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Exhibit 2.1
EXCHANGE AGREEMENT
EXCHANGE AGREEMENT (this "AGREEMENT") dated this 27th day of April, 2001
by and among AUTO-Q INTERNATIONAL INC., a Delaware corporation ("AUTO-Q USA"),
XXX XXX ("XXX XXX") and XXXXXXXXX XXXXXXX ("XXXXXXXXX XXXXXXX", and together
with XXX XXX the "AUTO-Q UK STOCKHOLDERS").
RECITALS
The Auto-Q UK Stockholders own an aggregate of 500 shares of Warminster
Systems Limited, a company formed under the laws of England and Wales ("AUTO-Q
UK"), which shares constitute all of the issued and outstanding capital stock of
Auto-Q UK (the "AUTO-Q UK SHARES").
Auto-Q USA and the Auto-Q UK Stockholders desire to effect the exchange
of 6,300,000 shares of common stock of Auto-Q USA for the Auto-Q UK Shares upon
the terms and subject to the conditions set forth herein.
In consideration of the foregoing and the mutual covenants,
representations, warranties and agreements hereinafter set forth, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
When used herein, the following terms shall have the meanings set forth
below:
"AFFILIATE" means, with respect to any given Person, any other Person
that directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person. The term "control"
(including, with correlative meaning, the terms "controlled by" and "under
common control with"), as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by contract or otherwise.
"ASSETS" means all properties, assets, Contracts, business, goodwill and
rights of Auto-Q UK or Auto-Q USA, as the case may be, as a going concern, of
every kind, nature, character and description, tangible and intangible, wherever
located and whether or not carried or reflected on the books and records of
Auto-Q UK or Auto-Q USA, as the case may be, on the Closing Date
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"CONTRACT" means any contract, agreement, lease, license, arrangement,
commitment, sales order, purchase order or any claim or right or any benefit or
obligation arising thereunder or resulting therefrom and currently in effect,
whether oral or written.
"LIABILITIES" means any direct or indirect liability, indebtedness,
claim, loss, damage, deficiency, obligation or responsibility, fixed or unfixed,
xxxxxx or inchoate, liquidated or unliquidated, secured or unsecured, accrued,
absolute, known or unknown, contingent or otherwise.
"LIEN" means any mortgage, lien, pledge, charge, security interest,
license, lease, claim, restriction, option, conditional sale or installment
Contract or encumbrance of any kind.
"PERSON" shall include an individual, a partnership, a corporation, or a
division or business unit thereof, a trust, an unincorporated organization, a
government or any department or agency thereof and any other entity.
"SECURITIES ACT" shall mean the United States Securities Act of 1933, as
amended.
ARTICLE II
EXCHANGE OF SHARES
2.1 DELIVERY OF AUTO-Q UK SHARES. At the Closing, the Auto-Q UK
Stockholders shall deliver to Auto-Q USA share certificates representing the
Auto-Q UK Shares, duly endorsed to Auto-Q USA or accompanied by stock powers
duly executed in proper form for transfer to Auto-Q USA from the applicable
Auto-Q UK Stockholders, in the amounts set forth below:
Xxx Xxx 499 shares
Xxxxxxxxx Xxxxxxx 1 share
2.2 ISSUANCE OF AUTO-Q USA SHARES. In exchange for the Auto-Q UK
Shares, Auto-Q USA shall, at the Closing, issue to the Auto-Q UK Stockholders
certificates representing an aggregate of 6,300,000 shares of common stock of
Auto-Q USA (the "AUTO-Q USA SHARES") to the Auto-Q UK Stockholders in the
amounts set forth next to each person's name below:
Xxx Xxx 6,287,400
Xxxxxxxxx Xxxxxxx 12,600
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ARTICLE III
CLOSING
3.1 CLOSING. The closing (the "CLOSING") of the transactions
contemplated hereby shall be held at the offices of Xxxxx Xxxxxxx Xxxxxxx &
Xxxxx LLP, located at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00
a.m., local time, on or before April 27, 2001 or within five (5) days after the
conditions contained in Articles VII and VIII have been satisfied or waived, or
at such other place and time as may be agreed upon by the parties hereto, but in
no event later than sixty-five (65) days from the execution of this Agreement
unless further extended by agreement of the parties. The time and date of the
Closing is referred to herein as the "CLOSING DATE." At the Closing, in addition
to the exchange of the Auto-Q UK Shares for the Auto-Q USA Shares, the parties
hereto shall deliver such, certificates, opinions and other documents as are
specified in Articles VII and VIII.
