AGREEMENT AND PLAN OF REORGANIZATION
AMONG
VOICE POWERED TECHNOLOGY INTERNATIONAL, INC.,
V-CO ACQUISITION, INC.
AND
WORLD WASTE TECHNOLOGIES, INC.
March 25, 2004
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TABLE OF CONTENTS
Page
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1. Plan of Reorganization.............................................1
2. Terms of Merger....................................................2
3. Delivery of Shares.................................................5
4. Representations of WW..............................................5
5. Representations of V-CO and V-ACQ-SUB..............................8
6. Closing...........................................................12
7. Actions Prior to Closing..........................................12
8. Conditions Precedent to the Obligations of WW.....................13
9. Conditions Precedent to the Obligations of V-CO and V-ACQ-SUB.....14
10. Survival and Indemnification......................................16
11. Nature of Representations.........................................16
12. Documents at Closing..............................................16
13. Finder's Fees.....................................................17
14. Additional Covenants..............................................17
15. Post-Closing Covenants............................................18
16. Termination.......................................................18
17. Effects of Termination............................................19
18. Miscellaneous.....................................................19
Signature Page.............................................................22
Exhibit A - Agreement of Merger (California)
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AGREEMENT AND PLAN OF REORGANIZATION
------------------------------------
This Agreement and Plan of Reorganization (hereinafter the "Agreement")
is entered into effective as of this 25th day of March, 2004, by and among Voice
Powered Technology International, Inc., a California corporation (hereinafter
"V-CO"); V-CO Acquisition, Inc., a newly-formed California corporation
(hereinafter "V-ACQ-SUB"); and World Waste Technologies, Inc., a California
corporation (hereinafter "WW").
RECITALS
--------
WHEREAS, V-CO desires to acquire WW as a wholly owned subsidiary and to
issue shares of V-CO common stock to the stockholders of WW upon the terms and
conditions set forth herein. V-ACQ-SUB is a wholly-owned subsidiary corporation
of V-CO that shall be merged into WW, whereupon WW shall be the surviving
corporation of said merger and shall become a wholly-owned subsidiary of V-CO
(V-ACQ-SUB and WW are sometimes collectively hereinafter referred to as the
"Constituent Corporations").
WHEREAS, the boards of directors of V-CO, V-ACQ-SUB and WW,
respectively, deem it advisable and in the best interests of such corporations
and their respective stockholders that V-ACQ-SUB merge with and into WW pursuant
to this Agreement and the Agreement of Merger (in the form attached hereto as
Exhibit "A") and pursuant to applicable provisions of law (such transaction
hereafter referred to as the "Merger").
WHEREAS, V-ACQ-SUB has an authorized capitalization consisting of
50,000,000 shares of $0.00001 par value common stock, of which 1,000 shares
shall be issued and outstanding and owned by V-CO as of the closing of the
Merger;
WHEREAS, WW has an authorized capitalization consisting of 50,000,000
shares of common stock, $0.00001 par value ("WW Common Stock"), of which,
16,800,000 shares are currently issued and outstanding, as of the date hereof
(giving effect to the conversion of the promissory notes, but excluding warrants
excercisable for WW Common Stock, as described herein).
NOW THEREFORE, for the mutual consideration set out herein, and other
good and valuable consideration, the sufficiency of which is hereby
acknowledged, the parties agree as follows:
AGREEMENT
---------
1. Plan of Reorganization. The parties to this Agreement do hereby
-----------------------
agree that V-ACQ-SUB shall be merged with and into WW upon the terms and
conditions set forth herein and in accordance with the provisions of the
California Corporations Code. It is the intention of the parties hereto that
this transaction qualify as a tax-free reorganization under Section 368(a)(2)(E)
of the Internal Revenue Code of 1986, as amended, and related sections
thereunder.
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2. Terms of Merger. In accordance with the provisions of this Agreement
---------------
and the requirements of applicable law, V-ACQ-SUB shall be merged with and into
WW as of the Effective Date (the terms "Closing" and "Effective Date" are
defined in Section 6 hereof). WW shall be the surviving corporation (hereinafter
sometimes the "Surviving Corporation") and the separate existence of V-ACQ-SUB
shall cease when the Merger shall become effective. Consummation of the Merger
shall be upon the following terms and subject to the conditions set forth
herein:
(a) Corporate Existence.
-------------------
(1) Commencing with the Effective Date, the Surviving
Corporation shall continue its corporate existence as a California corporation
and (i) it shall thereupon and thereafter possess all rights, privileges,
powers, franchises and property (real, personal and mixed) of each of the
Constituent Corporations; (ii) all debts due to either of the Constituent
Corporations, on whatever account, all causes in action and all other things
belonging to either of the Constituent Corporations shall be taken and deemed to
be transferred to and shall be vested in the Surviving Corporation by virtue of
the Merger without further act or deed; and (iii) all rights of creditors and
all liens, if any, upon any property of any of the Constituent Corporations
shall be preserved unimpaired, limited in lien to the property affected by such
liens immediately prior to the Effective Date, and all debts, liabilities and
duties of the Constituent Corporations shall thenceforth attach to the Surviving
Corporation.
(2) At the Effective Date, (i) the Articles of Incorporation and
the By-laws of WW, as existing immediately prior to the Effective Date, shall be
and remain the Articles of Incorporation and By-Laws of the Surviving
Corporation; (ii) the members of the Board of Directors of the Surviving
Corporation holding office immediately prior to the Effective Date shall remain
as the members of the Board of Directors of the Surviving Corporation (if on or
after the Effective Date a vacancy exists on the Board of Directors of the
Surviving Corporation, such vacancy may thereafter be filled in a manner
provided by applicable law and the By-laws of the Surviving Corporation); and
(iii) until the Board of Directors of the Surviving Corporation shall otherwise
determine, all persons who hold offices of the Surviving Corporation at the
Effective Date shall continue to hold the same offices of the Surviving
Corporation.
(b) Conversion of Securities.
