Person any
suit, action or proceeding which has a reasonable likelihood of success)
challenging or seeking to restrain or prohibit the consummation of the
Merger.
7.3.7 Resignations. Trist
shall deliver to Z&Z the Resignations, as required by Section
6.1.
7.3.8 Capital Raise. A
signed purchase agreement shall have been received to purchase senior
convertible promissory notes and warrants to purchase shares of Trist Common
Stock in the Capital Raise, representing gross proceeds of not less than
$1,500,000, with such gross proceeds having been fully funded into an escrow
account established for the Capital Raise the release of which to Trist is
conditioned only upon the Closing of the Merger and subject to the conditions of
Section 6.11
hereof, and Trist’s acceptance of such agreement simultaneous to or after the
Closing. The Securities Purchase Agreement and all other agreements,
documents and instruments contemplated by the Securities Purchase Agreement
shall have been executed and delivered, as provided therein
7.3.9 Trist
Reorganization. The Trist Reorganization shall have been
consummated pursuant to the terms outlined on Exhibit B-1
hereto.
7.3.10 Officer’s
Certificate. Z&Z shall have received an officer’s
certificate, substantially in the form of Exhibit G, duly
executed on Trist’s behalf.
7.3.11 Secretary’s
Certificate. Z&Z shall have received a Secretary’s
certificate, substantially in the form of Exhibit H, duly
executed on Trist’s behalf.
8. TERMINATION.
8.1 Termination. This
Agreement may be terminated and abandoned at any time prior to the Effective
Time:
8.1.1 by mutual
written consent of Trist and Z&Z;
8.1.2 by either
Trist or Z&Z if any Governmental Entity shall have issued an order, decree
or ruling or taken any other action permanently enjoining, restraining or
otherwise prohibiting the Merger and such order, decree, ruling or other action
shall have become final and nonappealable;
8.1.3 by either
Trist or Z&Z if the Merger shall not have been consummated on or before
April 30, 2010 (other than as a result of the failure of the Party seeking to
terminate this Agreement to perform its obligations under this Agreement
required to be performed at or prior to the Effective Time);
8.1.4 by Trist,
if a Material Adverse Effect shall have occurred relative to
Z&Z;
8.1.5 by Trist,
if Z&Z materially breaches any of its representations and warranties
contained in this Agreement or willfully fails to perform in any material
respect any of its material obligations under this Agreement, which failure or
breach is not cured within ten (10) days after Trist has notified Z&Z of its
or their intent to terminate this Agreement pursuant to this Section
8.1.5;
8.1.6 by Trist,
if the Z&Z Stockholders do not approve and adopt the Merger and the
transactions contemplated by this Agreement under the DGCL;
8.1.7 by
Z&Z, if a Material Adverse Effect shall have occurred relative to Trist;
and
8.1.8 by
Z&Z, if Trist materially breaches any of its representations and warranties
contained in this Agreement or willfully fails to perform in any material
respect any of its material obligations under this Agreement, in each case,
which failure or breach is not cured within ten (10) days after Z&Z has
notified Trist of its or their intent to terminate this Agreement pursuant to
this Section
8.1.8.
8.2 Effect of
Termination. In the event of termination of this Agreement by
either Z&Z or Trist as provided in Section 8.1, this
Agreement shall forthwith become void and have no effect, without any liability
or obligation on the part of Trist, Z&Z, KOM, Woodman or Europa (except as
contemplated below), other than the provisions of Section 6.6.1, Section 8.3, Section 10 and this
Section
8.2. In the event the Closing has not occurred and this
Agreement has been terminated pursuant to Section 8.1.2, 8.1.3, 8.1.4, 8.1.5, or 8.1.6, and Z&Z
consummates a debt or equity financing (in one or a series of transactions),
other than the Working Capital Round (as defined below), with aggregate gross
proceeds equal to or exceeding $500,000 within six months following the
termination of this Agreement, then notwithstanding the provisions of Section 6.11 and in
lieu of any obligations of any party contained therein, Z&Z shall reimburse
KOM, Woodman and Trist, as applicable, for any actual costs and
expenses (including but not limited to, the fees of attorneys, financial
advisors, placement agents, brokerage or finder’s fees and other fees and
expenses) incurred in connection with the transactions contemplated by this
Agreement in an aggregate amount not to exceed $150,000.00. In the
event that this Agreement is terminated pursuant to Section 8.1.7 or
8.1.8, then
notwithstanding the provisions of Section 6.11 and in
lieu of any obligations of any party contained therein, Woodman shall reimburse
Z&Z for any actual costs and expenses (including but not limited to, the
fees of attorneys, financial advisors, placement agents, brokerage or finder’s
fees and other fees and expenses) incurred in connection with the transactions
contemplated by this Agreement in an aggregate amount not to exceed
$50,000.00. The Parties acknowledge and agree that the provisions of
this Section
8.2 shall constitute the sole and exclusive remedy of the Parties with
respect to any claims resulting from or arising out of the termination of this
Agreement. For purposes hereof, the “Working Capital
Round” means Z&Z’s $750,000 private placement equity financing
offering which was concluded prior to the date hereof.
