EXHIBIT A
PLAN OF MERGER
PLAN OF MERGER, dated as of May 20, 1999, by and between H-Quotient
Inc., a Virginia corporation ("HQI") and Integrated Healthcare Systems, Inc., a
Delaware corporation ("IHS"), said corporations being hereinafter collectively
referred to as the "Constituent Corporations".
W I T N E S S E T H:
WHEREAS, HQI is a wholly-owned subsidiary of IHS;
WHEARES, the respective Boards of Directors of each of the Constituent
Corporations deem it advisable and in the best interests of each of such
corporations and their respective stockholders that IHS be merged with and into
HQI in the manner contemplated herein and have recommended that the merger of
IHS with and into HQI (the "Merger") be approved, and that this Plan of Merger
be approved and adopted by the stockholders of their respective corporations;
WHEREAS, the authorized capital stock of HQI is 100,000,000 shares consisting of
90,000,000 shares of common stock, $0.0001 par value ("Surviving Corporation
Common Stock") and 10,000,000 shares of Series Preferred Stock, of which 100
shares of the Surviving Corporation Common Stock are intended to be issued and
outstanding and to be owned by IHS, each such shares of Common Stock being
entitled to one vote;
WHEREAS, the authorized capital stock of IHS consists of 50,000,000 shares of
common stock, $0.0001 par value ("IHS Common Stock"), of which 6,925,318 shares
are issued and outstanding and 5,072,565 shares were reserved for issuance in
the event of the conversion all of the outstanding IHS Common Stock Purchase
Warrants, each such share of IHS common stock being entitled to one vote;
WHEREAS, the principal office of HQI is at 00000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx
000, Xxxxxx, Xxxxxxxx 00000; and
WHEREAS, the principal office of IHS is at 00000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx
000, Xxxxxx, Xxxxxxxx 00000.
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NOW THEREFORE, in consideration of the premises and the mutual covenants and
agreements herein contained, and for the purpose of stating the terms and
conditions of the Merger and the mode of carrying the same into effect and the
manner of converting IHS securities into HQI securities and such other details
and provisions as are deemed desirable, the parties hereto hereby agree as
follows:
ARTICLE I
In accordance with the provisions of the laws of the State of Virginia, IHS
shall be merged with and into HQI, and HQI shall be, and is herein sometimes
referred to as, the "Surviving Corporation" and, as such shall remain organized
under the laws of Virginia for the purposes stated in its Articles of
Incorporation.
ARTICLE II
The Merger shall become effective on the later of June 14, 1999 or the date of
the filing of the Articles of Merger attached hereto as Exhibit I with the
Secretary of State of the State of Virginia pursuant to the Virginia Stock
Corporation Act. The date when the Merger becomes effective is herein called the
"Effective Date of the Merger."
ARTICLE III
On the Effective Date of the Merger, the Articles of Incorporation of HQI,
attached hereto as Exhibit II, and the By-Laws of HQI shall continue to be the
Articles of Incorporation and By-Laws of the Surviving Corporation until further
amended in accordance with applicable laws of the State of Virginia..
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ARTICLE IV
The manner of (i) converting the shares IHS common Stock issued and
outstanding immediately prior to the Effective Date of the Merger into shares of
the Surviving Corporation Common Stock shall be as follows:
(1) On the Effective Date of the Merger each share of IHS Common Stock
issued and outstanding immediately prior to the Effective Date of
the Merger shall, by virtue of the Merger be convertible into one
(1) fully paid and nonassessalbe share of the Surviving
Corporation Common Stock. Upon the Effective Date of the Merger
the holders of certificates representing shares of IHS Common
Stock outstanding at such time shall cease to have any rights with
respect to such stock and their sole rights shall be with respect
to the Surviving Corporation Common Stock into which their shares
of IHS Common Stock have been converted by the Merger as herein
provided.
