MERGER AGREEMENT
THIS MERGER AGREEMENT is made
as of the January 29, 2010, by and among XxXxx Mobility Inc., a Delaware
corporation, having its principal place of business at 00000 Xxxxxxxx Xxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 (“XxXxx”), InovaChem,
Inc., a Delaware corporation, having its principal place of business at 0000
Xxxx Xxx Xxxxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 (“InovaChem”),
InovaChem Mergerco II, Inc., a Delaware corporation, having its principal place
of business at 00000 Xxxxxxxx Xxxxx, xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 (“Mergerco”), and Xxxx
Xxxxxxxx (“X.
Xxxxxxxx”) and Xxxxxx Xxxxxxxx (“X. Xxxxxxxx”) (X.
Xxxxxxxx and X. Xxxxxxxx are collectively referred to as the “XxXxx
Stockholders”).
WHEREAS, the Board of
Directors of InovaChem and the Boards of Directors of Mergerco and XxXxx xxxx it
advisable and generally to the advantage and welfare of XxXxx, InovaChem and
Mergerco and their respective shareholders that Mergerco be merged with and into
XxXxx under the terms and conditions hereinafter set forth (the “Merger”), the Merger
to be effected pursuant to the General Corporation Law of the State of Delaware
(the “General
Corporation Law”) and to be a tax free reorganization under Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the “Code”);
and
WHEREAS, InovaChem is
authorized to issue an aggregate of 200,000,000 shares (“InovaChem Shares”) of
its common stock, par value $.001 per share (the “InovaChem Common
Stock”), of which approximately 7,278,346 will be issued and
outstanding as of the Effective Date (as that term is defined in Section 1.9)
(the “Outstanding
InovaChem Common Shares”); and
WHEREAS, all of the stock of
XxXxx (the “XxXxx
Shares”) are owned by the XxXxx Stockholders in the proportions set forth
on Schedule 1
attached hereto; and
WHEREAS, Mergerco is a wholly
owned subsidiary of InovaChem and all of the stock of Mergerco (the “Mergerco Stock”), is
owned by InovaChem; and
WHEREAS, the parties desire to
merge Mergerco with and into XxXxx so that XxXxx is the surviving entity in such
merger and becomes a wholly owned subsidiary of InovaChem and the XxXxx
Stockholders receive shares of the Common Stock of InovaChem in exchange
therefor.
NOW, THEREFORE, in
consideration of the premises, the parties hereto do mutually agree as
follows:
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1.
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MERGER OF MERGERCO AND
XXXXX.
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1.1 Merger. On
the Effective Date (as that term is defined in Section 1.9), Mergerco shall be
merged with and into XxXxx, which shall be the surviving entity of the Merger
(the “Surviving
Entity”), pursuant to this Agreement and the Certificate of Merger
attached as Exhibit
A hereto (the “Certificate of
Merger”) and the XxXxx Stockholders shall receive an aggregate of
27,133,384 shares of InovaChem Common Stock (the “Merger Stock”). The
Merger Stock shall represent 58% of the issued and outstanding stock of
InovaChem on a fully diluted basis on the Effective Date.
1.2 Effect
of the Merger. Upon
the Merger becoming effective, the separate existence of Mergerco shall cease,
and the Surviving Entity shall succeed to and possess all the properties,
rights, privileges, powers, franchises, and immunities, of a public as well as
of a private nature, and be subject to all the debts, liabilities, obligations,
restrictions, disabilities, and duties of Mergerco, all without further act or
deed, as provided in Section 10.008 of the General Corporation Law.
1.3 Name of
the Surviving Entity. On the Effective Date, the name of
Surviving Entity shall remain “XxXxx Mobility
Inc.”
1.4 Certificate
of Incorporation and Bylaws. The Certificate of Incorporation
and Bylaws of Mergerco shall be the Certificate of Incorporation and Bylaws of
the Surviving Entity.