8.3 Return of
Documents. In the event of termination of this Agreement for
any reason, Trist and Z&Z will return to the other Party all of the other
Party’s documents, work papers, and other materials (including copies) relating
to the transactions contemplated in this Agreement, whether obtained before or
after execution of this Agreement. Trist and Z&Z will not use any
information so obtained from the other Party for any purpose and will take all
reasonable steps to have such other Party’s information kept
confidential.
9. POST-CLOSING
COVENANTS.
9.1 Z&Z
acknowledges that the agreements contained in this Section 9.1 are an integral
part of the transactions contemplated by this Agreement and that, without these
agreements, Trist would not enter into this Agreement. The parties hereto
acknowledge and agree that the failure by Trist or Z&Z to satisfy, perform
and comply with the covenants set forth in this Section 9.1 (“Post-Closing
Covenants”) following the Closing will have a material adverse effect on
Trist, KOM, Woodman and Europa and the investment of the participants in the
Capital Raise. During the period beginning upon the Closing and ending on
the first anniversary of the Closing, Z&Z agrees to satisfy, perform and
comply with, and Z&Z agrees to cause Trist to satisfy, perform, and comply
with, the following agreements and covenants:
9.1.1 Remain a
Section 12(g) reporting company in compliance with and current in its reporting
requirements under the Exchange Act, and remain quoted on, at a minimum, the OTC
BB;
9.1.2 (i)
Certify in writing to any person holding restricted shares of Trist Common Stock
as of the date of this Agreement (or having obtained such shares in or by virtue
of the Capital Raise) that Trist has filed all of the reports required to be
filed by it under the Exchange Act to enable such person to sell such person's
restricted stock under Rule 144 or 145, as may be applicable in the
circumstances, or will inform such person in writing that it has not filed any
such report or reports, upon being informed in writing by such person of its
intent to sell any shares under Rule 144 or Rule 145 promulgated under the
Securities Act (including any rule adopted in substitution or replacement
thereof), (ii) if any certificate representing any restricted shares of Trist
Common Stock is presented to Trist’s transfer agent for registration of transfer
in connection with any sale theretofore made or to be made under Rule 144 or
145, provided such certificate is duly endorsed for transfer by the appropriate
person(s) or accompanied by a separate stock power duly executed by the
appropriate person(s) in each case with reasonable assurances that such
endorsements are genuine and effective, and is accompanied by an opinion of
counsel satisfactory to Trist and its counsel that such transfer has complied
with the requirements of Rule 144 or 145 (“Opinion”),
as the case may be, and is not restricted by any applicable state securities law
requirement, promptly instruct the Transfer Agent to register such transfer and
to issue one or more new certificates representing such shares to the transferee
and, if appropriate under the provisions of Rule 144 or 145, as the case may be,
and state securities law requirements, free of any stop transfer order or
restrictive legend, and (iii) in the event Trist’s counsel is unwilling or
unable to issue such Opinion, Trist hereby agrees to accept, and shall instruct
its counsel to accept, an Opinion of Xxxxxx Xxxxxxxx & Markiles, LLP or such
other reasonable counsel selected by KOM or Woodman, and Trist and its counsel
shall hereby authorize the transfer agent to accept the opinion of Xxxxxx
Xxxxxxxx & Markiles, LLP (or such other reasonable counsel selected by KOM
or Woodman) for such purposes (“Transfer Agent
Authorization”), which Transfer Agent Authorization shall be delivered to
the transfer agent prior to Closing, or at such other time requested by KOM or
Woodman, with a copy to KOM and Woodman;
9.1.3 Respond
in a timely manner, and to the satisfaction of the SEC, to any review or inquiry
by the SEC to the Transaction Form 8-K.
