SHARE EXCHANGE AGREEMENT
THIS
AGREEMENT is made as of the 25th day of January, 2007
AMONG:
HAYSTAR
SERVICES AND TECHNOLOGY, INC., a corporation formed pursuant to the
laws of the State of Nevada and having an office for business at 0000 Xxxxxxx,
#000, Xxxxxx Xxxx, Xxxxxxxx 00000. (“Haystar”)
AND:
DIBZ
INTERNATIONAL, INC., a company formed pursuant to the laws of the State
of Delaware and having an office for business located at 9595 Six Pines – Market
Street, Building 8, Xxxxx 0, Xxx Xxxxxxxxx, XX 00000 ("Dibz")
AND:
The
shareholders of Dibz, each of whom are set forth on the signature page of this
Agreement (the “Dibz Shareholders”)
WHEREAS:
A. The
Dibz Shareholders own 100 shares of common stock, $0.001 par value, being 100%
of the presently issued and outstanding Dibz Shares;
B. Haystar
is a company whose common stock is quoted on the Pink Sheets under the symbol
HYSR; and
C. The
respective Boards of Directors of Haystar and Dibz deem it advisable and in
the
best interests of Haystar and Dibz that Dibz become a wholly-owned subsidiary
of
Haystar (the “Acquisition”) pursuant to this Agreement.
NOW
THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the
premises and the mutual covenants, agreements, representations and warranties
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree
as
follows:
ARTICLE
1
DEFINITIONS
AND INTERPRETATION
Definitions
1.1 In
this
Agreement the following terms will have the following meanings:
|
(a)
|
“Acquisition”
means the Acquisition, at the Closing, of Dibz by Haystar pursuant
to this
Agreement;
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(b)
|
“Acquisition
Shares” means the 39,474 Haystar Preferred Shares to be issued to
the Dibz Shareholders at Closing pursuant to the terms of the
Acquisition;
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(c)
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“Agreement”
means this share exchange agreement among Haystar, Dibz, and the
Dibz
Shareholders;
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(d)
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“Haystar
Accounts Payable and Liabilities” means all accounts payable and
liabilities of Haystar, on a consolidated basis, due and owing or
otherwise constituting a binding obligation of Haystar and its
subsidiaries (other than a Haystar Material Contract) as of September
30,
2006 as set forth is Schedule “A”
hereto;
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(e)
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“Haystar
Accounts Receivable” means all accounts receivable and other
debts owing to Haystar, on a consolidated basis, as of September
30, 2006
as set forth in Schedule “B”
hereto;
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(f)
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“Haystar
Assets” means the undertaking and all the property and assets of
the Haystar Business of every kind and description wheresoever situated
including, without limitation, Haystar Equipment, Haystar Inventory,
Haystar Material Contracts, Haystar Accounts Receivable, Haystar
Cash,
Haystar Intangible Assets and Haystar Goodwill, and all credit cards,
charge cards and banking cards issued to
Haystar;
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(g)
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“Haystar
Bank Accounts” means all of the bank accounts, lock boxes and
safety deposit boxes of Haystar and its subsidiaries or relating
to the
Haystar Business as set forth in Schedule “C”
hereto;
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(h)
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“Haystar
Business” means all aspects of any business conducted by Haystar
and its subsidiaries;
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(i)
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“Haystar
Cash” means all cash on hand or on deposit to the credit of
Haystar and its subsidiaries on the Closing
Date;
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(j)
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“Haystar
Common Shares” means the shares of common stock in the capital of
Haystar;
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(k)
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“Haystar
Debt to Related Parties” means the debts owed by Haystar to any
affiliate, director or officer of Haystar as described in Schedule
“D”
hereto;
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(l)
|
“Haystar
Equipment” means all machinery, equipment, furniture, and
furnishings used in the Haystar Business, including, without limitation,
the items more particularly described in Schedule “E”
hereto;
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(m)
|
“Haystar
Financial Statements” means, collectively, the audited
consolidated financial statements of Haystar for the fiscal year
ended
December 31, 2005, together with the unqualified auditors' report
thereon,
and the unaudited consolidated financial statements of Haystar for
the
nine month period ended September 30, 2006, true copies of which
are
attached as Schedule “F” hereto;
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(n)
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“Haystar
Goodwill” means the goodwill of the Haystar Business including
the right to all corporate, operating and trade names associated
with the
Haystar Business, or any variations of such names as part of or in
connection with the Haystar Business, all books and records and other
information relating to the Haystar Business, all necessary licenses
and
authorizations and any other rights used in connection with the Haystar
Business;
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(o)
|
“Haystar
Insurance Policies” means the public liability insurance and
insurance against loss or damage to the Haystar Assets and the Haystar
Business as described in Schedule “G”
hereto;
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(p)
|
“Haystar
Intangible Assets" means all of the intangible assets of Haystar
and its subsidiaries, including, without limitation, Haystar Goodwill,
all
trademarks, logos, copyrights, designs, and other intellectual and
industrial property of Haystar and its
subsidiaries;
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(q)
|
“Haystar
Inventory” means all inventory and supplies of the Haystar
Business as of September 30, 2006, as set forth in Schedule “H” hereto;
and
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(r)
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“Haystar
Material Contracts” means the burden and benefit of and the
right, title and interest of Haystar and its subsidiaries in, to
and under
all trade and non-trade contracts, engagements or commitments, whether
written or oral, to which Haystar or its subsidiaries are entitled
whereunder Haystar or its subsidiaries are obligated to pay or entitled
to
receive the sum of $10,000 or more including, without limitation,
any
pension plans, profit sharing plans, bonus plans, loan agreements,
security agreements, indemnities and guarantees, any agreements with
employees, lessees, licensees, managers, accountants, suppliers,
agents,
distributors, officers, directors, attorneys or others which cannot
be
terminated without liability on not more than one month's notice,
and
those contracts listed in Schedule “I”
hereto.
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(s)
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“Haystar
Preferred Shares” means the shares of Series A Preferred Stock,
par value $0.001 per share, in the capital of
Haystar.
