AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Plan") is made
this _____ day of April, 1999, among First Target Acquisition, Inc., a Nevada
corporation formerly known as "Cookie Cup International" ("FTA");
xxxxxxxx.xxx, Inc., a New Jersey corporation ("xxxxxxxx.xxx"); and the
xxxxxxxx.xxx stockholders, all of whom are listed on Exhibit A hereto and who
execute and deliver a copy of the Plan (collectively, the "xxxxxxxx.xxx
Stockholders").
W I T N E S S E T H:
RECITALS
WHEREAS, the respective Boards of Directors of FTA and
xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders have adopted resolutions
pursuant to which FTA shall acquire and the xxxxxxxx.xxx Stockholders shall
exchange 100% of the outstanding common stock of xxxxxxxx.xxx; and
WHEREAS, the sole consideration for 100% interest in xxxxxxxx.xxx
shall be the exchange of $0.001 par value common stock of FTA (which shares
are all "restricted securities" as defined in Rule 144 of the Securities and
Exchange Commission) as outlined in Exhibit A; and
WHEREAS, the xxxxxxxx.xxx Stockholders shall acquire in exchange
the "restricted securities" of FTA in a reorganization within the meaning of
Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended;
NOW, THEREFORE, in consideration of the mutual covenants and
promises contained herein, it is agreed:
Section 1
Exchange of Stock
1.1 Number of Shares. The xxxxxxxx.xxx Stockholders agree to
transfer to FTA at the closing (the "Closing") 100% of the outstanding
securities of xxxxxxxx.xxx, listed in Exhibit A, which is attached hereto and
incorporated herein by reference (the "xxxxxxxx.xxx Shares"), in exchange for
9,990,000 shares of common stock of FTA. Taking into account (i) these
shares; (ii) the current outstanding shares of FTA (368,333 shares); and (iii)
741,667 shares of common stock of FTA to be issued to certain consultants in
accordance with applicable federal and state securities laws, rules and
regulations at or immediately following the Closing of this Plan, as set forth
in the aforementioned resolutions of the Boards of Directors of FTA and
xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders, there will be 11,100,000
outstanding shares on the completion of the Plan. The exchange shall be on a
basis of 45,077.1591 shares of FTA for each of the xxxxxxxx.xxx Shares.
1.2 Delivery of Certificates by Xxxxxxxx.xxx Stockholders. The
transfer of the xxxxxxxx.xxx Shares by the xxxxxxxx.xxx Stockholders shall be
effected by the delivery to FTA at the Closing of stock certificate or
certificates representing the transferred shares duly endorsed in blank or
accompanied by stock powers executed in blank, with all signatures witnessed
or guaranteed to the satisfaction of FTA and with all necessary transfer taxes
and other revenue stamps affixed and acquired at the xxxxxxxx.xxx
Stockholders' expense.
1.3 Further Assurances. At the Closing and from time to time
thereafter, the xxxxxxxx.xxx Stockholders shall execute such additional
instruments and take such other action as FTA may request in order to exchange
and transfer clear title and ownership in the xxxxxxxx.xxx Shares to FTA.
1.4 Resignation of Present Director and Executive Officer and
Designation of New Directors and Executive Officers. On Closing, the present
director and executive officer of FTA shall designate the directors and
executive officers nominated by xxxxxxxx.xxx to serve in his place and stead,
until the next respective annual meetings of the stockholders and the Board of
Directors of FTA, and until their respective successors shall be elected and
qualified or until their respective prior resignations or terminations, who
shall be: Xxxxxx X. Xxxxxx, President and director; Xxxxxxx Xxxxxxxx, Vice
President; Xxxxxxx Xxxx Xxxxxxxx, Secretary/Treasurer; Xxxxxxx X. Xxxxx,
director; and Xxxx X. Xxxxxxx, director. In addition, at the Closing, the
present sole director and executive officer of FTA shall nominate two
directors to serve on the Board of Directors of FTA until the next annual
meeting of the stockholders of FTA, and then he shall resign.
1.5 Change of Name. Prior to or simultaneous with the Closing
of this Plan, the Board of Directors of FTA shall have adopted resolutions
declaring the advisability of amending FTA's Articles of Incorporation to
change its name to "xxxxxxxx.xxx, Inc." and calling a meeting of the
stockholders of FTA entitled to vote for the consideration thereof.
1.7 Assets and Liabilities of FTA at Closing.
FTA
shall have no material assets and no liabilities at Closing, and all costs
incurred by FTA incident to the Plan shall have been paid or satisfied. FTA
hereby acknowledges that xxxxxxxx.xxx has deposited the sum of $15,000 in the
trust account of FTA's legal counsel in full payment of FTA's legal fees
incurred in connection with the preparation and Closing of this Plan and that
there are no other liabilities (contingent or otherwise) that have been or
will
be incurred in connection with the transactions contemplated hereby.
1.8 Limitation on Reverse Splits. Without the prior written
consent of Xxxxxxx Xxxxxxx, the sole current member of the Board of Directors
of FTA, which consent shall not be unreasonably withheld, no reverse split of
the outstanding voting securities of FTA shall be effected following the
Closing, for a period of not less than 12 months.
1.9 Closing. The Plan will be deemed to be
closed
on receipt of the signatures of the xxxxxxxx.xxx Stockholders collectively
owning not less than 80% of the xxxxxxxx.xxx Shares; and FTA and xxxxxxxx.xxx
will use their "best efforts" to acquire the remaining xxxxxxxx.xxx Shares
under
the Plan as soon as is practicable.
Section 2
Closing
The Closing contemplated by Section 1 shall be held at the offices
of Xxxxxxx X. Xxxxxxxxxx, Esq., Suite 205 Hermes Building, 000 Xxxx 000 Xxxxx,
Xxxx Xxxx Xxxx, Xxxx 00000, on or before ten days following the execution and
delivery of this Plan, unless another place or time is agreed upon in writing
by the parties. The Closing may be accomplished by wire, express mail or
other courier service, conference telephone communications or as otherwise
agreed by the respective parties or their duly authorized representatives.
Section 3
Representations and Warranties of FTA
FTA represents and warrants to, and covenants with, the
xxxxxxxx.xxx Stockholders and xxxxxxxx.xxx as follows:
3.1 Corporate Status; Filings with Securities and Exchange
Commission. FTA is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada, is licensed or qualified as a
foreign corporation in all states in which the nature of its business or the
character or ownership of its properties makes such licensing or qualification
necessary and owns no interest in any other person or entity. FTA is a
publicly held company, having previously and lawfully offered and sold a
portion of its securities in accordance with applicable federal and state
securities laws, rules and regulations; its class of one mill ($0.001) par
value common stock is registered with the Securities and Exchange Commission
pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), and FTA has made all filings that it has been required to
make pursuant to the 1934 Act and the Securities Act of 1933, as amended (the
"1933 Act"). Each of such filings complied with the 1933 Act and/or the 1934
Act, as applicable, in all material respects. All of such filings were true,
accurate and complete in every material respect and none of such filings
omitted to state a material fact necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading.
3.2 Capitalization. The current pre-Plan authorized capital
stock of FTA consists of 50,000,000 shares of $0.001 par value common stock.
There are 368,333 shares of common stock issued and outstanding, all fully
paid and non-assessable, and all of which have been issued in accordance with
applicable federal and state securities laws, rules and regulations. Except
for (i) the 741,667 shares of common stock of FTA to be issued to certain
consultants at or immediately following the Closing, as set forth in Section
1.1, above, and (ii) the subscriptions of certain creditors of xxxxxxxx.xxx to
acquire after the Closing a presently undetermined amount of common stock of
FTA in consideration of retirement of xxxxxxxx.xxx debt, which subscriptions
are attached hereto as Exhibit B and incorporated herein by reference, there
are no options, warrants, rights or calls issuable or outstanding pursuant to
which any person has the right to acquire or purchase any shares of common
stock of FTA or other rights to acquire shares of common stock of FTA.
3.3 Financial Statements. The financial statements of FTA
furnished to the xxxxxxxx.xxx Stockholders and xxxxxxxx.xxx, consisting of
audited financial statements for the fiscal years ended June 30, 1998 and
1997, and unaudited financial statements for the period ended December 31,
1998, attached hereto as Exhibit C and incorporated herein by reference, are
correct and fairly present the financial condition, results of operations,
changes in stockholders' equity and cash flows of FTA at such dates and for
the periods involved; such statements were prepared in accordance with rules
and regulations of the Securities and Exchange Commission and generally
accepted accounting principles consistently applied throughout such periods,
and no material change has occurred in the matters disclosed therein, except
as indicated in Exhibit D, which is attached hereto and incorporated herein by
reference. Such financial statements do not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made, in light of the circumstances under which they were made, not
misleading.
3.4 Undisclosed Liabilities. FTA has no liabilities of any
nature except to the extent reflected or reserved against in its December 31,
1998, balance sheet, whether accrued, absolute, contingent or otherwise,
including, without limitation, tax liabilities and interest due or to become
due, except as set forth in Exhibit D.
3.5 Interim Changes. Since the date of its December 31, 1998,
balance sheet, except as set forth in Exhibit D, there have been no (1)
material adverse changes in the financial condition, assets, liabilities,
prospects, results of operations or business of FTA which, in the aggregate,
have been materially adverse; (2) damages, destruction or losses of or to
property of FTA, payments of any dividend or other distribution in respect of
any class of stock of FTA, or any direct or indirect redemption, purchase or
other acquisition of any class of any such stock; or (3) increases paid or
agreed to in the compensation, retirement benefits or other commitments to its
employees.
3.6 Title to Property. FTA has good and marketable title to all
properties and assets, real and personal, reflected in its December 31, 1998,
balance sheet, and the properties and assets of FTA are subject to no
mortgage, pledge, lien or encumbrance, except for liens shown therein or in
Exhibit D, with respect to which no default exists.