1.5 Board
of Directors. The Board of
Directors of Mergerco shall be the members of the Board of Directors of the
Surviving Entity on and after the Effective Date until the earlier of their
resignation or removal or until their respective successors are duly elected and
qualified, as the case may be.
1.6 Officers. The officers of
Mergerco shall be the officers of the Surviving Entity on and after the
Effective Date until the earlier of their resignation or until their respective
successors are duly appointed.
1.7 Status and Conversion of
Securities.
(a) Conversion
of Outstanding XxXxx Shares into Right to Receive Merger
Stock. At the Effective Date, the XxXxx Shares, shall, by
reason of the Merger and without any action on the part of the XxXxx
Stockholders, be converted into the Merger Stock.
(b) Issuance
of Merger Stock. At the Effective Date, InovaChem, or such
other person as may be designated by InovaChem (the “Exchange Agent”),
shall issue, in exchange for the XxXxx Shares, the number of shares of Merger
Stock into which the XxXxx Shares theretofore owned by the XxXxx Stockholders
shall have been converted.
1.8 Further
Documents. From time to time, on and after the Effective Date,
as and when requested by InovaChem, or by its successors or assigns, the
appropriate officers and directors of XxXxx as of the Effective Date shall, for
and on behalf of and in the name of Mergerco or otherwise, execute and deliver
all such deeds, bills of sale, assignments, and other instruments and shall take
or cause to be taken such further or other actions as the Surviving Entity,
Mergerco, or their respective successors or assigns may deem reasonably
necessary or desirable in order to confirm of record or otherwise to vest in the
Surviving Entity title to and possession of all of the properties, rights,
privileges, powers, franchises, and immunities of Mergerco and otherwise to
carry out fully the provisions and purposes of this Agreement.
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1.9 Effective Date and Closing Date;
Conditions to Closing; Termination.
(a) The
Merger shall become effective on the date the Certificate of
Merger is accepted for filing by the Secretary of State of the State
of Delaware (the “Effective Date”),
which shall be promptly after the date all conditions set forth in Section
1.9(b) have been satisfied or waived by the applicable party hereto, and all
applicable legal requirements have been fulfilled to consummate the
merger. The closing (the “Closing”) shall occur
immediately following the Effective Date (the “Closing
Date”).
(b) The
obligation of each of InovaChem, Mergerco and XxXxx to consummate the Merger is
subject to satisfaction of the following conditions: (i) the sale of
not less $1,000,000 in gross proceeds from the sale of common stock
which will become common stock of InovaChem immediately after the Effective Date
(the “Private
Offering”) and (ii) the Current Report on Form 8-K required as a result
of the consummation of the transactions contemplated hereby, including without
limitation, the audited and pro forma financial statements of XxXxx, shall be
ready to be filed with the Securities and Exchange Commission.
(c) This
Agreement and the Merger may be abandoned (a) by any of XxXxx, InovaChem or
Mergerco if InovaChem has not closed on the Private Offering by January 15, 2010
(the “Termination
Date”), or (b) by the mutual consent of the parties. In the
event of abandonment of this Agreement pursuant to this Section 1.9(c), the same
shall become wholly void and of no effect and there shall be no further
liability or obligation hereunder on the part of any of the parties, their
respective Boards of Directors or any other party to this
Agreement. If the Private Offering has closed on or prior to the
Termination Date and one of the parties hereto refuses to or is unable
consummate the Closing under this Agreement, such refusal to close shall be
deemed to be a breach of this Agreement and the other parties to this Agreement
shall have all the rights they may be entitled to under applicable
law.
1.10 Deliveries at
Closing. At Closing, the parties shall deliver the following
documents and instruments to each other:
(a) Deliveries
by XxXxx:
(1) XxXxx
shall deliver to InovaChem a Secretary’s certificate dated as of the Closing
Date stating that the Merger contemplated by this Agreement has been approved by
the Board of Directors and all of the XxXxx Stockholders, and
(2) XxXxx
shall deliver to InovaChem a copy of the Certificate of Merger duly signed by
authorized representatives of XxXxx.