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(t)
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“Closing”
means the completion, on the Closing Date, of the transactions
contemplated hereby in accordance with Article 9
hereof;
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(u)
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“Closing
Date” means the day on which all conditions precedent to the
completion of the transaction as contemplated hereby have been satisfied
or waived, but in any event no later than January __,
2007;
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(v)
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“Dibz
Accounts Payable and Liabilities” means all accounts payable and
liabilities of Dibz, due and owing or otherwise constituting a binding
obligation of Dibz (other than a Dibz Material Contract) as of September
30, 2006;
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(w)
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“Dibz
Accounts Receivable” means all accounts receivable and other
debts owing to Dibz, as of September 30,
2006;
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(x)
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“Dibz
Assets“ means the undertaking and all the property and assets of
the Dibz Business of every kind and description wheresoever situated
including, without limitation, Dibz Equipment, Dibz Inventory, Dibz
Material Contracts, Dibz Accounts Receivable, Dibz Cash, Dibz Intangible
Assets and Dibz Goodwill, and all credit cards, charge cards and
banking
cards issued to Dibz;
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(y)
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“Dibz
Bank Accounts” means all of the bank accounts, lock boxes and
safety deposit boxes of Dibz or relating to the Dibz
Business;
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(z)
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“Dibz
Business” means all aspects of the business conducted by
Dibz;
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(aa)
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“Dibz
Cash” means all cash on hand or on deposit to the credit of Dibz
on the Closing Date;
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(bb)
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“Dibz
Debt to Related Parties” means the debts owed by Dibz and its
subsidiaries to the Dibz Shareholders or to any family member thereof,
or
to any affiliate, director or officer of Dibz or the Dibz
Shareholders;
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(cc)
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“Dibz
Equipment” means all machinery, equipment, furniture, and
furnishings used in the Dibz
Business;
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(dd)
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“Dibz
Goodwill” means the goodwill of the Dibz Business together with
the exclusive right of Haystar to represent itself as carrying on
the Dibz
Business in succession of Dibz subject to the terms hereof, and the
right
to use any words indicating that the Dibz Business is so carried
on
including the right to use the name "Dibz” or “Dibz International" or any
variation thereof as part of the name of or in connection with the
Dibz
Business or any part thereof carried on or to be carried on by Dibz,
the
right to all corporate, operating and trade names associated with
the Dibz
Business, or any variations of such names as part of or in connection
with
the Dibz Business, all telephone listings and telephone advertising
contracts, all lists of customers, books and records and other information
relating to the Dibz Business, all necessary licenses and authorizations
and any other rights used in connection with the Dibz
Business;
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(ee)
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“Dibz
Insurance Policies” means the public liability insurance and
insurance against loss or damage to Dibz Assets and the Dibz
Business;
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(ff)
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“Dibz
Intangible Assets” means all of the intangible assets of Dibz,
including, without limitation, Dibz Goodwill, all trademarks, logos,
copyrights, designs, and other intellectual and industrial property
of
Dibz and its subsidiaries;
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(gg)
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“Dibz
Inventory” means all inventory and supplies of the Dibz Business
as of September 30, 2006;
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(hh)
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“Dibz
Material Contracts” means the burden and benefit of and the
right, title and interest of Dibz in, to and under all trade and
non-trade
contracts, engagements or commitments, whether written or oral, to
which
Dibz is entitled in connection with the Dibz Business whereunder
Dibz is
obligated to pay or entitled to receive the sum of $10,000 or more
including, without limitation, any pension plans, profit sharing
plans,
bonus plans, loan agreements, security agreements, indemnities and
guarantees, any agreements with employees, lessees, licensees, managers,
accountants, suppliers, agents, distributors, officers, directors,
attorneys or others which cannot be terminated without liability
on not
more than one month's notice;
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(ii)
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“Dibz
Related Party Debts” means the debts owed by the Dibz
Shareholders or by any family member thereof, or by any affiliate,
director or officer of Dibz or the Dibz Shareholders, to
Dibz;
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(jj)
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“Dibz
Shares” means all of the issued and outstanding shares of Dibz's
equity stock;
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(kk)
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“Place
of Closing” means the offices of Sichenzia Xxxx Xxxxxxxx Xxxxxxx
LLP, or such other place as Haystar and Dibz may mutually agree
upon;
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Any
other
terms defined within the text of this Agreement will have the meanings so
ascribed to them.
Captions
and Section Numbers
1.2 The
headings and section references in this Agreement are for convenience of
reference only and do not form a part of this Agreement and are not intended
to
interpret, define or limit the scope, extent or intent of this Agreement or
any
provision thereof.
Section
References and Schedules
1.3 Any
reference to a particular “Article”, “section”, “paragraph”, “clause” or other
subdivision is to the particular Article, section, clause or other subdivision
of this Agreement and any reference to a Schedule by letter will mean the
appropriate Schedule attached to this Agreement and by such reference the
appropriate Schedule is incorporated into and made part of this
Agreement. The Schedules to this Agreement are as
follows:
Information
concerning Haystar
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Schedule
“A”
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Haystar
Accounts Payable and Liabilities
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Schedule
“B”
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Haystar
Accounts Receivable
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Schedule
“C”
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Haystar
Bank Accounts
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Schedule
“D”
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Haystar
Debts to Related Parties
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Schedule
“E”
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Haystar
Equipment
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Schedule
“F”
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Haystar
Financial Statements
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Schedule
“G”
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Haystar
Insurance Policies
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Schedule
“H”
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Haystar
Inventory
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Schedule
“I”
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Haystar
Material Contracts
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Schedule
“J”
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Haystar
Business
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Schedule
“K”
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Haystar
Certificate of Designations
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Severability
of Clauses
1.4 If
any part of this Agreement is declared or held to be invalid for any reason,
such invalidity will not affect the validity of the remainder which will
continue in full force and effect and be construed as if this Agreement had
been
executed without the invalid portion, and it is hereby declared the intention
of
the parties that this Agreement would have been executed without reference
to
any portion which may, for any reason, be hereafter declared or held to be
invalid.
ARTICLE
2
THE
ACQUISITION
Sale
of Shares
2.1 The
Dibz Shareholders hereby agree to sell to Haystar the Dibz Shares in exchange
for the Acquisition Shares on the Closing Date and to transfer to Haystar on
the
Closing Date a 100% undivided interest in and to the Dibz Shares free from
all
liens, mortgages, charges, pledges, encumbrances or other burdens with all
rights now or thereafter attached thereto.
Allocation
of Consideration
2.2 The
Acquisition Shares shall be allocated to the Dibz Shareholders on the basis
of
_______ Acquisition Shares for each one Dibz Share held by a Dibz Shareholder
as
set forth in Schedule 2.2 attached hereto.
Adherence
with Applicable Securities Laws
2.3 The
Dibz Shareholders agree that they are acquiring the Acquisition Shares for
investment purposes and will not offer, sell or otherwise transfer, pledge
or
hypothecate any of the Acquisition Shares issued to them (other than pursuant
to
an effective Registration Statement under the Securities Act of 1933,
as amended) directly or indirectly unless:
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(a)
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the
sale is to Haystar;
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(b)
|
the
sale is made pursuant to the exemption from registration under the
Securities Act of 1933, as amended, provided by Rule 144
thereunder; or
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(c)
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the
Acquisition Shares are sold in a transaction that does not require
registration under the Securities Act of 1933, as amended, or any
applicable United States state laws and regulations governing the
offer
and sale of securities, and the vendor has furnished to Haystar an
opinion
of counsel to that effect or such other written opinion as may be
reasonably required by Haystar.
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The
Dibz Shareholders acknowledge that
the certificates representing the Acquisition Shares shall bear the following
legend:
NO
SALE,
OFFER TO SELL, OR TRANSFER OF THE SHARES REPRESENTED BY THIS CERTIFICATE SHALL
BE MADE UNLESS A REGISTRATION STATEMENT UNDER THE FEDERAL SECURITIES ACT OF
1933, AS AMENDED, IN RESPECT OF SUCH SHARES IS THEN IN EFFECT OR AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF SAID ACT IS THEN IN FACT APPLICABLE TO
SAID SHARES.
ARTICLE
3
REPRESENTATIONS
AND WARRANTIES
OF
HAYSTAR
Representations
and Warranties
3.1 Haystar
hereby represents and warrants in all material respects to Dibz and the Dibz
Shareholders, with the intent that Dibz and the Dibz Shareholders will rely
thereon in entering into this Agreement and in approving and completing the
transactions contemplated hereby, that:
Haystar
- Corporate Status and Capacity
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(a)
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Incorporation.