9.1.4 Comply
with the terms and conditions of the Voting Agreement.
9.1.5 Hold
meetings of Trist’s board of directors at least once each fiscal quarter; and
schedule regular meetings for the audit and compensation committee, with advance
notice to all directors, and insure that such committee meetings are properly
held as scheduled.
9.1.6 File
within the statutory time limits any required filings or notifications with the
SEC, FINRA and any other federal, state, foreign government or regulatory agency
including any agency or organization with jurisdiction over any exchange on
which Trist’s securities are listed or quoted.
9.1.7 Engage
certified public accountants that are at all times registered with PCAOB and, in
the event Trist’s certified public accountants resign or are terminated for any
reason, Trist shall promptly engage a new certified public accountant registered
with PCAOB.
9.1.8 Add
independent directors, create audit, compensation and other committees, and
comply with the provisions of the Xxxxxxxx-Xxxxx Act of 2002, and take such
other actions as required by applicable laws and regulations regarding corporate
governance.
9.1.9 Adopt
proper disclosure, xxxxxxx xxxxxxx and code of ethics policies to the extent
required by law or applicable regulation.
9.1.10 Pay, when
due, all transfer agent fees, listing fees and any other fees the non-payment of
which may adversely effect compliance with applicable laws and regulations
(including securities laws and regulations) or the listing or quotation of
Trist’s securities.
9.1.11 File all
tax returns of any kind in a timely manner, and pay, when due, all tax
obligations of any kind or nature.
9.1.12 Not later
than thirty (30) days following the Closing, engage an investor relations firm
reasonably acceptable to KOM and Woodman to provide customary services to Trist
following the Closing at a cost of no more than $5,000 per month.
9.2 Other
Provisions. Notwithstanding anything contained herein to the
contrary, the provisions of this Section 9 and of Section 6.11 shall survive
(and not be affected in any respect by) the Closing.
10. SURVIVAL.
Except
(i) as specifically set forth in provisions contained herein which contemplate
the performance of any agreement or covenant by any party hereto after the
Closing, (ii) with respect to the representations and warranties set forth in
Sections 3 and 4 which, solely for purposes of the indemnification provisions of
Section 6.11, shall survive for a period of six months, (iii) the obligations of
all parties pursuant to Section 2.9, and (iv) the obligations of all parties
pursuant to Section 6.11, which such obligations shall survive for a period of
six months, all representations, warranties, agreements and covenants contained
in or made pursuant to this Agreement by any party hereto or contained in any
Schedule hereto shall not survive the Closing, and no claims made by virtue of
such representations, warranties, agreements and covenants shall be made or
commenced by any party hereto from and after the Closing.
11. GENERAL
PROVISIONS.
11.1 Amendment. This
Agreement may not be amended except by an instrument in writing signed on behalf
of each of the Parties.
11.2 Extension;
Waiver. The Parties may (a) extend the time for the
performance of any of the obligations or other acts of the other Parties, (b)
waive any inaccuracies in the representations and warranties contained in this
Agreement or in any document delivered pursuant to this Agreement, or (c) waive
compliance with any of the agreements or conditions contained in this
Agreement. Any agreement on the part of a Party to any such extension
or waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such Party. The failure of any Party to assert any of its
rights under this Agreement or otherwise shall not constitute a waiver of such
rights.
11.3 Notices. All notices,
requests, claims, demands and other communications under this Agreement shall be
in writing and shall be deemed given if delivered Personally or sent by
facsimile, electronic mail, or overnight courier (providing proof of delivery)
to the parties at the following addresses (or at such other address for a Party
as shall be specified by like notice):
if to Z&Z, to:
Z&Z
Medical Holdings, Inc.