(3) Documentation
evidencing the cancellation of indebtedness owed by XxXxx from each of R
Takamura, Jardine Capital Corp., Po Xxxx Xxxx and Four M International,
Inc.
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(b) Deliveries
by Mergerco:
(4) Mergerco
shall deliver to XxXxx a Secretary’s certificate dated as of the Closing Date
stating that the Merger contemplated by this Agreement has been approved by the
Board of Directors and the sole stockholder of Mergerco,
(5) and
(4) Mergerco
shall deliver to XxXxx a copy of the Certificate of Merger duly signed by
authorized representatives of Mergerco.
(c) Deliveries
by InovaChem:
(1) InovaChem
shall deliver to XxXxx a Secretary’s certificate dated as of the Closing Date
stating that the Merger contemplated by this Agreement has been approved by the
Board of Directors of InovaChem,
(2) InovaChem
shall deliver to the XxXxx Stockholders, in proportion to their ownership of the
XxXxx Shares, the certificates representing the Merger Stock, and
(3) InovaChem
shall deliver to XxXxx an officer’s certificate certifying that the
representations and warranties of InovaChem and Mergerco set forth in this
Agreement are true and accurate as of the Closing Date.
(4) Stock
Redemption Agreements executed by each of Xxxxxxx X. Xxx, Xxxxxxx Xx, Xxxx Xxx
Xx and Xx Xxx.
(c) Deliveries
by the XxXxx Stockholders:
(5) The
XxXxx Stockholders shall deliver to InovaChem releases regarding their interests
in XxXxx since no stock certificates were ever issued evidencing the XxXxx
Shares, and
(6) The
XxXxx Stockholders shall deliver to InovaChem a certificate certifying that the
representations and warranties of the XxXxx Stockholders and those related to
XxXxx set forth in this Agreement are true and accurate as of the Closing
Date.
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2.
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REPRESENTATIONS AND WARRANTIES
RELATING TO XXXXX.
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The XxXxx
Stockholders, jointly and severally, hereby represent and warrant to Mergerco
and InovaChem as follows:
(a) XxXxx
is a duly formed and validly existing corporation in good standing under the
laws of the State of Delaware, authorized to issue the XxXxx
Shares. The XxXxx Shares, which are owned by the XxXxx Stockholders,
as set forth and in the proportions on Schedule 1, have been
duly authorized, and are validly issued, fully paid and nonassessable. There are
no issued or outstanding rights, or options to purchase all or a portion of the
XxXxx Shares or any issued or outstanding securities of any nature convertible
into all or a portion of the XxXxx Shares. The outstanding XxXxx Shares have
been issued in accordance with applicable securities laws or regulations in
connection with the offer or sale of such stock. The Certificate of
Incorporation of XxXxx that was filed with the Secretary of State for the State
of Delaware on September 8, 2006_, the Bylaws of XxXxx dated September 8, 2006,
which have been provided to InovaChem, are all of the documents comprising the
corporate books and records of XxXxx, and no such other documents
exist.
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(b) XxXxx
has full power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. XxXxx has caused a meeting to take
place of its Board of Directors and the XxXxx Stockholders to approve the
Merger. This Agreement and the transactions contemplated hereby have
been duly approved by the Board of Directors and all of the XxXxx
Stockholders. This Agreement has been duly executed and delivered by
XxXxx and constitutes a valid and binding obligation of XxXxx enforceable
against XxXxx in accordance with its terms, except that such enforcement may be
subject to bankruptcy, insolvency, reorganization, moratorium or other similar
laws now, or hereafter, in effect relating to creditors' rights.
(c) XxXxx
is qualified as a foreign corporation in all jurisdictions where its business or
ownership of assets or properties so requires, except where the failure to be so
qualified would not have a material adverse effect on the business or financial
condition of XxXxx (a “XxXxx Material Adverse
Effect”).
(d) XxXxx
has no subsidiaries.