3.7 Litigation. There is no litigation or proceeding pending, or
to the knowledge of FTA, threatened, against or relating to FTA, its
properties or business, except as set forth in Exhibit D. Further, no
officer, director or person who may be deemed to be an affiliate of FTA is
party to any material legal proceeding which could have an adverse effect on
FTA (financial or otherwise), and none is party to any action or proceeding
wherein any has an interest adverse to FTA.
3.8 Books and Records. From the date of this Plan to the
Closing, FTA will (1) give to the xxxxxxxx.xxx Stockholders and xxxxxxxx.xxx
or their respective representatives full access during normal business hours
to all of FTA offices, books, records, contracts and other corporate documents
and properties so that the xxxxxxxx.xxx Stockholders and xxxxxxxx.xxx or their
respective representatives may inspect and audit them; and (2) furnish such
information concerning the properties and affairs of FTA as the xxxxxxxx.xxx
Stockholders and xxxxxxxx.xxx or their respective representatives may
reasonably request.
3.9 Tax Returns. FTA has filed all federal and state income or
franchise tax returns required to be filed or has received currently effective
extensions of the required filing dates.
3.10 Confidentiality. Until the Closing (and thereafter if there
is no Closing), FTA and its representatives will keep confidential any
information which they obtain from the xxxxxxxx.xxx Stockholders or from
xxxxxxxx.xxx concerning the properties, assets and business of xxxxxxxx.xxx.
If the transactions contemplated by this Plan are not consummated by May 7,
1999, FTA will return to xxxxxxxx.xxx all written matter with respect to
xxxxxxxx.xxx obtained by FTA in connection with the negotiation or
consummation of this Plan.
3.11 Corporate Authority. FTA has full corporate power and
authority to enter into this Plan and to carry out its obligations hereunder
and will deliver to the xxxxxxxx.xxx Stockholders and xxxxxxxx.xxx or their
respective representatives at the Closing a certified copy of resolutions of
its Board of Directors authorizing execution of this Plan by FTA's officers
and performance thereunder, and certifying that the director adopting and
delivering such resolutions is the sole duly elected and incumbent director of
FTA.
3.12 Due Authorization. Execution of this Plan and performance by
FTA hereunder have been duly authorized by all requisite corporate action on
the part of FTA, and this Plan constitutes a valid and binding obligation of
FTA, enforceable in accordance with its terms, except as the enforceability
thereof may be limited by any applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or affecting the enforcement
of creditors' rights generally and by general equitable principles, regardless
of whether such enforceability is considered in a proceeding in equity or at
law, and performance hereunder will not violate any provision of the Articles
of Incorporation, Bylaws, agreements, mortgages or other commitments of FTA or
any law, rule or court order. Except for the filing of a certificate with the
State of New Jersey, which FTA hereby undertakes to do in a timely manner, FTA
need not give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or governmental agency in
order to consummate the transaction contemplated by this Plan.
3.13 Environmental Matters. FTA has no knowledge of any assertion
by any governmental agency or other regulatory authority of any environmental
lien, action or proceeding, or of any cause for any such lien, action or
proceeding related to the business operations of FTA or FTA's predecessors.
In addition, to the best knowledge of FTA, there are no substances or
conditions which may support a claim or cause of action against FTA or any of
FTA's current or former officers, directors, agents or employees, whether by a
governmental agency or body, private party or individual, under any Hazardous
Materials Regulations. "Hazardous Materials" means any oil or petrochemical
products, PCB's, asbestos, urea formaldehyde, flammable explosives,
radioactive materials, solid or hazardous wastes, chemicals, toxic substances
or related materials, including, without limitation, any substances defined as
or included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," or "toxic substances" under any applicable federal or
state laws or regulations. "Hazardous Materials Regulations" means any
federal, state or local statutes or regulations or court order or decree
governing the use, generation, handling, storage, treatment, disposal or
release of hazardous materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, the
Resource Conservation and Recovery Act and the Federal Water Pollution Control
Act.
3.14 Access to Information Regarding Xxxxxxxx.xxx. FTA
acknowledges that it has been delivered copies of what has been represented to
be documentation containing all material information respecting xxxxxxxx.xxx
and xxxxxxxx.xxx's present and contemplated business operations, potential
acquisitions, management and other factors; that it has had a reasonable
opportunity to review such documentation and discuss it, to the extent
desired, with its legal counsel, directors and executive officers; that it has
had, to the extent desired, the opportunity to ask questions of and receive
responses from the directors and executive officers of xxxxxxxx.xxx, and with
the legal and accounting firms of xxxxxxxx.xxx, with respect to such
documentation; and that to the extent requested, all questions raised have
been answered to FTA's complete satisfaction.
Section 4
Representations, Warranties and Covenants of Xxxxxxxx.xxx
and the Xxxxxxxx.xxx Stockholders
Xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders (Sections 4.1,
4.11, 4.12 and 4.15 are the only representations of the xxxxxxxx.xxx
Stockholders owning less than 20 shares of common stock of xxxxxxxx.xxx)
severally represents and warrants to, and covenants with, FTA as follows:
4.1 Ownership. Each of the xxxxxxxx.xxx Stockholders severally
represents and warrants that the xxxxxxxx.xxx Shares owned by such person as
reflected on Exhibit A annexed hereto are owned by such person free and clear
of any liens or encumbrances of any type or nature whatsoever, and each has
full right, power and authority to convey the xxxxxxxx.xxx Shares owned by
such person without qualification, subject to applicable federal and state
securities laws, rules and regulations.
4.2 Corporate Status. Xxxxxxxx.xxx is a corporation duly
organized, validly existing and in good standing under the laws of the State
of New Jersey and, except as indicated in Exhibit F, is licensed or qualified
as a foreign corporation in all states or foreign countries and provinces in
which the nature of xxxxxxxx.xxx's business or the character or ownership of
xxxxxxxx.xxx's properties makes such licensing or qualification necessary.
4.3 Capitalization. The current pre-Plan authorized capital
stock of xxxxxxxx.xxx consists of 1,000 shares of no par value common stock.
There are 221.62 shares of common stock issued and outstanding, all fully paid
and non-assessable and all of which have been issued in accordance with
applicable federal and state securities laws, rules and regulations. There
are no outstanding options, warrants or calls pursuant to which any person has
the right to acquire or purchase any other securities of xxxxxxxx.xxx.
4.4 Financial Statements. The financial statements of
xxxxxxxx.xxx furnished to FTA, consisting of unaudited financial statements
for the calendar year ended December 31, 1998, attached hereto as Exhibit E
and incorporated herein by reference, are correct and fairly present the
financial condition of FTA at such date and for the period involved; such
statements were prepared in accordance with generally accepted accounting
principles consistently applied, and no material change has occurred in the
matters disclosed therein, except as indicated in Exhibit F, which is attached
hereto and incorporated herein by reference. Such financial statements do not
contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading.
4.5 Undisclosed Liabilities. Except as set forth in Exhibit F,
xxxxxxxx.xxx has no liabilities of any nature except to the extent reflected
or reserved against in its December 31, 1998, balance sheet, whether accrued,
absolute, contingent or otherwise, including, without limitation, tax
liabilities and interest due or to become due.
4.6 Interim Changes. Since the date of its December 31, 1998,
balance sheet, except as set forth in Exhibit F, there have been no (1)
changes in financial condition, assets, liabilities or business of
xxxxxxxx.xxx which, in the aggregate, have been materially adverse; (2)
damages, destruction or losses of or to property of xxxxxxxx.xxx, payments of
any dividend or other distribution in respect of any class of stock of
xxxxxxxx.xxx, or any direct or indirect redemption, purchase or other
acquisition of any class of any such stock; or (3) increases paid or agreed to
in the compensation, retirement benefits or other commitments to its
employees.
4.7 Title to Property. Xxxxxxxx.xxx has good and marketable
title to all properties and assets, real and personal, proprietary or
otherwise, reflected in Exhibit E, and the properties and assets of
xxxxxxxx.xxx are subject to no mortgage, pledge, lien or encumbrance, except
as reflected in the balance sheet or in Exhibit F, with respect to which no
default exists.
4.8 Litigation. There is no litigation or proceeding pending, or
to the knowledge of xxxxxxxx.xxx, threatened, against or relating to
xxxxxxxx.xxx or its properties or business, except as set forth in Exhibit F.
Further, no officer, director or person who may be deemed to be an affiliate
of xxxxxxxx.xxx is party to any material legal proceeding which could have an
adverse effect on xxxxxxxx.xxx (financial or otherwise), and none is party to
any action or proceeding in which any has an interest adverse to xxxxxxxx.xxx.
4.9 Books and Records. From the date of this Plan to the
Closing, the xxxxxxxx.xxx Stockholders will cause xxxxxxxx.xxx to (1) give to
FTA and its representatives full access during normal business hours to all of
its offices, books, records, contracts and other corporate documents and
properties so that FTA may inspect and audit them; and (2) furnish such
information concerning the properties and affairs of xxxxxxxx.xxx as FTA may
reasonably request.
4.10 Tax Returns. Xxxxxxxx.xxx has filed all federal and state
income or franchise tax returns required to be filed or has received currently
effective extensions of the required filing dates.
4.11 Confidentiality. Until the Closing (and continuously if
there is no Closing), xxxxxxxx.xxx, the xxxxxxxx.xxx Stockholders and their
representatives will keep confidential any information which they obtain from
FTA concerning its properties, assets and business. If the transactions
contemplated by this Plan are not consummated by May 7, 1999, xxxxxxxx.xxx and
the xxxxxxxx.xxx Stockholders will return to FTA all written matter with
respect to FTA obtained by them in connection with the negotiation or
consummation of this Plan.