00
Xxxxxxxxxx
Xxxxxx
Xxxxxx, XX 9677
Attn: Xxx
Xxxxxxx, Chief Executive Officer
Fax:
with a copy to (which shall not
constitute notice):
Call
& Xxxxxx
000
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000
Attn: Xxx
Xxxxxx
Fax: (000) 000-0000
if to
Trist or MergerCo, to:
XX Xxx
0000
Xxxxxxx
Xxxxx, XX 00000
Attn:
Xxxx Xxxxxxxxxxxx
Fax:
(000) 000-0000
with a copy to (which shall not
constitute notice):
Xxxxxx
Xxxxxxxx & Markiles, LLP
00000
Xxxxxxx Xxxx., 00xx
Xx
Xxxxxxx
Xxxx, XX 00000
Attn:
Xxxx Xxxxxxxx
Fax:
(000) 000-0000
11.4 Interpretation. When
a reference is made in this Agreement to a Section, Exhibit or Schedule, such
reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement
unless otherwise indicated. The headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words “include”,
“includes” or “including” are used in this Agreement, they shall be deemed to be
followed by the words “without limitation”.
11.5 Entire Agreement; No
Third-Party Beneficiaries. This Agreement and the other
agreements referred to herein constitute the entire agreement, and supersede all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter of this Agreement. Except as
expressly provided herein, and except for Woodman, Europa and KOM which will be
deemed third party beneficiaries hereof, this Agreement is not intended to
confer upon any Person other than the parties any rights or
remedies.
11.6 Governing
Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws
thereof.
11.7 Assignment. Neither
this Agreement nor any of the rights, interests or obligations under this
Agreement shall be assigned, in whole or in part, by operation of law or
otherwise by any of the parties without the prior written consent of the other
parties. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
11.8 Enforcement. The
parties agree that irreparable damage may occur in the event that any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed
that the parties shall be entitled to seek an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement in any federal or state court located in the State
of Delaware, this being in addition to any other remedy to which they are
entitled at law or in equity. In addition, each of the parties hereto
(a) consents to submit itself to the personal jurisdiction of any court sitting
in the State of
Delaware in the event any dispute arises out of this Agreement or any of the
transactions contemplated by this Agreement to the extent such courts would have
subject matter jurisdiction with respect to such dispute and (b) agrees that it
will not attempt to deny or defeat such personal jurisdiction or venue by motion
or other request for leave from any such court.
11.9 Severability. Whenever
possible, each provision or portion of any provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law but
if any provision or portion of any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or portion of any provision in such jurisdiction,
and this Agreement will be reformed, construed and enforced in such jurisdiction
as if such invalid, illegal or unenforceable provision or portion of any
provision had never been contained herein.
11.10 Schedules and
Exhibits. The Schedules and Exhibits to this Agreement
are hereby incorporated into this Agreement and are hereby made a part of this
Agreement as if set out in full in this Agreement.
11.11 Counterparts. This
Agreement may be executed in one or more identical counterparts, all of which
shall be considered one and the same instrument and shall become effective when
one or more such counterparts shall have been executed by each of the parties
and delivered to the other parties. Delivery of a copy of this
Agreement bearing an original signature by facsimile transmission, by electronic
mail in “portable document format” (“.pdf”) form, or by any other electronic
means intended to preserve the original graphic and pictorial appearance of a
document, will have the same effect as physical delivery of the paper document
bearing the original signature.
[Signature page
follows]
IN
WITNESS WHEREOF, the undersigned have caused their duly authorized officers to
execute this Agreement as of the date first above written.
Z&Z
MEDICAL HOLDINGS, INC.
By: /s/ XXX
XXXXXXX
Name: Xxx
Xxxxxxx
Title: Chief
Executive Officer
By: /s/ XXXX
XXXXXXXXXXXX
Name: Xxxx
Xxxxxxxxxxxx
Title: Interim
President
Z&Z
MERGER CORPORATION
By: /s/ XXXX
XXXXXXXXXXXX
Name: Xxxx
Xxxxxxxxxxxx
Title: President
ACKNOWLEDGED
AND AGREED
WITH
RESPECT TO OBLIGATIONS
UNDER
SECTIONS 6.1, 6.11, 6.15 AND 8.2 HEREOF:
WOODMAN
MANAGEMENT CORPORATION
By: _____/s/ XXXXX
WEINER________________________
Name: Xxxxx
Xxxxxx
Title: President
[Signature page
continues]
ACKNOWLEDGED
AND AGREED
WITH
RESPECT TO OBLIGATIONS
UNDER
SECTIONS 6.11 AND 6.15 HEREOF:
EUROPA
INTERNATIONAL, INC.