(e) There
are no liabilities (including, but not limited to tax liabilities) or claims of
or against XxXxx (whether such liabilities or claims are contingent or absolute,
direct or indirect, matured or unmatured) except for the contractual liabilities
under the Contracts (as hereafter defined) provided to InovaChem, none of which
are past due.
(f) Since
its inception, XxXxx has paid all federal, state, foreign and local taxes on a
timely basis, including franchise and payroll taxes and other
taxes. XxXxx is not a party to any pending action or proceeding by
any governmental authority for the assessment of any tax, and no claim for
assessment or collection of any tax has been asserted in writing against XxXxx
that has not been paid. There are no liens for taxes upon the assets
of XxXxx (other than liens for taxes not yet due and payable). There
is no valid basis, to the knowledge of the XxXxx Stockholders, for any
assessment, deficiency, notice, 30-day letter or similar intention to assess any
tax to be issued to XxXxx by any governmental authority.
(g) XxXxx
has good and marketable title to all its assets and such assets are owned free
and clear of all security interests, pledges, liens, restrictions and
encumbrances of every kind and nature.
(h) Copies
of all written agreements, contracts, arrangements, understandings and
commitments, including, without limitation, real estate leases, legal opinions,
and loan agreements (each a “Contract,”
collectively, “Contracts”), to which
XxXxx is a party, by which XxXxx is bound, or from which XxXxx is entitled to
receive substantial benefits, and a summary of the provisions of each oral
contract, have been provided to InovaChem and XxXxx is not in default under any
such Contract. Each such Contract is valid and
enforceable. The validity and enforceability of, and the rights of
XxXxx contained in, each such Contract shall not be adversely affected by the
Merger or the transactions contemplated hereby and no consent from the other
party or parties to any Contract is required in connection with the Merger or
the transactions contemplated hereby.
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(i) There
are no legal, administrative, arbitral or other proceedings, claims, actions or
governmental investigations of any nature against XxXxx or which challenge the
validity or propriety of any Intellectual Property (as hereafter defined) owned
by XxXxx or the transactions contemplated by this Agreement and, to the
knowledge of the XxXxx Stockholders, there is no reasonable basis for any such
proceeding, claim, action or governmental investigation against
XxXxx. XxXxx is not a party to or bound by any order, judgment or
decree.
(j)
XxXxx has not (i)
made any loans to, or entered into any transactions with, any of the officers or
directors of XxXxx or their families; (ii) declared or paid any dividends since
its inception; or (iii) purchased any portion of the XxXxx Shares, except, in
all cases to the extent disclosed to InovaChem in writing.
(k) XxXxx
has not issued or committed itself to issue any of the XxXxx Shares or any
options, rights, warrants, or other securities convertible into any portion of
the XxXxx Shares.
(l)
“Intellectual
Property” shall mean and refer to: (i) domestic and foreign patents and
patent applications (or equivalents thereto); (ii) domestic and foreign
copyrights and copyright registrations; (iii) domestic and foreign trademarks,
service marks, trade names and respective registrations thereof; (iv) trade
secrets, privacy rights, and any other protection for confidential information
or ideas, and (v) technical information and documentation, proprietary
technology and processes, and know-how.
As of the
date hereof:
(1) XxXxx
owns the entire right, title and interest to all Intellectual Property used in
connection with its business, free and clear of all mortgages, liens, pledges,
security interests, charges, claims, restrictions and encumbrances of any nature
whatsoever, except as indicated on Schedule
2(l)(1).
(2) None
of the Intellectual Property used by XxXxx in its business nor XxXxx has
violated, misappropriated, infringed, induced infringement of, or contributed to
the infringement of any patent, copyright, trade secret, trademark, service
xxxx, trade name, Internet domain name or other intellectual property right of
any other person or entity.
(3) XxXxx
has not made, asserted or threatened any claim of violation, misappropriation or
infringement of the Intellectual Property it uses in its business against any
other person or entity, and XxXxx is not aware of any such violation,
misappropriation or infringement.
