MERGER AGREEMENT
AMONG
SPORTS-GUARD, INC.
TIO XXXXXXX CIGAR CORP.
AND
TIO CIGARS, INC.
TABLE OF CONTENTS
Page
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1. The Merger........................................................... 1
1.1. Effective Time............................................. 1
1.2. Conversion of Membership Interests......................... 2
1.3. Restricted Securities...................................... 2
1.4. Certificate of Incorporation............................... 3
1.5. Bylaws..................................................... 3
1.6. Dissenters' Rights......................................... 3
1.7. Directors.................................................. 3
2. Representations, Warranties and Agreements of RCP and RCP Members.... 3
2.1. Due Organization........................................... 3
2.2. Corporate Authority........................................ 4
2.3 Capitalization............................................. 4
2.4 Subsidiaries............................................... 4
2.5. No Financial Statements.................................... 4
2.6. No Undisclosed Liabilities................................. 4
2.7. Title To Properties........................................ 4
2.8. Compliance with Laws; Litigation........................... 4
2.9. Tax Returns................................................ 5
2.10. Full Disclosure............................................ 5
2.11. Board Action............................................... 5
2.12. Title to Target Shares..................................... 5
2.13. Continuity of Business Enterprise.......................... 5
2.14. No Intent to Sell.......................................... 5
3. Representations, Warranties and Agreements of Parent and Merger
Subsidiary.................................................................. 5
3.1. Organization of Parent and Merger Subsidiary............... 5
3.2. Corporate Authority........................................ 6
3.3. Capitalization............................................. 6
3.4. No Undisclosed Liabilities................................. 6
3.5. Compliance with the Laws; Litigation....................... 6
3.6. Tax Returns................................................ 7
3.7. Full Disclosure............................................ 7
3.8. Board Action............................................... 7
4. Action Prior to the Effective Time................................... 7
4.1. Approval of TIO Shareholders............................... 7
4.2. Accuracy of Representations and Warranties................. 7
4.3. Closing.................................................... 7
(i)
5. Conditions Precedent to Obligation of Parent and Merger Subsidiary... 8
5.1. No Adverse Change; Corporate Action........................ 8
5.2. No Litigation.............................................. 8
5.3. Securities Laws............................................ 8
6. Conditions Precedent to Obligation of TIO............................ 8
6.1. Accuracy of Representations and Warranties; Performance
of Obligations............................................. 8
6.2. No Litigation.............................................. 8
7. Other Provisions..................................................... 8
7.1. Governing Law.............................................. 9
7.2. Waiver..................................................... 9
7.3. Survival................................................... 9
7.4. No Indemnification......................................... 9
8. Titles and Headings.................................................. 9
9. Notices.............................................................. 9
10. Assignment........................................................... 10
11. Counterparts......................................................... 10
12. Amendment............................................................ 10
Exhibit A - TIO Share Ownership
(ii)
MERGER AGREEMENT
THIS MERGER AGREEMENT, made and entered into as of this 31st day of
October, 1997, by and among TIO CIGARS, INC., a corporation established and
governed under the laws of the State of Ohio ("Tio" or "Target"), TIO XXXXXXX
CIGAR CORP., a corporation to be established and governed under the laws of the
State of Delaware ("Merger Subsidiary"), Tio and Merger Subsidiary being
hereinafter sometimes called the "Constituent Corporations" and Merger
Subsidiary being hereinafter sometimes called the "Surviving Corporation", and
SPORTS-GUARD, INC., a Delaware corporation ("Parent") (Parent joining as an
additional party, not being a Constituent Corporation).
W I T N E S S E T H
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Merger Subsidiary and Target propose to merge pursuant to this Merger
Agreement (the "Merger Agreement"), which provides for the merger of Target with
and into Merger Subsidiary, with Merger Subsidiary as the surviving corporation
(the "Merger"), pursuant to the applicable laws of the States of Delaware and
Ohio, at the Effective Time, as defined herein, with the intent to qualify the
transactions provided for herein as a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code").