------------------------
As of the Effective Date and without any action on the part of V-CO,
V-ACQ-SUB, WW or the holders of any of the securities of any of these
corporations, each of the following shall occur:
(1) Each one (1) share of WW Common Stock issued and outstanding
immediately prior to the Effective Date shall be converted into one (1) share of
V-CO Common Stock. All such shares of WW Common Stock shall no longer be
outstanding and shall automatically be canceled and shall cease to exist, and
each certificate previously evidencing any such shares shall thereafter
represent the right to receive, upon the surrender of such certificate in
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accordance with the provisions of Section 3 hereof, certificates evidencing such
number of shares of V-CO Common Stock, respectively, into which such shares of
WW Common Stock were converted. The holders of such certificates previously
evidencing shares of WW Common Stock outstanding immediately prior to the
Effective Date shall cease to have any rights with respect to such shares of WW
Common Stock except as otherwise provided herein or by law;
(2) Any shares of WW capital stock held in the treasury of WW
immediately prior to the Effective Date shall automatically be canceled and
extinguished without any conversion thereof and no payment shall be made with
respect thereto;
(3) Each share of capital stock of V-ACQ-SUB issued and
outstanding immediately prior to the Effective Date shall remain in existence as
one share of common stock of the Surviving Corporation, which shall be owned by
V-CO;
(4) The 1,200,000 shares of V-CO Common Stock issued and
outstanding immediately prior to the Merger (the number of outstanding shares
reflecting the one-for-sixty reverse stock split referred to in Section 7(d)
below) will remain outstanding after the Merger and cancellation of V-CO Common
Stock referred to in 7(c) below.
(c) Restricted Shares.
------------------
(1) None of the V-CO common stock to be issued to the WW
shareholders shall, at the time of Closing, be registered under federal
securities' laws but, rather, shall be issued pursuant to an exemption therefrom
and be considered "restricted stock" within the meaning of Rule 144 promulgated
under the Securities Act of 1933, as amended (the "act"). All of such shares
shall bear a legend worded substantially as follows:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933 (the "Act") and are `restricted
securities' as that term is defined in Rule 144 under the Act. The shares may
not be offered for sale, sold or otherwise transferred except pursuant to an
exemption from registration under the Act, the availability of which is to be
established to the satisfaction of the Company."
(2) The transfer agent of V-CO shall annotate its records to
reflect the restrictions on transfer embodied in the legend set forth above.
There shall be no requirement of V-CO to register the V-CO common stock under
the Act.
(d) Other Matters.
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(1) Upon the effectiveness of the Merger, each outstanding
warrant to purchase WW Common Stock, whether or not then exercisable, shall be
converted into a warrant to purchase (in substitution for each share of WW
Common Stock subject to an WW warrant) one (1) share of V-CO Common Stock for
every one (1) share of WW Common Stock said warrant was exercisable for, on
terms substantially and materially similar to the terms and conditions of said
warrant prior to conversion.
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(2) Upon execution of this Agreement by the parties hereto, WW
shall deliver to V-CO a nonrefundable payment of $25,000 to be used by V-CO to
pay for certain outstanding expenses, liabilities and costs of V-CO incurred in
connection with this Agreement, including, among other costs, legal, accounting,
printing, mailing, and transfer agent fees. At the Closing, WW shall pay V-CO an
additional $25,000 for these costs. Any and all costs and/or fees relating to
this Agreement and the transactions contemplated hereunder in excess of an
aggregate of $50,000 shall be paid by V-CO prior to Closing and the surviving
corporation shall have no other obligations to any party for any costs, fees
and/or expenses relating to this Agreement or the transactions contemplated
hereunder, other than the obligations associated with, and rightfully payable
by, WW prior to Closing.
(3) Upon the Closing, WW shall deliver to V-CO an unaudited
Balance Sheet, dated as of no more than seven (7) days prior to the Closing,
showing not less than $1,000,000 cash and a net worth of no less than
$2,700,000. Such Balance Sheet shall be certified to as true and accurate in all
material respects by the President and Secretary of WW.
(4) As of the Closing and excluding outstanding warrants to
purchase up to 300,000 WW Common Stock (the "WW Warrants"), WW shall have no
more than 20,800,000 shares of its Common Stock issued and outstanding. Upon the
Effective Date of the Merger and excluding the WW Warrants, V-CO shall have no
more than 22,000,000 shares of Common Stock issued and outstanding.
(5) For a period of one year from the effectiveness of the
Merger, V-CO and WW agree that V-CO shall not effect a reverse-stock split.
After six months from the Effective Date, V-CO shall be entitled to effect a
reverse-stock split only in the event that the market upon which its stock
trades, provides written notice to V-CO that it will be specifically de-listed
from such exchange if its average trading price does not exceed a certain price
and a reverse-stock split will allow V-CO to meet such exchange's requirements.
If there are other criteria, in addition to the stock price, on which they are
in default and they are notified by the exchange, they must meet all of the
criteria before doing a reverse-stock split.
(6) From and after the Closing and with a view to making
available to holders of V-CO Common Stock the benefits of Rule 144 promulgated
under the Securities Act of 1933 (the "Securities Act") or any other similar
rule or regulation of the Securities and Exchange Commission ("SEC"), WW shall
cause V-CO to, and V-CO shall (a) take all action as may be required as a
condition to the availability of Rule 144 under the Securities Act (or any
successor exemptive rule hereinafter in effect) with respect to V-CO Common
Stock and (b) furnish to any holder of V-CO Common Stock forthwith upon request
(i) a written statement by V-CO as to its compliance with the reporting
requirements of Rule 144, (ii) a copy of the most recent annual or quarterly
report of V-CO as filed with the SEC, and (iii) such other reports and documents
as a holder may reasonably request in availing itself of any rule or regulation
of the SEC allowing a holder to sell any such Common Stock without registration.
WW shall cause V-CO to facilitate and expedite transfers of the shares of V-Co
Common Stock pursuant to Rule 144 under the Securities Act, which efforts shall
include timely notice to its transfer agent to expedite such transfers of such
shares.
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(7) At the Closing, the then existing directors of V-CO shall
then nominate and elect to the Board of Directors of V-CO not less than four
persons designated by WW, and all of the persons serving as directors and
officers of V-CO immediately prior to the Closing shall thereafter resign from
all of their positions with V-CO, effective immediately upon the Closing.
3. Delivery of Shares. On or as soon as practicable after the Effective
------------------
Date, WW will use reasonable efforts to cause all holders of WW Common Stock
(the "WW Shareholders") to surrender to V-CO's transfer agent for cancellation
certificates representing their shares of WW Common Stock, against delivery of
certificates representing the shares of V-CO Common Stock for which the WW
shares are to be converted in the Merger. Until surrendered and exchanged as
herein provided, each outstanding certificate which, prior to the Effective
Date, represented WW Common Stock shall be deemed for all corporate purposes to
evidence ownership of the same number of shares of V-CO Common Stock into which
the shares of WW Common Stock represented by such WW certificate shall have been
so converted.