(2) After the Effective Date of the Merger:
(a) Each holder of an outstanding certificate or certificates
which prior thereto represented shares of IHS Common Stock
shall be entitled to receive therefor a certificate or
certificates representing the number of shares of the
Surviving Corporation Common Stock into which the shares IHS
Common Stock theretofore represented by the certificate or
certificates shall have been converted as aforesaid, upon
surrender of such certificate or certificates to such agent or
agents as may be appointed by the Surviving Corporation (the
"Exchange Agent"). On or before the fifth business day
following the Effective Date of Merger, the Exchange Agent
will send a notice and a transmittal form to each holder of an
outstanding certificate or certificates which immediately
prior to the Effective Date of the Merger represented shares
of IHS Common Stock, advising such stockholder of the terms of
the conversion effected by the Merger and the procedure for
surrendering to the Exchange Agent such certificate or
certificates for exchange for one or more certificates
representing the number of full shares of the Surviving
Corporation Common Stock which such stockholder is entitled to
receive pursuant to the terms of this Agreement. After the
Effective Date of the Merger the stock transfer books of IHS
shall be permanently closed, there shall be no further
registry of transfers on the records of IHS Common Stock
outstanding immediately prior to the Effective Date of the
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Merger, and if certificates representing such shares are
presented to either IHS or HQI, they shall be cancelled and
exchanged for certificates representing full shares of The
Surviving Corporation Common Stock as herein provided.
(b) If any certificate for the Surviving Corporation Common Stock
is to be issued in a name other than that in which the
certificate for IHS Common Stock surrendered for exchange is
registered, it shall be a condition of such exchange that the
certificate so surrendered shall be properly endorsed and
otherwise in proper form for transfer and that the person
requesting such exchange shall pay to the Exchange Agent any
transfer or other taxes required by reason of the issuance of
such Surviving Corporation Common Stock in any name other than
that of the registered holder of the IHS certificate
surrendered, or establish to the satisfaction of the Exchange
Agent that such tax has been paid or is not applicable.
(c) Until so surrendered, each outstanding certificate which prior
to the Effective Date of the Merger represented shares of IHS
Common Stock shall be deemed for all corporate purposes to
evidence the ownership of the number of whole shares of the
Surviving Corporation Common Stock into which such shares of
IHS Common Stock have been so converted. No cash or stock
dividend payable, nor any certificate representing shares
deliverable in the event any stock split shall be declared to
holders of the Surviving Corporation Common Stock on or after
the Effective Date of the Merger, to the holder of any
certificate which prior to such date represented IHS Common
stock, unless and until such certificate is surrendered to the
Exchange Agent as herein provided, but upon such surrender
there shall be paid or delivered to the registered holder of
the certificate Surviving Corporation Common Stock issued in
exchange therefor, the amount of cash (without interest
thereon), resulting from any such stock dividends or splits
which shall have theretofore become payable or deliverable
with respect to the Surviving Corporation Common Stock.
ARTICLE V
Except as herein specifically set forth, the identity, existence, purposes,
powers, objects, franchises, privileges, rights and immunities of the Surviving
Corporation shall continue unaffected and unimpaired by the Merger and the
corporate
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franchises, existence and rights of IHS shall be merged into the Surviving
Corporation and HQI shall, as the Surviving Corporation be fully vested
therewith. On the Effective Date of the Merger, the separate existence of IHS
shall cease and in accordance with the terms of this Plan of Merger the
Surviving Corporation shall possess all the rights privileges, powers and
franchises as well of a public as of a private nature, and be subject to all the
restrictions, disabilities and duties of each of the Constituent Corporations;
and all and singular, the rights privileges, powers and franchises of each of
the Constituent Corporation and all property, real, personal and mixed and all
debts due to either of the Constituent Corporations on whatever account,
including stock subscriptions, and all other things in action and all and every
other interest of or belonging to or due to each of such corporations shall be
taken and deemed to be transferred to and vested in the Surviving Corporation
without any further act or deed; and all property, rights, privileges, powers
and franchises, and all and every other interest shall be thereafter as
effectually the property of the Surviving Corporation as they were of the
respective Constituent Corporations, and the title to any real estate or
interest therein, vested by deed or otherwise in either of such corporations
shall not revert or be in any way impaired by reason of the Merger. The
Surviving Corporation shall thence forth be responsible and liable for all the
liabilities and obligations of the Constituent Corporations and any claim
existing or action or proceeding pending by or against either of said
Constituent Corporations may be prosecuted as if the Merger had not taken place,
or the Surviving Corporation may be substituted in its place. Neither the rights
of creditors nor any liens upon the property of the of the Constituent
Corporations shall be impaired by the Merger, and all debts, liabilities and
duties of each of said Constituent Corporations shall thence forth attach to the
Surviving Corporation, and maybe enforced against it to the same extent as if
said debts, liabilities and duties had been incurred or contracted by it.