Contemporaneously herewith, Parent has entered into a merger agreement with RCP
Enterprises Group, LLC, an Ohio limited liability Company ("RCP"), whereby RCP
will merger with and into a wholly-owned subsidiary of Parent, with such
wholly-owned subsidiary as the surviving corporation and in which RCP members
shall receive Parent shares (the "RCP Merger"). This Merger Agreement records
the representations and warranties made by Parent, Merger Subsidiary and Tio in
connection with the instant Merger, sets forth certain covenants and agreements
of the parties, provides conditions to the obligations of the parties and sets
forth other provisions relating to the Merger.
NOW, THEREFORE, Parent, Merger Subsidiary and Tio in consideration of
the agreements, covenants and conditions contained herein, hereby make the
following representations and warranties, give the following covenants and agree
as follows:
A G R E E M E N T
- - - - - - - - -
1. THE MERGER. At the Effective Time (as hereinafter defined) of the
Merger, Tio shall be merged with and into Merger Subsidiary by statutory merger;
the separate existence of Tio shall cease and Merger Subsidiary shall be the
surviving corporation, and on the following terms and conditions:
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1.1. EFFECTIVE TIME. The Merger shall be effective (the
"Effective Time") when this Merger Agreement and/or appropriate certificates of
its approval and adoption and acknowledgments shall have been filed with the
Secretary of State of Delaware.
1.2. CONVERSION OF SHARES. At the Effective Time, by virtue of
the Merger, and without any action on the part of the holders thereof:
1.2.1. Each of the shares of Tio common stock, no par
value, ("Tio Common Stock") held by Tio Shareholders, as described in Appendix A
(the "Tio Shareholders"), which shall be outstanding immediately prior to the
Effective Time (collectively "the Shares") and other than Shares which are
dissenting shares, shall cease to be outstanding and shall be converted into
shares of common stock, $.01 par value, of Parent ("Parent Common Stock") at a
ratio of one (1) share of Parent Common Stock for each two (2) shares of Tio
Common Stock, except that fractional shares shall be rounded up to the nearest
whole share. The foregoing exchange ratio includes the effect of a proposed
one-for-ten reverse split of Parent Common Stock to be effected prior to the
Effective Time (i.e., an aggregate of 1,310,000 shares of Parent Common Stock
will be issued to the Tio Shareholders). Holders of certificates which represent
the Shares shall thereafter have no rights as shareholders of Target. Except for
issuance by Parent of stock in connection with the RCP Merger, after the date of
this Merger Agreement and prior to the Effective Time, neither Parent nor Tio
shall declare or pay to its shareholders of record a stock dividend upon the
Parent Common Stock or the Tio Common Stock, as the case may be, or subdivide,
split up, reclassify or combine the Parent Common Stock or the Tio Common Stock,
as the case may be, or make any other distribution of securities or property in
respect of the Parent Common Stock or the Tio Common Stock, as the case may be
or otherwise effect any capital reorganization.
1.2.2. From and after the Effective Time, each holder of a
certificate theretofore representing issued and outstanding Shares (but not
including Shares which are dissenting shares within the meaning of the Ohio
General Corporation Law shall, upon the surrender of such certificates to
Parent, be entitled to receive in exchange therefor a certificate or
certificates representing the number of shares of Parent Common Stock into which
the Shares theretofore represented by the certificate or certificates so
surrendered shall have been converted pursuant to subsection 1.2.1 above. From
and after the Effective Time, until so surrendered, each certificate theretofore
representing Shares (except for certificates representing dissenting shares)
shall be deemed for all corporate purposes to evidence the number of shares of
Parent Common Stock into which such Shares shall have been converted.
1.3. RESTRICTED SECURITIES. The Parent Common Stock to be issued
in exchange for the Shares has not been registered under the Securities Act of
1933, as amended, by reason of an exemption therefrom, and may not be
transferred or resold except pursuant to an effective registration statement or
exemption from registration and each certificate representing the Shares will be
endorsed with the following legends and any legend required to be placed thereon
by applicable state securities laws:
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"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). THE SHARES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF A CURRENT AND
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT WITH
RESPECT TO SUCH SHARES, OR AN OPINION OF THE ISSUER'S
COUNSEL TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED
UNDER THE ACT."
1.4. ARTICLES OF INCORPORATION. The Certificate of Incorporation
of Merger Subsidiary shall continue to be the Certificate of Incorporation of
the Surviving Corporation immediately after the Effective Time.