4.12 Investment Intent. The xxxxxxxx.xxx Stockholders are
acquiring the shares to be exchanged and delivered to them under this Plan for
investment and not with a view to the sale or distribution thereof, and the
xxxxxxxx.xxx Stockholders have no commitment or present intention to liquidate
the Company or to sell or otherwise dispose of the FTA shares. The
xxxxxxxx.xxx Stockholders shall execute and deliver to FTA on the Closing an
Investment Letter attached hereto as Exhibit G and incorporated herein by
reference, (i) acknowledging the "unregistered" and "restricted" nature of the
shares of FTA being received under the Plan in exchange for the xxxxxxxx.xxx
Shares, (ii) the receipt of certain material information regarding FTA (its
annual and quarterly reports filed with the Securities and Exchange Commission
during the past 12 months), and (iii) compromising any claims of any type or
nature whatsoever each may have against xxxxxxxx.xxx respecting the purchase
of any of the securities of xxxxxxxx.xxx or based upon any violation by
xxxxxxxx.xxx of any federal, state or foreign securities laws, rules or
regulations up to and including the date of the Closing.
4.13 Corporate Authority. Xxxxxxxx.xxx has full corporate power
and authority to enter into this Plan and to carry out its obligations
hereunder and will deliver to FTA or its representative at the Closing a
certified copy of resolutions of its Board of Directors authorizing execution
of this Plan by its officers and performance thereunder.
4.14 Due Authorization. Execution of this Plan and performance
by xxxxxxxx.xxx hereunder have been duly authorized by all requisite corporate
action on the part of xxxxxxxx.xxx, and this Plan constitutes a valid and
binding obligation of xxxxxxxx.xxx, enforceable in accordance with its terms,
except as the enforceability thereof may be limited by any applicable
bankruptcy, insolvency, reorganization or other similar laws relating to or
affecting the enforcement of creditors' rights generally and by general
equitable principles, regardless of whether such enforceability is considered
in a proceeding in equity or at law, and performance hereunder will not
violate any provision of the Articles of Incorporation, Bylaws, agreements,
mortgages or other material commitments of xxxxxxxx.xxx or any law, rule or
court order. Except for the filing of a certificate with the State of New
Jersey, which xxxxxxxx.xxx hereby undertakes to do in a timely manner,
xxxxxxxx.xxx need not give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or governmental agency in
order to consummate the transaction contemplated by this Plan.
4.15 Environmental Matters. Xxxxxxxx.xxx and the xxxxxxxx.xxx
Stockholders have no knowledge of any assertion by any governmental agency or
other regulatory authority of any environmental lien, action or proceeding, or
of any cause for any such lien, action or proceeding related to the business
operations of xxxxxxxx.xxx or its predecessors. In addition, to the best
knowledge of xxxxxxxx.xxx, there are no substances or conditions which may
support a claim or cause of action against xxxxxxxx.xxx or any of its current
or former officers, directors, agents, employees or predecessors, whether by a
governmental agency or body, private party or individual, under any Hazardous
Materials Regulations. "Hazardous Materials" means any oil or petrochemical
products, PCB's, asbestos, urea formaldehyde, flammable explosives,
radioactive materials, solid or hazardous wastes, chemicals, toxic substances
or related materials, including, without limitation, any substances defined as
or included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," or "toxic substances" under any applicable federal or
state laws or regulations. "Hazardous Materials Regulations" means any
federal, state or local statutes or regulations or court order or decree
governing the use, generation, handling, storage, treatment, disposal or
release of hazardous materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, the
Resource Conservation and Recovery Act and the Federal Water Pollution Control
Act.
4.16 Access to Information Regarding FTA. Xxxxxxxx.xxx and the
xxxxxxxx.xxx Stockholders acknowledge that they have been delivered copies of
what has been represented to be documentation containing all material
information respecting FTA and its present and contemplated business
operations, potential acquisitions, management and other factors; that they
have had a reasonable opportunity to review such documentation and discuss it,
to the extent desired, with their legal counsel, directors and executive
officers; that they have had, to the extent desired, the opportunity to ask
questions of and receive responses from the directors and executive officers
of FTA, and with the legal and accounting firms of FTA, with respect to such
documentation; and that to the extent requested, all questions raised have
been answered to their complete satisfaction.
Section 5
Conditions Precedent to Obligations of Xxxxxxxx.xxx
and the Xxxxxxxx.xxx Stockholders
All obligations of xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders
under this Plan are subject, at their option, to the fulfillment, before or at
the Closing, of each of the following conditions:
5.1 Representations and Warranties True at Closing. The
representations and warranties of FTA contained in this Plan shall be deemed
to have been made again at and as of the Closing and shall then be true in all
material respects and shall survive the Closing.
5.2 Due Performance. FTA shall have performed and complied with
all of the terms and conditions required by this Plan to be performed or
complied with by it before the Closing.
5.3 Officer's and Controlling Stockholder's Certificate.
Xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders shall have been furnished with
a certificate signed by the President and the controlling stockholder of FTA,
in such capacities, attached hereto as Exhibit H and incorporated herein by
reference, dated as of the Closing, certifying (i) that all representations
and warranties of FTA contained herein are true and correct; and (ii) that
since the date of the financial statements (Exhibit C hereto), there has been
no material adverse change in the financial condition, business or properties
of FTA, taken as a whole. In addition, FTA hereby covenants that Xxxxx X.
Xxxxxxx, doing business as Chiricahua Corp., who is the controlling
stockholder of FTA prior to the Closing of the Plan, within five days of the
date hereof, shall execute an agreement reasonably satisfactory to
xxxxxxxx.xxx to indemnify and hold xxxxxxxx.xxx and the xxxxxxxx.xxx
Stockholders harmless against any liability, cost and expense (including their
reasonable attorney's fees) arising from any material breach of any
representation or warranty of FTA herein.
5.4 Opinion of Counsel. Xxxxxxxx.xxx and the xxxxxxxx.xxx
Stockholders shall have received an opinion of counsel for FTA in form and
substance reasonably satisfactory to them, dated as of the Closing, to the
effect that (1) the representations of Sections 3.1, 3.2, 3.11 and 3.12 are
correct; (2) except as specified in the opinion, counsel knows of no
inaccuracy in the representations in 3.5, 3.6 or 3.7; and (3) the shares of
FTA to be issued to the xxxxxxxx.xxx Stockholders under this Plan will, when
issued in accordance with this Plan, be validly issued, fully-paid and non-
assessable.
5.5 Assets and Liabilities of FTA. Unless otherwise agreed, FTA
shall have no assets and no liabilities at Closing, and all costs, expenses
and fees incident to the Plan shall have been paid.
5.6 Resignation of Director and Executive Officer and
Designation of New Directors and Executive Officers. The present director and
executive officer of FTA shall resign, and shall have designated nominees of
xxxxxxxx.xxx and two nominees of his own, as outlined in Section 1.4 hereof as
directors and executive officers of FTA to serve in his place and stead, until
the next respective annual meetings of the stockholders and Board of Directors
of FTA, and until their respective successors shall be elected and qualified
or until their respective prior resignations or terminations, and then the
present director and executive officer of FTA shall resign.
5.7 Name Change of FTA and Issuance of Compensation Shares.
Prior to or simultaneous with the Closing of this Plan, the Board of Directors
of FTA shall have adopted such resolutions as are necessary for the purpose of
amending its Articles of Incorporation to change the name of FTA to
"xxxxxxxx.xxx, Inc." and shall promptly call a meeting of the FTA stockholders
entitled to vote for the consideration thereof. Simultaneous with the Closing
of this Plan, the Board of Directors of FTA shall cause the compensation
shares of common stock outlined in Section 1.1 hereof, to be issued as fully
paid and non-assessable shares, and xxxxxxxx.xxx and the xxxxxxxx.xxx
stockholders agree not to challenge the validity or legality of the issuance
of such shares or any other shares that are issued and outstanding immediately
prior to the Closing of this Plan, except to the extent such issuance is
inconsistent with the representations set forth in Section 3.2 hereof.
5.8 Xxxxxxxx.xxx Stockholders' Approval. Persons collectively
owning not less than 100% of the xxxxxxxx.xxx Shares shall have adopted,
executed and delivered the Plan.
Section 6
Conditions Precedent to Obligations of FTA
All obligations of FTA under this Plan are subject, at FTA's
option, to the fulfillment, before or at the Closing, of each of the following
conditions:
6.1 Representations and Warranties True at Closing. The
representations and warranties of xxxxxxxx.xxx and the xxxxxxxx.xxx
Stockholders contained in this Plan shall be deemed to have been made again at
and as of the Closing and shall then be true in all material respects and
shall survive the Closing.
6.2 Due Performance. Xxxxxxxx.xxx and the xxxxxxxx.xxx
Stockholders shall have performed and complied with all of the terms and
conditions required by this Plan to be performed or complied with by them
before the Closing.
6.3 Officer's Certificate. FTA shall have been furnished with a
certificate signed by the President of xxxxxxxx.xxx, in such capacity, and
personally, attached hereto as Exhibit I and incorporated herein by reference,
dated as of the Closing, certifying (1) that all representations and
warranties of xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders contained herein
are true and correct; and (2) that since the date of the financial statements
(Exhibit E), there has been no material adverse change in the financial
condition, business or properties of xxxxxxxx.xxx, taken as a whole.
6.4 Stockholders' Approval. Persons collectively owning not less
than 100% of the xxxxxxxx.xxx Shares shall have adopted, executed and
delivered the Plan.
6.5 Subscriptions. The Subscription Documents covering the
subscriptions provided in Section 3.2 hereof shall have been delivered and
accepted by FTA.
6.6 Books and Records. The xxxxxxxx.xxx Stockholders or the
Board of Directors of xxxxxxxx.xxx shall have caused xxxxxxxx.xxx to make
available all books and records of xxxxxxxx.xxx, including minute books and
stock transfer records; provided, however, only to the extent requested in
writing by FTA at Closing.
Section 7
Termination
Prior to Closing, this Plan may be terminated (1) by mutual
consent in writing; (2) by either the directors of FTA or xxxxxxxx.xxx and the
xxxxxxxx.xxx Stockholders if there has been a material misrepresentation or
material breach of any warranty or covenant by the other party; or (3) by
either the directors of FTA or xxxxxxxx.xxx and the xxxxxxxx.xxx Stockholders
if the Closing shall not have taken place, unless adjourned to a later date by
mutual consent in writing, by the date fixed in Section 2.