ARTICLE VI
From time to time, as and when by the Surviving Corporation, or by its
successors or assigns, IHS shall execute and deliver or cause to be executed and
delivered all such other instruments and shall take or cause to be taken all
such further or other actions, as the Surviving Corporation or its successors or
assigns, may deem necessary or desirable oin order to vest in and confirm to the
Surviving Corporation,, and its successors and assigns, title to and possession
of all the property, rights, privileges, powers and franchises referred to in
Article V hereof and otherwise to carry out the intent and purposes of this Plan
of Merger, and the officers and directors of Surviving Corporation are fully
authorized in the name of IHS or other wise to take any and all such action.
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ARTICLE VII
This Plan of Merger may be terminated and abandoned upon mutual consent
of the respective Boards of Directors of IHS and HQI at any time prior to the
Effective Date of the Merger, notwithstanding approval of this Plan of Merger by
the stockholders of the Constituent Corporations. In the event of the
termination and abandonment of this Plan of Merger pursuant to the foregoing
provisions of this Article VII, this Plan shall be void and have no effect, and
of liability shall be incurred thereby on the part of either or IHS or HQI the
shareholders , directors, or officers thereof.
ARTICLE VIII
Any of the terms or conditions of this Plan of Merger may be waived at any time
by whichever of the Constituent Corporation is, or the stockholders of which
are, entitled to the benefit thereof, by action taken by the Board of Directors
of such Constituent Corporation, or may be amended or modified in whole or in
part at any time by an agreement in writing authorized by The Boards of
Directors of the Constituent Corporations; provided, however, that no such
amendment or modification or waiver after adoption by the stockholders of the
Constituent Corporations shall be made which changes the ratio at which the IHS
Common Stock is to be converted into the Surviving Corporation Common Stock as
provided in Article IV of this Plan of Merger.
ARTICLE IX
For the convenience of the parties hereto and to facilitate the filing of this
Plan of Merger, counterparts hereof may be executed, and each such counterpart
shall be deemed to be an original instrument.
IN WITNESS WHEREOF, each of the Constituent Corporations has caused
this Planed Merger to be signed in its corporate name by its President and
Secretary, and its corporate seal to be affixed hereto, all as of the date first
above written.
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INTEGRATED HEALTHCARE SYSTEMS, INC.
By /s/ Xxxxxxx X. Xxxxx
------------------------------------
Xxxxxxx X. Xxxxx
Chairman of the Board and
Chief Executive Officer
Attest:
/s/ Xxxx Xxxxx
------------------------
Xxxx Xxxxx
President
H-QUOTIENT, INC.
By /s/ Xxxx X. Xxxxx
------------------------------------
Xxxx X. Xxxxx
President
Attest:
/s/ Xxxxxxx X. Xxxxx
------------------------
Xxxxxxx X. Xxxxx
Secretary
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EXHIBIT I
ARTICLES OF MERGER
H-QUOTIENT, INC.
and
INTEGRATED HEALTHCARE
SYSTEMS, INC.
The undersigned corporations, pursuant to Title 13.1, Chapter 9,
Article 13 of the Code of Virginia (the "Code"), hereby execute the following
Articles of Merger and set forth:
ONE
The Plan of Merger between the undersigned corporations, dated as of
May 20, 1999, attached hereto as Exhibit A and made a part hereof.
TWO
The Plan of Merger was adopted by the written consent of a majority of
the stockholders, entitled to vote, of Integrated Healthcare Systems, Inc., a
Delaware corporation and holder of all the outstanding shares of Common Stock of
H-Quotient, Inc., a Virginia corporation, in accordance with the provisions of
Sections 228 and 253 of the Delaware Corporation Law and Section 13.1-719 of the
Code.
The undersigned executive officers declare that the facts herein stated
are true as of June 4, 1999.
INTEGRATED HEALTHCARE SYSTEMS, INC. H-QUOTIENT, INC.
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxx
------------------------------ ----------------------
Xxxxxxx X. Xxxxx, Chairman and Xxxx X. Xxxxx
Chief Executive Officer President
EXHIBIT II
ARTICLES OF INCORPORATION OF
H-QUOTIENT, INC.
The undersigned, pursuant to Chapter 9 of Title 13.1 of the Code of
Virginia, states as follows:
1. The name of the Corporation is: H-Quotient, Inc.
2. The address of its initial registered office which is the business
address of the initial registered agent is 0000 Xxxxxxx Xxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000 in the County of Henrico. The name of its initial registered
agent at such address: is Xxxxxx X. Xxxxxx, a resident of the State of Virginia.