Haystar is a corporation duly incorporated and validly subsisting
under
the laws of the State of Nevada and in good standing with the office
of
the Secretary of State for the State of
Nevada;
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(b)
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Carrying
on Business. Haystar conducts the business described in the Form
15c-211 set forth on Schedule “J” hereto and does not conduct any other
business. Haystar is duly authorized to carry on such business in
the
State of Nevada. The nature of the Haystar Business does not
require Haystar to register or otherwise be qualified to carry on
business
in any other jurisdictions;
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(c)
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Corporate
Capacity. Haystar has the corporate power, capacity and authority to
own the Haystar Assets and to enter into and complete this
Agreement;
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(d)
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Listing.
the Haystar Common Shares are quoted on the Pink Sheets and all reports
required to be filed by Haystar with the NASD have been
filed;
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Haystar
- Capitalization
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(e)
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Authorized
Capital. The authorized capital of Haystar consists of 50,000,000
Haystar Common Shares, $0.001 par value and 1,000,000 shares of preferred
stock, $0.001 par value, of which 4,522,000 Haystar Common Shares
are
presently issued and outstanding and no shares of Haystar Preferred
Shares
are presently issued and
outstanding;
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(f)
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No
Option, Warrant or Other Right. No person, firm or corporation has any
agreement, option, warrant, preemptive right or any other right capable
of
becoming an agreement, option, warrant or right for the acquisition
of
Haystar Common Shares or for the purchase, subscription or issuance
of any
of the unissued shares in the capital of
Haystar;
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Haystar
- Records and Financial
Statements
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(g)
|
Charter
Documents. The charter documents of Haystar and its subsidiaries have
not been altered since the incorporation of each, respectively, except
as
filed in the record books of Haystar or its subsidiaries, as the
case may
be;
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(h)
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Corporate
Minute Books. The corporate minute books of Haystar and its
subsidiaries are complete and each of the minutes contained therein
accurately reflect the actions that were taken at a duly called and
held
meeting or by consent without a meeting. All actions by Haystar and
its
subsidiaries which required director or shareholder approval are
reflected
on the corporate minute books of Haystar and its subsidiaries. Haystar
and
its subsidiaries are not in violation or breach of, or in default
with
respect to, any term of their respective Certificates of Incorporation
(or
other charter documents) or
by-laws.
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(i)
|
Haystar
Financial Statements. The Haystar Financial Statements present fairly,
in all material respects, the assets and liabilities (whether accrued,
absolute, contingent or otherwise) of Haystar, on a consolidated
basis, as
of the respective dates thereof, and the sales and earnings of the
Haystar
Business during the periods covered thereby, in all material respects
and
have been prepared in substantial accordance with generally accepted
accounting principles consistently
applied;
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(j)
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Haystar
Accounts Payable and Liabilities. There are no liabilities, contingent
or otherwise, of Haystar or its subsidiaries which are not disclosed
in
Schedule “A” hereto or reflected in the Haystar Financial Statements
except those incurred in the ordinary course of business since the
date of
the said schedule and the Haystar Financial Statements, and neither
Haystar nor its subsidiaries have guaranteed or agreed to guarantee
any
debt, liability or other obligation of any person, firm or corporation.
Without limiting the generality of the foregoing, all accounts payable
and
liabilities of Haystar as of September 30, 2006, are described in
Schedule
“A” hereto;
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(k)
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Haystar
Accounts Receivable. All the Haystar Accounts Receivable result from
bona fide business transactions and services actually rendered without,
to
the knowledge and belief of Haystar, any claim by the obligor for
set-off
or counterclaim. Without limiting the generality of the foregoing,
all
accounts receivable of Haystar as of September 30, 2006, are described
in
Schedule “B” hereto;
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(l)
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Haystar
Bank Accounts. All of the Haystar Bank Accounts, their location,
numbers and the authorized signatories thereto are as set forth in
Schedule “C” hereto;
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(m)
|
No
Debt to Related Parties. Except as disclosed in Schedule “D” hereto,
neither Haystar nor any of its subsidiaries is, and on Closing will
not
be, indebted to any affiliate, director or officer of Haystar except
accounts payable on account of bona fide business transactions of
Haystar
incurred in normal course of the Haystar Business, including employment
agreements, none of which are more than 30 days in
arrears;
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(n)
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No
Related Party Debt to Haystar. No director or officer or affiliate of
Haystar is now indebted to or under any financial obligation to Haystar
or
any subsidiary on any account whatsoever, except for advances on
account
of travel and other expenses not exceeding $1,000 in
total;
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(o)
|
No
Dividends. No dividends or other distributions on any shares in the
capital of Haystar have been made, declared or authorized since the
date
of Haystar Financial Statements;
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(p)
|
No
Payments. No payments of any kind have been made or authorized since
the date of the Haystar Financial Statements to or on behalf of officers,
directors, shareholders or employees of Haystar or its subsidiaries
or
under any management agreements with Haystar or its subsidiaries,
except
payments made in the ordinary course of business and at the regular
rates
of salary or other remuneration payable to
them;
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(q)
|
No
Pension Plans. There are no pension, profit sharing, group insurance
or similar plans or other deferred compensation plans affecting
Haystar;
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(r)
|
No
Adverse Events. Since the date of the Haystar Financial
Statements
|
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(i)
|
there
has not been any material adverse change in the consolidated financial
position or condition of Haystar, its subsidiaries, its liabilities
or the
Haystar Assets or any damage, loss or other change in circumstances
materially affecting Haystar, the Haystar Business or the Haystar
Assets
or Haystar’ right to carry on the Haystar Business, other than changes in
the ordinary course of business,
|
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(ii)
|
there
has not been any damage, destruction, loss or other event (whether
or not
covered by insurance) materially and adversely affecting Haystar,
its
subsidiaries, the Haystar Business or the Haystar
Assets,
|
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(iii)
|
there
has not been any material increase in the compensation payable or
to
become payable by Haystar to any of Haystar’ officers, employees or agents
or any bonus, payment or arrangement made to or with any of
them,
|
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(iv)
|
the
Haystar Business has been and continues to be carried on in the ordinary
course,
|
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(v)
|
Haystar
has not waived or surrendered any right of material
value,
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(vi)
|
neither
Haystar nor its subsidiaries have discharged or satisfied or paid
any lien
or encumbrance or obligation or liability other than current liabilities
in the ordinary course of business,
and
|
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(vii)
|
no
capital expenditures in excess of $10,000 individually or $30,000 in total
have been authorized or made.
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Haystar
- Income Tax Matters
|
(s)
|
Tax
Returns. All tax returns and reports of Haystar and its subsidiaries
required by law to be filed have been filed and are true, complete
and
correct, and any taxes payable in accordance with any return filed
by
Haystar and its subsidiaries or in accordance with any notice of
assessment or reassessment issued by any taxing authority have been
so
paid;
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(t)
|
Current
Taxes. Adequate provisions have been made for taxes payable for the
current period for which tax returns are not yet required to be filed
and
there are no agreements, waivers, or other arrangements providing
for an
extension of time with respect to the filing of any tax return by,
or
payment of, any tax, governmental charge or deficiency by Haystar
or its
subsidiaries. Haystar is not aware of any contingent tax
liabilities or any grounds which would prompt a reassessment including
aggressive treatment of income and expenses in filing earlier tax
returns;
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Haystar
- Applicable Laws and Legal Matters
|
(u)
|
Licenses.
