AGREEMENT AND PLAN OF MERGER
by and among
WorldCast Interactive, Inc.
ConvergIT, Inc.
Cable Tech, Inc.
and
Lyncs Technologies, Inc.
May 8, 2000
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger, dated as of May 8, 2000 ("Agreement"), is
made and entered into by and among WorldCast Interactive, Inc., a Florida
corporation ("WorldCast"), its wholly owned subsidiary, ConvergIT, Inc., a
Florida corporation ("ConvergIT"), Cable Tech, Inc., a California corporation
("Cable Tech"), and its wholly owned subsidiary and Lyncs Technologies, Inc.,
California corporation, ("Lyncs Technologies").
RECITALS
WorldCast Interactive, Inc., is a Florida corporation with offices located at
00000 Xxxxx Xxxx 0, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000. WorldCast is a public
corporation traded on the NASDAQ OTC exchange under the trading symbol "WRCI."
WorldCast was formerly known as FutureTrak International, Inc., and its stock
traded on NASDAQ OTC under the trading symbol "FTRK."
ConvergIT, Inc., is a Florida corporation and is a wholly owned subsidiary of
WorldCast with offices located at 00000 Xxxxx Xxxx 0, Xxxxx 000, Xxxx Xxxxx,
Xxxxxxx 00000. The shares of ConvergIT are not traded on any public exchange.
Cable Tech, Inc., is a California corporation with offices located at 0000
Xxxxxxxx Xxxxxx, Xxxxx X, Xxx Xxxx, Xxxxxxxxxx 00000. Cable Tech is a closely
held, private corporation. The shares of Cable Tech are not traded on any public
exchange.
Lyncs Technologies, Inc., is a California corporation and a wholly owned
subsidiary of Cable Tech with offices located at 0000 Xxxxxxxx Xxxxxx, Xxxxx X,
Xxx Xxxx, Xxxxxxxxxx 00000. Lyncs Technologies is a closely held, private
corporation. The shares of Lyncs Technologies are not traded on any public
exchange.
WorldCast, ConvergIT, Cable Tech and Lyncs Technologies agree that on the
effective date of the merger stated in this Agreement, ConvergIT, Cable Tech and
Lyncs Technologies shall be merged into a single corporation, ConvergIT, which
surviving corporation shall remain a wholly owned subsidiary of WorldCast. Cable
Tech shall continue to exist as a distinct corporation after the merger and
shall be a wholly owned subsidiary of ConvergIT. Lyncs Technologies shall cease
to exist as a separate corporation and its business operations shall inure to
ConvergIT. ConvergIT shall succeed to all of the rights and property of Lyncs
Technologies and shall be subject to all the debts and liabilities of Lyncs
Technologies in the same manner as if ConvergIT had incurred them. The terms and
conditions of the merger are as stated in this Agreement.
WorldCast, ConvergIT, Cable Tech and Lyncs Technologies adopt this Agreement as
a plan of reorganization pursuant to Section IRC 368(a)(1)(E) that qualifies for
an election pursuant to IRC Section 338.
The respective Boards of Directors of WorldCast, ConvergIT, Cable Tech and Lyncs
Technologies Board of Directors have adopted resolutions approving and adopting
the proposed merger ("Merger") upon the terms and conditions hereinafter set
forth in this Agreement.
In consideration of the foregoing premises, the representations, warranties and
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and subject to the
conditions set forth herein, the parties agree as follows:
ARTICLE 1
THE MERGER
1.1 The Merger.
Subject to the terms and conditions of this Agreement, at the Effective Date (as
hereinafter defined), Cable Tech, and its wholly owned subsidiary Lyncs
Technologies, shall be merged with and into ConvergIT. Cable Tech shall continue
to exist as a California corporation and shall be a wholly owned subsidiary of
ConvergIT. The separate corporate existence of Lyncs Technologies shall cease
and its business operations shall inure to ConvergIT. ConvergIT shall acquire
all of the rights and property of Lyncs Technologies and shall be subject to all
the debts and liabilities of Lyncs Technologies in the same manner as if
ConvergIT had incurred them. ConvergIT shall be the surviving corporation in the
Merger (sometimes referred to in this Agreement as "Surviving Corporation"). The
Merger shall have the effects set forth in the applicable provisions of the
California Corporations Code ("Ca. Corp. Code"), the Florida Business
Corporation Act (the "FBCA") and the applicable provisions of state and federal
tax law. ConvergIT shall continue to be a wholly owned subsidiary of WorldCast.
1.2 Closing.
The closing of the Merger ("Closing") shall take place at 00000 Xxxxx Xxxx 0
Xxxxx 000, Xxxx Xxxxx, XX. 00000 on May 30, 2000, or as soon thereafter as the
conditions set forth in Article 8 have been satisfied or waived ("Closing
Date").
1.3 Effective Date of the Merger.
If all the conditions to the Merger set forth in Article 8 shall have been
satisfied or waived and this Agreement shall not have been terminated, the
parties hereto shall cause Articles of Merger ("Articles of Merger") that comply
with the applicable requirements of the Ca. Corp. Code and the FBCA,
respectively, to be properly executed and filed with the Secretary of State of
the States of California and Florida, respectively, on the Closing Date. The
Merger shall be effective at the time of filing of the Articles of Merger with
the Secretary of State of the States of California and Florida in accordance
with the Ca. Corp. Code and the FBCA, respectively, or at such later time that
the parties shall have agreed upon and designated in such filing as the
Effective Date of the Merger ("Effective Date").
1.4 The Surviving Corporation.
(a) Articles of Incorporation. The Articles of Incorporation of ConvergIT
shall be the Articles of Incorporation of the Surviving Corporation.
(b) Bylaws. The Bylaws of ConvergIT as in effect immediately prior to the
Effective Date shall be the Bylaws of the Surviving Corporation.
(c) Directors and Officers. The directors and officers of ConvergIT
immediately prior to the Effective Date shall be the initial directors and
officers of the Surviving Corporation and shall hold office from the Effective
Date until their respective successors are duly elected or appointed and qualify
in the manner provided in the Articles of Incorporation and Bylaws of the
Surviving Corporation, or as otherwise provided by law.
1.5 Conversion of Shares.
(a) Cable Tech, Inc. Common Stock. At Closing, all of the shares of capital
stock of Cable Tech issued and outstanding immediately prior to the Effective
Date, being 5,000 shares of common stock, shall be automatically converted into
2,667,000 shares of Series A Convertible Preferred Stock of WorldCast, par value
$0.001 per share ("WorldCast Preferred Stock").
(b) Lyncs Technologies Common Stock. At Closing, all of the shares of
capital stock of Lyncs Technologies issued and outstanding immediately prior to
the Effective Date, being 40,000 shares of common stock, shall be cancelled
without consideration and cease to be outstanding.
1.6 Stock Certificates.
At Closing, each holder of an outstanding certificate representing Cable Tech
common stock shall surrender the same to WorldCast. In exchange, WorldCast shall
issue to the holders of such certificates new certificates representing shares
of WorldCast Preferred Stock in accordance with the provisions of Article 8 of
this Agreement.
1.7 Fractional Shares.
No fractional shares of WorldCast Preferred Stock shall be issued in the Merger.
In the event that a holder of Cable Tech common stock would otherwise be
entitled to receive any fractional shares of WorldCast Preferred Stock as a
result of the Merger, such holder shall be entitled to receive one full share in
lieu thereof.