(4) The
transactions contemplated herein will not invalidate or adversely impact XxXxx’x
rights in any of the Intellectual Property it uses in its business and will not
require the consent of any third party.
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(m) Since
its inception, XxXxx has, in all material respects, conducted its affairs in
compliance with all applicable laws, rules and regulations.
(n) Except
for the filing of the Certificate of Merger, no consents or approvals of, or
filings or registrations with, any third party or any public body or authority
are necessary in connection with (i) the execution and delivery by XxXxx of this
Agreement and (ii) the consummation by XxXxx of the Merger and the other
transactions contemplated hereby.
(o) The
execution and delivery by XxXxx of this Agreement, the consummation and
performance of the transactions herein contemplated, and compliance with the
terms of this Agreement by XxXxx will not conflict with, result in a breach of,
or constitute a default under any indenture, mortgage, deed of trust or other
agreement, instrument or Contract to which XxXxx is now a party or by which it
or any of its assets or properties is bound or the Certificate of Incorporation
or the Bylaws of XxXxx, in each case as amended, or any law, order, rule or
regulation, writ, injunction, judgment or decree of any government, governmental
instrumentality or court, domestic or foreign, having jurisdiction over XxXxx or
any of its business or properties, including its Intellectual
Property.
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3.
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REPRESENTATIONS AND WARRANTIES
RELATING TO MERGERCO.
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Mergerco
and InovaChem, jointly and severally, represent and warrant to the XxXxx
Stockholders as follows:
(a) Mergerco
is a duly formed and validly existing corporation in good standing under the
laws of the State of Delaware, authorized to issue only the Mergerco
Stock. The Mergerco Stock, which is owned solely by InovaChem, has
been duly authorized, validly issued and fully paid and
nonassessable. There are no issued or outstanding rights, or options
to purchase all or a portion of the Mergerco Stock or any issued or outstanding
securities of any nature convertible into all or a portion of the Mergerco
Stock. The outstanding Mergerco Stock has been issued in accordance with
applicable securities laws or regulations in connection with the offer or sale
of such stock.
(b) Mergerco
has full power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. Mergerco has caused a meeting of its Board of
Directors and sole stockholder to approve the Merger. This Agreement
and the transactions contemplated hereby have been duly approved by the Board of
Directors and sole stockholder of
Mergerco. This Agreement has been duly executed and delivered by
Mergerco, and constitutes a valid and binding obligation of Mergerco,
enforceable against Mergerco in accordance with its terms, except that such
enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights.
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4.
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REPRESENTATIONS AND WARRANTIES
RELATING TO INOVACHEM.
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InovaChem
represents and warrants to the XxXxx Stockholders as follows:
(a) InovaChem
is a duly organized and validly existing corporation in good standing under the
laws of the State of Delaware, authorized to issue 200,000,000 shares of
InovaChem Common Stock, $.001 par value per share. All of the
InovaChem Common Stock is fully paid and nonassessable. Prior to the
Effective Date, (i) 15,000,000 InovaChem Common Shares will be canceled and
returned to treasury; (ii) InovaChem Common Shares will be issued to investors
in InovaChem; and (iii) InovaChem Common Shares will be issued to certain
individuals. The Merger Stock to be issued in the Merger will be, when duly and
validly issued, fully paid and nonassessable.
7
(b) InovaChem
has full power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. InovaChem caused a special meeting of its
Board of Directors to authorize the issuance of the Common Stock in the Merger.
This Agreement and the transactions contemplated hereby have been duly approved
by the Board of Directors of InovaChem. This Agreement has been duly
executed and delivered by InovaChem and constitutes a valid and binding
obligation of InovaChem enforceable against InovaChem in accordance with its
terms, except that such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights.