Haystar and its subsidiaries hold all licenses and permits as may
be
requisite for carrying on the Haystar Business in the manner in which
it
has heretofore been carried on, which licenses and permits have been
maintained and continue to be in good standing except where the failure
to
obtain or maintain such licenses or permits would not have a material
adverse effect on the Haystar
Business;
|
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(v)
|
Applicable
Laws. Neither Haystar nor its subsidiaries have been charged with
or
received notice of breach of any laws, ordinances, statutes, regulations,
by-laws, orders or decrees to which they are subject or which apply
to
them the violation of which would have a material adverse effect
on the
Haystar Business, and neither Haystar nor its subsidiaries are in
breach
of any laws, ordinances, statutes, regulations, bylaws, orders or
decrees
the contravention of which would result in a material adverse impact
on
the Haystar Business;
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(w)
|
Pending
or Threatened Litigation. There is no material litigation or
administrative or governmental proceeding pending or threatened against
or
relating to Haystar, its subsidiaries, the Haystar Business, or any
of the
Haystar Assets nor does Haystar have any knowledge of any deliberate
act
or omission of Haystar or its subsidiaries that would form any material
basis for any such action or
proceeding;
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(x)
|
No
Bankruptcy. Neither Haystar nor its subsidiaries have made any
voluntary assignment or proposal under applicable laws relating to
insolvency and bankruptcy and no bankruptcy petition has been filed
or
presented against Haystar or its subsidiaries and no order has been
made
or a resolution passed for the winding-up, dissolution or liquidation
of
Haystar or its subsidiaries;
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(y)
|
Labor
Matters. Neither Haystar nor its subsidiaries are party to any
collective agreement relating to the Haystar Business with any labor
union
or other association of employees and no part of the Haystar Business
has
been certified as a unit appropriate for collective bargaining or,
to the
knowledge of Haystar, has made any attempt in that
regard;
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(z)
|
Finder's
Fees. Neither Haystar nor its subsidiaries are party to any agreement
which provides for the payment of finder's fees, brokerage fees,
commissions or other fees or amounts which are or may become payable
to
any third party in connection with the execution and delivery of
this
Agreement and the transactions contemplated
herein;
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Execution
and Performance of Agreement
|
(aa)
|
Authorization
and Enforceability. The execution and delivery of this Agreement, and
the completion of the transactions contemplated hereby, have been
duly and
validly authorized by all necessary corporate action on the part
of
Haystar;
|
|
(bb)
|
No
Violation or Breach. The execution and performance of this Agreement
will not:
|
|
(i)
|
violate
the charter documents of Haystar or result in any breach of, or default
under, any loan agreement, mortgage, deed of trust, or any other
agreement
to which Haystar or its subsidiaries are
party,
|
|
(ii)
|
give
any person any right to terminate or cancel any agreement including,
without limitation, the Haystar Material Contracts, or any right
or rights
enjoyed by Haystar or its
subsidiaries,
|
|
(iii)
|
result
in any alteration of Haystar’ or its subsidiaries’ obligations under any
agreement to which Haystar or its subsidiaries are party including,
without limitation, the Haystar Material
Contracts,
|
|
(iv)
|
result
in the creation or imposition of any lien, encumbrance or restriction
of
any nature whatsoever in favor of a third party upon or against the
Haystar Assets,
|
|
(v)
|
result
in the imposition of any tax liability to Haystar or its subsidiaries
relating to the Haystar Assets, or
|
|
(vi)
|
violate
any court order or decree to which either Haystar or its subsidiaries
are
subject;
|
The
Haystar Assets - Ownership and Condition
|
(cc)
|
Business
Assets. The Haystar Assets comprise all of the property and assets
of
the Haystar Business, and no other person, firm or corporation owns
any
assets used by Haystar or its subsidiaries in operating the Haystar
Business, whether under a lease, rental agreement or other arrangement,
other than as disclosed in Schedules “E” or “H”
hereto;
|
|
(dd)
|
Title.
Haystar or its subsidiaries are the legal and beneficial owner of
the
Haystar Assets, free and clear of all mortgages, liens, charges,
pledges,
security interests, encumbrances or other claims whatsoever, save
and
except as disclosed in Schedules “E” or “H”
hereto;
|
|
(ee)
|
No
Option. No person, firm or corporation has any agreement or option
or
a right capable of becoming an agreement for the purchase of any
of the
Haystar Assets;
|
|
(ff)
|
Haystar
Insurance Policies. Haystar and its subsidiaries maintain the public
liability insurance and insurance against loss or damage to the Haystar
Assets and the Haystar Business as described in Schedule “G”
hereto;
|
|
(gg)
|
Haystar
Material Contracts. The Haystar Material Contracts listed in Schedule
“I” constitute all of the material contracts of Haystar and its
subsidiaries;
|
|
(hh)
|
No
Default. There has not been any default in any material obligation of
Haystar or any other party to be performed under any of the Haystar
Material Contracts, each of which is in good standing and in full
force
and effect and unamended (except as disclosed in Schedule “I” hereto), and
Haystar is not aware of any default in the obligations of any other
party
to any of the Haystar Material
Contracts;
|
|
(ii)
|
No
Compensation on Termination. There are no agreements, commitments or
understandings relating to severance pay or separation allowances
on
termination of employment of any employee of Haystar or its subsidiaries.
Neither Haystar nor its subsidiaries are obliged to pay benefits
or share
profits with any employee after termination of employment except
as
required by law;
|
Haystar
Assets - Haystar Equipment
|
(jj)
|
Haystar
Equipment. The Haystar Equipment has been maintained in a manner
consistent with that of a reasonably prudent owner and such equipment
is
in good working condition;
|
Haystar
Assets - Haystar Goodwill and Other Assets
|
(kk)
|
Haystar
Goodwill. Haystar and its subsidiaries do not carry on the Haystar
Business under any other business or trade names. Haystar does not
have
any knowledge of any infringement by Haystar or its subsidiaries
of any
patent, trademarks, copyright or trade
secret;
|
The
Haystar Business
|
(ll)
|
Maintenance
of Business. Since the date of the Haystar Financial Statements,
Haystar and its subsidiaries have not entered into any material agreement
or commitment except in the ordinary course and except as disclosed
herein;
|
|
(mm)
|
Subsidiaries.
Haystar does not own any subsidiaries and does not otherwise own,
directly
or indirectly, any shares or interest in any other corporation,
partnership, joint venture or firm;
and
|
Haystar
- Acquisition Shares
|
(nn)
|
Acquisition
Shares. The Acquisition Shares when delivered to the Dibz Shareholders
pursuant to the Acquisition shall be validly issued and outstanding
as
fully paid and non-assessable shares and the Acquisition Shares shall
be
transferable upon the books of Haystar, in all cases subject to the
provisions and restrictions of all applicable securities
laws.
|
Non-Merger
and Survival
3.2 The
representations and warranties of Haystar contained herein will be true at
and
as of Closing in all material respects as though such representations and
warranties were made as of such time. Notwithstanding the completion
of the transactions contemplated hereby, the waiver of any condition contained
herein (unless such waiver expressly releases a party from any such
representation or warranty) or any investigation made by Dibz or the Dibz
Shareholders, the representations and warranties of Haystar shall survive the
Closing.
Indemnity
3.3 Haystar
agrees to indemnify and save harmless Dibz and the Dibz Shareholders from and
against any and all claims, demands, actions, suits, proceedings, assessments,
judgments, damages, costs, losses and expenses, including any payment made
in
good faith in settlement of any claim (subject to the right of Haystar to defend
any such claim), resulting from the breach by it of any representation or
warranty made under this Agreement or from any misrepresentation in or omission
from any certificate or other instrument furnished or to be furnished by Haystar
to Dibz or the Dibz Shareholders hereunder.
ARTICLE
4
COVENANTS
OF HAYSTAR
Covenants
4.1 Haystar
covenants and agrees with Dibz and the Dibz Shareholders that it
will:
|
(a)
|
Conduct
of Business. Until the Closing, conduct the Haystar Business
diligently and in the ordinary course consistent with the manner
in which
the Haystar Business generally has been operated up to the date of
execution of this Agreement;
|
|
(b)
|
Preservation
of Business. Until the Closing, use its best efforts to
preserve the Haystar Business and the Haystar Assets and, without
limitation, preserve for Dibz, Haystar’s and its subsidiaries’
relationships with any third party having business relations with
them;
|
|
(c)
|
Access.
Until the Closing, give Dibz, the Dibz Shareholders, and their
representatives full access to all of the properties, books, contracts,
commitments and records of Haystar, and furnish to Dibz, the Dibz
Shareholders and their representatives all such information as they
may
reasonably request; and
|
|
(d)
|
Procure
Consents. Until the Closing, take all reasonable steps required to
obtain, prior to Closing, any and all third party consents required
to
permit the Acquisition and to preserve and maintain the Haystar Assets
notwithstanding the change in control of Dibz arising from the
Acquisition.
|
Authorization
4.2 Haystar
hereby agrees to authorize and direct any and all federal, state, municipal,
foreign and international governments and regulatory authorities having
jurisdiction respecting Haystar and its subsidiaries to release any and all
information in their possession respecting Haystar and its subsidiaries to
the
Dibz Shareholders. Haystar shall promptly execute and deliver to the Dibz
Shareholders any and all consents to the release of information and specific
authorizations which the Dibz Shareholders reasonably requires to gain access
to
any and all such information.