Section 8
General Provisions
8.1 Further Assurances. At any time, and from time to time,
after the Closing, each party will execute such additional instruments and
take such action as may be reasonably requested by the other party to confirm
or perfect title to any property transferred hereunder or otherwise to carry
out the intent and purposes of this Plan.
8.2 Waiver. Any failure on the part of any party hereto to
comply with any of FTA obligations, agreements or conditions hereunder may be
waived in writing by the party to whom such compliance is owed.
8.3 Brokers. Each party represents to the other parties
hereunder that no broker or finder has acted for it in connection with this
Plan, and agrees to indemnify and hold harmless the other parties against any
fee, loss or expense arising out of claims by brokers or finders employed or
alleged to have been employed by him/her/it.
8.4 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been given if delivered in
person or sent by prepaid first-class registered or certified mail, return
receipt requested, as follows:
If to FTA: Mr. Xxxxxxx Xxxxxxx
0000 Xxxxx 0000 Xxxx
Xxxxx, Xxxx 00000
With a copy to: Xxxxxxx X. Xxxxxxxxxx, Esq.
455 East 000 Xxxxx, #000
Xxxx Xxxx Xxxx, Xxxx 00000
If to xxxxxxxx.xxx:210 Xxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxxx, Xxxxxxxxxxxx 00000
With a copy to: S. Xxxxx Xxxxxxx, Esq.
Xxxxxxxx Brog Leinwand Xxxxxx Xxxxxxxx &
Xxxxx P.C.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Stockholders: To the addresses listed on Exhibit A
8.5 Entire Agreement. This Plan constitutes the entire agreement
between the parties and supersedes and cancels any other agreement,
representation, or communication, whether oral or written, between the parties
hereto relating to the transactions contemplated herein or the subject matter
hereof.
8.6 Headings. The section and subsection headings in this Plan
are inserted for convenience only and shall not affect in any way the meaning
or interpretation of this Plan.
8.7 Governing Law. This Plan shall be governed by and construed
and enforced in accordance with the laws of the State of Nevada, except to the
extent pre-empted by federal law, in which event (and to that extent only),
federal law shall govern.
8.8 Assignment. This Plan shall inure to the benefit of, and be
binding upon, the parties hereto and their successors and assigns.
8.9 Counterparts. This Plan may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
8.10 Default. In the event of any default hereunder, the
prevailing party in any action to enforce the terms and provisions hereof
shall be entitled to recover reasonable attorney's fees and related costs.
IN WITNESS WHEREOF, the parties have executed this Agreement and Plan of
Reorganization effective the day and year first above written.
FIRST TARGET ACQUISITION, INC.
Date: April 29, 1999. By /s/ Xxxxxxx Xxxxxxx
--------------- -------------------
Xxxxxxx Xxxxxxx, President
XXXXXXXX.XXX, INC.
Date: April 29, 1999. By /s/ Xxxxxx X. Xxxxxx
--------------- --------------------
Xxxxxx X. Xxxxxx, Chief Executive
Officer
AGREEMENT AND PLAN OF REORGANIZATION
COUNTERPART SIGNATURE PAGE
This Counterpart Signature Page for that certain Agreement and
Plan of Reorganization (the "Agreement") dated as of the 29 day of April,
1999, among First Target Acquisition., Inc., a Nevada corporation ("FTA");
xxxxxxxx.xxx, Inc., a New Jersey corporation ("xxxxxxxx.xxx"); and the
xxxxxxxx.xxx stockholders (the "xxxxxxxx.xxx Stockholders") who are
signatories thereto, is executed by the undersigned, a xxxxxxxx.xxx
Stockholder, as of the date first written above. The undersigned, through
execution and delivery of this Counterpart Signature page, intends to be
legally bound by the terms of the Agreement.
/s/ Xxxxxxx Xxxxx
/s/ Xxxxxx Xxxxxx
/s/Xxxx Xxxxxxx
/s/Xxxxxx X. Xxxxxx
/s/ Xxxxxx Xxxxxx
/s/Xxxxxx X and Xxxxxxx Xxxxxx
/s/Xxxxxxx Xxxxxx
/s/Xxxxxxx X. Xxxxxxxx
/s/Xxxxxxx Xxxx Xxxxxxxx
/s/The Xxxxxx Group
/s/Xxxxxx X. Dinner, M.D.
/s/Xxxxxxx Xxxxxxx
/s/Clarion Associates
/s/Xxxxxx Xxxxxxx
/s/Xxxxxxx X. Xxxxx, Xx.
/s/Xxxxxxx Xxxxxx
/s/ Xxxxx Xxxxxxxx
/s/Xxxx Xxxxxxxxxx
/s/ Xxxxx Xxxxx
/s/Xxxx Xxxxxxx
/s/Xxxxxx Xxxxxx
/s/Xxxxx Xxxxxxxxxx
/s/Xxxxxxx Xxxxxx
/s/Xxxxxx Xxxxxxxxx
/s/Xxxxx Xxxxxxxx
/s/Xxxxxx Xxxxxxxx
/s/Xxxxx Xxxxxx
/s/Xxxxxxxx Xxxxxx
/s/Xxxxxxx Xxxxxxx
/s/Xxxx Xxxxx
/s/Xxxxxx Xxxxx
/s/Xxxxxxx Xxxxxx
/s/Xxxxx Xxxxxx
/s/Xxxxx Xxxxxxx
/s/Xxxxxxxx Xxxxxxx
/s/Xxxxxxx Xxxxx
EXHIBIT A
STOCKHOLDERS OF XXXXXXXX.XXX, INC.
Number of Shares of
Number of Shares First Target
Acquisition, Inc. Owned of to be
Name and Address xxxxxxxx.xxx, Inc. Received in
Exchange
Xxxxxxx Xxxxx 20 901,543.18
000 Xxxxx Xxxx
Xxxxxx, XX 00000
Xxxxxx Xxxxxx 11 495,848.75
000 Xxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Xxxx Xxxxxxx 11 495,848.75
00 X. Xxxxxxxxx Xx.
Xxxx Xxxxxx, XX 00000
Xxxxxx X. Xxxxxx 81.3 3,664,773.03
00 X. Xxxxxxx Xxxx Xx.
Xxxxxxxxxxx, XX 00000
Xxxxxx Xxxxxx 0.2 9,015.43
X.X. Xxx 000
Xxxxxxxxx, XX 00000
Xxxxxx X. and Xxxxxxx Xxxxxx 3.8 171,293.20
X.X. Xxx 000
Xxxxxxxxx, XX 00000
Xxxxxxx Xxxxxx 0.2 9,015.43
X.X. Xxx 000
Xxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxx 34.5 1,555,161.99
00 Xxxxxx Xxxxx
X. Xxxxxxxxxxx, XX 00000
Xxxxxxx Xxxx Xxxxxxxx 34.5 1,555,161.99
00 Xxxxxx Xxxxx
X. Xxxxxxxxxxx, XX 00000
The Xxxxxx Group 10 450,771.59
000 X. Xxxxxx Xxxxxx
X. Xxxxxxxxxxx, XX 00000
Xxxxxx X. Dinner, M.D. 2 90,154.32
00000 Xxxxx Xx., Xxxxx 000
Xxxxxxxxx, XX 00000-0000
Xxxxxxx Xxxxxxx 2.8 126,216.05
00000 Xxx Xxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000
Clarion Associates 2 90,154.32
0000 Xxxxxx Xxxxx Xx.
Xxxxx, XX 00000
Xxxxxx Xxxxxxx 2 90,154.32
00 Xxx Xxxxx Xx.
Xxxxxxxx Xxx, XX 00000
Xxxxxxx X. Xxxxx, Xx. 2 90,154.32
X.X. Xxx 000
Xxxxxxx xx Xxxxxxxx, XX 00000
Xxxxxxx Xxxxxx 0.4 18,030.86
XX0, Xxx XXX 000
Xxxxxxxx, XX 00000
Xxxxx Xxxxxxxx 0.5 22,538.58
000 Xxxxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxx Xxxxxxxxxx 0.2 9,015.43
000 Xxxxxxxxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxxx Xxxxx 0.1 4,507.72
0 Xxxxxxxx Xxxxx Xxxxxxx
Xxxxxxx, XX 00000
Xxxx Xxxxxxx 0.1 4,507.72
XX0, Xxx 00X
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxx 0.04 1,803.09
00 Xxxxxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxxx Xxxxxxxxxx 0.04 1,803.09
00 Xxxxxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxxxxx Xxxxxx 0.04 1,803.09
000 X. Xxxxxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxxxx 0.04 1,803.09
000 Xxxxxx Xxxxx
X. Xxxxxxxxxxx, XX 00000
Xxxxx Xxxxxxxx 0.04 1,803.09
RR1, Xxx 0000
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxxx 0.04 1,803.09
RD 0, Xxx 0000
X. Xxxxxxxxxxx, XX 00000
Xxxxx Xxxxxx 0.04 1,803.09
Xxx. 0, Xxxxxx Xxxxxx
X. Xxxxxxxxxxx, XX 00000
Xxxxxxxx Xxxxxx 0.04 1,803.09
00 Xxxxxxxxx Xxxxxxx
X. Xxxxxxxxxxx, XX 00000
Xxxxxxx Xxxxxxx 0.3 13,523.15
00 Xxxxx Xxxxxx
Xxxxxxxx Xxx, XX 00000
Xxxx Xxxxx 0.2 9,015.43
XX 0, Xxx 000XX
Xxxxxxxxxxxx, XX 00000
Xxxxxx Xxxxx 0.1 4,507.72
X.X. Xxx 000
Xxxxxxx xx Xxxxxxxx, XX 00000
Xxxxxxx Xxxxxx 0.4 18,030.86
000 Xxxxxx Xxxxxx, X00
X. Xxxxxxxxxxx, XX 00000
Xxxxx Xxxxxx 0.1 4,507.72
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxxxx Xxxxxxx 0.1 4,507.72
000 Xxxxxx Xx.
X. Xxxxxxxxxxx, XX 00000
Xxxxxxxx Xxxxxxx 1.2 54,092.59
00000 Xxx Xxxxxxxx Xxxx. Xxxxx 000
Xxx Xxxxxxx, XX 00000
Xxxxxxx Xxxxx 0.3 13,523.15
X.X. Xxx 000
Xxxxxxx, XX 00000
Total 221.62 9,990,000.04
EXHIBIT B
FIRST TARGET ACQUISITION, INC.