4. Representations of WW. WW hereby represents and warrants as follows,
---------------------
which warranties and representations shall also be true as of the Effective
Date:
(a) As of the date hereof, excluding the WW Warrants and giving
effect to the conversion of the promissory notes described in Section 9(k)
below, the total number of shares of WW Common Stock issued and outstanding is
16,800,000. Excluding the WW Warrants, the WW capital stock that will be issued
and outstanding as of the Effective Date shall not exceed 20,800,000 shares.
(b) The WW Common Stock constitutes duly authorized, validly issued
shares of capital stock of WW. All shares of WW Common Stock are fully paid and
nonassessable.
(c) The WW audited financial statements as of and for the year ended
December 31, 2003, which have been delivered to V-CO, or will be delivered to
V-CO prior to the Closing, (hereinafter referred to as the "WW Financial
Statements"), fairly present the financial condition of WW as of the dates
thereof and the results of its operations for the periods covered. Other than as
set forth in any schedule or Exhibit attached hereto, and except as may
otherwise be set forth or referenced herein, there are no material liabilities
or obligations, either fixed or contingent, not disclosed or referenced in the
WW Financial Statements or in any exhibit thereto or notes thereto other than
contracts or obligations occurring in the ordinary course of business since
December 31, 2003; and no such contracts or obligations occurring in the
ordinary course of business constitute liens or other liabilities which
materially alter the financial condition of WW as reflected in the WW Financial
Statements. WW has or will have at the Closing, good title to all assets shown
on the WW Financial Statements subject only to dispositions and other
transactions in the ordinary course of business, the disclosures set forth
therein and liens and encumbrances of record. WWW agrees to provide updated,
quarterly financial statements prior to the Closing, if required by a
governmental agency.
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(d) Except as set forth in Schedule 4(d), since December 31, 2003,
there have not been any material adverse changes in the financial position of WW
except changes arising in the ordinary course of business, which changes will
not materially and adversely affect the financial position of WW.
(e) WW is not a party to any material pending litigation or, to the
knowledge of its executive officers (herein, "Knowledge"), any governmental
investigation or proceeding, not reflected in the WW Financial Statements, and,
to its Knowledge, no material litigation, claims, assessments or any
governmental proceedings are threatened in writing against WW.
(f) WW is in good standing in its state of incorporation, and is in
good standing and duly qualified to do business in each state where required to
be so qualified except where the failure to so qualify would have no material
negative impact on WW.
(g) WW has, or by the Effective Date will have, filed all material
tax, governmental and/or related forms and reports (or extensions thereof) due
or required to be filed in the ordinary course of business and has (or will
have) paid or made adequate provisions for all taxes or assessments which have
become due as of the Effective Date.
(h) WW has not materially breached any material agreement to which
it is a party. WW has previously given V-CO copies of or access to all material
contracts, commitments and/or agreements to which WW is a party.
(i) WW has the corporate power to enter into this Agreement and to
perform its obligations hereunder. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been or will
prior to the Closing and the Effective Date be duly authorized by the Board of
Directors of WW and by the stockholders of WW. The execution of this Agreement
does not materially violate or breach any material agreement or contract to
which WW is a party, and WW, to the extent required, has (or will have by
Closing) obtained all necessary approvals or consents required by any agreement
to which WW is a party. The execution and performance of this Agreement will not
violate or conflict with any provision of the Articles of Incorporation or
by-laws of WW.
(j) Information regarding WW, which has been delivered by WW to V-CO
for use in connection with the Merger, is, to WW's Knowledge, true and accurate
in all material respects.
(k) To its Knowledge, WW has (and at the Closing it will have)
disclosed in writing to V-CO all events, conditions and facts materially
affecting the business, financial conditions (including any liabilities,
contingent or otherwise) or results of operations of WW.
(l) All information regarding WW which has been provided to V-CO by
WW or set forth in any document or other communication, disseminated to any
former, existing or potential stockholders of WW or to the public or filed with
any state securities regulators or authorities is, to WW's Knowledge, true,
complete, accurate in all material respects.
(m) To its Knowledge WW is and has been in compliance with, and WW
has conducted any business previously owned or operated by it in compliance
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with, all applicable laws, orders, rules and regulations of all governmental
bodies and agencies, including applicable securities laws and regulations and
environmental laws and regulations, except where such noncompliance has and will
have, in the aggregate, no material adverse effect. WW has not received notice
of any noncompliance with the foregoing, nor is it aware of any claims or
threatened claims in connection therewith.
(n) To its Knowledge without limiting the foregoing, (i) WW and any
other person or entity for whose conduct WW is legally held responsible are and
have been in material compliance with all applicable federal, state, regional,
local laws, statutes, ordinances, judgments, rulings and regulations relating to
any matters of pollution, protection of the environment, health or safety, or
environmental regulation or control, and (ii) neither WW nor any other person
for whose conduct WW is legally held responsible has manufactured, generated,
treated, stored, handled, processed, released, transported or disposed of any
hazardous substance on, under, from or at any of WW's properties or in
connection with WW's operations.
(o) Except as and to the extent specifically disclosed in this
Agreement and as may be specifically disclosed or reserved against as to amount
in the latest balance sheet contained in the WW Financial Statements, there is
no basis for any assertion against WW of any material liabilities or obligations
of any nature, whether absolute, accrued, contingent or otherwise and whether
due or to become due, including, without limitation, any liability for taxes
(including e-commerce sales or other taxes), interest, penalties and other
charges payable with respect thereto. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will (a)
result in any payment (whether severance pay, unemployment compensation or
otherwise) becoming due from WW to any person or entity, including without
limitation any employee, director, officer or affiliate or former employee,
director, officer or affiliate of WW, (b) increase any benefits otherwise
payable to any person or entity, including without limitation any employee,
director, officer or affiliate or former employee, director, officer or
affiliate of WW, or (c) result in the acceleration of the time of payment or
vesting of any such benefits.
(p) To its Knowledge no aspect of WW's past or present business,
operations or assets is of such a character as would restrict or otherwise
hinder or impair WW from carrying on the business of WW as it is presently being
conducted by WW.
(q) Except as disclosed to V-CO in writing, to its Knowledge WW has
no material contracts, commitments, arrangements, or understandings relating to
its business, operations, financial condition, prospects, or otherwise. For
purposes of this Section 4, "material" means payment or performance of a
contract, commitment, arrangement or understanding in the ordinary course of
business, which is expected to involve payments in excess of $100,000.
(r) To its Knowledge no representation or warranty by WW contained
in this Agreement and no statement contained in any certificate, schedule or
other communication furnished pursuant to or in connection with the provisions
hereof contains or shall contain any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statements therein
not misleading. To WW's Knowledge, there is no current or prior event or
condition of any kind or character pertaining to WW that may reasonably be
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expected to have a material adverse effect on WW. Except as specifically
indicated elsewhere in this Agreement, all documents delivered by WW in
connection herewith have been and will be complete originals, or exact copies
thereof.