Survival
4.3 The
covenants set forth in this Article shall survive the Closing for the benefit
of
Dibz and the Dibz Shareholders.
ARTICLE
5
REPRESENTATIONS
AND WARRANTIES OF
THE
DIBZ SHAREHOLDERS
Representations
and Warranties
5.1 The
Dibz Shareholders hereby jointly and severally represent and warrant in all
material respects to Haystar, with the intent that it will rely thereon in
entering into this Agreement and in approving and completing the transactions
contemplated hereby, that:
Dibz
- Company Status and Capacity
|
(a)
|
Formation.
Dibz is a corporation duly incorporated and validly subsisting under
the
laws of the State of Delaware and in good standing with the office
of the
Secretary of State for the State of
Delaware;
|
|
(b)
|
Carrying
on Business. Dibz carries on the Dibz Business primarily in the State
of Texas and carries on material business activity in other jurisdiction.
The nature of the Dibz Business does not require Dibz to register
or
otherwise be qualified to carry on business in any
jurisdiction;
|
|
(c)
|
Legal
Capacity. Dibz has the legal power, capacity and authority to own Dibz
Assets, to carry on the Business of Dibz and to enter into and complete
this Agreement;
|
Dibz
- Capitalization
|
(d)
|
Authorized
Capital. The authorized capital of Dibz consists of 1500 shares of
common stock, $0.001 par value;
|
|
(e)
|
Ownership
of Dibz Shares. The issued and outstanding shares of Dibz common stock
will on Closing consist of 100 shares of common stock, $0.001 par
value,
(being the Dibz Shares), which shares on Closing shall be validly
issued
and outstanding as fully paid and non-assessable shares. The Dibz
Shareholders will be at Closing the registered and beneficial owners
of
the 100 Dibz Shares. The Dibz Shares owned by the Dibz Shareholders
will
on Closing be free and clear of any and all liens, charges, pledges,
encumbrances, restrictions on transfer and adverse claims
whatsoever;
|
|
(f)
|
No
Restrictions. There are no restrictions on the transfer, sale or other
disposition of Dibz Shares contained in the charter documents of
Dibz or
under any agreement;
|
Dibz
- Records and Financial Statements
|
(g)
|
Charter
Documents. The charter documents of Dibz have not been altered since
its formation date, except as filed in the record books of
Dibz;
|
|
(h)
|
Minute
Books. The minute books of Dibz are complete and each of the minutes
contained therein accurately reflect the actions that were taken
at a duly
called and held meeting or by consent without a meeting. All actions
by
Dibz which required director or shareholder approval are reflected
on the
corporate minute books of Dibz. Dibz is not in violation or breach
of, or
in default with respect to, any term of its Certificate of Incorporation
(or other charter documents) or
by-laws.
|
|
(i)
|
No
Debt to Related Parties. Dibz is not and on Closing will not be,
indebted to the Dibz Shareholders nor to any family member thereof,
nor to
any affiliate, director or officer of Dibz or the Dibz Shareholders
except
accounts payable on account of bona fide business transactions of
Dibz
incurred in normal course of Dibz Business, including employment
agreements with the Dibz Shareholders, none of which are more than
30 days
in arrears;
|
|
(j)
|
No
Dividends. No dividends or other distributions on any shares in the
capital of Dibz have been made, declared or
authorized;
|
|
(k)
|
No
Pension Plans. There are no pension, profit sharing, group insurance
or similar plans or other deferred compensation plans affecting
Dibz;
|
Dibz
- Income Tax Matters
|
(l)
|
Tax
Returns. All tax returns and reports of Dibz required by law to be
filed have been filed and are true, complete and correct, and any
taxes
payable in accordance with any return filed by Dibz or in accordance
with
any notice of assessment or reassessment issued by any taxing authority
have been so paid;
|
|
(m)
|
Current
Taxes. Adequate provisions have been made for taxes payable for the
current period for which tax returns are not yet required to be filed
and
there are no agreements, waivers, or other arrangements providing
for an
extension of time with respect to the filing of any tax return by,
or
payment of, any tax, governmental charge or deficiency by Dibz. Dibz
is
not aware of any contingent tax liabilities or any grounds which
would
prompt a reassessment including aggressive treatment of income and
expenses in filing earlier tax
returns;
|
Dibz
- Applicable Laws and Legal Matters
|
(n)
|
Licenses.
Dibz holds all licenses and permits as may be requisite for carrying
on
the Dibz Business in the manner in which it has heretofore been carried
on, which licenses and permits have been maintained and continue
to be in
good standing except where the failure to obtain or maintain such
licenses
or permits would not have a material adverse effect on the Dibz
Business;
|
|
(o)
|
Applicable
Laws. Dibz has not been charged with or received notice of breach
of
any laws, ordinances, statutes, regulations, by-laws, orders or decrees
to
which they are subject or which applies to them the violation of
which
would have a material adverse effect on the Dibz Business, and, to
the
knowledge of the Dibz Shareholders, Dibz is not in breach of any
laws,
ordinances, statutes, regulations, by-laws, orders or decrees the
contravention of which would result in a material adverse impact
on the
Dibz Business;
|
|
(p)
|
Pending
or Threatened Litigation. There is no material litigation or
administrative or governmental proceeding pending or threatened against
or
relating to Dibz, the Dibz Business, or any of the Dibz Assets, nor
do the
Dibz Shareholders have any knowledge of any deliberate act or omission
of
Dibz that would form any material basis for any such action or
proceeding;
|
|
(q)
|
No
Bankruptcy. Dibz has not made any voluntary assignment or proposal
under applicable laws relating to insolvency and bankruptcy and no
bankruptcy petition has been filed or presented against Dibz and
no order
has been made or a resolution passed for the winding-up, dissolution
or
liquidation of Dibz;
|
|
(r)
|
Labor
Matters. Dibz is not party to any collective agreement relating to the
Dibz Business with any labor union or other association of employees and
no part of the Dibz Business has been certified as a unit appropriate
for
collective bargaining or, to the knowledge of the Dibz Shareholders,
has
made any attempt in that regard;
|
|
(s)
|
Finder's
Fees. Dibz is not a party to any agreement which provides for the
payment of finder's fees, brokerage fees, commissions or other fees
or
amounts which are or may become payable to any third party in connection
with the execution and delivery of this Agreement and the transactions
contemplated herein;
|
Execution
and Performance of Agreement
|
(t)
|
Authorization
and Enforceability. The execution and delivery of this Agreement, and
the completion of the transactions contemplated hereby, have been
duly and
validly authorized by all necessary corporate action on the part
of
Dibz;
|
|
(u)
|
No
Violation or Breach. The execution and performance of this Agreement
will not
|
|
(i)
|
violate
the charter documents of Dibz or result in any breach of, or default
under, any loan agreement, mortgage, deed of trust, or any other
agreement
to which Dibz is a party,
|
|
(ii)
|
give
any person any right to terminate or cancel any agreement including,
without limitation, Dibz Material Contracts, or any right or rights
enjoyed by Dibz,
|
|
(iii)
|
result
in any alteration of Dibz's obligations under any agreement to
which Dibz is a party including, without limitation, the Dibz
Material Contracts,
|
|
(iv)
|
result
in the creation or imposition of any lien, encumbrance or restriction
of
any nature whatsoever in favor of a third party upon or against the
Dibz
Assets,
|
|
(v)
|
result
in the imposition of any tax liability to Dibz relating to Dibz Assets
or
the Dibz Shares, or
|
|
(vi)
|
violate
any court order or decree to which either Dibz is
subject;
|
Dibz
Assets - Ownership and Condition
|
(v)
|
Business
Assets. The Dibz Assets, comprise all of the property and assets of
the Dibz Business, and neither the Dibz Shareholders nor any other
person,
firm or corporation owns any assets used by Dibz in operating the
Dibz
Business, whether under a lease, rental agreement or other
arrangement;
|
|
(w)
|
Title.