1.5. BYLAWS. The Bylaws of Merger Subsidiary in effect
immediately prior to the Effective Time shall continue to be the Bylaws of the
Surviving Corporation immediately after the Effective Time.
1.6. DISSENTERS' RIGHTS. Parent and Tio shall take all actions
mandated by the Ohio General Corporation Law to permit and satisfy the exercise
of rights of dissent and appraisal by holders of Tio Common Stock.
1.7. DIRECTORS. The Board of Directors of the Surviving
Corporation at and as of the consummation of the transactions contemplated
herein shall be as set forth on Schedule 1.7 hereto.
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF TIO AND TIO
SHAREHOLDERS. As an inducement to Parent and Merger Subsidiary to enter into
this Merger Agreement and to consummate the transactions contemplated herein,
Tio, and the Tio shareholders as to Sections 2.12 and 2.14 only, represent and
warrant to Parent and Merger Subsidiary and agree as follows:
2.1. DUE ORGANIZATION. Tio is a corporation duly incorporated and
validly existing in good standing under the laws of the State of Ohio, and has
full corporate power and authority to own or lease its properties and to carry
on its business as now conducted. Tio is duly licensed, qualified to do business
and in good standing as a foreign corporation in each jurisdiction in which its
failure to be so licensed or qualified would have a material adverse effect on
its business taken as a whole.
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2.2. CORPORATE AUTHORITY. The execution, delivery and performance
by Tio of this Merger Agreement has been duly authorized and approved by its
Board of Directors, subject to approval of the Merger contemplated herein by its
shareholders pursuant to section 4.1 hereof, and neither the execution and
delivery of this Merger Agreement nor the consummation of the transactions
contemplated hereby, nor compliance with nor fulfillment of the terms and
provisions herein, will: (i) conflict with or result in a breach of the terms,
conditions or provisions of or constitute a default under the Articles of
Incorporation or Bylaws of Tio, any material agreement, instrument or judgment
to which it is a party or by which it is bound or any statute or regulatory
provisions affecting Tio; (ii) give any party to or with rights under any such
agreement, instrument or judgment the right to terminate, modify or otherwise
change the material rights or obligations of Tio under such agreement,
instrument or judgment; or (iii) require the approval, consent or authorization
of any Federal, state or local court, governmental authority or regulatory body,
other than in connection with or in compliance with the provisions of the Ohio
General Corporation Law and Federal or state securities or antitrust laws. Tio
has, and will have at the Effective Time, full corporate power and corporate
authority to complete the merger with Merger Subsidiary pursuant to this Merger
Agreement and to do and perform all acts and things required to be done by Tio
under the Merger Agreement, subject to compliance with the provisions of the
Ohio General Corporation Law and Federal or state securities or antitrust laws.
2.3. CAPITALIZATION. As of the Effective Time, the authorized
capital stock of Tio shall consist of 3,000,000 shares of Tio Common Stock, no
par value, of which 2,620,000 shares shall be issued and outstanding (none of
which are owned beneficially or of record by Tio) as of the date of this Merger
Agreement. All of the issued and outstanding shares of Tio Common Stock are duly
and validly issued and are fully paid and non-assessable. Except as set forth on
Exhibit B, no other securities of Tio are outstanding, and Tio has not issued
nor taken any action toward issuance of any other options, warrants, conversion
privileges or other rights to purchase or acquire shares of Tio Common Stock,
whether upon exchange for or conversion of other securities or otherwise, and no
rescission or redemption rights exist with regard to existing shareholders. No
shares of Tio Common Stock will be issued between the date hereof and the
Effective Time.
2.4. SUBSIDIARIES. Tio has no subsidiaries and no ownership
interest in any other entities.
2.5. NO FINANCIAL STATEMENTS. Tio was incorporated on June 19,
1997 and has had no significant operations to date.
2.6. NO UNDISCLOSED LIABILITIES. Tio has no material liabilities,
fixed or contingent.
2.7. TITLE TO PROPERTIES. Tio has good, valid and marketable
title to all of the properties and assets. All such properties and assets are
free and clear of all liens, claims, charges, security interests or other
encumbrances.