(c) InovaChem
has filed all reports, schedules, forms, statements and other documents required
to be filed by InovaChem under the Securities Act of 1933, as amended
(the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange
Act”) (the foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to herein as the
“SEC
Reports”). As of their respective dates, the SEC Reports
complied in all material respects with the requirements of the Securities Act
and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of InovaChem included in the SEC
Reports comply in all material respects with applicable accounting requirements
and the rules and regulations of the SEC with respect thereto as in effect at
the time of filing. Such financial statements have been prepared in
accordance with GAAP, except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all
material respects the financial position of InovaChem as of and for the dates
thereof and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end
audit adjustments.
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5.
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REPRESENTATIONS AND WARRANTIES
RELATING TO THE XXXXX
STOCKHOLDERS
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Each
XxXxx Stockholder represents and warrants to InovaChem as
follows:
(a) Acknowledgment. Each
XxXxx Stockholder understands and agrees that the Merger Stock has not been
registered under the Securities Act or the securities laws of any state of the
United State and that the issuance of the Merger Stock is being effected in
reliance upon one or more exemptions from registration afforded under the
Securities Act.
8
(b) Status. Each
XxXxx Stockholder represents and warrants to InovaChem that such XxXxx
Stockholder is an “Accredited Investor” as defined in the rules promulgated
under the Securities Act. Each XxXxx Stockholder understands that the
Merger Stock is being offered and sold to such XxXxx Stockholder in reliance
upon the truth and accuracy of the representations, warranties, agreements,
acknowledgments and understandings of such XxXxx Stockholder set forth in this
Agreement, in order that InovaChem may determine the applicability and
availability of the exemptions from registration of the Merger Stock on which
InovaChem is relying.
(c) Stock
Legends. Each XxXxx Stockholder hereby agrees with InovaChem
as follows:
Securities
Act Legend. The certificates evidencing the Merger
Stock will bear the following legend:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND
NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS OR (2) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, IN
WHICH CASE THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AN
OPINION OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE
COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED IN THE MANNER CONTEMPLATED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS.
Other
Legends. The certificates representing the Merger Stock, and
each certificate issued in transfer or exchange thereof, will also bear any
other legend required under any applicable law, including, without limitation,
any United States state corporate and state securities law, or
contract.
Opinion. No
XxXxx Stockholder will transfer any or all of the Merger Stock absent an
effective registration statement under the Securities Act and applicable state
securities law covering the disposition of such Merger Stock, without first
providing InovaChem with an opinion of counsel (which counsel and opinion are
reasonably satisfactory to InovaChem) to the effect that such transfer will be
exempt from the registration and the prospectus delivery requirements of the
Securities Act and the registration or qualification requirements of any
applicable United States state securities laws.
(d) Review of InovaChem Filings
with the Securities and Exchange Commission. Each XxXxx
Stockholder has reviewed the InovaChem filings with the Securities and Exchange
Commission, including the exhibits thereto.
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6.
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SURVIVAL AND
INDEMNIFICATION.
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(a) Survival. All
of the representations and warranties contained in this Agreement (including all
statements contained in any certificate or other instrument delivered by or on
behalf of XxXxx, InovaChem or Mergerco pursuant hereto or in connection with the
transactions contemplated hereby) shall survive the closing for a period of one
year.
(b) Indemnification by XxXxx
Stockholders. From and after the Closing, the XxXxx Stockholders,
severally and jointly, shall indemnify, defend and hold harmless InovaChem and
its officers, directors, shareholders, employees, agents and affiliates and
their successors and assigns against any loss, claim, damage, cost, obligation,
liability, penalty and expense, including all legal and other expenses
reasonably incurred in connection with investigating or defending against any
such loss, claim, damage, cost, obligation, liability, penalty or expense or
action in respect of such matters (collectively referred to as "Indemnified
Damages"), occasioned by, arising out of or resulting from (i) any breach
or default of any representation or warranty by, or covenant of, such XxXxx
Stockholders contained in this Agreement or any other agreement provided for in
this Agreement; (ii) claims that XxXxx does not own all rights to its assets,
including without limitation the Intellectual Property, and (iii) liabilities of
XxXxx arising out of or resulting from compliance or noncompliance with any law
or order, the basis of which arose on or before the Effective
Date.