SUBSCRIPTION DOCUMENTS
FIRST TARGET ACQUISITION, INC.
(A Nevada Corporation)
SUBSCRIPTION DOCUMENTS
April 28, 1999
INDEX TO SUBSCRIPTION DOCUMENTS
Page
Number
Instructions for Completing Subscription Documents 3
Subscription Agreement 7
Subscriber Information 8, 10
Subscriber Signature 10
Suitability Letter 11
Subscriber Information 11, 12, 13, 14
Subscriber Signature 14
Agency Representation Form, if Subscriber is an Entity 15
Agency Information 15, 16
Agency Signature 16
Investment Letter 17
Subscriber Signature 19
PAGE
FIRST TARGET ACQUISITION, INC.
INSTRUCTIONS FOR COMPLETING SUBSCRIPTION DOCUMENTS
GENERAL
This packet contains the documents that are required to be
completed by King Media, Inc. ("King Media") and Xxxxxxxxxxxxxx.xxx
(collectively, the "Subscribers") and maintained by First Target Acquisition,
Inc. (the "Company"), in an effort to document the facts relied on by the
Company for claiming one or more exemptions from registration under applicable
federal and state securities laws, rules and regulations in connection with
the offer and sale of shares of the Company's common stock, par value $0.001
per share (the "Shares"), to certain creditors of xxxxxxxx.xxx, Inc., a New
Jersey corporation ("xxxxxxxx.xxx").
Completed and manually executed Subscription Documents with
indicia of payment as provided below must be delivered to the Company, which
will review the Subscription Documents and other information available to it
to determine whether to accept the subscription.
The following is a list of individual documents that must be
furnished and may be used as a checklist to assure that all necessary
documents have been completed and delivered to the Company:
[ ] 1. Subscription Agreement
[ ] 2. Suitability Letter
[ ] 3. Investment Letter
INDICIA OF PAYMENT
The Company is offering to issue shares to the Subscribers in
satisfaction of xxxxxxxx.xxx's indebtedness of the principal amount of
$1,538,000 ($1,500,000 to King Media and $38,000 to Xxxxxxxxxxxxxx.xxx), which
constitutes all of the indebtedness of xxxxxxxx.xxx to the Subscribers (the
"Indebtedness"). The number of Shares issuable in satisfaction of the
Indebtedness shall equal a fraction, the numerator of which shall be 3,000,000
in the case of King Media and $49,400 in the case of Xxxxxxxxxxxxxx.xxx, and
the denominator of which shall be the average of the closing bid prices of the
Company's common stock on the OTC Bulletin Board for the first 10 trading days
following the Closing of the Plan (as defined therein). The sole
consideration for the issuance of the Shares shall be the retirement of the
Indebtedness.
Subscriptions in consideration of the retirement of debt must be
accompanied by copies of the agreements, notes, invoices or other indicia of
debt to be exchanged in payment of the purchase price of the Shares.
CORPORATIONS, PARTNERSHIPS, AND OTHER LEGAL ENTITIES
If the Subscriber is a corporation, partnership, trust or other
legal entity, it must also furnish a certificate executed by the corporate
secretary, partner, trustee or other appropriate officer to the effect that
the person signing the subscription has been duly authorized to do so; that
the subscription is being made in accordance with the articles of
incorporation, bylaws, partnership agreement, trust agreement or other
governing instrument as applicable under the circumstances; and that such
entity was not formed for the principal purpose of making the investment.
Advice regarding the form and content of such certificate, appropriate in
specific circumstances, will be provided on request.
SPECIAL INSTRUCTIONS
Persons subscribing jointly (example: husband and wife) must sign
the Subscription Agreement. All blanks in the Subscription Agreement must be
completed with respect to all persons purchasing.
Persons Subscribing Through an Attorney-in-Fact
A Subscriber may authorize another person (an attorney-in-fact) to
subscribe for the Shares on the Subscriber's behalf. To do so, a Subscriber
must execute a power of attorney which appoints such other person as attorney-
in-fact and authorizes him or her in that capacity to execute a Subscription
Agreement. Any Subscription Agreement signed on behalf of a Subscriber by an
attorney-in-fact must be accompanied by a copy of a power of attorney in
proper form executed by such Subscriber.
Retain Copies
You should carefully read the Subscription Documents before
subscribing for the purchase of Shares. Once accepted by the Company,
subscriptions may not be revoked. The duplicate copy of the Subscription
Documents should be retained for your own files. The other copy of the
Subscription Documents will be used by the Company in reviewing your
subscription. After processing, a copy of the Subscription Agreement, signed
by the Company, will be returned to Subscribers whose subscriptions are
accepted and, if applicable, certificates and authenticated subscriptions will
be issued immediately.
Questions
If you have any questions regarding the completion of the
documents in this packet, contact the following persons:
Xxxxxxx X. Xxxxxxxxxx, Esq. Xxxxxxx X. Xxxxxxxxxx, Esq.
Lawyer Lawyer
000 Xxxx 000 Xxxxx, Xxxxx 000 455 East 000 Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000 Xxxx Xxxx Xxxx, Xxxx 00000
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Due Diligence
Only "accredited investors," and "sophisticated investors," who,
by reason of education, experience, business acumen or other factors, are
capable of evaluating the risks and merits of such an investment may subscribe
to purchase the Shares. These are persons who are deemed to be able to "fend
for themselves," and who are believed to be in a position to demand the type
of information from the Company that would have been provided to the Company
had the offer and sale of the Shares been registered with the Securities and
Exchange Commission or any state regulatory agency; accordingly, you are
expected to conduct your personal "due diligence" investigation of the Company
and xxxxxxxx.xxx and related information contained in the Company's Annual
Report on Form 10-KSB and Quarterly Reports on Form 10-QSB for the last 12
months, which are being provided concurrently with these Subscription
Documents, and such information regarding xxxxxxxx.xxx as you deem
appropriate. Your failure to do so may be used as a defense by the Company or
any person associated with the offer and sale of the Company's securities in
any action brought by you alleging any misstatement of a material fact or an
omission to state a material fact required to be stated, in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
Very truly yours,
FIRST TARGET ACQUISITION, INC.
By /s/ Xxxxxxx Xxxxxxx
------------------------
Xxxxxxx Xxxxxxx, President
FIRST TARGET ACQUISITION, INC.
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (the "Agreement") is entered into by and
between First Target Acquisition, Inc., a Nevada corporation (the "Company"),
and the undersigned subscriber to purchase securities of the Company pursuant
hereto (the "Subscriber").
The Company is offering to issue shares to the Subscribers in
satisfaction of xxxxxxxx.xxx's indebtedness of the principal amount of
$1,538,000 ($1,500,000 to King Media and $38,000 to Xxxxxxxxxxxxxx.xxx), which
constitutes all of the indebtedness of xxxxxxxx.xxx to the Subscribers (the
"Indebtedness"). The number of Shares issuable in satisfaction of the
Indebtedness shall equal a fraction, the numerator of which shall be 3,000,000
in the case of King Media and $49,400 in the case of Xxxxxxxxxxxxxx.xxx, and
the denominator of which shall be the average of the closing bid prices of the
Company's common stock on the OTC Bulletin Board for the first 10 trading days
following the Closing of the Agreement and Plan of Reorganization between the
Company, xxxxxxxx.xxx and other other persons identified therein. The sole
consideration for the issuance of the Shares shall be the retirement of the
Indebtedness.
On the foregoing premises, the Subscriber hereby subscribes for the
purchase of the Company's Shares on the following terms and conditions:
1. Subscription to Purchase Shares
1.1 Offer to Purchase. Subject to the terms and conditions of
this Agreement, the Subscriber irrevocably subscribes to purchase at the
Closing as defined herein, the number of the Shares outlined on the
Counterpart Signature Page hereto.
With this Agreement, the Subscriber is also tendering to the
Company: (i) a suitability letter, (ii) an investment letter, (iii) indicia
of the retirement of the Company's debt to the Subscriber, and (iv) a
certificate of corporation, partnership or other entity, if applicable. The
foregoing are sometimes hereinafter referred to as the "Subscription
Documents."
1.2 Acceptance or Rejection. The acceptance or rejection of the
offer to purchase Shares shall take place at such time and place within 30
days of the date hereof, as the Company may specify (which time and place are
designated as the "Closing"). At the Closing, the Company shall either (i)
accept this subscription (in whole or in part) and deliver to the Subscriber
certificates for the Shares, all against retirement of xxxxxxxx.xxx's
indebtedness to the Subscriber in an amount equal to the subscription amount;
or (ii) reject this subscription and return to the Subscriber his/her/its
subscription (or as much thereof as is not accepted).
2. Representations. The Subscriber, singly, or on behalf of an entity
subscribing, hereby represents and warrants as follows:
2.1 Age. The Subscriber or signatory is over the age of
majority.
2.2 No Governmental Approval. The Subscriber acknowledges that
neither the Securities and Exchange Commission nor the securities commission
of any state or any other federal agency has made any determination as to the
merits of purchasing the Shares.