(s) To WW's Knowledge, all information to be supplied by it for
inclusion or incorporation by reference in the Information Statement to be filed
by V-CO with the SEC, will not at the time the Information Statement is filed
with the SEC, at any time it is amended or supplemented or at the time it
becomes effective under the Securities Act of 1933, contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
5. Representations of V-CO and V-ACQ-SUB. V-CO and V-ACQ-SUB hereby
--------------------------------------
jointly and severally represent and warrant as follows, each of which
representations and warranties shall continue to be true as of the Effective
Date:
(a) As of the Effective Date, the shares of V-CO Common Stock to be
issued and delivered to the WW Shareholders hereunder and in connection herewith
will, when so issued and delivered, constitute duly authorized, validly and
legally issued, fully-paid, nonassessable shares of V-CO capital stock, free of
all liens and encumbrances.
(b) V-CO has the corporate power to enter into this Agreement and to
perform its obligations hereunder. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby (i) have been or
will prior to the Closing and the Effective Date be duly authorized by the
respective Boards of Directors of V-CO and V-ACQ-SUB and by V-CO as the sole
stockholder of V-ACQ-SUB, and (ii) do not have to be approved or authorized by
the stockholders of V-CO. The execution and performance of this Agreement will
not constitute a material breach of any agreement, indenture, mortgage, license
or other instrument or document to which V-CO or V-ACQ-SUB is a party or to
which it is otherwise subject and will not violate any judgment, decree, order,
writ, law, rule, statute, or regulation applicable to V-CO, V-ACQ-SUB or their
properties. The execution and performance of this Agreement will not violate or
conflict with any provision of the respective Articles of Incorporation or
by-laws of either V-CO or V-ACQ-SUB.
(c) V-CO has delivered to WW a true and complete copy of its audited
financial statements for the fiscal years ended 2001, 2002 and 2003 (the "V-CO
Financial Statements"). The V-CO Financial Statements are complete, accurate and
fairly present the financial condition of V-CO as of the dates thereof and the
results of its operations for the periods then ended. There are no material
liabilities or obligations either fixed or contingent not reflected therein. The
V-CO Financial Statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis (except as may be
indicated therein or in the notes thereto) and fairly present the financial
position of V-CO as of the dates thereof and the results of its operations and
changes in financial position for the periods then ended. V-CO agrees to provide
updated quarterly financial statements if required by governmental agency.
V-ACQ-SUB has no financial statements because it was recently formed solely for
8
the purpose of effectuating the Merger and it has been, is and will remain
inactive except for purposes of the Merger, and it has no assets, liabilities,
contracts or obligations of any kind other than as incurred in the ordinary
course in connection with its incorporation in California. V-CO has no
subsidiaries or affiliates except for V-ACQ-SUB, and V-ACQ-SUB has no
subsidiaries or affiliates.
(d) Since December 31, 2003, there have not been any material
adverse changes in the financial condition of V-CO. At the Closing, neither V-CO
nor V-ACQ-SUB shall have any material assets and neither such corporation now
has, nor shall it have, any liabilities of any kind other than those reflected
in the December 31, 2003 financial statements and any costs or liabilities
incurred in connection with the Merger (which costs and liabilities, including
those liabilities reflected on the December 31, 2003 financial statements,
collectively shall in no event exceed $75,000 in the aggregate).
(e) Neither V-CO nor V-ACQ-SUB is a party to, or the subject of, any
material pending litigation, claims, or governmental investigation or proceeding
not reflected in the V-CO Financial Statements, and to the Knowledge of V-CO and
V-ACQ-SUB, there are no material lawsuits, claims, assessments, investigations,
or similar matters, threatened in writing against V-ACQ-SUB, V-CO, or the
management or properties of V-CO or V-ACQ-SUB.
(f) V-CO and V-ACQ-SUB are each duly organized, validly existing and
in good standing under the laws of the jurisdiction of their incorporation; each
has the corporate power to own its property and to carry on its business as now
being conducted and is duly qualified to do business in any jurisdiction where
so required except where the failure to so qualify would have no material
negative impact. Neither corporation is required to be qualified to do business
in any state other than the State of California.
(g) To their Knowledge, V-CO and V-ACQ-SUB have filed all federal,
state, county and local income, excise, property and other tax, governmental
and/or other returns, forms, filings, or reports, which are due or required to
be filed by it prior to the date hereof and have paid or made adequate provision
in the V-CO Financial Statements for the payment of all taxes, fees, or
assessments which have or may become due pursuant to such returns, filings or
reports or pursuant to any assessments received. Neither V-CO nor V-ACQ-SUB is
delinquent or obligated for any tax, penalty, interest, delinquency or charge
and there are no tax liens or encumbrances applicable to either corporation.
(h) As of the date of this Agreement, V-CO's authorized capital
stock consists of 100,000,000 shares of V-CO Common Stock, $.001 par value, of
which 92,970,027 shares are presently issued and outstanding. Immediately prior
to the Closing, V-CO shall have outstanding 92,970,027 shares of V-CO Common
Stock and no other shares of its capital stock. At the Closing and as a result
of V-CO effecting the 60-to-1 reverse stock split described as per Section 7 (c)
and (d), and upon return of the shares cancelled pursuant to Section 7(c), V-CO
shall have outstanding 1,200,000 shares of V-CO Common Stock and no other shares
of its capital stock. V-ACQ-SUB's capitalization consists solely of 50,000,000
authorized shares of $0.00001 par value common stock ("V-ACQ-SUB's Common
Stock"), of which 1,000 shares are outstanding, all of which are owned by V-CO,
free and clear of all liens, claims and encumbrances. All outstanding shares of
capital stock of V-CO and V-ACQ-SUB are, and shall be at the Closing, validly
issued, fully paid and nonassessable. There are no existing options, calls,
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claims, warrants, preemptive rights, registration rights or commitments of any
character relating to the issued or unissued capital stock or other securities
of either V-CO or V-ACQ-SUB.
(i) The financial records, minute books, and other documents and
records of V-CO and V-ACQ-SUB have been made available to WW prior to the
Closing. The records and documents of V-CO and V-ACQ-SUB that have been
delivered to WW, including Indemnity Agreements between V-CO and its officers
and directors, constitute all of the material records and documents of V-CO and
V-ACQ-SUB that they are aware of or that are in their possession or in the
possession of V-CO or V-ACQ-SUB.