(c) Indemnification by
InovaChem. From and after the Closing, InovaChem shall indemnify, defend
and hold harmless the XxXxx Stockholders and their heirs, personal
representatives, agents, successors, and affiliates against any Indemnified
Damages occasioned by, arising out of or resulting from any breach or default of
any representation or warranty by, or covenant of, InovaChem contained in this
Agreement or any other agreement provided for in this
Agreement.
(d) Notice of
Indemnification. Upon receipt by an indemnified party of notice of the
commencement against it of any action involving a claim, such indemnified party,
if a claim in respect of such action is to be made by it against any
indemnifying party under this Article 6, shall promptly notify in writing the
indemnifying party of such commencement. In case any such action is
brought against any indemnified party, and it notifies an indemnifying party of
such commencement, the indemnifying party will be entitled to participate in the
defense and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, assume the defense of the action, with counsel
reasonably satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election to assume the
defense, the indemnifying party will not be liable to such indemnified party
under this Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense other than reasonable costs of
investigation. Any such indemnifying party shall not be liable to any
such indemnified party on account of any settlement of any claim or action
effected without the consent of such indemnifying party unless the indemnifying
party had determined not to assume the defense of the action. The
indemnifying party will not settle or compromise any claim or action without the
written consent of the indemnified party (which consent shall not be
unreasonably withheld).
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(e) Indemnification Not
Exclusive Remedy. If a party breaches any aspect of this
Agreement, the non-breaching parties shall be entitled to seek all remedies
available to them under applicable law and shall not be limited to just the
remedies of indemnification provided for in this Agreement. ADDITIONALLY, IF ANY PARTY IS FOUND
TO HAVE MADE AN INTENTIONAL MISSTATEMENT OR OTHERWISE ACTED WITH FRAUDULENT
INTENT WITH RESPECT TO A REPRESENTATION OR WARRANTY, THE OTHER PARTIES MAY SEEK
ALL REMEDIES TO WHICH THEY MAY BE ENTITLED UNDER APPLICABLE LAW, INCLUDING BUT
NOT LIMITED TO, A CLAIM FOR RESCISSION OF THE ENTIRE AGREEMENT,
COMPENSATORY AND PUNITIVE DAMAGES, AND, IF APPLICABLE, INJUNCTIVE
RELIEF.
|
7.
|
EXPENSES; ATTORNEYS
FEES.
|
Each
party shall bear its expenses in connection with the Merger. In the
event of any action, dispute, litigation or other proceeding with respect to
this Agreement, the prevailing party shall be entitled to recover from the
non-prevailing party all reasonable fees, costs, and expenses of counsel
incurred in connection with such action, dispute, litigation or other
proceeding, whether or not litigation is instituted, and if instituted, at both
trial and appellate levels, in addition to any other relief to which the parties
may be entitled.
|
8.
|
THIRD PARTY
BENEFICIARIES.
|
The
representations and warranties made by any party to this Agreement are intended
to be relied upon only by the other parties to this Agreement, and by no other
person. Nothing contained in this Agreement shall be deemed to confer upon any
person not a party to this Agreement any third party beneficiary rights or any
other rights of any nature whatsoever, and only to the extent expressly referred
to herein.
|
9.
|
FURTHER INSTRUMENTS AND
ACTIONS.
|
Each
party shall deliver such further instruments and take such further action as may
be reasonably requested by any other parties in order to carry out the intents
and purposes of this Agreement.
|
10.
|
GOVERNING LAW;
JURISDICTION.
|
This
Agreement shall be governed by the laws of the State of Delaware without giving
effect to its conflicts of laws principles. Each of the parties hereby
irrevocably submits to the exclusive jurisdiction of the courts of the State of
Delaware and the United States District Court for the State of Delaware, for the
purpose of any action or proceeding arising out of or relating to this Agreement
and each of the parties hereby irrevocably agrees that all claims in respect of
such action or proceeding may be heard and determined exclusively in any
Delaware state or federal court. Each of the parties agrees that a final
judgment in any action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment in any other matter provided by law.