2.8. COMPLIANCE WITH LAWS; LITIGATION. Tio is not in default in
any material respect under any material agreement, lease or other document to
which it is a party, nor has Tio received written notice of or is, to the
knowledge of any executive officer of Tio, in material violation of any law or
order, writ, injunction or decree of any court or Federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality and there are no material lawsuits, proceedings, claims or
governmental investigations pending or, to the knowledge of any executive
officer of Tio, threatened against Tio or against its properties or business,
nor is there any reasonable basis known to Tio for any such action and there is
no action, suit, proceeding or investigation pending, threatened or, to the
knowledge of Tio, contemplated which questions the legality, validity or
propriety of the transactions contemplated by this Merger Agreement.
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2.9. TAX RETURNS. Tio has (i) filed or has caused to be filed all
federal, state and local franchise, income, sales, gross receipts and all other
tax returns and statements required to be filed by Tio or on its behalf and
which were due prior to the date of this Merger Agreement (the "Tax Returns and
Statements") and (ii) paid within the time and in the manner prescribed by law
all taxes due prior to the date of this Merger Agreement. No tax assessment or
deficiency has been made against Tio nor has any notice been given of any actual
or proposed assessment or deficiency which has not been paid or for which an
adequate reserve has not been set aside.
2.10. FULL DISCLOSURE. No representation or warranty by Tio in
this Merger Agreement or any written information, documents or memoranda
furnished or to be furnished by Tio or any of its authorized representatives to
Parent or Merger Subsidiary or any of their representatives is false or
misleading in any material respect or omits to state a material fact required to
be stated therein or necessary in order to make any of the statements therein
not misleading.
2.11. BOARD ACTION. The Board of Directors of Tio, by requisite
vote, determined that the Merger is in the best interests of Tio and its
shareholders, approved the Merger Agreement and recommended approval and
adoption of the Merger Agreement by the shareholders of Tio.
2.12. TITLE TO TARGET SHARES. Each Tio Shareholder owns and holds
title to, and will at the Effective Time own and hold title to, respectively,
the Tio Common Stock (or shares) now (and at Effective Time to be) owned by him
or her, as set forth in Exhibit A, free and clear of any lien, charge or
encumbrance of any kind.
2.13. CONTINUITY OF BUSINESS ENTERPRISE. Tio operates at least
one significant historic business line, or owns at least a significant portion
of its historic business assets, within the meaning of Treasury Regulation ss.
1.368-1(d) promulgated under the Internal
Revenue Code.
2.14. NO INTENT TO SELL. No Tio Shareholder has, or at the
Effective Time will have, any present plan, intention or arrangement to sell,
transfer or otherwise in any manner dispose of any of the Parent Common Stock to
be issued to such Shareholder pursuant to
the merger.
3. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF PARENT AND MERGER
SUBSIDIARY. As an inducement to Tio to enter into this Merger Agreement and to
consummate the transactions contemplated herein, Parent and Merger Subsidiary
hereby represent and warrant to Tio and its shareholders and agree as follows:
3.1. ORGANIZATION OF PARENT AND MERGER SUBSIDIARY. Parent is a
corporation duly incorporated and validly existing in good standing under the
laws of the State of Delaware; Merger Subsidiary is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Delaware and is a directly and wholly owned subsidiary of Parent; Parent and
Merger Subsidiary each has full corporate power and authority to consummate the
Merger as provided herein and Parent has full corporate power to own or lease
its properties and to carry on its business as it is currently conducted. Parent
is duly licensed, qualified to do business and in good standing as a foreign
corporation in each jurisdiction in which its failure to be so licensed or
qualified would have a material adverse effect on its business taken as a whole.