(j) V-CO and V-ACQ-SUB has not materially breached any material
Agreement to which it is a party. Prior to the Closing, V-CO shall have given to
WW copies or access to all material contracts, commitments and/or Agreements to
which V-CO is a party. There are no currently existing agreements with any
affiliates, related or controlling persons or entities.
(k) V-CO has complied with all of the provisions relating to the
issuance of shares, and for the registration thereof, under the Securities Act.
To the best of its knowledge there are no outstanding, pending or threatened
stop orders or other actions or investigations relating thereto involving
federal and state securities laws.
(l) V-CO currently has no employees, consultants or independent
contractors other than its attorneys and accountants and transfer agent. Xxxxxx
X. Xxxxxxxxxx, Xxx Xxxxxxx and Xxxx Xxxxxxx are, or will be, the sole directors
and sole executive officers of V-CO, and Xxxxxx X. Xxxxxxxxxx and Xxx Xxxxxxx
are the sole directors and sole executive officers of V-ACQ-SUB.
(m) To the best of their knowledge V-CO and V-ACQ-SUB have (and at
the Closing they will have) disclosed in writing to WW all events, conditions
and facts materially affecting the business, financial conditions (including any
liabilities, contingent or otherwise) or results of operations of either V-CO or
V-ACQ-SUB, since August 19, 2002.
(n) To the knowledge of its executive officers (herein "Knowledge"),
V-CO was organized for the purposes of, and with a specific plan for developing,
marketing and distributing voice recognition and voice-activated products on a
worldwide basis, both directly and through licensing agreements.
(o) To their Knowledge all information since August 19, 2002
regarding V-CO which has been provided to WW by V-CO or set forth in any
document or other communication, disseminated to any former, existing or
potential stockholders of V-CO or to the public or filed with the SEC or any
state securities regulators or authorities is true, complete, accurate in all
material respects, not misleading, and was and is in full compliance with all
securities laws and regulations.
(p) To their Knowledge V-CO is and has been in compliance with, and
V-CO has conducted any business owned or operated by it since August 19, 2002 in
compliance with, all applicable laws, orders, rules and regulations of all
governmental bodies and agencies, including applicable securities laws and
regulations and environmental laws and regulations, except where such
noncompliance has and will have, in the aggregate, no material adverse effect.
10
V-CO has not received notice of any noncompliance with the foregoing, nor is it
aware of any claims or threatened claims in connection therewith. To their
Knowledge V-CO has never conducted any operations or engaged in any business
transactions of a material nature other than as set forth in the reports V-CO
has previously filed with the SEC.
(q) Since August 19, 2002, V-CO has filed all required documents,
reports and schedules with the SEC (collectively, the "V-CO SEC Documents"). To
their Knowledge and as of their respective dates, the V-CO SEC Documents
complied in all material respects with the requirements of the Securities Act.
None of the V-CO SEC Documents contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
(r) Except as and to the extent specifically disclosed in this
Agreement and as may be specifically disclosed or reserved against as to amount
in the latest balance sheet contained in the V-CO Financial Statements, there is
no basis for any assertion against V-CO of any material liabilities or
obligations of any nature, whether absolute, accrued, contingent or otherwise
and whether due or to become due, including, without limitation, any liability
for taxes (including e-commerce sales or other taxes), interest, penalties and
other charges payable with respect thereto. Neither the execution and delivery
of this Agreement nor the consummation of the transactions contemplated hereby
will (a) result in any payment (whether severance pay, unemployment compensation
or otherwise) becoming due from V-CO to any person or entity, including without
limitation any employee, director, officer or affiliate or since August 19,
2002, any employee, director, officer or affiliate of V-CO, (b) increase any
benefits otherwise payable to any person or entity, including without limitation
any employee, director, officer or affiliate, or (c) result in the acceleration
of the time of payment or vesting of any such benefits.
(s) To their Knowledge and since August 19, 2002 no aspect of V-CO's
business, operations or assets is of such a character as would restrict or
otherwise hinder or impair V-CO from carrying on the business of V-CO as it is
presently being conducted by V-CO.
(t) To their Knowledge, other than retention of accountants,
attorney, and transfer agent, V-CO has no other material contracts, commitments,
arrangements, or understandings relating to its business, operations, financial
condition, prospects or otherwise. For purposes of this Section 5, "material"
means payment or performance of a contract, commitment, arrangement or
understanding, which is expected to involve payments individually in excess of
$5,000 or, in excess of $20,000 in the aggregate.
(u) To their Knowledge no representation or warranty by V-CO or
V-ACQ-SUB contained in this Agreement and no statement contained in any
certificate, schedule or other communication furnished pursuant to or in
connection with the provisions hereof contains or shall contain any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements therein not misleading. There is no current or
since August 19, 2002, an event or condition of any kind or character pertaining
to V-CO that may reasonably be expected to have a material adverse effect on
V-CO or its subsidiaries. Except as specifically indicated elsewhere in this
Agreement, all documents delivered by V-CO in connection herewith have been and
will be complete originals, or exact copies thereof.
11
6. Closing. The Closing of the transactions contemplated herein shall
-------
take place on such date (the "Closing") as mutually determined by the parties
hereto when all conditions precedent have been met and all required documents
have been delivered, which Closing is expected to occur on or before June 15,
2004. The "Effective Date" of the Merger shall be that date and time specified
in the Articles of Merger as the date on which the Merger shall become
effective.
7. Actions Prior to Closing.
------------------------
(a) Prior to the Closing, WW on the one hand, and V-CO and V-ACQ-SUB
on the other hand, shall be entitled to make such investigations of the assets,
properties, business and operations of the other party, and to examine the
books, records, tax returns, financial statements and other materials of the
other party as such investigating party deems necessary in connection with this
Agreement and the transactions contemplated hereby. Any such investigation and
examination shall be conducted at reasonable times and under reasonable
circumstances, and the parties hereto shall cooperate fully therein. The
representations and warranties contained in this Agreement shall not be affected
or deemed waived by reason of the fact that either party hereto discovered or
should have discovered any representation or warranty is or might be inaccurate
in any respect.
(b) Prior to the Closing, any written news releases or public
disclosure by either party pertaining to this Agreement shall be submitted to
the other party for its review and approval prior to such release or disclosure,
provided, however, that (a) such approval shall not be unreasonably withheld,
and (b) such review and approval shall not be required of disclosures required
to comply, in the judgment of counsel, with federal or state securities or
corporate laws or policies.