3.2 TRANSFER TAXES. Each party shall be responsible for its own
transfer and similar taxes assessed or payable in connection with the sale and
transfer of the Auto-Q UK Shares or Auto-Q USA Shares, as the case may be, and
the transactions contemplated hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF AUTO-Q USA
Auto-Q USA hereby represents and warrants to, and agrees with, the
Auto-Q UK Stockholders as follows:
4.1 ORGANIZATION. Auto-Q USA is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Auto-Q USA has all requisite corporate power and authority to own, lease and
operate its properties and to carry on its business as now being conducted.
Auto-Q USA has previously delivered to the Auto-Q UK Stockholders true, accurate
and complete copies of its Certificates of Incorporation and By-Laws as in
effect on the date hereof and minutes of all meetings of stockholders and
directors of Auto-Q USA held as of the date of this Agreement. Auto-Q USA is not
in violation of any of the provisions of its Certificate of Incorporation or
By-Laws.
4.2 AUTHORITY. Auto-Q USA has full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized by the Board of Directors and, if necessary, the stockholders of
Auto-Q USA, and no other corporate proceedings on the part of Auto-Q USA are
necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly authorized, executed and
delivered by Auto-Q USA and constitutes the legal, valid and binding obligation
of Auto-Q USA, enforceable against it in accordance with its terms.
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4.3 CAPITALIZATION.
(a) Auto-Q USA has authorized capital stock of 50,000,000 shares of
common stock, par value $.001 per share, none of which are issued and
outstanding as of the date hereof and 1,000,000 shares of Series Preferred
Stock, $.001 par value per share, none of which are issued and outstanding as of
the date hereof. There are no other convertible securities, options, warrants,
subscription calls or other rights or agreements, arrangements or commitments
obligating Auto-Q USA to issue, transfer or sell any of its securities.
(b) The issuance and delivery of the Auto-Q USA Shares have been
duly authorized by all required corporate action on the part of Auto-Q USA. The
Auto-Q USA Shares when issued and paid for in accordance with this Agreement,
will be validly issued, fully paid and nonassessable, with no personal liability
attaching to the ownership thereof and will be free and clear of all Liens.
4.4 NO CONFLICT; REQUIRED FILINGS AND CONSENTS.
(a) The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby will not, (i) conflict with
or violate any law, regulation, court order, judgment or decree, (ii) violate or
conflict with the Certificate of Incorporation or By-Laws of Auto-Q USA, or
(iii) result in any breach of or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination or cancellation of any Contract, permit, license or
franchise to which Auto-Q USA is bound or affected, except for conflicts,
violations, breaches or defaults which, in the aggregate, would not have a
material adverse effect on the business, operations, Assets, Liabilities,
condition (financial or otherwise), results of operations or prospects (a
"MATERIAL ADVERSE EFFECT") of Auto-Q USA.
(b) The execution, delivery or performance of this Agreement do not,
and the consummation of the transactions contemplated hereby will not require
any notice, report or other filing with any governmental authority, domestic or
foreign, or require any waiver, consent, approval or authorization of any Person
or any governmental or regulatory authority, domestic or foreign.
4.5 FINDER'S FEE. There is no investment banker, broker, finder or
other intermediary which has been retained by, or is authorized to act on behalf
of Auto-Q USA or its Affiliates who might be entitled to any fee or commission
from any of the Auto-Q UK Stockholders or their respective Affiliates upon the
consummation of the transactions contemplated hereby or thereafter.