-5-
3.2. CORPORATE AUTHORITY. The execution, delivery and performance
by Parent and Merger Subsidiary of this Merger Agreement have been duly
authorized and approved by the Boards of Directors of Parent and Merger
Subsidiary, subject to the approval of the shareholders of Parent pursuant to
section 4.1, and neither the execution nor delivery of this Merger Agreement nor
the consummation of the transactions contemplated hereby, nor compliance with
nor fulfillment of the terms and provisions herein, will, (i) conflict with or
result in a breach of the terms, conditions or provisions of or constitute a
default under the Articles of Incorporation or Bylaws of Parent, the Articles of
Incorporation or Bylaws of Merger Subsidiary or any material agreement,
instrument or judgment to which Parent or Merger Subsidiary is a party or by
which either is bound or any statute or regulatory provisions affecting Parent
or Merger Subsidiary, (ii) give any party to or with rights under any such
agreement, instrument or judgment the right to terminate, modify or otherwise
change the material rights or obligations of Parent or Merger Subsidiary under
such agreement, instrument or judgment, or (iii) require the approval, consent
or authorization of any Federal, state or local court, governmental authority or
regulatory body, other than in connection with or in compliance with the
provisions of the Delaware General Corporation Law and Federal or state
securities or antitrust laws. Merger Subsidiary has, and will have at the
Effective Time, full corporate power and corporate authority to merge with Tio
pursuant to this Merger Agreement and Parent and Merger Subsidiary will have at
the Effective Time, full corporate power and corporate authority to do and
perform all acts and things required to be done by them under this Merger
Agreement, subject to compliance with the provisions of the Delaware General
Corporation Law and Federal or state securities or antitrust laws.
3.3. CAPITALIZATION. The authorized capital stock of Parent
consists of 20,000,000 shares of Parent Common Stock, $.01 par value, of which
following the Merger and the RCP Merger approximately 6,167,700 shares will be
issued and outstanding. The shares of Parent Common Stock to be issued to the
shareholders of Tio pursuant to this Merger Agreement, when issued and delivered
in accordance with the terms of this Merger Agreement, will be validly issued,
fully paid and non-assessable, and not subject to preemptive rights.
3.4. NO UNDISCLOSED LIABILITIES. Parent has no material
undisclosed liabilities, either fixed or contingent.
3.5. COMPLIANCE WITH THE LAWS; LITIGATION. Neither Parent or
Merger Subsidiary is in default in any material respect under any material
agreement, lease or other document to which it is a party, or has received
written notice of or is, to the knowledge of any executive officer of Parent or
Merger Subsidiary, in material violation of any law or order, writ, injunction
or decree of any court or Federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality. There are no
material lawsuits, proceedings, claims or governmental investigations pending
or, to the knowledge of any executive officer of Parent or Merger Subsidiary,
threatened against Parent or Merger Subsidiary or against its properties or
business, nor is there any reasonable basis known to Parent or Merger Subsidiary
for any such action and there is no action, suit, proceeding or investigation
pending, threatened or, to the knowledge of Parent or Merger Subsidiary,
contemplated which questions the legality, validity or propriety of the
transactions contemplated by this Merger Agreement.
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3.6. TAX RETURNS. Parent has (i) filed or has caused to be filed
all federal, state and local franchise, income, sales, gross receipts and all
other tax returns and statements required to be filed by Parent or on its behalf
and which were due prior to the date of this Merger Agreement (the "Tax Returns
and Statements") and (ii) paid within the time and in the manner prescribed by
law all taxes due prior to the date of this Merger Agreement. The Tax Returns
and Statements are true, complete and accurate in all material respects. No tax
assessment or deficiency has been made against Parent nor has any notice been
given of any actual or proposed assessment or deficiency which has not been paid
or for which an adequate reserve has not been set aside.
3.7. FULL DISCLOSURE. No representation or warranty by Parent and
Merger Subsidiary to Tio under this Merger Agreement or any of the written
information, documents or memoranda furnished or to be furnished by Parent or
any of its authorized representatives to Tio or any of its representatives is
false or misleading or omits to state a material fact required to be stated
therein or necessary in order to make any of the statements therein not
misleading.
3.8. BOARD ACTION. The Board of Directors of Parent, by requisite
vote, determined that the Merger is in the best interests of Parent and approved
the Merger Agreement.
4. ACTION PRIOR TO THE EFFECTIVE TIME. The parties covenant to take the
following action between the date hereof and the Effective Time:
4.1. APPROVAL OF TIO SHAREHOLDERS. Tio will obtain the approval
of its shareholders for the Merger on the terms and conditions set forth in this
Merger Agreement and in connection therewith will comply fully with the
applicable provisions of the Florida 1989 Business Corporation Act relating to
the calling and holding of a meeting of shareholders or the action of
shareholders without a meeting for such purpose.