1.8 Dissenting Shares.
Each share of Cable Tech common stock issued and outstanding immediately prior
to Closing not voted in favor of the Merger, the holder of which has given
written notice of the exercise of dissenter's rights and has perfected such
rights as required by law, is herein called a "Dissenting Share." Dissenting
Shares shall not be converted into shares of WorldCast Preferred Stock and shall
be entitled only to such rights as are available to such holder pursuant to
applicable law unless the holder thereof shall have withdrawn or forfeited his
dissenter's rights. Each holder of Dissenting Shares shall be entitled to
receive the value of such Dissenting Shares held by him in accordance with the
applicable provisions of law. WorldCast will promptly pay to any holder of
Dissenting Shares such amount as such holder shall be entitled to receive in
accordance with the applicable provisions of law. If any holder of Dissenting
Shares shall effectively withdraw or forfeit his dissenter's rights, such
Dissenting Shares shall be converted into shares of WorldCast Preferred Stock in
accordance with Section 1.5 (a) of this Agreement.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF WORLDCAST
WorldCast represents and warrants to Cable Tech and Lyncs Technologies as
follows:
2.1 Organization.
WorldCast is a corporation duly organized, validly existing and in good standing
under the laws of the state of its incorporation, and has the requisite
corporate power to carry on its business as now conducted.
2.2 Capitalization.
The authorized capital stock WorldCast consists of 100,000,000 shares of
WorldCast common stock, the shares issued and outstanding are set forth in the
NOBO Repport
attached hereto as Schedule 2.2(a), and 5,000,000 shares of WorldCast Preferred
Stock, of which no shares are issued and outstanding. At Closing, 4,000,000
shares of WorldCast Preferred Stock will be issued in connection with the
Merger. All issued and outstanding shares of WorldCast common stock are, and all
shares of WorldCast Preferred Stock will, upon issuance, be duly authorized,
validly issued, fully paid, non-assessable and free of preemptive rights. Except
as set forth in Schedule 2.2(b), there are no outstanding or authorized options,
rights, warrants, calls, convertible securities, rights to subscribe, conversion
rights or other agreements or commitments to which WorldCast is a party or which
are binding upon WorldCast providing for the issuance by WorldCast or transfer
by WorldCast, of additional shares of its capital stock and WorldCast has not
reserved any shares of its capital stock for issuance, nor are there any
outstanding stock option rights, phantom equity or similar rights, contracts,
arrangements or commitments. There are no voting trusts or any other agreements
or understandings with respect to the voting of WorldCast capital stock.
2.3 Certain Corporate Matters.
WorldCast is duly licensed or qualified to do business and is in good standing
as a foreign corporation in every jurisdiction in which the character of its
properties or the nature of its business requires it to be so licensed or
qualified other than such jurisdictions in which the failure to be so licensed
or qualified does not, or insofar as can reasonably be foreseen, have a material
adverse effect on its financial condition, results of operations or business.
WorldCast has full corporate power and authority and all authorizations,
licenses and permits necessary to carry on the business in which it is engaged
or in which it proposes presently to engage and to own and use the properties
owned and used by it. WorldCast has delivered to Cable Tech true, accurate and
complete copies of its Articles of Incorporation and Bylaws as filed under 10SB
on December 30, 1999, which reflect all restatements of and amendments made
thereto at any time prior to the date of this Agreement. WorldCast is not in
default under or in violation of any provision of its Articles of Incorporation
or Bylaws in any material respect. WorldCast is not in any material default or
in violation of any restriction, lien, encumbrance, indenture, contract, lease,
sublease or other obligation or liability by which it is bound or to which any
of its assets is subject.
2.4 Authority Relative to this Agreement.
WorldCast has the requisite corporate power and authority to enter into this
Agreement and carry out its obligations hereunder. The execution, delivery and
performance of this Agreement by WorldCast and the consummation of the
transactions contemplated hereby have been duly authorized by its Board of
Directors and no other actions on the part of WorldCast are necessary to
authorize this Agreement or the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by WorldCast and constitutes a
valid and binding obligation of WorldCast enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights generally or
by general principles of equity.
2.5 Consents and Approvals; No Violations.
Except for applicable requirements of federal securities laws and state
securities or blue sky laws, no filing with, and no permit, authorization,
consent or approval of, any third party, public body or authority is necessary
for the consummation by WorldCast of the transactions contemplated by this
Agreement. Neither the execution and delivery of this Agreement by WorldCast nor
the consummation by WorldCast of the transactions contemplated hereby, nor
compliance by WorldCast with any of the provisions hereof, will (a) conflict
with or result in any material breach of any provisions of the Articles of
Incorporation or Bylaws of WorldCast (b) result in a material violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
material default (or give rise to any right of termination, cancellation or
acceleration) under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, contract or agreement or other instrument or
obligation to which WorldCast is a party or by which it or any of its properties
or assets may be bound or (c) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to WorldCast, or any of its properties or
assets, except in the case of clauses (b) and (c) for violations, breaches or
material defaults which are not in the aggregate material to WorldCast, taken as
a whole.
2.6 Subsidiaries.
ConvergIT is a wholly owned subsidiary of WorldCast. WorldCast does not
otherwise own, directly or indirectly, any of the capital stock of any other
corporation or any equity, profit sharing, participation or other interest in
any corporation, partnership, joint venture or other entity, except as specified
in Schedule 2.3.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF CONVERGIT
ConvergIT represents and warrants to Cable Tech and Lyncs Technologies as
follows:
3.1 Organization.
ConvergIT is a corporation duly organized, validly existing and in good standing
under the laws of the state of its incorporation, and has the requisite
corporate power to carry on its business as now conducted.
3.2 Capitalization.
The authorized capital stock ConvergIT consists of 100,000,000 shares of
ConvergIT common stock, of which 100,000 shares are issued and outstanding, and
50,000,000 shares of ConvergIT preferred stock, of which no shares are issued
and outstanding. All issued and outstanding shares of ConvergIT common stock are
duly authorized, validly issued, fully paid, non-assessable and free of
preemptive rights. Except as set forth in Schedule 3.2, there are no outstanding
or authorized options, rights, warrants, calls,
convertible securities, rights to subscribe, conversion rights or other
agreements or commitments to which ConvergIT is a party or which are binding
upon ConvergIT providing for the issuance by ConvergIT or transfer by ConvergIT,
of additional shares of its capital stock and ConvergIT has not reserved any
shares of its capital stock for issuance, nor are there any outstanding stock
option rights, phantom equity or similar rights, contracts, arrangements or
commitments. There are no voting trusts or any other agreements or
understandings with respect to the voting of ConvergIT capital stock.
3.3 Certain Corporate Matters.
ConvergIT is duly licensed or qualified to do business and is in good standing
as a foreign corporation in every jurisdiction in which the character of its
properties or the nature of its business requires it to be so licensed or
qualified other than such jurisdictions in which the failure to be so licensed
or qualified does not, or insofar as can reasonably be foreseen, have a material
adverse effect on its financial condition, results of operations or business.
ConvergIT has full corporate power and authority and all authorizations,
licenses and permits necessary to carry on the business in which it is engaged
or in which it proposes presently to engage and to own and use the properties
owned and used by it. ConvergIT has delivered to Cable Tech true, accurate and
complete copies of its Articles of Incorporation and Bylaws, which reflect all
restatements of and amendments made thereto at any time prior to the date of
this Agreement. ConvergIT is not in default under or in violation of any
provision of its Articles of Incorporation or Bylaws in any material respect.