2.3 Information Provided by the Subscriber. All information
which the Subscriber has provided or is providing the Company, or to its
agents or representatives concerning the Subscriber's suitability to invest in
the Company is complete, accurate and correct as of the date of the signature
on the last page of this Agreement. Such information includes, but is not
limited to information concerning the Subscriber's personal financial affairs,
business position and the knowledge and experience of the Subscriber and the
Subscriber's advisors. The Company shall maintain such information regarding
the Subscriber in strict confidence except as may be required to be disclosed
to governmental agencies in support of an available exemption from the
registration requirements of applicable securities laws, rules and regulations
regarding the offer and sale of the Shares.
2.4 Information Provided by the Company. The Subscriber has been
provided with copies of (i) the Company's Annual Report on Form 10-KSB and
Quarterly Reports on Form 10-QSB for the last 12 months, (ii) the Plan, with
all exhibits thereto, (iii) a letter from the Company, dated April 28, 1999,
disclosing the general terms of the Plan and the implications of any
subscription hereunder, and describing the procedures for subscribing for the
Shares, together with all material and information requested by either the
Subscriber or others representing the Subscriber, including any information
requested to verify any information furnished, and there has been direct
communication between the Company and its representatives on the one hand and
the Subscriber and the Subscriber's representatives and advisors on the other
in connection with information regarding the purchase made hereby. The
Subscriber has also been afforded the opportunity to ask questions of and
receive answers from the Company and xxxxxxxx.xxx and/or the directors,
officers, employees or representatives of the Company and xxxxxxxx.xxx
concerning the business of xxxxxxxx.xxx and the terms and conditions of this
offering and to obtain any additional information (to the extent the Company
and/or xxxxxxxx.xxx possesses such information or can acquire it without
unreasonable effort or expense) desired or necessary to verify the accuracy of
the information provided. Any proprietary information disclosed or discovered
by the Subscriber in reviewing information made available to the Subscriber by
the Company or xxxxxxxx.xxx in connection with the offer and sale of the
Shares shall be maintained by the Subscriber in strict confidence.
2.5 Subscription Subject to Acceptance. The Subscriber
acknowledges that this Agreement may be accepted or rejected by the Company
with respect to all of the amount subscribed and that on rejection of a
subscription in retirement of debt, the Subscriber will provide
acknowledgement of the appropriate credit, if any, in reduction of debt.
2.6 Financial Condition of the Subscriber. The Subscriber is an
"accredited investor" as defined in Rule 501 of Regulation D of the Securities
and Exchange Commission, has adequate means of providing for his/her/its
current needs and possible personal contingencies and has no need now, and
anticipates no need in the foreseeable future, to sell the Shares in the
Company for which the undersigned hereby subscribes. The Subscriber
represents that Subscriber is able to bear the economic risks of this
investment and is able to hold the securities for an indefinite period of time
and has a sufficient net worth to sustain a loss of the entire investment, in
the event such loss should occur.
2.7 Purchase Entirely for Own Account. The Subscriber has no
present intention of dividing the Shares with others or of reselling or
otherwise disposing of any portion of the Shares, unless registered pursuant
to a registration statement filed with the Securities and Exchange Commission
or there is an available exemption from such registration.
2.8 No Reliance on Unauthorized Representations. The Subscriber
has not specifically relied on any oral representations from the Company, or
any broker or salesman or their partners, shareholders, directors, officers,
employees or agents, except the following:
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
In making a decision to purchase the Shares, the Subscriber has read the
disclosure materials provided and has made an independent investigation
without assistance of the Company.
3. Indemnity. The Subscriber hereby agrees to indemnify the Company
and to hold it harmless, and to grant it a right of set-off, from and against
any and all liability, damages, cost or expense (including, but not limited
to, reasonable attorneys' fees), including the amount paid in settlement and
whether or not suit is commenced, incurred on account of or arising out of any
inaccuracy in the Subscriber's declarations, representations and warranties
set forth in any portion of the Subscription Documents executed and delivered
by the Subscriber in connection with his/her/its subscription for the Shares.
4. Setoff. Notwithstanding the provisions of the last preceding
section or the enforceability thereof, the Subscriber hereby grants the
Company the right of setoff against any amounts payable by the Company to the
Subscriber for whatever reason, before any and all damages, costs or expenses
(including, but not limited to, reasonable attorneys' fees) incurred on
account of or arising out of any of the items referred to in the last
preceding section.
5. Miscellaneous. The Subscriber further understands, acknowledges and
agrees that:
(a) This Agreement is not transferable or assignable by the
Subscriber.
(b) This Agreement shall be construed in accordance with
and governed by the laws of the State of Nevada.
(c) This Agreement constitutes the entire agreement between
the parties respecting the subject matter hereof.
(d) This Agreement does not entitle the Subscriber to any
rights as a shareholder of the Company with respect to any
securities purchasable hereunder which have not been fully paid
for by the retirement of xxxxxxxx.xxx debt.
COUNTERPART SIGNATURE PAGE TO
FIRST TARGET ACQUISITION, INC.
SUBSCRIPTION AGREEMENT
This Counterpart Signature Page for that certain Subscription
Agreement between First Target Acquisition, Inc., a Nevada corporation (the
"Company"), and the undersigned Subscriber to purchase securities of the
Company pursuant thereto, is executed by the undersigned as of the date
hereof. The undersigned, through execution and delivery of this Counterpart
Signature page, intends to be legally bound by the terms of such Agreement.
/s/ King Media, Inc.
--------------------
/s/ thegerardgroup
------------------
ACCEPTANCE BY THE COMPANY
First Target Acquisition, Inc. hereby accepts the foregoing subscription
and agrees to be bound by the terms of this Agreement.
[Each subscription was accepted by separate consent of the Board
of Directors of First Target Acquisition, Inc.]
FIRST TARGET ACQUISITION, INC.
SUITABILITY LETTER
TO: First Target Acquisition, Inc.
0000 Xxxxx 0000 Xxxx
Xxxxx, Xxxx 00000
Singly or on behalf of a subscribing entity, I make the following
representations with the intent that they may be relied on by First Target
Acquisition, Inc. (the "Company"), in determining my suitability or that of my
principal as a subscriber (the "Subscriber") to purchase shares of the
Company's $0.001 par value common stock (the "Shares") in consideration of the
retirement of Indebtedness of the Company, as fully described in the
Subscription Agreement executed by the undersigned and the Company.
1. I have such knowledge and experience in business and financial
matters that I am capable of evaluating the Company, its proposed business
activities and the risks and merits of this prospective investment.
2. I am not utilizing a purchaser representative as defined in
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), in connection with the evaluation of such risks and merits.
3. The undersigned has such knowledge and experience in financial and
business matters that he/she/it is capable of evaluating the Company and the
proposed activities thereof and the merits and risks of this prospective
investment.
4. I have adequate means of providing for my current needs and
possible personal contingencies and have no need in the foreseeable future for
liquidity of an investment in the Company.
5. I confirm that I am an "accredited investor" as defined under Rule
501 of Regulation D of the Securities Act as checked below:
(a) Any bank as defined in Section 3(a)(2) of the Securities Act
or any savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary
capacity; any broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934; any insurance company as defined in Section
2(13) of the Securities Act; any investment company registered under the
Investment Company Act of 1940 or a business development company as defined in
Section 2(a)(48) of that Act; any small business investment company licensed
by the U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958; any employee benefit plan within the
meaning of the Employee Retirement Income Security Act of 1974, if the
investment decision is made by a plan fiduciary, as defined in Section 3(21)
of such Act, which is either a bank, savings and loan association, insurance
company, or registered investment advisor, or if the employee benefit plan has
total assets in excess of $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited investors;
[ ] Yes [ X ] No
(b) Any private business development company as defined in
Section 202(a)(22) of the Investment Advisors Act of 1940;
[ ] Yes [ X ] No
(c) Any organization described in Section 501(c)(3) of the
Internal Revenue Code, corporation, Massachusetts or similar business trust,
or partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of $5,000,000;
[ ] Yes [ X ] No
(d) Any director, executive officer, or general partner of the
issuer of the securities being offered or sold, or any director, executive
officer, or general partner of a general partner of that issuer;
[ ] Yes [ X ] No
(e) Any natural person whose individual net worth, or joint net
worth with the person's spouse, at the time of this purchase exceeds
$1,000,000;
[ ] Yes [ X ] No
(f) Any natural person who had an individual net income in excess
of $200,000 in each of the two most recent fiscal years or joint income with
the person's spouse in excess of $300,000 in each of those two years and has a
reasonable expectation of reaching the same income level in the current fiscal
year;
[ ] Yes [ X ] No
(g) Any trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the securities offered, whose
purchase is directed by a sophisticated person as described in Section
230.506(b)(2)(ii); and
[ ] Yes [ X ] No
(h) Any entity in which all of the equity owners are accredited
investors.
[ X ] Yes [ ] No
6. I have previously been advised that I would have an opportunity to
review all the pertinent facts concerning the Company, and to obtain any
additional information which I might request, to the extent possible or
obtainable, without unreasonable effort and expense, in order to verify the
accuracy of the information provided me by the Company.
7. I have personally communicated or been offered the opportunity to
communicate with the directors or executive officers of the Company, its
attorneys and accountants to discuss the proposed business and financial
affairs of the Company, its proposed activities and plans for the future. I
acknowledge that if I would like to further avail myself of the opportunity to
ask additional questions of the Company, the Company will make arrangements
for such an opportunity on request.
8. I have been advised that no accountant or attorney engaged by the
Company is acting as my representative, accountant or attorney.
9. I will hold title to my interest as follows: King Media, Inc.
[ ] Community Property [ ] Separate Property
[ ] Joint Tenants with Rights [ ] Tenants in Common
of Survivorship [X ] Other (Single Person,
Trust, Etc.,
Please Indicate.)
10. I am a bona fide resident of the State of Pa. The address below is
my true and correct principal residence.
11. That if I am not an "accredited investor," I am capable of
evaluating the risks and merits of this investment by reason of the following:
[X ] Education [ ] Similar Investments in
[X ] Business Experience "Restricted Securities"
[ ] Previous Investments [ ] Other:
__________________________
__________________________
DATED this 29 day of April, 1999.