By: _______/s/ XXXX
KNOLL______________________
Name: Xxxx
Xxxxx
Title: Managing
Director
S-1
INDEX OF SCHEDULES AND
EXHIBITS
Schedules:
Z&Z
Disclosure Schedule
Trist
Disclosure Schedule
Exhibits:
Exhibit
A-1: Capital
Raise Terms
Exhibit
A-2: Form
of Securities Purchase Agreement
Exhibit
B-1: Trist
Reorganization Terms
Exhibit
B-2: Form
of Certificate of Designations
Exhibit
B-3: Trist
Reorganization Capital Structure
Exhibit
C: Form
of Certificate of Merger
Exhibit
D: Form
of Z&Z Officer’s Certificate
Exhibit
E: Form
of Z&Z Secretary’s Certificate
Exhibit
F: Form
of Opinion of Z&Z Counsel
Exhibit
G: Form
of Trist Officer’s Certificate
Exhibit
H: Form
of Trist Secretary’s Certificate
Exhibit
I: Voting
Agreement
Exhibit
J: Certificate
of Incorporation of Surviving Corporation
Exhibit
K: Post-Closing
Trist Capital Structure
EXHIBIT
A-1
Capital
Raise Terms
a.
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In
connection with the Closing of the Merger, Trist will consummate the
Capital Raise, consisting of a private placement of its Senior Convertible
Notes (as defined herein) to be sold to KOM and Woodman (or their
affiliates or assigns) with gross proceeds of $1,500,000. The
proceeds of the Capital Raise, subject to offset as described in Section
6.11 of the Agreement (as adjusted, the “Escrow
Amount”), shall be paid into an escrow account maintained by an
escrow agent mutually agreed upon by Woodman and Z&Z prior to the
Closing, subject to an escrow agreement to be negotiated among the
parties. The “Senior Convertible
Notes” will (i) be secured on a senior first priority basis by all
of the assets of Trist and Z&Z, (ii) initially be convertible at the
election of the holders thereof into a number of shares of Trist Common
Stock (the “KOM
Convertible Shares”) such that the KOM Convertible Shares will
initially represent at the Closing of the Capital Raise, in the aggregate,
10.5% of the outstanding capital stock, on a fully-diluted, as-converted
basis, of Trist, (iii) accrue interest at a rate of 2.5% per year,
compounded annually, payable in cash or Trist Common Stock, at the
election of the holder thereof, on the earlier of the date that the
applicable Senior Convertible Notes are converted and the Maturity Date,
and (iv) otherwise mature on the fourth anniversary of the closing of the
Capital Raise (if not converted earlier) (the “Maturity
Date”). In connection with the Capital Raise, the
purchasers will also receive warrants to purchase a number of shares of
Trist Common Stock equal to 50% of the amount of shares initially issuable
upon conversion of the Senior Convertible Notes, with an exercise price
equal to the conversion price.
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b.
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The
Capital Raise transaction documents will provide that KOM and Woodman, or
their assignees will provide additional debt financing to Trist following
the closing of the Capital Raise, on the following terms and
conditions:
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i.
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If,
during the twelve (12) month period following the closing of the Capital
Raise, Z&Z obtains (A) a favorable ruling, determination or other
correspondence from the United States Patent and Trademark Office (or any
foreign equivalent) with respect to any of its existing patent
applications, and (B) a favorable “freedom to operate” legal
opinion from a law firm reasonably acceptable to Woodman, and (C) a
favorable result from its next phase of animal testing (collectively, the
“Favorable
Determination Milestones”), in each case, all as determined in the
sole discretion of Woodman, then, following the completion of all of the
Favorable Determination Milestones, Trist will have the right, but not the
obligation, to cause Woodman to provide additional debt financing to Trist
on the same terms and conditions as the Capital Raise (excluding any
warrant coverage), in an amount equal to $1,500,000 (the “Additional Funding
Amount”) to be paid following Woodman’s written confirmation of its
acceptance of all of the Favorable Determination
Milestones. Within thirty (30) days following the completion of
all of the proposed Favorable Determination Milestones, Trist will have
the right to request in writing (the “Favorable Milestone
Notice”) the Additional Funding Amount. If Woodman
determines, in its sole discretion, that all of the Favorable
Determination Milestones have been achieved, then Woodman (or its
affiliates/assigns) will fund the Additional Funding Amount within sixty
(60) days after the receipt of the Favorable Milestone Notice. For
clarity, if Woodman determines, in its sole discretion, that all of the
Favorable Determination Milestones have not been achieved, then Woodman
will provide notice thereof and will thereafter have no obligation to fund
the Additional Funding Amount.