ConvergIT is not in any material default or in violation of any restriction,
lien, encumbrance, indenture, contract, lease, sublease or other obligation or
liability by which it is bound or to which any of its assets is subject.
3.4 Authority Relative to this Agreement.
ConvergIT has the requisite corporate power and authority to enter into this
Agreement and carry out its obligations hereunder. The execution, delivery and
performance of this Agreement by ConvergIT and the consummation of the
transactions contemplated hereby have been duly authorized by its Board of
Directors and no other actions on the part of ConvergIT are necessary to
authorize this Agreement or the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by ConvergIT and constitutes a
valid and binding obligation of ConvergIT enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights generally or
by general principles of equity.
3.5 Consents and Approvals; No Violations.
Except for applicable requirements of federal securities laws and state
securities or blue sky laws, no filing with, and no permit, authorization,
consent or approval of, any third party, public body or authority is necessary
for the consummation by ConvergIT of the transactions contemplated by this
Agreement. Neither the execution and delivery of this Agreement by ConvergIT nor
the consummation by ConvergIT of the transactions
contemplated hereby, nor compliance by ConvergIT with any of the provisions
hereof, will (a) conflict with or result in any material breach of any
provisions of the Articles of Incorporation or Bylaws of ConvergIT (b) result in
a material violation or breach of, or constitute (with or without due notice or
lapse of time or both) a material default (or give rise to any right of
termination, cancellation or acceleration) under, any of the terms, conditions
or provisions of any note, bond, mortgage, indenture, license, contract or
agreement or other instrument or obligation to which ConvergIT is a party or by
which it or any of its properties or assets may be bound or (c) violate any
order, writ, injunction, decree, statute, rule or regulation applicable to
ConvergIT, or any of its properties or assets, except in the case of clauses (b)
and (c) for violations, breaches or material defaults which are not in the
aggregate material to ConvergIT, taken as a whole.
3.6 Subsidiaries.
Except as specified in Schedule3.6, ConvergIT does not own, directly or
indirectly, any of the capital stock of any other corporation or any equity,
profit sharing, participation or other interest in any corporation, partnership,
joint venture or other entity.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
CABLE TECH
Cable Tech hereby represents and warrants to WorldCast and ConvergIT as follows:
4.1 Organization.
Cable Tech is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation, and has the requisite
corporate power to carry on its business as now conducted.
4.2 Capitalization.
The authorized capital stock Cable Tech consists of 1,000,000 shares of Cable
Tech common stock, of which 5,000 shares are issued and outstanding. All issued
and outstanding shares of Cable Tech common stock are duly authorized, validly
issued, fully paid, non-assessable and free of preemptive rights. Except as set
forth in Schedule 4.2, there are no outstanding or authorized options, rights,
warrants, calls, convertible securities, rights to subscribe, conversion rights
or other agreements or commitments to which Cable Tech is a party or which are
binding upon Cable Tech providing for the issuance by Cable Tech or transfer by
Cable Tech, of additional shares of its capital stock and Cable Tech has not
reserved any shares of its capital stock for issuance, nor are there any
outstanding stock option rights, phantom equity or similar rights, contracts,
arrangements or commitments. There are no voting trusts or any other agreements
or understandings with respect to the voting of Cable Tech capital stock.
4.3 Certain Corporate Matters.
Cable Tech is duly licensed or qualified to do business and is in good standing
as a foreign corporation in every jurisdiction in which the character of its
properties or the nature of its business requires it to be so licensed or
qualified other than such jurisdictions in which the failure to be so licensed
or qualified does not, or insofar as can reasonably be foreseen, have a material
adverse effect on its financial condition, results of operations or business.
Cable Tech has full corporate power and authority and all authorizations,
licenses and permits necessary to carry on the business in which it is engaged
or in which it proposes presently to engage and to own and use the properties
owned and used by it. Cable Tech has delivered to Cable Tech true, accurate and
complete copies of its Articles of Incorporation and Bylaws which reflect all
restatements of and amendments made thereto at any time prior to the date of
this Agreement. Cable Tech is not in default under or in violation of any
provision of its Articles of Incorporation or Bylaws in any material respect.
Cable Tech is not in any material default or in violation of any restriction,
lien, encumbrance, indenture, contract, lease, sublease or other obligation or
liability by which it is bound or to which any of its assets is subject.
4.4 Authority Relative to this Agreement.
Cable Tech has the requisite corporate power and authority to enter into this
Agreement and carry out its obligations hereunder. The execution, delivery and
performance of this Agreement by Cable Tech and the consummation of the
transactions contemplated hereby have been duly authorized by its Board of
Directors and no other actions on the part of Cable Tech are necessary to
authorize this Agreement or the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Cable Tech and constitutes a
valid and binding obligation of Cable Tech enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights generally or
by general principles of equity.
4.5 Consents and Approvals; No Violations.
Except for applicable requirements of federal securities laws and state
securities or blue sky laws, no filing with, and no permit, authorization,
consent or approval of, any third party, public body or authority is necessary
for the consummation by Cable Tech of the transactions contemplated by this
Agreement. Neither the execution and delivery of this Agreement by Cable Tech
nor the consummation by Cable Tech of the transactions contemplated hereby, nor
compliance by Cable Tech with any of the provisions hereof, will (a) conflict
with or result in any material breach of any provisions of the Articles of
Incorporation or Bylaws of Cable Tech (b) result in a material violation or
breach of, or
constitute (with or without due notice or lapse of time or both) a material
default (or give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract or agreement or other instrument or obligation to
which Cable Tech is a party or by which it or any of its properties or assets
may be bound or (c) violate any order, writ, injunction, decree, statute, rule
or regulation applicable to Cable Tech, or any of its properties or assets,
except in the case of clauses (b) and (c) for violations, breaches or material
defaults which are not in the aggregate material to Cable Tech, taken as a
whole.
4.6 Subsidiaries.
Lyncs Technologies is a wholly owned subsidiary of Cable Tech. Cable Tech does
not otherwise own, directly or indirectly, any of the capital stock of any other
corporation or any equity, profit sharing, participation or other interest in
any corporation, partnership, joint venture or other entity, except as specified
in Schedule 4.6.
4.7 Financial Statements.
Cable Tech has delivered to WorldCast management prepared financial reports for
fiscal years 1998-99, 1997-98, 1997-96 and 1996-95, reviewed financial
statements for fiscal years 1998-99 and 1997-98 and audited financial statements
for fiscal year 1998-99 (collectively, the "Financial Statements"). Except for
the management prepared financial reports, the Financial Statements have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods covered thereby and accurately
present the financial condition of Cable Tech as of such dates.
4.8 Events Subsequent to Financial Statements.
Since February 29, 2000, there has not been:
(a) Any material adverse change in the financial condition, results of
operations or business of Cable Tech;
(b) Any sale, lease, transfer, license or assignment of any assets,
tangible or intangible, of Cable Tech;
(c) Any damage, destruction or property loss, whether or not covered by
insurance, affecting adversely the properties or business of Cable Tech;
(d) Any declaration or setting aside or payment of any dividend or
distribution with respect to the shares of capital stock of Cable Tech or any
redemption, purchase or other acquisition of any such shares;
(e) Any subjection to any lien on any of the assets, tangible or
intangible, of Cable Tech;
(f) Any incidence of indebtedness or liability or assumption of obligations
by Cable Tech;
(g) Any waiver or release by Cable Tech of any right of any material value;
(h) Any compensation or benefits paid to officers or directors of Cable
Tech;
(i) Any change made or authorized in the Articles of Incorporation or
Bylaws of Cable Tech; or
(j) Any loan to or other transaction with any officer, director or
shareholder of Cable Tech giving rise to any claim or right of Cable Tech
against any such person or of such person against Cable Tech.