4.6 ACCURACY OF REPRESENTATIONS. The representations and warranties
made by Auto-Q USA in this Agreement, and in any certificate or schedule
referenced hereby or attached hereto, do not contain, and will not contain, any
statement which is false or misleading with respect to any material fact and do
not and will not omit to state a material fact required to be stated herein or
therein or necessary in order to make the statements contained herein or therein
not materially false or misleading. There is no material fact or condition which
could have a
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Material Adverse Effect on Auto-Q USA which has not been set forth in this
Agreement or described in the Schedules hereto.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE AUTO-Q UK STOCKHOLDERS
Each of the Auto-Q UK Stockholders hereby, severally and not jointly,
represents and warrants to, and agrees with, Auto-Q USA as follows:
5.1 ORGANIZATION AND AUTHORITY.
(a) Auto-Q UK is a corporation duly organized, validly existing and
in good standing under the laws of England and Wales. Auto-Q UK has all
requisite corporate power and authority to own, lease and operate its properties
and to carry on its business as now being conducted. Auto-Q UK is duly qualified
to do business and in good standing as a foreign corporation in each
jurisdiction in which the property owned, leased or operated by Auto-Q UK or the
nature of the business conducted by it makes such qualification necessary.
(b) Each Auto-Q UK Stockholder is of full age and has the legal
capacity to enter into this Agreement and to carry out the transactions
contemplated hereby, and this Agreement constitutes the valid and binding
obligation of such Auto-Q UK Stockholders, enforceable in accordance with its
terms.
5.2 NO CONFLICT; REQUIRED FILINGS AND CONSENTS.
(a) The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby will not, (i) conflict with
or violate any law, regulation, court order, judgment or decree applicable to
the Auto-Q UK Stockholders, (ii) result in any breach of or constitute a default
(or an event which with notice or lapse of time or both would become a default)
under, or give to others any rights of termination or cancellation of any
Contract, permit, license or franchise to which any of the Auto-Q UK
Stockholders is a party or is bound or affected, which conflict, violation,
breach, default or right of termination or cancellation would impair such Auto-Q
UK Stockholder's ability to consummate the transactions contemplated hereby.
(b) The execution, delivery or performance of this Agreement do not,
and the consummation of the transactions contemplated hereby will not require
any notice, report or other filing with any governmental authority, domestic or
foreign, or require any waiver, consent, approval or authorization of any Person
or any governmental or regulatory authority, domestic or foreign.
5.3 CAPITALIZATION. Auto-Q UK has authorized capital stock of 500
shares, of which 500 shares are issued and outstanding as of the date hereof.
All issued and outstanding shares of capital stock of Auto-Q UK have been duly
authorized, validly issued, fully paid, nonassessable
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and free of preemptive rights. There are no other convertible securities,
options, warrants, subscription calls or other rights or agreements,
arrangements or commitments obligating Auto-Q UK to issue, transfer or sell any
of its securities. None of such issued and outstanding shares is the subject of
any voting trust agreement or other agreement relating to the voting thereof or
restricting in any way the sale or transfer thereof.
5.4 SHARE OWNERSHIP. Each of the Auto-Q UK Stockholders is the
record and beneficial owner of all of the number of Auto-Q UK Shares set forth
opposite such Auto-Q UK Stockholder's name in Section 2.1, free and clear of any
Lien. Each Auto-Q UK Stockholder has full right and authority to transfer such
Auto-Q UK Shares pursuant to the terms of this Agreement
5.5 SECURITIES LAW ACKNOWLEDGMENTS. The Auto-Q UK Stockholders
acknowledge that the Auto-Q USA Shares are being and will be issued to the
Auto-Q UK Stockholders in reliance on specific exemptions from the registration
requirements of federal and state securities laws. The Auto-Q UK Stockholders
and any transferee of the Auto-Q UK Stockholders will not sell or otherwise
transfer the Auto-Q USA Shares without registration under the Securities Act or
an exemption therefrom, and fully understand and agree that the Auto-Q UK
Stockholders or any such transferee must bear the economic risk of holding the
Auto-Q USA Shares for an indefinite period of time because, among other reasons,
the Auto-Q USA Shares have not been registered under the Securities Act or under
the securities laws of certain states and, therefore, cannot be resold, pledged,
assigned or otherwise disposed of unless the securities are subsequently
registered under the Securities Act and under the applicable securities laws of
such states or unless an exemption from such registration is available in the
opinion of counsel for the holder, which counsel and opinion are reasonably
satisfactory to counsel for Auto-Q USA. The Auto-Q UK Stockholders are acquiring
the Auto-Q USA Shares for the account of the Auto-Q UK Stockholders for
investment and not with a view to resale or distribution except in compliance
with the Securities Act.