(c) Of the V-CO common shares owned by or under the control of the
Belle Group Ltd., twenty million nine hundred seventy thousand and twenty-seven
(20,970,027) Belle Group Ltd., shall automatically be canceled and extinguished
and shall no longer be outstanding and shall cease to exist without any
conversion thereof and no payment shall be made with respect thereto.
(d) Prior to the Closing, V-CO will effect a 60-to-1 reverse stock
split, in which each block of sixty (60) outstanding shares of V-CO Common Stock
will be merged and combined into one (1) share, the effect of which, in each
case, shall be to decrease the issued and outstanding number of shares of V-CO
Common Stock from, after the cancellation of 20,970,027 shares pursuant to
Section 7(c), from 72,000,000 shares to 1,200,000 shares.
(e) Except as contemplated by this Agreement, there shall be no
stock dividend, stock split, recapitalization, or exchange of shares with
respect to or rights issued in respect of V-CO's Common Stock after the date
hereof and there shall be no dividends or other distributions paid on V-CO's
Common Stock after the date hereof, in each case through and including the
Effective Date. V-CO and V-ACQ-SUB shall conduct no business, prior to the
Closing, other than in the ordinary course of business or as may be necessary in
order to consummate the transactions contemplated hereby.
12
(f) Prior to the Closing, if requested by WW, V-CO shall promptly
(i) adopt a new stock option plan reserving no less than 2,000,000 shares of
V-CO Common Stock for issuance thereunder, (ii) adopt new bylaws, (iii) change
its name, (iv) amend and restate its articles of incorporation and/or (v)
conduct such other reasonable action in the manner requested by WW all in the
form requested by WW.
8. Conditions Precedent to the Obligations of WW. All obligations of WW
---------------------------------------------
under this Agreement are subject to the fulfillment, prior to or as of the
Closing and/or the Effective Date, as indicated below, of each of the following
conditions:
(a) The representations and warranties by or on behalf of V-CO, and
V-ACQ-SUB contained in this Agreement or in any certificate or document
delivered pursuant to the provisions hereof or in connection herewith shall be
true at and as of the Closing and Effective Date as though such representations
and warranties were made at and as of such time.
(b) V-CO and V-ACQ-SUB shall have performed and complied with, in
all material respects, all covenants, agreements, and conditions required by
this Agreement to be performed or complied with by them prior to or at the
Closing.
(c) On or before the Closing, the directors of V-CO and V-ACQ-SUB,
and V-CO as sole stockholder of V-ACQ-SUB, shall have approved in accordance
with applicable state corporation law the execution and delivery of this
Agreement and the consummation of the transactions contemplated herein.
(d) On or before the Closing Date, V-CO and V-ACQ-SUB shall have
delivered certified copies of resolutions of the sole stockholder and director
of V-ACQ-SUB and of the directors of V-CO approving and authorizing the
execution, delivery and performance of this Agreement and authorizing all of the
necessary and proper action to enable V-CO and V-ACQ-SUB to comply with the
terms of this Agreement, including the election of WW's nominees to the Board of
Directors of V-CO and all matters outlined or contemplated herein.
(e) Shareholders of WW shall have delivered to V-CO a letter
commonly known as an "investment letter" agreeing that the shares of V-CO common
stock (the "Shares") to be converted in the merger are, among other things,
being acquired for investment purposes and not with a view to public resale, are
being acquired for the investor's own account, that the investor is an
"accredited" individual as defined under Regulation D of the Securities Act of
1933, and that the Shares are restricted and may not be resold, except in
reliance of an exemption under the Securities Act of 1933.
(f) The Merger shall be permitted by applicable state law and
otherwise and V-CO shall have sufficient shares of its capital stock authorized
to complete the Merger and the transactions contemplated hereby.
(g) At Closing, all of the directors and officers of V-CO and
V-ACQ-SUB shall have resigned in writing from their positions as directors and
officers of V-CO and V-ACQ-SUB, respectively, effective upon the election and
appointment of the WW nominees, and the directors of V-CO shall take such action
as may be necessary or desirable regarding such election and appointment of WW
nominees.
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(h) At the Closing, all instruments and documents delivered by V-CO
or V-ACQ-SUB, including to WW Shareholders pursuant to the provisions hereof
shall be reasonably satisfactory to legal counsel for WW.
(i) The capitalization of V-CO and V-ACQ-SUB shall be the same as
described in Section 5(h), except that the number of outstanding shares of V-CO
Common Stock shall have been decreased by the cancellation and reverse stock
split to 1,200,000 shares.
(j) The shares of restricted V-CO capital stock to be issued to WW
Shareholders at Closing will be validly issued, nonassessable and fully paid
under California corporation law and will be issued in a nonpublic offering in
compliance with all federal, state and applicable securities laws.
(k) WW shall have received all necessary and required approvals and
consents from required parties and from its stockholders.
(l) At the Closing, V-CO and V-ACQ-SUB shall have delivered to WW an opinion of
V-CO's legal counsel dated as of the Closing to the effect that:
(1) Each of V-CO and V-ACQ-SUB is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation;
(2) This Agreement has been duly authorized, executed and
delivered by V-CO and V-ACQ-SUB and is a valid and binding obligation of V-CO
and V-ACQ-SUB enforceable in accordance with its terms;
(3) V-CO and V-ACQ-SUB each through its Board of Directors and
stockholders have taken all corporate action necessary for performance under
this Agreement;
(4) The documents executed and delivered to WW and WW
Shareholders hereunder are valid and binding in accordance with their terms and
vest in WW Shareholders all right, title and interest in and to the shares of
V-CO's Common Stock to be issued pursuant to Section 2 hereof, and the shares of
V-CO capital stock when issued will be duly and validly issued, fully paid and
nonassessable;
(5) V-CO and V-ACQ-SUB each has the corporate power to execute,
deliver and perform under this Agreement.
(m) WW shall have completed its financial and legal due diligence
investigation of V-CO with results thereof satisfactory to WW in its sole
discretion.
9. Conditions Precedent to the Obligations of V-CO and V-ACQ-SUB. All
--------------------------------------------------------------
obligations of V-CO and V-ACQ-SUB under this Agreement are subject to the
fulfillment, prior to or at the Closing and/or the Effective Date, of each of
the following conditions:
(a) The representations and warranties by WW contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be true at and as of the Closing and the Effective Date as though
such representations and warranties were made at and as of such times.
14
(b) WW shall have performed and complied with, in all material
respects, all covenants, agreements, and conditions required by this Agreement
to be performed or complied with by it prior to or at the Closing;
(c) On or before the Closing, the directors of WW shall have
approved in accordance with applicable state corporation law the execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein.