4.9 Undisclosed Liabilities.
Other than as stated in the Financial Statements, Cable Tech has no material
liability or obligation whatsoever, direct or indirect, matured or immature,
accrued, absolute, contingent or otherwise.
4.10 Tax Matters.
(a) Except as set forth on Schedule 4.10, Cable Tech has (and as of the
Closing Date will have) duly filed all federal, state, local and foreign tax
returns required to be filed by or with respect to it with the Internal Revenue
Service or other applicable taxing authority, and no extensions with respect to
such tax returns have (or as of the Closing Date will have) been requested or
granted;
(b) Cable Tech has (and as of the Closing Date will have) paid, or
adequately reserved against in the Financial Statements, all material taxes due,
or claimed by any taxing authority to be due, from or with respect to it;
(c) To the best knowledge of Cable Tech there has been no issue raised or
adjustment proposed (and none is pending) by the Internal Revenue Service or any
other taxing authority in connection with any of the tax returns;
(d) No waiver or extension of any statute of limitations as to any federal,
state, local or foreign tax matter has been given by or requested from Cable
Tech; and
(e) Cable Tech has not filed a consent under Section 341(f) of the Internal
Revenue Code of 1986, as amended.
For the purposes of this Section 4.10, a tax is due (and must therefore either
be paid or adequately reserved against in the Financial Statements) only on the
last date payment of such tax can be made without interest or penalties, whether
such payment is due in respect of estimated taxes, withholding taxes, required
tax credits or any other tax.
4.11 Real Property.
Cable Tech does not own any real property.
4.12 Books and Records.
The books and records of Cable Tech accurately reflect the transactions to which
Cable Tech is a party or by which its properties are bound.
4.13 Questionable Payments.
Neither Cable Tech nor any employee, agent or representative has, directly or
indirectly, made any bribes, kickbacks, illegal payments or illegal political
contributions using Cable Tech funds or made any payments from Cable Tech funds
to governmental officials for improper purposes or made any illegal payments
from Cable Tech funds to obtain or retain business.
4.14 Environmental Matters.
(a) Definitions. For the purpose of this Agreement, the following terms
shall have the meaning herein specified:
(i) "Governmental Authority" shall mean the United States, each state, each
county, each city and each other political subdivision in which Cable Tech's
business is located, and any court, political subdivision, agency or
instrumentality with jurisdiction over Cable Tech's business.
(ii) "Environmental Laws" shall mean (A) the Comprehensive Environmental
Response Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 U.S.C.A. 9601 et seq. ("CERCLA"),
(B) the Resource Conservation and Recovery Act, as amended by the Hazardous and
Solid Waste Amendment of 1984, 42 U.S.C.A. 6901 et seq. ("RCRA"), (C) the Clean
Air Act, 42 U.S.C.A. 7401 et seq., (D) the Federal Water Pollution Control Act,
as amended, 33 U.S.C.A. 1251 et seq., (E) the Toxic Substances Control Act, 15
U.S.C.A. 2601 et seq., (F) all applicable state laws, and (G) all other laws and
ordinances relating to municipal waste, solid waste, air pollution, water
pollution and/or the handling, discharge, disposal or recovery of on-site or
off-site hazardous substances or materials, as each of the foregoing has been or
may hereafter be amended from time to time.
(iii) "Hazardous Materials" shall mean, among others, (A) any "hazardous waste"
as defined by RCRA, and regulations promulgated thereunder; (B) any "hazardous
substance" as defined by CERCLA, and regulations promulgated thereunder; (C) any
"toxic pollutant" as defined in the Federal Water Pollution Prevention and
Control Act, as amended, 33 U.S.C. 1251 et seq., (commonly known as "CWA" for
"Clean Water Act"), and any regulations thereunder; (D) any "hazardous air
pollutant" as defined in the Air Pollution Prevention and Control Act, as
amended, 42 U.S.C. 7401 et seq. (commonly known as "CAA" for "Clean Air Act")
and any regulations thereunder; (E) asbestos; (F) polychlorinated biphenyls; (G)
any substance the presence of which on the Business Location (as hereinafter
defined) is prohibited by any Environmental Laws; and (H) any other substance
which is regulated by any Environmental Laws.
(iv) "Hazardous Materials Contamination" shall mean the presence of Hazardous
Materials in the soil, groundwater, air or any other media regulated by the
Environmental Laws on, under or around Cable Tech facilities at levels or
concentration which trigger any requirement under the Environmental Laws to
remove, remedy, mitigate, xxxxx or otherwise reduce the level or concentration
of the Hazardous Materials. The term "Hazardous Materials Contamination" does
not include the presence of Hazardous Materials in process tanks, lines, storage
or reactor vessels, delivery trucks or any other equipment or containers, which
Hazardous Materials are used in the manufacture, processing, distribution, use,
storage, sale, handling, transportation, recycling, reuse or disposal of the
products that were manufactured and/or distributed by Cable Tech.
(b) Representations and Warranties. Based on the foregoing, Cable Tech
represents and warrants that:
(i) To the best knowledge of Cable Tech, there has been no material failure by
Cable Tech to comply with all applicable requirements of Environmental Laws
relating to EPA, Cable Tech operations, and its manufacture, processing,
distribution, use, treatment, generation, recycling, reuses, sale, storage,
handling, transportation or disposal of any Hazardous Material and Cable Tech is
not aware of any facts or circumstances which could materially impair such
compliance with all applicable Environmental Laws.
(ii) Cable Tech through the Closing Date, has not received notice from any
Governmental Authority or any other person of any actual or alleged violation of
any Environmental Laws, nor is any such notice anticipated.
(iii) Prior to the Closing Date, Cable Tech will not do or permit anything that
will cause Cable Tech to be in material violation of any requirements of
Environmental Laws, or do or permit a violation of Environmental Laws that would
materially and adversely affect the financial condition of Cable Tech or subject
Cable Tech to any enforcement actions under any Environmental Laws.
(iv) Environmental Laws do not require that any permits, licenses or similar
authorizations to construct, occupy or operate any equipment or facilities used
in the conduct of Cable tech's business.
(v) No Hazardous Materials are now located at the business location, Cable Tech
has not ever caused or permitted any Hazardous Materials to be generated,
placed, stored, held, handled, located or used at the business location, except
those which may lawfully be used, transported, stored, held, handled, generated
or placed at the business location in the conduct of Cable Tech business.
(vi) Cable Tech has not received any notices, whether from a Governmental
Authority or some other third party, that Hazardous Material Contamination
exists at the Business Location or at any other location utilized by Cable Tech
in the conduct of its business nor is Cable Tech aware of any circumstances that
would give rise to an allegation of such contamination.
(vii) No investigation, administrative order, consent order or agreement,
litigation or settlement with respect to Hazardous Materials or Hazardous
Materials Contamination is proposed, threatened, anticipated, pending or
otherwise in existence with respect to the Business Location or with respect to
any other site controlled or utilized by Cable Tech in the operation of its
business. To the best knowledge of Cable Tech, the Business Location is not
currently on, and has never been on, any federal or state "Superfund" or
"Superlien" list.