5.6 FINDER'S FEE. There is no investment banker, broker, finder or
other intermediary which has been retained by, or is authorized to act on behalf
of, the Auto-Q UK Stockholders who might be entitled to any fee or commission
from Auto-Q USA or any of its Affiliates upon the consummation of the
transactions contemplated by this Agreement thereafter.
5.7 ACCURACY OF REPRESENTATIONS. The representations and warranties
made by the Auto-Q UK Stockholders in this Agreement, and in any certificate or
schedule referenced hereby or attached hereto, do not contain, and will not
contain, any statement which is false or misleading with respect to any material
fact and do not and will not omit to state a material fact required to be stated
herein or therein or necessary in order to make the statements contained herein
or therein not materially false or misleading. There is no material fact or
condition which could have a Material Adverse Effect on any of the Auto-Q UK
Stockholders which has not been set forth in this Agreement or described in the
Schedules hereto.
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ARTICLE VI
COVENANTS
6.1 CONSENTS. Each party hereto shall use its best efforts to
obtain, at its expense, all consents, approvals and waivers of third Persons or
governmental entities or regulatory bodies required to consummate the
transactions contemplated hereby.
6.2 PUBLIC ANNOUNCEMENTS. Each of the parties hereto will consult
with one another before issuing any press release or otherwise making any public
statement with respect to the transactions contemplated hereby and shall not,
except as may be required by law or any listing agreements with any national
securities exchange, issue any such press release or make any such public
statement without the approval of one another.
6.2 EXPENSES. Except as otherwise provided herein, whether or not
the transactions contemplated hereby are consummated, all expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
the obligation of the party incurring such expenses.
ARTICLE VII
CONDITIONS PRECEDENT TO
THE PERFORMANCE OF AUTO-Q USA
The obligations of Auto-Q USA under this Agreement are subject to the
following conditions which may be waived in whole or in part by Auto-Q USA at
its election:
7.1 BRING DOWN OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of each of the Auto-Q UK Stockholders in this
Agreement shall be true and correct in all material respects on the date hereof
and shall also be true and correct in all material respects on the Closing Date
with the same force and effect as if made on and as of the Closing Date, and the
Auto-Q UK Stockholders shall have performed or complied in all material respects
with all agreements, conditions and covenants required by this Agreement to be
performed or complied with by them on or before the Closing Date.
7.2 CONSENTS. The Auto-Q UK Stockholders shall have obtained all
approvals, authorizations and consents required to consummate the transactions
contemplated hereby upon terms and subject to conditions satisfactory to Auto-Q
USA in its sole discretion and they shall be in full force and effect. Auto-Q
USA shall have been furnished with appropriate evidence, reasonably satisfactory
to it and its counsel, of the granting of such approvals, authorizations and
consents.
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ARTICLE VIII
CONDITIONS PRECEDENT
TO PERFORMANCE OF THE AUTO-Q UK STOCKHOLDER
The obligations of the Auto-Q UK Stockholders under this Agreement are
subject to the following conditions which may be waived in whole or in part by
the Auto-Q UK Stockholders at their election:
8.1 BRING DOWN OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Auto-Q USA contained in this Agreement shall
be true and correct in all material respects on the date hereof and shall also
be true and correct in all material respects on and as at the Closing Date with
the same force and effect as if made on and as of the Closing Date, and Auto-Q
USA shall have performed or complied in all material respects with all
agreements, conditions and covenants required by this Agreement to be performed
or complied with by it on or before the Closing Date.
8.2 AUTHORITY. Auto-Q USA shall have delivered to the Auto-Q UK
Stockholders a certificate of the Secretary of Auto-Q USA certifying to the
resolutions of the Board of Directors of Auto-Q USA authorizing the transactions
contemplated hereby and certifying that such resolutions have not been revoked,
suspended or amended and remain in full force and effect. The Auto-Q UK
Stockholders shall have received all other documents they may reasonably request
relating to the existence of Auto-Q USA and the authority of Auto-Q USA to enter
into this Agreement and to consummate the transactions contemplated hereby.