Dibz is the legal and beneficial owner of the Dibz Assets, free and
clear
of all mortgages, liens, charges, pledges, security interests,
encumbrances or other claims
whatsoever;
|
|
(x)
|
No
Option. No person, firm or corporation has any agreement or option
or
a right capable of becoming an agreement for the purchase of any
of the
Dibz Assets;
|
|
(y)
|
Dibz
Insurance Policies. Dibz maintains the public liability insurance and
insurance against loss or damage to the Dibz Assets and the Dibz
Business;
|
|
(z)
|
Dibz
Material Contracts. Dibz has no material
contracts;
|
|
(aa)
|
No
Default. There has not been any default in any material obligation of
Dibz or any other party to be performed under any of Dibz Material
Contracts, each of which is in good standing and in full force and
effect
and unamended and Dibz is not aware of any default in the obligations
of
any other party to any of the Dibz Material
Contracts;
|
|
(bb)
|
No
Compensation on Termination. There are no agreements, commitments or
understandings relating to severance pay or separation allowances
on
termination of employment of any employee of Dibz. Dibz is not
obliged to pay benefits or share profits with any employee after
termination of employment except as required by
law;
|
Dibz
Assets - Dibz Equipment
|
(cc)
|
Dibz
Equipment. The Dibz Equipment has been maintained in a manner
consistent with that of a reasonably prudent owner and such equipment
is
in good working condition;
|
Dibz
Assets - Dibz Goodwill and Other Assets
|
(dd)
|
Dibz
Goodwill. Dibz carries on the Dibz Business only under the name "Dibz
Technologies, Inc." and variations thereof and under no other business
or
trade names. The Dibz Shareholders do not have any knowledge of any
infringement by Dibz of any patent, trademark, copyright or trade
secret;
|
|
|
The
Business of Dibz
|
|
(ee)
|
Maintenance
of Business. The Dibz Business has been carried on in the ordinary
course and Dibz has not entered into any material agreement or commitment
except in the ordinary course; and
|
|
(ff)
|
Subsidiaries.
Dibz does not own any subsidiaries and does not otherwise own, directly
or
indirectly, any shares or interest in any other corporation, partnership,
joint venture or firm and Dibz does not own any subsidiary and does
not
otherwise own, directly or indirectly, any shares or interest in
any other
corporation, partnership, joint venture or
firm.
|
Non-Merger
and Survival
5.2 The
representations and warranties of Dibz contained herein will be true at and
as
of Closing in all material respects as though such representations and
warranties were made as of such time. Notwithstanding the completion
of the transactions contemplated hereby, the waiver of any condition contained
herein (unless such waiver expressly releases a party from any such
representation or warranty) or any investigation made by Haystar, the
representations and warranties of Dibz shall survive the Closing.
Indemnity
5.3 The
Dibz Shareholders agree to indemnify and save harmless Haystar from and against
any and all claims, demands, actions, suits, proceedings, assessments,
judgments, damages, costs, losses and expenses, including any payment made
in
good faith in settlement of any claim (collectively, the “Claims”) (subject to
the right of the Dibz Shareholders to defend any such claim), resulting from
the
breach by any of them of any representation or warranty of such party made
under
this Agreement or from any misrepresentation in or omission from any certificate
or other instrument furnished or to be furnished by Dibz or the Dibz
Shareholders to Haystar hereunder; provided, however, the Dibz Shareholders
shall not be required to indemnify Haystar for any such Claims in excess of
the
value of the Dibz Shares.
ARTICLE
6
COVENANTS
OF DIBZ AND
THE
DIBZ SHAREHOLDERS
Covenants
6.1 Dibz
and the Dibz Shareholders covenant and agree with Haystar that they
will:
|
(a)
|
Conduct
of Business. Until the Closing, conduct the Dibz Business diligently
and in the ordinary course consistent with the manner in which the
Dibz
Business generally has been operated up to the date of execution
of this
Agreement;
|
|
(b)
|
Preservation
of Business. Until the Closing, use their best efforts to
preserve the Dibz Business and the Dibz Assets and, without limitation,
preserve for Haystar Dibz’s relationships with their suppliers, customers
and others having business relations with
them;
|
|
(c)
|
Access.
Until the Closing, give Haystar and its representatives full access
to all
of the properties, books, contracts, commitments and records of Dibz
relating to Dibz, the Dibz Business and the Dibz Assets, and furnish
to
Haystar and its representatives all such information as they may
reasonably request;
|
|
(d)
|
Procure
Consents. Until the Closing, take all reasonable steps required to
obtain, prior to Closing, any and all third party consents required
to
permit the Acquisition and to preserve and maintain the Dibz Assets,
including the Dibz Material Contracts, notwithstanding the change
in
control of Dibz arising from the
Acquisition;
|
|
(e)
|
Prohibitions.
|
|
(1)
|
From
and for a period of six (6) months after the Closing Date, not remove
assets from Dibz without true and valid consideration or register
shares
pursuant to Form S-8.
|
|
(2)
|
From
and for a period of one (1) year after the Closing Date, not effect
any
reverse splits.
|
Authorization
6.2 Dibz
hereby agrees to authorize and direct any and all federal, state, municipal,
foreign and international governments and regulatory authorities having
jurisdiction respecting Dibz to release any and all information in their
possession respecting Dibz to Haystar. Dibz shall promptly execute
and deliver to Haystar any and all consents to the release of information and
specific authorizations which Haystar reasonably require to gain access to
any
and all such information.
Survival
6.3 The
covenants set forth in this Article shall survive the Closing for the benefit
of
Haystar.
ARTICLE
7
CONDITIONS
PRECEDENT
Conditions
Precedent in favor of Haystar
7.1 Haystar’s
obligations to carry out the transactions contemplated hereby are subject to
the
fulfillment of each of the following conditions precedent on or before the
Closing:
|
(a)
|
all
documents or copies of documents required to be executed and delivered
to
Haystar hereunder will have been so executed and
delivered;
|
|
(b)
|
all
of the terms, covenants and conditions of this Agreement to be complied
with or performed by Dibz or the Dibz Shareholders at or prior to
the
Closing will have been complied with or
performed;
|
|
(c)
|
title
to the Dibz Shares held by the Dibz Shareholders and to the Dibz
Assets
will be free and clear of all mortgages, liens, charges, pledges,
security
interests, encumbrances or other claims whatsoever, save and except
as
disclosed herein, and the Dibz Shares shall be duly transferred to
Haystar;
|
|
(d)
|
subject
to Article 8 hereof, there will not have
occurred
|
|
(i)
|
any
material adverse change in the financial position or condition of
Dibz,
its liabilities or the Dibz Assets or any damage, loss or other change
in
circumstances materially and adversely affecting Dibz, the Dibz Business
or the Dibz Assets or Dibz's right to carry on the Dibz Business,
other
than changes in the ordinary course of business, none of which has
been
materially adverse, or
|
|
(ii)
|
any
damage, destruction, loss or other event, including changes to any
laws or
statutes applicable to Dibz or the Dibz Business (whether or not
covered
by insurance) materially and adversely affecting Dibz, the Dibz Business
or the Dibz Assets;
|
|
(e)
|
the
transactions contemplated hereby shall have been approved by all
other
regulatory authorities having jurisdiction over the subject matter
hereof,
if any;
|
|
(f)
|
the
transactions contemplated hereby shall have been approved by the
Board of
Directors and shareholders of Dibz;
|
|
(g)
|
on
or prior to the Closing Date, Dibz and/or the Dibz Shareholders shall
have
acquired all of the ordinary shares held by Dibz Shareholders that
are not
participating in this Agreement so that Haystar shall acquire 100%
of the
presently issued and outstanding Dibz Shares;
and
|
Waiver
by Haystar
7.2 The
conditions precedent set out in the preceding section are inserted for the
exclusive benefit of Haystar and any such condition may be waived in whole
or in
part by Haystar at or prior to the Closing by delivering to Dibz a written
waiver to that effect signed by Haystar. In the event that the conditions
precedent set out in the preceding section are not satisfied on or before the
Closing, Haystar shall be released from all obligations under this
Agreement.