/s/ thegerardgroup
SUITABILITY LETTER
TO: First Target Acquisition, Inc.
0000 Xxxxx 0000 Xxxx
Xxxxx, Xxxx 00000
Singly or on behalf of a subscribing entity, I make the following
representations with the intent that they may be relied on by First Target
Acquisition, Inc. (the "Company"), in determining my suitability or that of my
principal as a subscriber (the "Subscriber") to purchase shares of the
Company's $0.001 par value common stock (the "Shares") in consideration of the
retirement of Indebtedness of the Company, as fully described in the
Subscription Agreement executed by the undersigned and the Company.
1. I have such knowledge and experience in business and financial
matters that I am capable of evaluating the Company, its proposed business
activities and the risks and merits of this prospective investment.
2. I am not utilizing a purchaser representative as defined in
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), in connection with the evaluation of such risks and merits.
3. The undersigned has such knowledge and experience in financial and
business matters that he/she/it is capable of evaluating the Company and the
proposed activities thereof and the merits and risks of this prospective
investment.
4. I have adequate means of providing for my current needs and
possible personal contingencies and have no need in the foreseeable future for
liquidity of an investment in the Company.
5. I confirm that I am an "accredited investor" as defined under Rule
501 of Regulation D of the Securities Act as checked below:
(a) Any bank as defined in Section 3(a)(2) of the Securities Act
or any savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary
capacity; any broker or dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934; any insurance company as defined in Section
2(13) of the Securities Act; any investment company registered under the
Investment Company Act of 1940 or a business development company as defined in
Section 2(a)(48) of that Act; any small business investment company licensed
by the U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958; any employee benefit plan within the
meaning of the Employee Retirement Income Security Act of 1974, if the
investment decision is made by a plan fiduciary, as defined in Section 3(21)
of such Act, which is either a bank, savings and loan association, insurance
company, or registered investment advisor, or if the employee benefit plan has
total assets in excess of $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited investors;
[ ] Yes [ X ] No
(b) Any private business development company as defined in
Section 202(a)(22) of the Investment Advisors Act of 1940;
[ ] Yes [ X ] No
(c) Any organization described in Section 501(c)(3) of the
Internal Revenue Code, corporation, Massachusetts or similar business trust,
or partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of $5,000,000;
[ ] Yes [ X ] No
(d) Any director, executive officer, or general partner of the
issuer of the securities being offered or sold, or any director, executive
officer, or general partner of a general partner of that issuer;
[ ] Yes [ X ] No
(e) Any natural person whose individual net worth, or joint net
worth with the person's spouse, at the time of this purchase exceeds
$1,000,000;
[ ] Yes [ X ] No
(f) Any natural person who had an individual net income in excess
of $200,000 in each of the two most recent fiscal years or joint income with
the person's spouse in excess of $300,000 in each of those two years and has a
reasonable expectation of reaching the same income level in the current fiscal
year;
[ ] Yes [ X ] No
(g) Any trust, with total assets in excess of $5,000,000, not
formed for the specific purpose of acquiring the securities offered, whose
purchase is directed by a sophisticated person as described in Section
230.506(b)(2)(ii); and
[ ] Yes [ X ] No
(h) Any entity in which all of the equity owners are accredited
investors.
[ ] Yes [ X] No
6. I have previously been advised that I would have an opportunity to
review all the pertinent facts concerning the Company, and to obtain any
additional information which I might request, to the extent possible or
obtainable, without unreasonable effort and expense, in order to verify the
accuracy of the information provided me by the Company.
7. I have personally communicated or been offered the opportunity to
communicate with the directors or executive officers of the Company, its
attorneys and accountants to discuss the proposed business and financial
affairs of the Company, its proposed activities and plans for the future. I
acknowledge that if I would like to further avail myself of the opportunity to
ask additional questions of the Company, the Company will make arrangements
for such an opportunity on request.
8. I have been advised that no accountant or attorney engaged by the
Company is acting as my representative, accountant or attorney.
9. I will hold title to my interest as follows: King Media, Inc.
[ ] Community Property [ ]Separate Property
[ ] Joint Tenants with Rights [ ]Tenants in Common
of Survivorship [ ]Other (Single Person,
Trust, Etc.,
Please Indicate.)
10. I am a bona fide resident of the State of Pa. The address below is
my true and correct principal residence.
11. That if I am not an "accredited investor," I am capable of
evaluating the risks and merits of this investment by reason of the following:
[X ] Education [ ] Similar Investments in
[X ] Business Experience "Restricted Securities"
[ ] Previous Investments [ ] Other:
__________________________
__________________________
DATED this 29 day of April, 1999. /s/ Xxxxx Xxxxx
FIRST TARGET ACQUISITION, INC.
CERTIFICATE OF PARTNERSHIP, CORPORATION OR OTHER ENTITY
The undersigned, King Media, Inc., (the "Subscriber"), a Pennsylvania
corporation, organized under the laws of the State of Delaware with its
principal offices located at the address set forth below, hereby certifies as
follows to induce First Target Acquisition, Inc. (the "Company"), to accept
the Subscriber's offer to purchase the Company's shares of common stock, par
value $0.001 per share (the "Shares"), payable in the form of retirement of
the debt of the Company to the Subscriber, as fully described in the
Subscription Agreement between the Company and the Subscriber:
1. Pursuant to valid and legally binding documents filed at the time
and in the manner required by the laws of the state under which Subscriber was
organized as stated above, Subscriber was formed on March 30, 1992.
2. Subscriber was organized to engage in the business of media
planning and media buying. Since its organization, Subscriber's business
activities have included the following: media planning and media buying.
Subscriber was not organized for the specific purpose of purchasing the
Company's securities.
3. The offer to purchase the Shares to be sold by the Company has
been approved by the governing authority of Subscriber in accordance with the
power vested in it by applicable law and the documents under which the
Subscriber was organized and exists.
4. Subscriber has determined that the purchase of the Shares is
consistent with its purposes and policies, is of benefit to it and involves
risks that it can reasonably bear.
5. On request of the Company, Subscriber shall deliver a certified
copy of resolutions duly adopted by the board of directors, general partners,
trustees or other governing authority of Subscriber and provide further
evidence of the authority and power of Subscriber to make the investment
described herein.
The Subscriber has caused this document to be executed by the
Subscriber's representative or agent, hereunto duly authorized as of April 29,
1999.
FOR REQUIRED SIGNATURES, SEE NOTE BELOW.
/s/ King Media, Inc.
__________________________________
Address: Name of Subscriber
000 Xxxx Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxx, XX 00000
/s/ Xxxxx Xxxxx
__________________________________
Signature of Authorized Signatory
President
__________________________________
Title
NOTE: Corporations: must be signed by a president or vice-president
Partnerships: must be signed by all general partners
Trusts: must be signed by all managing trustees
Others: contact the issuer
FIRST TARGET ACQUISITION, INC.
CERTIFICATE OF PARTNERSHIP, CORPORATION OR OTHER ENTITY
The undersigned, The Xxxxxx Group, (the "Subscriber"), a corporation,
organized under the laws of the State of Delaware with its principal offices
located at the address set forth below, hereby certifies as follows to induce
First Target Acquisition, Inc. (the "Company"), to accept the Subscriber's
offer to purchase the Company's shares of common stock, par value $0.001 per
share (the "Shares"), payable in the form of retirement of the debt of the
Company to the Subscriber, as fully described in the Subscription Agreement
between the Company and the Subscriber:
1. Pursuant to valid and legally binding documents filed at the time
and in the manner required by the laws of the state under which Subscriber was
organized as stated above, Subscriber was formed on November 22, 1992.
2. Subscriber was organized to engage in the business of management.
Since its organization, Subscriber's business activities have included the
following: management contract work. Subscriber was not organized for the
specific purpose of purchasing the Company's securities.
3. The offer to purchase the Shares to be sold by the Company has
been approved by the governing authority of Subscriber in accordance with the
power vested in it by applicable law and the documents under which the
Subscriber was organized and exists.
4. Subscriber has determined that the purchase of the Shares is
consistent with its purposes and policies, is of benefit to it and involves
risks that it can reasonably bear.
5. On request of the Company, Subscriber shall deliver a certified
copy of resolutions duly adopted by the board of directors, general partners,
trustees or other governing authority of Subscriber and provide further
evidence of the authority and power of Subscriber to make the investment
described herein.
The Subscriber has caused this document to be executed by the
Subscriber's representative or agent, hereunto duly authorized as of April 29,
1999.
FOR REQUIRED SIGNATURES, SEE NOTE BELOW.
/s/ The Xxxxxx Group
__________________________________
Address: Name of Subscriber
___________________________________
/s/ Xxxxxx X. Xxxxxx
___________________________________ __________________________________
Signature of Authorized Signatory
President
__________________________________
Title
NOTE: Corporations: must be signed by a president or vice-president
Partnerships: must be signed by all general partners
Trusts: must be signed by all managing trustees
Others: contact the issuer
FIRST TARGET ACQUISITION, INC.
INVESTMENT LETTER
First Target Acquisition
0000 Xxxxx 0000 Xxxx
Xxxxx, Xxxx 00000
Attention: Xxxxxxx Xxxxxxx, President
Re: Acquisition of "unregistered" and "restricted" shares of common
stock of First Target Acquisition, Inc., a Nevada corporation
("FTA" or the "Company"), par value $0.001 per share (the "Common
Stock") in consideration of retirement of debt
Dear Xx. Xxxxxxx:
In connection with the acquisition of the Common Stock of FTA, I
hereby acknowledge that singly, or on behalf of an entity subscribing to
purchase the Common Stock, I represent and warrant that I have sufficient
knowledge and experience to understand the nature of this acquisition and am
fully capable of bearing the economic risk of the loss of my entire cost
basis.