4.15 Intellectual Property.
Except as set forth on Schedule 4.15, Cable Tech does not own or use any
trademarks, trade-names, service marks, patents, copyrights or any applications
with respect thereto. Cable Tech has no knowledge of any claim that, or inquiry
as to whether, any product, activity or operation of Cable Tech infringes upon
or involves, or has resulted in the infringement of, any trademarks,
trade-names, service marks, patents, copyrights or other proprietary rights of
any other person, corporation or other entity; and no proceedings have been
instituted, are pending or are threatened.
4.16 Insurance.
Cable Tech has delivered to WorldCast management a copy of each insurance policy
in effect.
4.17 Contracts.
Cable Tech has delivered to WorldCast management copies of all material
contracts, leases, arrangements and commitments (whether oral or written) all of
which are briefly described in Schedule 4.17 hereof. Except as set forth in the
Financial Statements or on Schedule 4.17, Cable Tech is not a party to or bound
by or affected by any contract, lease, arrangement or commitment (whether oral
or written) relating to: (a) the employment of any person; (b) collective
bargaining with, or any representation of any employees by, any labor union or
association; (c) the acquisition of services, supplies, equipment or other
personal property; (d) the purchase or sale of real property; (e) distribution,
agency or construction; (f) lease of real or personal property as lessor or
lessee or sublessor or sublessee; (g) lending or advancing of funds; (h)
borrowing of funds or receipt of credit; (i) incurring any obligation or
liability; or (j) the sale of personal property.
4.18 Litigation.
Cable Tech is not subject to any judgment or order of any court or
quasi-judicial or administrative agency of any jurisdiction, domestic or
foreign, nor is there any charge, complaint, lawsuit or governmental
investigation pending against Cable Tech. Cable Tech is not a plaintiff in any
action, domestic or foreign, judicial or administrative. There are no existing
actions, suits, proceedings or investigations of Cable Tech, and Cable Tech does
not know of any basis for such actions, suits, proceedings or investigations.
There are no unsatisfied judgments, orders, decrees or stipulations affecting
Cable Tech or to which Cable Tech is a party.
4.19 Employees.
Cable Tech has provided to WorldCast management a list of all employees of Cable
Tech. Except as specified in Schedule 4.19, Cable Tech does not owe any
compensation of any kind, deferred or otherwise, to any current or previous
employees. Cable Tech has no written or oral employment agreements with any
officer or director of Cable Tech. Cable Tech is a party to and is bound by a
collective bargaining agreement with the Communications Workers of America a
copy of which Cable Tech has provided to WorldCast management. Except as
specified in Schedule 4.19, there are no loans or other obligations payable or
owing by Cable Tech to any shareholder, officer, director or employee of Cable
Tech, nor are there any loans or debts payable or owing by any of such persons
to Tech Cable or any guarantees by Cable Tech of any loan or obligation of any
nature to which any such person is a party.
4.20 Employee Benefit Plans.
Cable Tech has provided to WorldCast management copies of all (a) non-qualified
deferred or incentive compensation or retirement plans or arrangements, (b)
qualified retirement plans or arrangements, (c) other employee compensation,
severance or termination pay or welfare benefit plans, programs or arrangements
or (d) any related trusts, insurance contracts or other funding arrangements
maintained, established or contributed to by Cable Tech.
4.21 Legal Compliance.
No claim has been filed against Cable Tech alleging a violation of any
applicable laws and regulations of foreign, federal, state and local governments
and all agencies thereof. Cable Tech holds all of the material permits,
licenses, certificates or other authorizations of foreign, federal, state or
local governmental agencies required for the conduct of its business as
presently conducted.
4.22 Broker's Fees.
Neither Cable Tech, nor anyone on their behalf has any liability to any broker,
finder, investment banker or agent, or has agreed to pay any brokerage fees,
finder's fees or commissions, or to reimburse any expenses of any broker,
finder, investment banker or agent in connection with this Agreement.
4.23 Disclosure.
The representations and warranties and statements of fact made by Cable Tech in
this Agreement are, as applicable, accurate, correct and complete and do not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements and information contained herein
not misleading.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF
LYNCS TECHNOLOGIES
Lyncs Technologies hereby represents and warrants to WorldCast and ConvergIT as
follows:
5.1 Organization.
Lyncs Technologies is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation, and has the requisite
corporate power to carry on its business as now conducted.
5.2 Capitalization.
The authorized capital stock Lyncs Technologies consists of 1,000,000 shares of
Lyncs Technologies common stock, of which 40,000 shares are issued and
outstanding. All issued and outstanding shares of Lyncs Technologies common
stock are duly authorized, validly issued, fully paid, non-assessable and free
of preemptive rights. Except as set forth in Schedule 5.2, there are no
outstanding or authorized options, rights, warrants, calls, convertible
securities, rights to subscribe, conversion rights or other agreements or
commitments to which Lyncs Technologies is a party or which are binding upon
Lyncs Technologies providing for the issuance by Lyncs Technologies or transfer
by Lyncs Technologies, of additional shares of its capital stock and Lyncs
Technologies has not reserved any shares of its capital stock for issuance, nor
are there any outstanding stock option rights, phantom equity or similar rights,
contracts, arrangements or commitments. There are no voting trusts or any other
agreements or understandings with respect to the voting of Lyncs Technologies
capital stock.
5.3 Certain Corporate Matters.
Lyncs Technologies is duly licensed or qualified to do business and is in good
standing as a foreign corporation in every jurisdiction in which the character
of its properties or the
nature of its business requires it to be so licensed or qualified other than
such jurisdictions in which the failure to be so licensed or qualified does not,
or insofar as can reasonably be foreseen, have a material adverse effect on its
financial condition, results of operations or business. Lyncs Technologies has
full corporate power and authority and all authorizations, licenses and permits
necessary to carry on the business in which it is engaged or in which it
proposes presently to engage and to own and use the properties owned and used by
it. Lyncs Technologies has delivered to WorldCast true, accurate and complete
copies of its Articles of Incorporation and Bylaws as filed under 10SB on
December 30, 1999, which reflect all restatements of and amendments made thereto
at any time prior to the date of this Agreement. Lyncs Technologies is not in
default under or in violation of any provision of its Articles of Incorporation
or Bylaws in any material respect. Lyncs Technologies is not in any material
default or in violation of any restriction, lien, encumbrance, indenture,
contract, lease, sublease or other obligation or liability by which it is bound
or to which any of its assets is subject.
5.4 Authority Relative to this Agreement.
Lyncs Technologies has the requisite corporate power and authority to enter into
this Agreement and carry out its obligations hereunder. The execution, delivery
and performance of this Agreement by Lyncs Technologies and the consummation of
the transactions contemplated hereby have been duly authorized by its Board of
Directors and no other actions on the part of Lyncs Technologies are necessary
to authorize this Agreement or the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by Lyncs Technologies
and constitutes a valid and binding obligation of Lyncs Technologies enforceable
in accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors' rights generally or by general principles of equity.
5.5 Consents and Approvals; No Violations.
Except for applicable requirements of federal securities laws and state
securities or blue sky laws, no filing with, and no permit, authorization,
consent or approval of, any third party, public body or authority is necessary
for the consummation by Lyncs Technologies of the transactions contemplated by
this Agreement. Neither the execution and delivery of this Agreement by Lyncs
Technologies nor the consummation by Lyncs Technologies of the transactions
contemplated hereby, nor compliance by Lyncs Technologies with any of the
provisions hereof, will (a) conflict with or result in any material breach of
any provisions of the Articles of Incorporation or Bylaws of Lyncs Technologies
(b) result in a material violation or breach of, or constitute (with or without
due notice or lapse of time or both) a material default (or give rise to any
right of termination, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract or agreement or other instrument or obligation to which Lyncs
Technologies is a party or by which it or any of its properties or assets may be
bound or (c) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Lyncs Technologies, or any of its properties or assets,
except in the case of clauses (b) and (c) for violations, breaches or material
defaults which are not in the aggregate material to Lyncs Technologies, taken as
a whole.