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ii.
|
If,
for the twelve (12) month period following the closing of the Capital
Raise, Z&Z fails to obtain all of the Favorable Determination
Milestones (whether directly or as a result of the determinations of
Woodman that all of such Favorable Determination Milestones have not been
achieved), then the rights of Trist set forth in Section b.i. above shall
expire, provided, however, that Woodman (or its affiliates/assigns) shall
have the right, but not the obligation, during the two (2) month period
following the twelve (12) month anniversary of the closing of the Capital
Raise, to cause Trist to accept additional debt financing on the same
terms and conditions as the Capital Raise (excluding any warrant coverage,
and except that the valuation of Z&Z and Trist in such additional debt
financing shall be 1.25 times the valuation of Z&Z and Trist at the
closing of the Capital Raise), in an amount up to the Additional Funding
Amount. The parties shall use their commercially reasonable
efforts to consummate such additional debt financing within sixty (60)
days following the delivery by Woodman of notice of its desire to provide
such financing.
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c.
|
The
Senior Convertible Notes (and related warrants), and any and all
additional notes to be issued as contemplated hereunder, will contain
customary anti-dilution and registration rights to be negotiated by the
parties. The Capital Raise transaction documents will include,
at a minimum, a Securities Purchase Agreement, Promissory Note, an
accompanying Security Agreement, Warrant, and Registration Rights
Agreement.
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d.
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For
the avoidance of doubt, no portion of the provisions of Section b. above
shall in any way limit the ability of Trist to seek and obtain, subject to
the provisions of the Capital Raise transaction documents, additional debt
or equity financing following the closing of the Capital Raise from
parties other than Woodman.
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.
EXHIBIT
A-2
Form
of Securities Purchase Agreement
To be
agreed among the parties prior to the Closing.
EXHIBIT
B-1
Trist
Reorganization Terms
The terms
of the Trist Reorganization shall be:
(i)
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All
outstanding liabilities of Trist to Europa and Woodman as disclosed in
Trist’s public filings (the “Outstanding
Debt”) shall be designated to be repaid in part pursuant to Section
6.11 of the Agreement and the remainder of the Outstanding Debt shall be
converted into 21,674,067 shares of Trist Common
Stock.
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(ii)
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Trist
shall file a Certificate of Designations to its Certificate of
Incorporation to designate the Trist Super-Voting Common Stock in the form
attached hereto as Exhibit B-2 to
the Agreement.
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(iii)
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If
approved by Z&Z and Trist, Trist shall complete a short form merger
solely to change Trist’s corporate name to “Atherocare, Inc.” or such
other name as shall be approved by Z&Z and
Trist.
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The
capital structure of Trist resulting from the consummation of the Trist
Reorganization (but not taking into account the Merger or the Capital Raise) is
reflected on Exhibit
B-3 to the Agreement.
EXHIBIT
B-2
Form
of Certificate of Designations
To be
agreed among the parties prior to the Closing.
EXHIBIT
B-3
Trist
Reorganization Capital Structure
EXHIBIT
C
Form
of Certificate of Merger
EXHIBIT
D
Form
of Z&Z Officer’s Certificate
EXHIBIT
E
Form
of Z&Z Secretary’s Certificate
EXHIBIT
F
Form
of Opinion of Z&Z Counsel
EXHIBIT
G
Form
of Trist Officer’s Certificate
EXHIBIT
H
Form
of Trist Secretary’s Certificate
EXHIBIT
I
Voting
Agreement
EXHIBIT
J
Certificate
of Incorporation of Surviving Corporation
EXHIBIT
K
Post-Closing
Trist Capital Structure