Conditions
Precedent in Favor of Dibz and the Dibz Shareholders
7.3 The
obligations of Dibz and the Dibz Shareholders to carry out the transactions
contemplated hereby are subject to the fulfillment of each of the following
conditions precedent on or before the Closing:
|
(a)
|
all
documents or copies of documents required to be executed and delivered
to
Dibz hereunder will have been so executed and
delivered;
|
|
(b)
|
all
of the terms, covenants and conditions of this Agreement to be complied
with or performed by Haystar at or prior to the Closing will have
been
complied with or performed;
|
|
(c)
|
Haystar
will have delivered the Acquisition Shares to be issued pursuant
to the
terms of the Acquisition to Dibz at the Closing and the Acquisition
Shares
will be registered on the books of Haystar in the name of the holder
of
Dibz Shares at the time of Closing;
|
|
(d)
|
title
to the Acquisition Shares will be free and clear of all mortgages,
liens,
charges, pledges, security interests, encumbrances or other claims
whatsoever;
|
|
(e)
|
subject
to Article 8 hereof, there will not have
occurred
|
|
(i)
|
any
material adverse change in the financial position or condition of
Haystar,
its subsidiaries, their liabilities or the Haystar Assets or any
damage,
loss or other change in circumstances materially and adversely affecting
Haystar, the Haystar Business or the Haystar Assets or Haystar’ right to
carry on the Haystar Business, other than changes in the ordinary
course
of business, none of which has been materially adverse,
or
|
|
(ii)
|
any
damage, destruction, loss or other event, including changes to any
laws or
statutes applicable to Haystar or the Haystar Business (whether or
not
covered by insurance) materially and adversely affecting Haystar,
its
subsidiaries, the Haystar Business or the Haystar
Assets;
|
|
|
(f)
|
the
transactions contemplated hereby shall have been approved by all
other
regulatory authorities having jurisdiction over the subject matter
hereof,
if any;
|
|
|
(g)
|
the
transactions contemplated hereby shall have been approved by the
Board of
Directors of Haystar;
|
|
(h)
|
each
of the directors and officers of Haystar shall have resigned as directors
and/or officers of Haystar;
|
|
(i)
|
Xxxx
Xxxx shall have been appointed to the Board of
Directors.
|
|
(j)
|
Xxxxxx
Xxxxxxx and Xxxxx Xxxxxxxxxx shall have executed that certain Agreement,
dated January 25, 2007 for the cancellation of 3,000,000 Haystar
Common
Shares;
|
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(k)
|
The
Company shall have filed that certain Certificate of Designations
as set
forth on Schedule “K” hereto, to authorize and fix the terms of the Series
A Preferred Stock and the number of shares constituting such
series.
|
Waiver
by Dibz and the Dibz Shareholders
7.4 The
conditions precedent set out in the preceding section are inserted for the
exclusive benefit of Dibz and the Dibz Shareholders and any such condition
may
be waived in whole or in part by Dibz or the Dibz Shareholders at or prior
to
the Closing by delivering to Haystar a written waiver to that effect signed
by
Dibz and the Dibz Shareholders. In the event that the conditions precedent
set
out in the preceding section are not satisfied on or before the Closing, Dibz
and the Dibz Shareholders shall be released from all obligations under this
Agreement.
Nature
of Conditions Precedent
7.5 The
conditions precedent set forth in this Article are conditions of completion
of
the transactions contemplated by this Agreement and are not conditions precedent
to the existence of a binding agreement. Each party acknowledges receipt of
the
sum of $10.00 and other good and valuable consideration as separate and distinct
consideration for agreeing to the conditions of precedent in favor of the other
party or parties set forth in this Article.
Termination
7.6 Notwithstanding
any provision herein to the contrary, if the Closing does not occur on or before
January 26, 2007 (the “Termination Date”), this Agreement will be at an end and
will have no further force or effect, unless otherwise agreed upon by the
parties in writing.
Confidentiality
7.7 Notwithstanding
any provision herein to the contrary, the parties hereto agree that the
existence and terms of this Agreement are confidential and that if this
Agreement is terminated pursuant to the preceding section the parties agree
to
return to one another any and all financial, technical and business documents
delivered to the other party or parties in connection with the negotiation
and
execution of this Agreement and shall keep the terms of this Agreement and
all
information and documents received from Dibz and Haystar and the contents
thereof confidential and not utilize nor reveal or release same, provided,
however, that Haystar [will] be required to issue a news release regarding
the
execution and consummation of this Agreement.
ARTICLE
8
RISK
Material
Change in the Business of Dibz
8.1 If
any material loss or damage to the Dibz Business occurs prior to Closing and
such loss or damage, in Haystar' reasonable opinion, cannot be substantially
repaired or replaced within sixty (60) days, Haystar shall, within two (2)
days
following any such loss or damage, by notice in writing to Dibz, at its option,
either:
|
(a)
|
terminate
this Agreement, in which case no party will be under any further
obligation to any other party; or
|
|
(b)
|
elect
to complete the Acquisition and the other transactions contemplated
hereby, in which case the proceeds and the rights to receive the
proceeds
of all insurance covering such loss or damage will, as a condition
precedent to Haystar' obligations to carry out the transactions
contemplated hereby, be vested in Dibz or otherwise adequately secured
to
the satisfaction of Haystar on or before the Closing
Date.
|
Material
Change in the Haystar Business
8.2 If
any material loss or damage to the Haystar Business occurs prior to Closing
and
such loss or damage, in Dibz's reasonable opinion, cannot be substantially
repaired or replaced within sixty (60) days, Dibz shall, within two (2) days
following any such loss or damage, by notice in writing to Haystar, at its
option, either:
|
(a)
|
terminate
this Agreement, in which case no party will be under any further
obligation to any other party; or
|
|
(b)
|
elect
to complete the Acquisition and the other transactions contemplated
hereby, in which case the proceeds and the rights to receive the
proceeds
of all insurance covering such loss or damage will, as a condition
precedent to Dibz's obligations to carry out the transactions contemplated
hereby, be vested in Haystar or otherwise adequately secured to the
satisfaction of Dibz on or before the Closing
Date.
|
ARTICLE
9
CLOSING
Closing
9.1 The
Acquisition and the other transactions contemplated by this Agreement will
be
closed at the Place of Closing on Closing Date in accordance with the closing
procedure set out in this Article.