(d) On or before the Closing Date, WW shall have delivered certified
copies of resolutions of the stockholders and directors of WW approving and
authorizing the execution, delivery and performance of this Agreement and
authorizing all of the necessary and proper action to enable WW to comply with
the terms of this Agreement.
(e) The Merger shall be permitted by applicable state law and
otherwise.
(f) At the Closing, all instruments and documents delivered by WW
pursuant to the provisions hereof shall be reasonably satisfactory to legal
counsel for V-CO.
(g) The capitalization of WW shall be the same as described in
Section 4(a), except that the number of outstanding shares of WW Common Stock
shall not exceed 20,800,000 shares.
(h) V-CO shall have received all necessary and required approvals
and consents from required parties and from its stockholders.
(i) At the Closing, WW shall have delivered to V-CO an opinion of
WW's legal counsel dated as of the Closing to the effect that:
(1) WW is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation;
(2) This Agreement has been duly authorized, executed and
delivered by WW and is a valid and binding obligation of WW enforceable in
accordance with its terms;
(3) WW, through its Board of Directors and stockholders have
taken all corporate action necessary for performance under this Agreement;
(4) The documents executed and delivered to V-CO hereunder are
valid and binding in accordance with their terms and vest in V-CO all right,
title and interest in and to the shares of WW 's Common Stock to be converted
pursuant to Section 2 hereof.
(5) WW has the corporate power to execute, deliver and perform
under this Agreement.
(j) V-CO shall have an exemption from registration under the
California Securities Laws for issuance of the shares of V-CO Common Stock to be
issued to the WW Shareholders.
(k) Prior to the Closing, the outstanding principal balance of the
Promissory Notes to F&F and Promissory Note to CMCP (as those items are labeled
15
on WW's financial statements dated December 31, 2003), and all accrued and
unpaid interest thereon, shall have been converted into shares of WW Common
Stock.
(l) V-CO shall have received from the WW shareholders a letter
commonly known as an "investment letter" agreeing that the shares of V-CO common
stock (the "Shares") to be converted in the merger are, among other things,
being acquired for investment purposes and not with a view to public resale, are
being acquired for the investor's own account, that the investor is an
"accredited" individual as defined under Regulation D of the Securities Act of
1933, and that the Shares are restricted and may not be resold without
registration, except in reliance of an exemption therefrom under the Securities
Act of 1933.
(m) V-CO shall have completed its financial and legal due diligence
investigation of WW with results thereof satisfactory to V-CO in its sole
discretion.
10.Survival.
--------
The representations and warranties contained in this Agreement and any other
document or certificate relating hereto (collectively, the "Acquisition
-----------
Documents") shall not survive the Effective Date.
---------
11.Nature of Representations. All of the parties hereto are executing
-------------------------
and carrying out the provisions of this Agreement in reliance solely on the
representations, warranties and covenants and agreements contained in this
Agreement and the other documents delivered at the Closing and not upon any
representation, warranty, agreement, promise or information, written or oral,
made by the other party or any other person other than as specifically set forth
herein.
12.Documents at Closing. At the Closing, the following documents shall
--------------------
be delivered:
(a) WW will deliver, or will cause to be delivered, to V-CO the
following:
(1) a certificate executed by the President of WW to the effect
that all representations and warranties made by WW under this Agreement are true
and correct as of the Closing and as of the Effective Date, the same as though
originally given to V-CO or V-ACQ-SUB on said date;
(2) a certificate from the state of WW's incorporation dated
within five business days of the Closing to the effect that WW is in good
standing under the laws of said state;
(3) such other instruments, documents and certificates, if any,
as are required to be delivered pursuant to the provisions of this Agreement;
16
(4) executed copy of the Articles of Merger for filing in
California;
(5) certified copies of resolutions adopted by the stockholders
and directors of WW authorizing the Merger; and
(6) Opinion of WW's counsel as described in Section 9(i) above;
(7) all other items, the delivery of which is a condition
precedent to the obligations of V-CO and V-ACQ-SUB, as set forth herein.
(b) V-CO and V-ACQ-SUB will deliver or cause to be delivered to WW:
(1) stock certificates representing those securities of V-CO to
be issued as a part of the Merger as described in Section 2 hereof;
(2) a certificate of the President of V-CO and V-ACQ-SUB,
respectively, to the effect that all representations and warranties of V-CO and
V-ACQ-SUB made under this Agreement are true and correct as of the Closing, the
same as though originally given to WW on said date;
(3) certified copies of resolutions adopted by V-CO's and
V-ACQ-SUB's Board of Directors and V-ACQ-SUB's stockholder authorizing the
Merger and all related matters;
(4) certificates from the jurisdiction of incorporation of V-CO
and V-ACQ-SUB dated within five business days of the Closing Date that each of
said corporations is in good standing under the laws of said state;
(5) executed copy of the Articles of Merger for filing in
California;
(6) opinion of V-CO's counsel as described in Section 8(l)
above;
(7) such other instruments and documents as are required to be
delivered pursuant to the provisions of this Agreement;
(8) written resignation of all of the officers and directors of
V-CO and V-ACQ-SUB;
(9) all other items, the delivery of which is a condition
precedent to the obligations of WW, as set forth in Section 8 hereof.
13.Finder's Fees. V-CO and V-ACQ-SUB, jointly and severally, represent
-------------
and warrant to WW, and WW represents and warrants to V-CO and V-ACQ-SUB, that
none of them, or any party acting on their behalf, has incurred any liabilities,
either express or implied, to any "broker" or "finder" or similar person in
connection with this Agreement or any of the transactions contemplated hereby.
14.Additional Covenants. Between the date hereof and the Closing Date,
--------------------
except with prior written consent of the other party.
17
(a) V-CO and WW shall conduct their business only in the usual and
ordinary course and the character of such business shall not be changed nor
shall any different business be undertaken;
(b) No change shall be made in the Articles of Incorporation or
Bylaws of V-CO or WW except as described herein;
(c) No change shall be made in the authorized or issued shares of
V-CO except as set forth herein;
(d) Neither V-CO nor WW shall discharge or satisfy any lien or
encumbrance or obligation or liability, other than current liabilities shown on
the financial statements heretofore delivered and current liabilities incurred
since that date in the ordinary course of business;
(e) V-CO shall not make any payment or distribution to its
stockholders or purchase or redeem any shares or capital stock except as set
forth herein.
15.Post-Closing Covenants.