4.2. ACCURACY OF REPRESENTATIONS AND WARRANTIES. Tio and Parent
shall refrain from taking any action which would render any representation
and/or warranty contained in paragraphs 2 and 3 of this Merger Agreement
inaccurate as of the Effective Time. Parent will promptly notify Tio of any
lawsuits, claims, proceedings or investigations that may be threatened, brought,
asserted or commenced against Parent or its subsidiary or any of their officers
or directors (i) involving in any way the Merger or (ii) which might have a
material adverse impact on the business, properties or assets of Parent, taken
as a whole. Tio will promptly notify Parent of any lawsuits, claims, proceedings
or investigations that may be threatened, brought, asserted or commenced against
Tio or its officers or directors (i) involving in any way the Merger or (ii)
which might have a material adverse impact on the business, properties or assets
of Tio, taken as a whole.
4.3. CLOSING. The transactions contemplated in this Merger
Agreement shall be closed at the offices of Tio and this Merger Agreement and
Articles of Merger shall be filed promptly following such closing.
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5. CONDITIONS PRECEDENT TO OBLIGATION OF PARENT AND MERGER SUBSIDIARY.
The obligation of Parent and Merger Subsidiary to effect the Merger is subject
to the satisfaction on or prior to the Effective Time of each of the following
conditions:
5.1. NO ADVERSE CHANGE; CORPORATE ACTION. No material adverse
change shall have occurred in the assets, liabilities, business, operations,
properties, prospects or condition (financial or otherwise) of Tio. Tio shall
have performed in all material respects all obligations and agreements and
complied in all material respects with all covenants and conditions contained in
this Merger Agreement to be performed and complied with by it at or prior to the
Effective Time.
5.2. NO LITIGATION. No order of any court or administrative
agency shall be in effect which restrains or prohibits the transactions
contemplated by this Merger Agreement and no suit, action, investigation,
inquiry or proceeding by any governmental body or other person or legal or
administrative proceeding shall have been instituted or threatened which
questions the validity or legality of the transactions contemplated hereby.
5.3. SECURITIES LAWS. Parent shall have received all necessary
permits and otherwise complied with any state Blue Sky, securities, tender offer
or take-over laws applicable to the issuance of shares of Parent Common Stock in
connection with the Merger. Parent agrees to use its best efforts promptly to
accomplish the foregoing.
6. CONDITIONS PRECEDENT TO OBLIGATION OF TIO. The obligation of Tio to
effect the Merger is subject to the fulfillment at or prior to the Effective
Time of each of the following
conditions:
6.1. ACCURACY OF REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF
OBLIGATIONS. The representations and warranties of Parent and Merger Subsidiary
contained in this Merger Agreement, or in any certificate or document delivered
pursuant to the provisions hereof shall be true and correct on and as of the
Effective Time as though such representations and warranties were made at and as
of such time. Parent shall have performed in all material respects all
obligations and agreements and complied in all material respects with all
covenants and conditions contained in this Merger Agreement to be performed and
complied with by it at or prior to the Effective Time.
6.2. NO LITIGATION. No order of any court or administrative
agency shall be in effect which restrains or prohibits the transactions
contemplated by this Merger Agreement and no suit, action, investigation,
inquiry or proceeding by any governmental body or other person or legal or
administrative proceeding shall have been instituted or threatened which
questions the validity or legality of the transactions contemplated hereby.
7. OTHER PROVISIONS.
7.1. GOVERNING LAW. This Merger Agreement shall be construed and
interpreted according to the laws of the State of Ohio and the Ohio General
Corporation Law shall be applicable to approval of the Merger by the board of
directors and shareholders of Tio and to the procedures relating to filing of
the Merger Agreement with the Secretary of State of Ohio.
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7.2. WAIVER. To the extent otherwise permitted by applicable law
any party may, at its option, waive in writing any and all of the conditions
herein contained to which its obligations hereunder are subject.
7.3. SURVIVAL. The representations and warranties of Tio, Merger
Subsidiary and Parent shall survive the Effective Time.
7.4. NO INDEMNIFICATION. Except as set forth in this Merger
Agreement, there shall be no agreement, express or implied, to indemnify Tio,
Merger Subsidiary or Parent with respect to the respective covenants,
representations or warranties expressed herein.
8. TITLES AND HEADINGS. The titles and headings contained in this Merger
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Merger Agreement.