8.3 CONSENTS. All approvals, authorizations and consents required by
Auto-Q USA to consummate the transactions contemplated hereby shall have been
obtained on terms and conditions satisfactory to the Auto-Q UK Stockholders in
their sole discretion and shall be in full force and effect, and the Auto-Q UK
Stockholders shall have been furnished with appropriate evidence, reasonably
satisfactory to them and their counsel, of the granting of such approvals,
authorizations and consents.
8.4 INJUNCTION. There shall be no effective injunction, writ or
preliminary restraining order of any nature issued by a court or governmental
agency of competent jurisdiction directing that the transactions provided for
herein or any of them not be consummated as herein provided.
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ARTICLE IX
MISCELLANEOUS
9.1 ENTIRE AGREEMENT; ASSIGNMENT. This Agreement, together with all
Schedules and Exhibits, constitutes the entire agreement among the parties with
respect to the subject matter hereof and supersedes all other prior agreements
and understandings, both written and oral, among the parties or between any of
them with respect to the subject matter hereof. All references to Sections,
Exhibits and Schedules shall be deemed references to such parts of this
Agreement unless the text requires otherwise. This Agreement shall not be
assigned by operation of law or otherwise.
9.2 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made as of
the date delivered or mailed if delivered in person, by telecopy, cable,
telegram or telex, or by registered or certified mail (postage prepaid, return
receipt requested) to the respective parties as follows:
If to Auto-Q USA:
Auto-Q International, Inc.
Beaumont Lodge, 000 Xxxxxx Xxxxx Xxxx
Xxxxxxxxx XX0 0XX Xxxxxx Xxxxxxx
Fax: 00000 000 000
Attn: Xxx Xxx
with a copy to:
Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attn: Xxxx X. Xxxxxxx, Esq.
If to the Auto-Q UK Stockholders:
c/o Xxx Xxx
Warminster Systems Limited
Beaumont Lodge, 000 Xxxxxx Xxxxx Xxxx
Xxxxxxxxx XX0 0XX Xxxxxx Xxxxxxx
Fax: 00000 000 000
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with a copy to:
Fox Hayes
Bank House
000 Xxxxxxxx Xxxx
Xxxxx, XX0 0XX
Xxxxxx Xxxxxxx
Fax: 000-00-000-000-0000
Attn: Mr. J. Xxxxxx Xxxxxxx
or to such other address as the Person to whom notices is given may have
previously furnished to the others in writing in the manner set forth above.
9.3 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without giving effect to
applicable principles of conflicts of laws thereof.
9.4 PARTIES IN INTEREST. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, its successors and assigns.
9.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
9.6 SPECIFIC PERFORMANCE. Irreparable damage would occur if any of
the provisions of this Agreement were not performed in accordance with the terms
hereof, and the parties shall be entitled to specific performance of the terms
hereof, in addition to any other remedy at law or equity.
9.7 CONSTRUCTION. The parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation. Nothing in the
Schedules shall be deemed adequate to disclose an exception to a representation
or warranty made herein unless the Schedule identifies the exception with
reasonable particularity and describes the relevant facts in reasonable detail.
Without limiting the generality of the foregoing, the mere listing (or inclusion
of a copy) of a document or other item shall not be deemed adequate to disclose
an exception to a representation or warranty made herein (unless the
representation or warranty has to do with the existence of the document or other
item itself). The parties intend that each representation, warranty, and
covenant contained herein shall have independent significance. If any party has
breached any representation, warranty, or covenant contained herein in any
respect, the fact that there exists another representation, warranty, or
covenant relating to the same subject matter (regardless of the relative levels
of specificity)
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which the party has not breached shall not detract from or mitigate the fact
that the party is in breach of the first representation, warranty, or covenant.
9.8 INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference and
made a part hereof.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, or
individually, as the case may be, all as of the day and year first above
written.
AUTO-Q INTERNATIONAL INC.
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
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Title: President
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/s/ Xxx Xxx
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Xxx Xxx
/s/ Xxxxxxxxx Xxxxxxx
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Xxxxxxxxx Xxxxxxx
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