----------------------
(a) Financial Statements. After the Closing, V-CO shall timely file
a current report on Form 8-K to report the Merger. In addition, for a period of
12 months following the Closing, V-CO shall use its commercially reasonable
efforts to timely file all reports and other documents required to be filed by
V-CO under the Securities Exchange Act of 1934.
(b) Standard and Poors. If required, V-CO shall use its commercially
reasonable efforts to apply for listing with Standard and Poors Information
Service or other such similar service.
16.Termination. This Agreement may be terminated at any time prior to
-----------
the Effective Date, by action taken or authorized by the Board of Directors of
the terminating party or parties, and except as provided below, whether before
or after approval of the matters presented in connection with the Mergers by the
stockholders of V-CO or WW:
(a) By mutual written consent of V-CO and WW;
(b) By either V-CO or WW, if the Effective Date shall not have
occurred on or before June 15, 2004 (the "Termination Date"); provided, however,
that the right to terminate this Agreement under this Section 16 shall not be
available to any party whose failure to fulfill any obligation under this
Agreement has been the cause of or resulted in, the failure of the Effective
Date to occur on or before the Termination Date;
(c) By either V-CO or WW, if any Governmental Entity (i) shall have
issued an order, decree or ruling or taken any other action (which the parties
shall use their reasonable best efforts to resist, resolve or lift, as
applicable, permanently restraining, enjoining or otherwise prohibiting the
transaction contemplated by this Agreement, and such order, decree, ruling or
other action shall have become final and nonappealable or (ii) shall have failed
to issue an order, decree or ruling or to take any other action, and such denial
18
of a request to issue such order, decree, ruling or take such other action shall
have become final and nonappealable (which order, decree, ruling or other action
the parties shall have used their reasonable best efforts to obtain, in the case
of each of (i) and (ii) which is necessary to fulfill the conditions set forth
in Sections 8 and 9 , as applicable;
(d) By either V-CO or WW, if the approvals of the stockholders of
either V-CO or WW contemplated by this Agreement shall not have been obtained by
reason of the failure to obtain the required vote of stockholders or consent;
(e) V-CO, if WW shall have breached or failed to perform any of its
representations, warranties, covenants or other agreements contained in this
Agreement, such that the conditions set forth in Section 9 are not capable of
being satisfied on or before the Termination Date; or
(f) By WW, if V-CO shall have breached or failed to perform any of
its representations, warranties, covenants or other agreements contained in this
Agreement, such that the conditions set forth in Section 8 are not capable of
being satisfied on or before the Termination Date.
(g) By V-CO or WW if, in the opinion of the SEC, the shares of V-CO
Common Stock owned by affiliates of V-CO and/or to be owned by shareholders of
WW cannot be sold pursuant to a Rule 144 exemption but must be registered under
the Securities Act of 1933.
17.Effect of Termination. In the event of termination of this
-----------------------
Agreement by either V-CO or WW as provided in Section 16, this Agreement shall
forthwith become void and there shall be no liability or obligation on the part
of any of the parties or their respective officers or directors.
18.Miscellaneous.
-------------
(a) Further Assurances. At any time, and from time to time, after
-------------------
the Effective Date, each party will execute such additional instruments and take
such action as may be reasonably requested by the other party to confirm or
perfect title to any property transferred hereunder or otherwise to carry out
the intent and purposes of this Agreement.
(b) Waiver. Any failure on the part of any party hereto to comply
------
with any of its obligations, agreements or conditions hereunder may be waived in
writing by the party (in its sole discretion) to whom such compliance is owed.
(c) Amendment. This Agreement may be amended only in writing as
---------
agreed to by all parties hereto.
(d) Notices. All notices and other communications hereunder shall be
-------
in writing and shall be deemed to have been given if delivered in person or sent
by prepaid first class registered or certified mail, return receipt requested to
the last known address of the noticed party.
19
(e) Headings. The section and subsection headings in this Agreement
--------
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(f) Counterparts. This Agreement may be executed simultaneously in
------------
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(g) Binding Effect. This Agreement shall be binding upon the parties
--------------
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors and assigns.
(h) Entire Agreement. This Agreement and the attached Exhibits,
-----------------
including the Articles of Merger, both of which are attached hereto as Exhibit
"A," is the entire agreement of the parties covering everything agreed upon or
understood in the transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof.
(i) Severability. If any part of this Agreement is deemed to be
------------
unenforceable, the balance of the Agreement shall remain in full force and
effect.
(j) Responsibility and Costs. Whether the Merger is consummated or
-------------------------
not, all fees, expenses and out-of-pocket costs, including, without limitation,
fees and disbursements of counsel, financial advisors and accountants, incurred
by the parties hereto shall be borne solely and entirely by the party that has
incurred such costs and expenses, unless the failure to consummate the Merger
constitutes a breach of the terms hereof, in which event the breaching party
shall be responsible for all costs of all parties hereto. The indemnification
provisions of Section 10 shall not apply in the event of the termination of this
Agreement prior to the Closing as a result of a breach hereof by either party.
(k) Applicable Law. This Agreement shall be construed and governed
---------------
by the internal laws of the State of California.
(l) Jurisdiction and Venue. Each party hereto irrevocably consents
----------------------
to the jurisdiction and venue of the state or federal courts located in San
Diego County, State of California, in connection with any action, suit,
proceeding or claim to enforce the provisions of this Agreement, to recover
damages for breach of or default under this Agreement, or otherwise arising
under or by reason of this Agreement. The prevailing party may recover costs and
reasonable attorney's fees.
20
(m) Arbitration. Any dispute between the parties relating in any way
-----------
to this Agreement or any of its terms and provisions shall be submitted to
binding arbitration before a single arbitrator in San Diego County, Calif.,
before JAMS and the prevailing party in such arbitration shall have the right to
have any award made by arbitrators confirmed by a court of competent
jurisdiction. The provisions of section 1283.05 of the CA Code of Civil
Procedure, authorizing and taking of depositions and obtaining discovery are
incorporated herein by this reference and shall be applicable to any such
arbitration. Any such arbitration shall be conducted in an expeditious manner.
Any such arbitration shall be governed by the JAMS complex arbitration rules and
the JAMS optional arbitration appeal procedure.
21
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
V-CO ACQUISITION, INC. V-CO., INC.
By: By:
-------------------------- --------------------------------
Xxx Xxxxxxx, Xxx Xxxxxxx,
President President
WORLD WASTE TECHNOLOGIES, INC.
By:
--------------------------------
Xxxxx Xxxxxxxx, President
WORLD WASTE TECHNOLOGIES, INC.
By:
--------------------------------
Xxxxxx X. Xxxxxxx, Chief Executive Officer
22