5.6 Subsidiaries.
Lyncs Technologies does not own, directly or indirectly, any of the capital
stock of any other corporation or any equity, profit sharing, participation or
other interest in any corporation, partnership, joint venture or other entity,
except as specified in Schedule 5.6.
ARTICLE 6
CONDUCT OF BUSINESS PENDING THE CLOSING
6.1 Conduct of Business by Cable Tech Pending the Close
Pending Closing, Cable Tech shall not pay any dividend or other distribution
payable in cash, stock, property or otherwise with respect to shares of its
capital stock; (iv) redeem, purchase or acquire or offer to acquire any shares
of its capital stock or other securities; (v) create any subsidiaries; (vi)
enter into or modify any contract, agreement, commitment or arrangement with
respect to any of the foregoing; (c) Cable Tech shall not, (i) issue, sell,
pledge or dispose of, or agree to issue, sell, pledge or dispose of, any
additional shares of, or any options, warrants, conversion privileges or rights
of any kind to acquire any shares of, its capital stock; (ii) acquire (by
merger, consolidation, acquisition of stock or assets or otherwise) any
corporation, partnership or other business organization or division or the
material assets thereof; (iii) incur any indebtedness for borrowed money, issue
any debt securities or guarantee any indebtedness to others; or (iv) enter into
or modify any contract, agreement, commitment or arrangement with respect to any
of the foregoing;
(d) Cable Tech shall not enter into any employment, severance or similar
agreements or arrangements with, or grant any bonus, salary increase, severance
or termination pay to, any officers or directors;
(e) Cable Tech shall not adopt any bonus, profit sharing, compensation,
stock option, pension, retirement, deferred compensation, employment or other
employee benefit plan, agreement, trust, fund or arrangement for the benefit or
welfare of any employee unless approved by the Board of Directors;
(f) Except as otherwise required by its Articles of Incorporation or
Bylaws, by this Agreement or by applicable law, Cable Tech shall not call any
meeting of shareholders;
(g) Cable Tech shall (i) use its best efforts not to take any action which
would render, or which reasonably may be expected to render, any representation
or warranty made by them in this Agreement untrue at any time prior to the
Closing Date as if then made; and (ii) notify WorldCast of any emergency or
other change in the normal course of its
business or in the operation of its properties and of any tax audits, tax
claims, governmental or third party complaints, investigations or hearings (or
communications indicating that the same may be contemplated) if such emergency,
change, audit, claim, complaint, investigation or hearing would be material,
individually or in the aggregate, to the financial condition, results of
operations or business of Cable Tech, or to the ability of any of the parties
hereto to consummate the transactions contemplated by this Agreement;
(h) Cable Tech shall notify WorldCast promptly of any material adverse
event or circumstance affecting Cable Tech (including the filing of any material
litigation against Cable Tech or the existence of any dispute with any person or
entity which involves a reasonable likelihood of such litigation being
commenced); and
(i) Cable Tech shall comply with all legal requirements and contractual
obligations applicable to its operations and business and pay all applicable
taxes.
6.2 Other Actions.
Unless approved in writing by WorldCast, Cable Tech shall not to take any action
or permit any action to occur that might reasonably be expected to result in any
of the representations and warranties of Cable Tech contained in this Agreement
becoming untrue after the date hereof or any of the conditions to the Closing
set forth in Article 8 of this Agreement not being satisfied.
ARTICLE 7
ADDITIONAL AGREEMENTS
7.1 Access and Information.
Except for information relating to any claims any party may have against the
other, Cable Tech and WorldCast shall each afford to the other and to the
other's financial advisors, legal counsel, accountants, consultants and other
representatives necessary access throughout the period prior to the Closing to
all of its books, records, properties and personnel and, during such period in
order to allow each party to complete its due diligence review, each shall
furnish promptly to the other all information as such other party may reasonably
request. Each party shall hold in confidence all non-public information until
such time as such information is otherwise publicly available and, if this
Agreement is terminated, each party will upon written request deliver to the
other all documents, work papers and other material obtained by such party or on
its behalf from the other party as a result of this Agreement or in connection
herewith, whether so obtained before or after the execution hereof.
7.2 Press Releases.
WorldCast and Cable Tech shall consult with each other as to the form and
substance of any press release or other public disclosure of matters related to
this Agreement or any of
the transactions contemplated hereby; provided, however, that nothing in this
Section 7.2 shall be deemed to prohibit any party hereto from making any
disclosure that is required to fulfill such party's disclosure obligations
imposed by law, including, without limitation, federal securities laws.
ARTICLE 8
CONDITIONS TO CLOSING
8.1 Conditions to Obligations of Each Party to Effect the Closing.
The respective obligations of each party hereto to effect the Closing shall be
subject to fulfillment, on or prior to the Closing Date, of the following
conditions:
(a) The Merger shall have been approved by the shareholders of WorldCast,
ConvergIT, Cable Tech and Lyncs Technologies in accordance with applicable law;
and
(b) No order or injunction shall have been entered and remained in effect
in any action or proceeding before any foreign, federal or state court or
governmental agency or other foreign, federal or state regulatory or
administrative agency or commission that would prevent or make illegal the
consummation of the transactions contemplated hereby.
8.2 Additional Conditions to WorldCast's Obligations.
The obligations of WorldCast to effect the Closing are subject to the
satisfaction of the following additional conditions on or before the Closing
Date:
(a) The representations and warranties set forth in Articles 4 and 5 of
this Agreement will be true and correct in all material respects as of the date
hereof and at and as of the Closing Date as though then made;
(b) Cable Tech shall have performed, in all material respects, each
obligation and agreement and complied with each covenant to be performed by it
under Articles 7 and 8 of this Agreement;
(c) All consents by third party or governmental or regulatory agencies or
otherwise that are required to be obtained by Cable Tech for the consummation of
the transactions contemplated hereby will have been obtained;
(d) No action or proceeding before any court or governmental body will be
pending or threatened wherein a judgment, decree, injunction or order would
prevent any of the transactions contemplated hereby or cause such transactions
to be declared unlawful or rescinded;
(e) WorldCast and its financial and legal representatives shall have
completed a due diligence review of the business, operations and financial
statements of Cable Tech, the results of which shall be satisfactory to
WorldCast in its sole discretion;
(f) WorldCast will have received from Cable Tech Attorney's, an opinion
addressed to WorldCast, dated the Closing Date, in a form mutually satisfactory
to the parties;
(g) Cable Tech shall have received the consent of a majority of its
shareholders to consummate the Merger and shareholders holding an aggregate of
greater than 10% of the issued and outstanding shares of Cable Tech shall not
have exercised dissenters' rights with regard to the Merger as set forth in
Section 1.8 hereof; and
h) At the Closing, Cable Tech shall have delivered to WorldCast the
following:
(i) A certificate executed on behalf of Cable Tech stating that the conditions
set forth in Sections 8.2(a) through (d) of this Agreement have been satisfied;
(ii) Resolutions duly adopted by the Cable Tech Board of Directors authorizing
and approving the Merger and the execution, delivery and performance of this
Agreement;
(iii) Certificates of Good Standing for Cable Tech from the Secretary of State
of the State of California dated not earlier than five days prior to the Closing
Date;
(iv) A copy of the Cable Tech 's Articles of Incorporation (including all
amendments thereof) certified as of a recent date by the Secretary of State of
the State of California;
(v) An incumbency certificate of the officers of Cable Tech; and
(vi) Such other documents as WorldCast may reasonably request in connection with
the transactions contemplated hereby.