9. NOTICES. All notices, requests, demands, and other communications
given, or required to be given pursuant to the terms of this Merger Agreement
shall be in writing and may be delivered in person (by hand, messenger, or other
confirmable form of delivery), or be sent by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows, or by Federal
Express or other nationally recognized overnight courier service, addressed as
follows, or by facsimile transmission, to the following respective numbers,
followed by a copy being delivered in person, by mail, or by overnight courier
as specified herein:
If to Tio: Tio Cigars, Inc.
Attention: Xxxxxxx X. Xxxxxx, Xx., President
00000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
If to Parent or
Merger Subsidiary: Sports-Guard, Inc.
c/o Invest L'Inc. Partners, LLC
0000 X. Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxxxxxx, Xxxxxxxx 00000
Either party may, by written notice to the other, specify a different address or
numbers for notice purposes. Any notice sent to the party to whom it is
addressed in accordance with this paragraph will be deemed to have been given
(i) when received, if personally delivered; (ii) if sent by registered or
certified mail, return receipt requested, upon the date of delivery shown on the
receipt card, or if no date is shown, the postmark thereon; (iii) if sent via
Federal Express or other nationally recognized overnight courier, one (1)
business day after deposit with such overnight courier; or (iv) if sent by
facsimile transmission, on the day on which it is sent, if receipt of
transmission is confirmed by telephone. If notice is received on a Saturday,
Sunday or legal holiday, it will be deemed to have been given and received on
the next following business day.
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10. ASSIGNMENT. This Merger Agreement shall be binding upon and inure to
the benefit of the parties named herein and their respective successors and
assigns, provided that neither this Merger Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties hereto.
11. COUNTERPARTS. This Merger Agreement may be executed 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.
12. AMENDMENT. This Merger Agreement may be amended by the parties
hereto at any time before or after approval hereof by the shareholders of Tio
and/or Parent, but after any such approval by the shareholders of Tio or Parent,
no amendment shall be made without further approval by the board of directors of
Tio and Merger Subsidiary and by the shareholders of Tio and Parent, if such
amendment would materially or adversely affect the shareholders, would amend the
articles of incorporation, or would affect the amount or kind of stock,
securities or other consideration to be exchanged under this Agreement.
IN WITNESS WHEREOF, the undersigned directors and officers of each of
the parties of this Merger Agreement, pursuant to authority duly given by their
respective Board of Directors, have caused this Merger Agreement to be duly
executed.
Constituent Corporations:
TIO CIGARS, INC.,
an Ohio corporation
By:
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Xxxxxxx X. Xxxxxx, Xx., President
TIO XXXXXXX CIGAR CORP.,
a Delaware corporation
By:
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Xxxx X. Xxxxxxx, President
Additional Party:
SPORTS-GUARD, INC.,
a Delaware corporation
By:
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Xxxx X. Xxxxxxx, President
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IN WITNESS WHEREOF, as to Sections 2.12 and 2.14 only, the undersigned Tio
Shareholders have duly executed this Agreement.
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Xxxxxxx X. Xxxxxx, Xx., individually and
as Trustee for Xxxxxxx X. Xxxxxx, III,
Xxxxxxxxxx X. Xxxxxx and Xxxxxx X. Xxxxxx,
UGTMA
LAKEWOOD MFG. CO.
By:
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Xxxxxxx X. Xxxxxx, Xx., President
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Xxxx X. Xxxxxx
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Xxxxx Xxxxxxx
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Xxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxx
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Xxxxxxx Xxxxxx
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Xxxxxxx Outcult
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Xxxx Schweidle
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Xxxxxx Xxxxx
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EXHIBIT A
TIO SHARE OWNERSHIP
Shareholder Number of Shares
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Xxxxxxx X. Xxxxxx, Xx. 800,000
Xxxx X. Xxxxxx 800,000
Xxxxx Xxxxxxx 37,500
Xxxx Xxxxxxxxxx 350,000
Xxxxx Xxxxxxxxx 350,000
Xxxxxxx Xxxxxx 60,000
Lakewood Mfg. Co. 75,000
Xxxxxxx Outcult 22,500
Xxxx Schweidle 30,000
Xxxxxx Xxxxx 50,000
Xxxxxxx X. Xxxxxx, III 15,000
Xxxxxxxxxx X. Xxxxxx 15,000
Xxxxxx X. Xxxxxx 15,000
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