|
11.
|
NOTICES.
|
All notices or other communications to
be sent by any party to this Agreement to any other party to this Agreement
shall be sent by certified mail, return receipt requested, nationwide overnight
delivery service or by personal delivery to the addresses set forth on the
signature pages hereto, or such other addresses as may hereafter be designated
in writing by a party. All notices shall be deemed given and received
upon the earlier of five days after being sent by certified mail, or upon actual
receipt, if addressed to the parties at their addresses as provided in this
Section:
11
|
If
to XxXxx:
|
|
|
XxXxx
Mobility Inc.
|
|
|
00000
Xxxxxxxx Xxxxx
|
|
|
Xxxxx
000
|
|
|
Xxxxxxx,
XX 00000
|
|
|
Attention: Xxxx
Xxxxxxxx
|
|
|
If
to InovaChem:
|
|
|
0000
Xxxx Xxx Xxxxxxxxx,
|
|
|
Xxxxx
0000,
|
|
|
Xxxxxxx,
Xxxxx 00000
|
|
|
Attention:
Xxxxx Toh
|
|
|
If
to Mergerco:
|
|
|
InovaChem
Mergerco II, Inc.
|
|
|
0000
Xxxx Xxx Xxxxxxxxx,
|
|
|
Xxxxx
0000,
|
|
|
Xxxxxxx,
Xxxxx 00000
|
|
|
Attention:
Xxxxx Toh
|
|
|
If
to E. or X. Xxxxxxxx:
|
|
|
XxXxx
Mobility Inc.
|
|
|
00000
Xxxxxxxx Xxxxx
|
|
|
Xxxxx
000
|
|
|
Xxxxxxx,
XX 00000
|
|
12.
|
BINDING
AGREEMENT.
|
This
Agreement represents the entire agreement among the parties hereto with respect
to the matters described herein and is binding upon and shall inure to the
benefit of the parties hereto and their legal representatives, successors and
permitted assigns. This Agreement may not be assigned and, except as stated
herein, may not be altered or amended except in writing executed by the parties
hereto.
|
13.
|
COUNTERPARTS.
|
This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original and all of which, when taken together, shall constitute one
and the same Agreement.
12
|
14.
|
SEVERABILITY.
|
The
provisions of this Agreement shall be severable, so that the unenforceability,
validity or legality of any one provision shall not affect the enforceability,
validity or legality of the remaining provisions hereof.
[SIGNATURE
BLOCK ON FOLLOWING PAGE]
13
IN
WITNESS WHEREOF, the parties hereto have made and executed this Agreement as of
the day and year first above written.
|
XXXXX
MOBILITY INC.
|
|
|
By:
|
/s/ Xxxx Xxxxxxxx |
|
Title: Xxxx
Xxxxxxxx, Chairman, President
and
CEO
|
|
|
By:
|
/s/ Xxxxx Toh, |
|
Title: Xxxxx
Toh, Executive Vice President
of
Corporate Development
|
|
|
INOVACHEM
MERGERCO, LLC
|
|
|
By:
|
/s/ Xxxx Xxxxxxxx, |
|
Title:
Xxxx Xxxxxxxx, Treasurer and Secretary
|
|
|
XXXXX
STOCKHOLDERS
|
|
| /s/ Xxxx Xxxxxxxx | |
|
Xxxx
Xxxxxxxx
|
|
|
/s/
Xxxxxx Xxxxxxxx
|
|
|
Xxxxxx
Xxxxxxxx
|
|
14
Schedule
1
XxXxx
Shares
|
Number of XxXxx Shares Owned
|
||||
|
Xxxx
Xxxxxxxx
|
911 | |||
|
Xxxxxx
Xxxxxxxx
|
200 | |||
|
Total:
|
1,111 | |||
15