8.3 Additional Conditions to the Obligations of.
The obligations of Cable Tech to effect the Closing are subject to the
satisfaction of the following conditions on or before the Closing Date:
(a) The representations and warranties set forth in Articles 2 and 3 of
this Agreement will be true and correct in all material respects as of the date
hereof and at and as of the Closing Date as though then made;
(b) WorldCast shall have performed, in all material respects, each
obligation and agreement and complied with each covenant required to be
performed and complied with by them under Articles 7 and 8 of this Agreement
prior to the Closing Date;
(c) All consents by any third party or governmental or regulatory agencies
or otherwise that are required to be obtained by WorldCast for the consummation
of the transactions contemplated hereby will have been obtained.
(d) No action or proceeding before any court or governmental body will be
pending or threatened wherein a judgment, decree, injunction or order would
prevent any of the transactions contemplated hereby or cause such transactions
to be declared unlawful or rescinded;
(e) Cable Tech and its financial and legal representatives shall have
completed a due diligence review of the business, operations and financial
statements of WorldCast, the results of which shall be satisfactory to Cable
Tech in their sole discretion;
(f) Cable Tech shall have received from Atlas, Xxxxxxxx, Trop & Borkson,
counsel to WorldCast, an opinion addressed to Cable Tech, dated the Closing
Date, in a form mutually satisfactory to the parties;
(g) WorldCast shall have designated 2,667,000 shares of its authorized
5,000,000 shares of preferred stock as Series A Convertible Preferred Stock. The
Series A Convertible Preferred Stock shall have the following rights,
preferences, privileges and restrictions ("RPP&R") in addition to such standard
RPP&R as are typically characteristic of convertible preferred shares: (a) The
Series A Convertible Preferred Stock shall be convertible into WorldCast common
stock at a ratio of one Series A Convertible Preferred Stock share for one and
one-half WorldCast common stock shares (1:1.5 ratio of preferred to common).
Conversion rights may be exercised on a semi-annual, calendar year basis,
commencing no earlier than the 90th day after Closing, at the discretion of each
Series A Convertible Preferred Stock shareholder. (b) Commencing no earlier than
the third anniversary of the Closing Date, the holders of Series A Convertible
Preferred Stock shall have a put option to subject any unconverted shares to
redemption by WorldCast at a price of $3.00 per share, adjusted to reflect a
price increase of 10% per annum, compounded daily. (c) The unconverted shares of
Series A Convertible Preferred Stock shall be non-voting shares.
(h) WorldCast shall have issued 2,506,980 shares of Series A Convertible
Preferred Stock to Xxxxxx X. Xxxxxxx, Xx. and Xxxxx X. Xxxxxxx, Trustees,
Perrins Revocable Trust ("Perrins"), in exchange for 4,700 shares of the issued
and outstanding shares of the common stock of Cable Tech (94% of the total
capital stock).
(i) WorldCast shall have issued 160,020 shares of Series A Convertible
Preferred Stock to Xxxxx X. Xxxx ("Roux") in exchange for 300 shares of the
issued and outstanding shares of the common stock of Cable Tech (6% of the total
capital stock).
(j) Any and all shares of Series A Convertible Preferred Stock converted to
common stock by Perrins and/or Roux shall be registered in accordance with
Securities Exchange Commission (SEC) Rule 144 promulgated under the Securities
Exchange Act of 1933, as amended.
(k) At each exercise period, WorldCast shall have first "Rights of
Acceptance or Refusal" for a 60-day period to acquire any shares offered for
sale by Perrins or Roux or to facilitate the placement of such shares with a
third party. However, WorldCast shall not be party to gain any financial gain
because of the exercise of such rights of acceptance or refusal.
(l) WorldCast shall enable Perrins to file and perfect a UCC1 Financing
Statement creating a security interest in assets of WorldCast, ConvergIT, Cable
Tech and Lyncs Technologies as protection against payment default. Upon
satisfaction of its payment, the UCC1 shall be released and revoked.
(m) WorldCast shall refinance and relieve Perrins from any and all
"Personal Guarantees" (PG) signed on behalf of Cable Tech or Lyncs Technologies,
which are estimated at $1,300,000, of which $438,000 is a loan repayment to
Perrins.
(n) At Closing, Xxxxxx X. Xxxxxxx, Xx., will resign as an Officer and
Director of Cable Tech and Lyncs Technologies. Concurrently, WorldCast will
enter into a consulting agreement with Perrins Management Corporation for a
minimum term of 2 years, upon mutually acceptable terms and conditions.
(o) WorldCast shall elect new board of directors comprised of the following
individuals:
Xxxxx Xxxxxx, Ph. D.
Xxxxx X. Xxxx, X.X.
Xxx Xxxxxx
(p) WorldCast shall elect the following individual as an advisor to the
Board of Directors:
Xxxx Xxxxxxx
(q) WorldCast will enter into an employment agreement with Xxxxx Xxxx, upon
mutually acceptable terms and conditions, providing for his services as
President of ConvergIT and Cable Tech.
(r) WorldCast will establish an Employee Stock Option Plan to provide
incentive stock options for employees of ConvergIT and Cable Tech to acquire
WorldCast common stock.
(s) On the Closing Date, WorldCast shall have delivered to Cable Tech the
following:
(i) a certificate executed on behalf of WorldCast stating that the conditions
set forth in Sections 8.3(a) through (d) of this Agreement have been satisfied;
(ii) resolutions duly adopted by WorldCast's Board of Directors authorizing
and approving the Merger and the execution, delivery and performance of this
Agreement;
(iii) a good standing certificate for WorldCast from the Secretary of State of
the State of Florida, dated not earlier than five days prior to the Closing
Date;
(iv) a copy of WorldCast's Articles of Incorporation (including amendments
thereto) certified by the Secretary of State of the State of Florida;
(v) an incumbency certificate of the officers of WorldCast; and
(vi) such other documents as Cable Tech may reasonably request in connection
with the transactions contemplated hereby.
ARTICLE 9
TERMINATION
9.1 Termination by Mutual Consent.
This Agreement may be terminated at any time prior to the Closing by the mutual
consent of the parties hereto.
9.2 Termination by Any Party.
This Agreement may be terminated by any party hereto if a United States federal
or state court of competent jurisdiction or United States federal or state
governmental, regulatory or administrative agency or commission shall have
issued an order, decree or ruling or taken any other action permanently
restraining, enjoining or otherwise prohibiting the transactions contemplated by
this Agreement and such order, decree, ruling or other action shall have become
final and non-appealable; provided, however, that the party seeking to terminate
this Agreement pursuant to this clause shall have used all reasonable efforts to
remove such injunction, order or decree. This Agreement may be terminated by any
party hereto if the condition set forth in Section 8.2 (g) is not met as of the
date of the shareholders' meeting contemplated by Section 8.1 (a).