Documents
to be Delivered by Dibz
9.2 On
or before the Closing, Dibz and the Dibz Shareholders will deliver or cause
to
be delivered to Haystar:
|
(a)
|
the
original or certified copies of the charter documents of Dibz, including
amendments thereof, and all corporate records documents and instruments
of
Dibz, the corporate seal of Dibz and all books and accounts of
Dibz;
|
|
(b)
|
all
reasonable consents or approvals required to be obtained by Dibz
for the
purposes of completing the Acquisition and preserving and maintaining
the
interests of Dibz under any and all Dibz Material Contracts and in
relation to Dibz Assets;
|
|
(c)
|
certified
copies of such resolutions and minutes of the shareholders and directors
of Dibz as are required to be passed to authorize the execution,
delivery
and implementation of this
Agreement;
|
|
(d)
|
an
acknowledgement from Dibz and the Dibz Shareholders of the satisfaction
of
the conditions precedent set forth in section 7.3
hereof;
|
|
(e)
|
the
certificates or other evidence of ownership of the Dibz Shares, together
with such other documents or instruments required to effect transfer
of
ownership of the Dibz Shares to
Haystar;
|
|
(f)
|
declaration
of acceptance by Xxxx Xxxx of being elected as a member of the Board
of
Directors of Haystar,
|
|
(g)
|
good
standing certificate of Dibz, and
|
|
(h)
|
such
other documents as Haystar may reasonably require to give effect
to the
terms and intention of this
Agreement.
|
Documents
to be Delivered by Haystar
9.3 On
or before the Closing, Haystar shall deliver or cause to be delivered to Dibz
and the Dibz Shareholders:
|
(a)
|
share
certificates representing the Acquisition Shares duly registered
in the
names of the holders of shares of Dibz Common
Stock;
|
|
(b)
|
certified
copies of such resolutions of the directors of Haystar as are required
to
be passed to authorize the execution, delivery and implementation
of this
Agreement;
|
|
(c)
|
a
certified copy of a resolution of the directors of Haystar dated
as of the
Closing Date appointing the nominees of Dibz as officers of Dibz
and
appointing the nominee of the Dibz Shareholders to the board of directors
of Haystar;
|
|
(d)
|
resignations
of all of the officers of Haystar as of the Closing
Date;
|
|
(e)
|
resignation
of Xxxxxx Xxxxxxx and Xxxxx Xxxxxxxxx as directors of
Haystar;
|
|
(f)
|
an
acknowledgement from Haystar of the satisfaction of the conditions
precedent set forth in section 7.1
hereof;
|
|
(g)
|
certificate
or incorporation and good standing certificate of
Haystar;
|
|
(h)
|
an
executed copy of the Agreement for the retirement of 3,000,000 Haystar
Common Shares held by Xxxxxx Xxxxxxx and Xxxxx Xxxxxxxxxx,
and
|
|
(i)
|
such
other documents as Dibz may reasonably require to give effect to
the terms
and intention of this Agreement.
|
ARTICLE
10
POST-CLOSING
MATTERS
Forthwith
after the Closing, Haystar,
Dibz and the Dibz Shareholders, as the case may be, agree to use all their
best
efforts to:
|
(a)
|
issue
a news release reporting the
Closing;
|
|
(b)
|
change
the name of Haystar to “________” of such other name as determined by the
Board of Directors of Haystar;
|
|
(c)
|
obtain
adequate funding which will enable Dibz to pursue its business plan
for
the subsequent twelve (12) months;
|
|
(d)
|
associate
itself with financial intermediaries who have the experience and
capability to provide financial public relations and market
support.
|
ARTICLE
11
GENERAL
PROVISIONS
Arbitration
11.1 The
parties hereto shall attempt to resolve any dispute, controversy, difference
or
claim arising out of or relating to this Agreement by negotiation in good
faith. If such good negotiation fails to resolve such dispute,
controversy, difference or claim within fifteen (15) days after any party
delivers to any other party a notice of its intent to submit such matter to
arbitration, then any party to such dispute, controversy, difference or claim
may submit such matter to arbitration in the City of New York, New
York.
Notice
11.2 Any
notice required or permitted to be given by any party will be deemed to be
given
when in writing and delivered to the address for notice of the intended
recipient by personal delivery, prepaid single certified or registered mail,
or
telecopier. Any notice delivered by mail shall be deemed to have been received
on the fourth business day after and excluding the date of mailing, except
in
the event of a disruption in regular postal service in which event such notice
shall be deemed to be delivered on the actual date of receipt. Any notice
delivered personally or by telecopier shall be deemed to have been received
on
the actual date of delivery.
Addresses
for Service
11.3 The
address for service of notice of each of the parties hereto is as
follows:
|
(a)
|
Haystar:
|
0000
Xxxxxxx, #000
Xxxxxx
Xxxx, Xxxxxxxx 00000
Attention:
Telephone
no.
Facsimile
no.
With
a
copy to:
Xxxxxx
& Jaclin, LLP
000
Xxxxx
0, Xxxxx 000
Xxxxxxxxx,
Xxx Xxxxxx 00000
Attn:
Xxxxx X. Xxxxxx, Esq.
Phone: (000)000-0000
Telecopier:
(000)000-0000
|
(b)
|
Dibz
or the Dibz Shareholders:
|
9595
Six
Pines – Xxxxxx Xxxxxx
Xxxxxxxx
0, Xxxxx 0
Xxx
Xxxxxxxxx, XX 00000
Attention:
Xxxx Xxxx
Telephone
no.
Facsimile
no.
With
a
copy to:
Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn: Xxxxxxx
X. Xxxxxxx, Esq.
Phone: (000)
000-0000
Telecopier: (000)
000-0000
Change
of Address
11.4 Any
party may, by notice to the other parties change its address for notice to
some
other address in North America and will so change its address for notice
whenever the existing address or notice ceases to be adequate for delivery
by
hand. A post office box may not be used as an address for service.
Further
Assurances
11.5 Each
of the parties will execute and deliver such further and other documents and
do
and perform such further and other acts as any other party may reasonably
require to carry out and give effect to the terms and intention of this
Agreement.
Time
of the Essence
11.6 Time
is expressly declared to be the essence of this Agreement.
Entire
Agreement
11.7 The
provisions contained herein constitute the entire agreement among Dibz, the
Dibz
Shareholders and Haystar respecting the subject matter hereof and supersede
all
previous communications, representations and agreements, whether verbal or
written, among Dibz, the Dibz Shareholders and Haystar with respect to the
subject matter hereof.
Enurement
11.8 This
Agreement will enure to the benefit of and be binding upon the parties hereto
and their respective heirs, executors, administrators, successors and permitted
assigns.
Assignment
11.9 This
Agreement is not assignable without the prior written consent of the parties
hereto.
Counterparts
11.10 This
Agreement may be executed in counterparts, each of which when executed by any
party will be deemed to be an original and all of which counterparts will
together constitute one and the same Agreement. Delivery of executed copies
of
this Agreement by telecopier will constitute proper delivery, provided that
originally executed counterparts are delivered to the parties within a
reasonable time thereafter.
Applicable
Law
11.11 This
Agreement shall be enforced, governed by and construed in accordance with the
laws of the State of New York applicable to agreements made and to be performed
entirely within such state, without regard to the principles of conflict of
laws The parties hereto hereby submit to the exclusive jurisdiction
of the United States federal courts located in New York, New York with respect
to any dispute arising under this Agreement, the agreements entered into in
connection herewith or the transactions contemplated hereby or thereby. All
parties irrevocably waive the defense of an inconvenient forum to the
maintenance of such suit or proceeding. All parties further agree
that service of process upon a party mailed by first class mail shall be deemed
in every respect effective service of process upon the party in any such suit
or
proceeding. Nothing herein shall affect either party’s right to serve
process in any other manner permitted by law. All parties agree that
a final non-appealable judgment in any such suit or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on such judgment
or in any other lawful manner. The party which does not prevail in
any dispute arising under this Agreement shall be responsible for all fees
and
expenses, including attorneys’ fees, incurred by the prevailing party in
connection with such dispute.
[Remainder
of page intentionally left blank.]
IN
WITNESS WHEREOF the parties have executed this Agreement effective as
of the day and year first above written.
HAYSTAR
SERVICES AND TECHNOLOGY, INC.
By:_____________________________
_________,
Chief Executive Officer
DIBZ
INTERNATIONAL, INC.
By:_____________________________
Xxxx
Xxxx, Chief Executive Officer
SHAREHOLDERS
OF DIBZ INTERNATIONAL, INC.
_____________________
_____________________