3. The initial registered agent of the Corporation is a member of the
Virginia State Bar.
4. The names and addresses of the initial directors are:
Xxxxxxx X. Xxxxx 0000X Xxxxxxxxxx Xxx., Xxxxxxx,
Xxxxxxxx 00000
Xxxx X. Xxxxx 0000X Xxxxxxxxxx Xxx., Xxxxxxx,
Xxxxxxxx 00000
Xxxxx X. Xxxxxxx 00000 Xxxxxxxxx'x Xxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxx 00000
5. The nature of the business or purposes to be conducted or promoted
is: To engage in any lawful act or activity for which corporations may be
organized under the Virginia Stock Corporation Act.
6. The total number of shares of stock which the Corporation shall have
authority to issue is 100,000,000 shares, consisting of 90,000,000 shares of
Common Stock and 10,000,000 shares of Series Preferred Stock. Each of such
shares of Common Stock shall have a par value of $0.0001 and each such shares of
Series Preferred Stock shall have such par value as the Board of Directors shall
determine. All such shares (other than the shares of Series Preferred Stock) are
shares of common stock. The designations and the powers, preferences and rights,
and the qualifications, limitations or restrictions of the shares of each class
of stock are as follows:
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EXHIBIT II
PREFERRED STOCK
The Series Preferred Stock may be issued from time to time by the Board
of Directors in one or more series. The Board of Directors is hereby expressly
vested with authority to fix by resolution or resolutions the designations and
the powers, preferences and relative, participating, optional or other rights,
if any, and the qualifications, limitations or restrictions thereof, including,
without limitation, the voting powers, if any, the dividend rate, conversion
rights, redemption price, or liquidation preference, of any series of Series
Preferred Stock, and to fix the number of shares constitution any such series
and to increase or decrease the number of shares of any such series (but not
below the number of shares thereof then outstanding). The number of authorized
shares of any class or classes of stock may be increased or decreased (but not
below the number of shares thereof then outstanding) by the affirmative vote of
the holders of a majority of the stock of the Corporation entitled to vote.
COMMON STOCK
Subject to all of the rights of the Preferred Stock, and except as may
be expressly provided with respect to the Preferred Stock herein, by law or by
the Board of Directors pursuant to this Article 4:
a) dividends may be declared and paid or set apart for payment
upon the Common Stock out of any assets or funds of the Corporation
legally available for the payment of dividends;
b) the holders of Common Stock shall have the exclusive right to
vote for the election of directors and on all other matters requiring
stockholder action, each share being entitled to one vote; and
c) upon the voluntary or involuntary liquidation, dissolution or
winding up of the Corporation, the net assets of the Corporation shall
be distributed pro rata to the holders of the Common Stock in
accordance with their respective rights and interests.
PREEMPTIVE RIGHTS
No holder of any stock of the Corporation shall be entitled as such, as
a matter of right, to subscribe for or purchase any part of any new or
additional issue of stock of any class whatsoever of the Corporation, or of
securities convertible into stock of any class whatsoever, whether now or
hereafter authorized, or whether issued for cash or other consideration or by
way of dividend.
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7. The name and mailing address of the incorporator is as follows:
Name Mailing Address
H. Xxxxxxxx Xxxxx, Xx. 000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
8. The Corporation is to have perpetual existence.
9. In furtherance and not in limitation of the powers conferred by
statute, it is further provided:
a) Election of directors need not be by written ballot unless the
By-Laws of the Corporation shall so provide;
b) The Board of Directors is expressly authorized to adopt, amend
or repeal all or any of the By-Laws of the Corporation.
10. The Corporation shall, to the fullest extent permitted by the
Virginia Stock Corporation Act, as the same may be amended and supplemented,
indemnify any and all persons whom it shall have power to indemnify under said
Act from and against any and all of the expenses, liabilities or other matters
referred to in or covered by said Act, and the indemnification provided for
herein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any By-Law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office, and shall
continue as to a person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person.
11. The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Articles of Incorporation, in the manner
now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to the provisions of this Article 11.
IN WITNESS WHEREOF, the undersigned, being the sole incorporator named
above, has hereunto set his hand and seal this 12 day of May, 1999.
/s/ H. Xxxxxxxx Xxxxx Xx.
--------------------------------
H. Xxxxxxxx Xxxxx, Xx.
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