9.3 Material Breach.
This Agreement may be terminated if there has been a material breach of this
Agreement and such breach has not been cured by the alleged breaching party
within 30 days of receipt of written notice from a non-breaching party detailing
such breach.
9.4 Effect of Termination.
In the event of termination of this Agreement pursuant to this Article 9, all
obligations of the parties hereto shall terminate, except the obligations of the
parties pursuant to Section 8.1.
ARTICLE 10
GENERAL PROVISIONS
10.1 Notices.
All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if delivered personally, sent by overnight
courier or mailed by registered or certified mail (postage prepaid and return
receipt requested) to the party to whom the same is so delivered, sent or mailed
at the following addresses (or at such other address for a party as shall be
specified by like notice):
If to WorldCast or ConvergIT:
WorldCast Interactive
00000 Xxxxx Xxxx 0, Xxxxx 000
Xxxx Xxxxx, XX. 33498
If to Cable Tech or Lyncs Technologies:
Cable Tech, Inc.
0000-X Xxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
10.2 Interpretation.
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.
References to Sections and Articles refer to sections and articles of this
Agreement unless otherwise stated.
10.3 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated and the parties shall negotiate in good faith to modify this
Agreement to preserve each party's anticipated benefits under this Agreement.
10.4 Miscellaneous.
This Agreement (together with all other documents and instruments referred to
herein): (a) constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof; (b) except as expressly set forth herein,
is not intended to confer upon any other person any rights or remedies hereunder
and (c) shall not be assigned by operation of law or otherwise, except as may be
mutually agreed upon by the parties hereto.
10.5 Separate Counsel.
Each party hereby expressly acknowledges that it has been advised and urged to
seek its own separate legal counsel for advice with respect to this Agreement.
10.6 Governing Law.
This Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the State of California, without regard to conflicts or choice
of law provisions of the State of California.
10.7 Counterparts.
This Agreement may be executed in two or more counterparts, which together shall
constitute a single agreement.
10.8 Amendment.
This Agreement may be amended, modified or supplemented only by an instrument in
writing executed by all parties hereto.
10.9 Parties In Interest: No Third Party Beneficiaries.
Except as otherwise provided herein, the terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective heirs, legal
representatives, successors and assigns of the parties hereto. This Agreement
shall not be deemed to confer upon any person not a party hereto any rights or
remedies hereunder.
10.10 Expenses.
Except as may be otherwise provided in the Consulting Agreement described above,
the parties hereto shall pay all of their own expenses relating to the
transactions contemplated by this Agreement, including, without limitation, the
fees and expenses of their respective counsel and financial advisers.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
WORLDCAST INTERACTIVE, INC.
By: /s/ Xxxxx Xxxxxx
------------------------------------
Xxxxx Xxxxxx, Ph.D. C.D.P.
Interim Chairman, CEO
ConvergIT, Inc.
By: /s/ Xxxxx Xxxxxx
------------------------------------
Xxxxx Xxxxxx, Ph.D.
President
Cable Tech, Inc.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
------------------------------------
Xxxxxx X. Xxxxxxx, Xx.,
Chairman, CEO
By: /s/ Xxxxx X. Xxxx
------------------------------------
Xxxxx X. Xxxx,
President
Lyncs Technologies, Inc.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
------------------------------------
Xxxxxx X. Xxxxxxx, Xx.,
Chairman, CEO
By: /s/ Xxxxx X. Xxxx
------------------------------------
Xxxxx X. Xxxx,
President
ARTICLE/SECTION PAGE
RECITALS 1
ARTICLE 1.....................................................................2
THE MERGER....................................................................2
1.1 The Merger.........................................................2
1.2 Closing............................................................2
1.3 Effective Date of the Merger.......................................3
1.5 Conversion of Shares...............................................3
1.6 Stock Certificates.................................................3
1.7 Fractional Shares..................................................4
1.8 Dissenting Shares..................................................4
ARTICLE 2.....................................................................4
REPRESENTATIONS AND WARRANTIES OF WORLDCAST...................................4
2.1 Organization.......................................................4
2.2 Capitalization.....................................................4
2.3 Certain Corporate Matters..........................................5
2.4 Authority Relative to this Agreement...............................5
2.5 Consents and Approvals; No Violations..............................6
2.6 Subsidiaries.......................................................6
ARTICLE 3.....................................................................6
REPRESENTATIONS AND WARRANTIES OF CONVERGIT...................................6
3.1 Organization.......................................................6
3.2 Capitalization.....................................................6
3.3 Certain Corporate Matters..........................................7
3.4 Authority Relative to this Agreement...............................7
3.5 Consents and Approvals; No Violations..............................7
3.6 Subsidiaries.......................................................8
ARTICLE 4.....................................................................8
REPRESENTATIONS AND WARRANTIES OF.............................................8
CABLE TECH....................................................................8
4.1 Organization.......................................................8
4.2 Capitalization.....................................................8
4.3 Certain Corporate Matters..........................................9
4.4 Authority Relative to this Agreement...............................9
4.5 Consents and Approvals; No Violations..............................9
4.6 Subsidiaries......................................................10
4.7 Financial Statements..............................................10
4.8 Events Subsequent to Financial Statements.........................10
4.9 Undisclosed Liabilities...........................................11
4.10 Tax Matters.......................................................11
4.12 Books and Records.................................................12
4.13 Questionable Payments.............................................12
4.14 Environmental Matters.............................................12
4.15 Intellectual Property.............................................14
4.16 Insurance.........................................................14
4.17 Contracts.........................................................14
4.18 Litigation........................................................15
4.19 Employees.........................................................15
4.20 Employee Benefit Plans............................................15
4.21 Legal Compliance..................................................15
4.22 Broker's Fees.....................................................15
4.23 Disclosure........................................................16
ARTICLE 5....................................................................16
REPRESENTATIONS AND WARRANTIES OF............................................16
LYNCS TECHNOLOGIES...........................................................16
5.1 Organization......................................................16
5.2 Capitalization....................................................16
5.3 Certain Corporate Matters.........................................16
5.4 Authority Relative to this Agreement..............................17
5.5 Consents and Approvals; No Violations.............................17
5.6 Subsidiaries......................................................18
ARTICLE 6....................................................................18
CONDUCT OF BUSINESS PENDING THE CLOSING......................................18
6.1 Conduct of Business by Cable Tech Pending the Close...............18
6.2 Other Actions.....................................................19
ARTICLE 7....................................................................19
ADDITIONAL AGREEMENTS........................................................19
7.1 Access and Information............................................19
7.2 Press Releases....................................................19
ARTICLE 8....................................................................20
CONDITIONS TO CLOSING........................................................20
8.1 Conditions to Obligations of Each Party to Effect the Closing.....20
8.2 Additional Conditions to WorldCast's Obligations..................20
8.3 Additional Conditions to the Obligations of.......................21
ARTICLE 9....................................................................24
TERMINATION..................................................................24
9.1 Termination by Mutual Consent.....................................24
9.2 Termination by Any Party..........................................24
9.3 Material Breach...................................................24
9.4 Effect of Termination.............................................24
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ARTICLE 10...................................................................25
GENERAL PROVISIONS...........................................................25
10.1 Notices...........................................................25
10.3 Severability......................................................25
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10.4 Miscellaneous.....................................................25
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10.5 Separate Counsel..................................................26
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10.6 Governing Law.....................................................26
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10.7 Counterparts......................................................26
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10.8 Amendment.........................................................26
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10.9 Parties In Interest: No Third Party Beneficiaries.................26
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10.10 Expenses........................................................26
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