I acknowledge receipt of the Agreement and Plan of Reorganization
between the Company, xxxxxxxx.xxx, Inc., a New Jersey corporation
("xxxxxxxx.xxx") and the xxxxxxxx.xxx stockholders, the Company's Annual
Report on Form 10-KSB and its Quarterly Reports on Form 10-QSB for the last 12
months, and understand that you and representatives of xxxxxxxx.xxx will make
all books and records of your Company and xxxxxxxx.xxx available to me for my
inspection in connection with the contemplated acquisition of Common Stock,
and that I have been encouraged to review the information given to me and ask
any questions I may have concerning the information of any director or officer
of the Company and xxxxxxxx.xxx or of the legal and accounting firms for the
Company and xxxxxxxx.xxx.
I also understand that I must bear the economic risk of ownership
of the FTA Common Stock for a long period of time, the minimum of which will
be one (1) year, as these shares of Common Stock are "unregistered" securities
and may not be sold unless any subsequent offer or sale is registered with the
United States Securities and Exchange Commission or otherwise exempt from the
registration requirements of the Securities Act of 1933, as amended (the
"Act"), or other applicable laws, rules and regulations.
I intend that you rely on all of my representations made herein as
they are made to induce you to issue me the Common Stock, and I further
represent (of my personal knowledge or by virtue of my reliance on one or more
personal representatives), and agree as follows, to-wit:
1. That the Common Stock is being received for investment
purposes and not with a view toward further distribution;
2. That I have a full and complete understanding of the phrase
"for investment purposes and not with a view toward further distribution";
3. That I understand the meaning of "restricted securities" and
know that they are not freely tradeable;
4. That any stock certificate issued by you to me or my
principal in connection with the Common Stock shall be imprinted with a legend
restricting their sale, assignment, hypothecation or other disposition unless
it can be made in accordance with applicable laws, rules and regulations;
5. I agree that the stock transfer records of your Company
shall reflect that I have requested the Company not to effect any transfer of
any stock certificate representing any of the Common Stock being acquired
unless I or my principal shall first have obtained an opinion of legal counsel
to the effect that the Common Stock may be sold in accordance with applicable
laws, rules and regulations, and I understand that any opinion must be from
legal counsel satisfactory to the Company and, regardless of any opinion, I
understand that the exemption covered by any opinion must in fact be
applicable to the Common Stock;
6. That neither I nor my principal shall sell, offer to sell,
transfer, assign, hypothecate or make any other disposition of any interest in
the Common Stock being acquired except as may be pursuant to any applicable
laws, rules and regulations;
7. I fully understand that my investment or that of my
principal for the acquisition of Common Stock of the Company is "risk
capital," and that I and my principal are fully capable of bearing the
economic risks attendant to this investment, without qualification; and
8. I also understand that without approval of counsel for FTA,
all of the Common Stock to be issued and delivered to me or my principal shall
be represented by one stock certificate only, and that such stock certificate
shall be imprinted with the following legend or a reasonable facsimile thereof
on the front and reverse sides thereof:
The shares of Common Stock represented by this certificate have
not been registered under the Securities Act of 1933, as amended, and may not
be sold or otherwise transferred unless compliance with the registration
provisions of such Act has been made or unless availability of an exemption
from such registration provisions has been established, or unless sold
pursuant to Rule 144 under the Act.
Any request for more than one stock certificate must be
accompanied by a letter signed by the requesting stockholder setting forth all
relevant facts relating to the request. FTA will attempt to accommodate any
request where it believes the request is made for valid business or personal
reasons so long as in its sole discretion, the granting of the request will
not facilitate a "public" distribution of unregistered Common Stock of FTA.
You are requested and instructed to issue stock certificates as
follows, to-wit:
___________________________________________________
___________________________________________________
___________________________________________________
___________________________________________________
If joint tenancy with full rights of survivorship is
desired, put the initials JTRS after your names.
Thank you very much.
Dated this ________ day of ______________________, 1999.
Very truly yours,
__________________________________
__________________________________
(title or capacity)
EXHIBIT C
FIRST TARGET ACQUISITION, INC.
AUDITED FINANCIAL STATEMENTS FOR THE FISCAL YEARS ENDED
JUNE 30, 1998, AND 1997,
AND UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED
DECEMBER 31, 1998
COOKIE CUP INTERNATIONAL
FINANCIAL STATEMENTS
June 30, 1998 and 1997
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Cookie Cup International
(A Development Stage Company)
Salt Lake City, Utah
We have audited the accompanying balance sheet of Cookie Cup
International (a development stage company) as of June 30, 1998, and the
related statements of operations, stockholders' equity (deficit), and cash
flows for the years ended June 30, 1998 and 1997, and from inception on April
15, 1977 through June 30, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Cookie Cup
International (a development stage company) as of June 30, 1998 and the
results of its operations and its cash flows for the years ended June 30, 1997
and 1996, and from inception on April 15, 1977 through June 30, 1998 in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 2 to
the financial statements, the Company does not have any significant
operations. Because the Company has no significant operations, there is
substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 2.
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.
/s/Xxxxx, Xxxxxx & Company
Xxxxx, Xxxxxx & Company
Salt Lake City, Utah
July 31, 1998
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Balance Sheets
ASSETS
June 30,
1998
CURRENT ASSETS
Cash $ -
Total Current Assets -
TOTAL ASSETS $ -
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 10,254
Total Current Liabilities 10,254
TOTAL LIABILITIES 10,254
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: 50,000,000 shares authorized of
$0.001 par value, 50,000,000 shares issued and
outstanding 50,000
Additional paid-in capital 255,500
Deficit accumulated during the development stage (315,754)
Total Stockholders' Equity (Deficit) (10,254)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ -
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Statements of Operations
From
Inception on
April 15,
For the Years Ended 1977 Through
June 30, June 30,
1998 1997 1998
REVENUES $ - $ - $ -
EXPENSES (9,004) (2,750) (315,754)
NET LOSS $ (9,004) $ (2,750) $ (315,754)
BASIC LOSS PER SHARE $ (0.00) $ (0.00)
BASIC WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 50,000,000 50,000,000
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated Additional
During the
Common Stock Paid-in Development
Shares Amount Capital Stage
Balance, April 15, 1977 - $ - $ - $ -
Common stock issued at an
average of $0.01 per share 50,000,000 50,000 253,500 -
Additional capital contributed - - 500 -
Net loss from the year ended
June 30, 1994 - - - (304,000)
Balance, June 30, 1995 50,000,000 50,000 254,000 (304,000)
Net loss for the year ended
June 30, 1996 - - - -
Balance, June 30, 1996 50,000,000 50,000 254,000 (304,000)
Additional capital contributed - - 750 -
Net loss for the year ended
June 30, 1997 - - - (2,750)
Balance, June 30, 1997 50,000,000 50,000 254,750 (306,750)
Additional capital contributed - - 750 -
Net loss for the year ended
June 30, 1998 - - - (9,004)
Balance, June 30, 1998 50,000,000 $ 50,000 $ 255,500 (315,754)
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Statements of Cash Flows
From
Inception on
April 15,
For the Years Ended 1977 Through
June 30, June 30,
1998 1997 1998
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (9,004) $ (2,750) $ (315,754)
Changes in operating assets
and liabilities:
Increase in accounts payable 8,254 2,000 10,254
Net Cash Used By Operating Activities (750) (750) (305,500)
CASH FLOWS FROM INVESTING
ACTIVITIES - - -
CASH FLOWS FROM FINANCING
ACTIVITIES
Contributed capital for expenses 750 750 2,000
Issuance of common stock for cash - - 303,500
Net Cash Provided By Financing
Activities 750 750 305,500
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS - - -
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD - - -
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ - $ - $ -
Cash Paid For:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
/TABLE
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1998
NOTE 1 - ORGANIZATION AND HISTORY
a. Organization
The financial statements presented are those of Cookie Cup International (the
Company). The Company was originally incorporated under the laws of the State
of Utah on April 15, 1977. Subsequently the Corporation was "re-incorporated"
under the laws of the State of Nevada on May 11, 1987.
The Company is an outgrowth of a merger between Sierra Development, (A Utah
corporation that became public via an offering in October, 1977) and Cookie
Cup International, (A Nevada Corporation) that merged in 1987. Sierra
Development was organized as a "blind pool" corporation. Cookie Cup
International was organized to engage in the retail and wholesale business of
ice cream and frozen dessert novelties. The intended business of the
corporation was not successful and the corporation has been dormant and
operationally inactive for many years. The Company has been seeking new
business opportunities believed to hold a potential profit or to merge with
an existing, operating company.
b. Accounting Method
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected a June 30, year end.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with maturities
of three months or less at the time of acquisition.
d. Basic Loss Per Share
The computations of basic loss per share of common stock are based on the
weighted average number of shares outstanding during the period of the
financial statements.
e. Provision for Taxes
At June 30, 1998, the Company has net operating loss carryforwards of
approximately $11,000 that may be offset against future taxable income through
2013. No tax benefit has been reported in the financial statements because
the Company believes there is a 50% or greater chance the carryforwards will
expire unused. Accordingly, the potential tax benefits of the loss
carryforwards are offset by a valuation allowance of the same amount.
PAGE
COOKIE CUP INTERNATIONAL
(A Development Stage Company)
Notes to the Financial Statements
June 30, 1998
NOTE 1 - ORGANIZATION AND HISTORY (Continued)
f. Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company does not have an established source of
revenues sufficient to cover its operating costs and to allow it to continue
as a going concern. It is the intent of the Company to seek a merger with an
existing, operating company. In the interim, shareholders of the Company have
committed to meeting its minimal operating expenses.
NOTE 3 - RELATED PARTY TRANSACTIONS
A shareholder of the Company contributed $750 for expenses paid on behalf of
the Company in 1996. An additional $750 was contributed by the shareholder in
1997.
(A Development Stage Company)
Balance Sheets
ASSETS
December 31, June 30,
1998 1998
( Unaudited)
CURRENT ASSETS
Cash $ - $ -
Total Current Assets - -
TOTAL ASSETS $ - $ -
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 11,863 $ 10,254
Total Current Liabilities 11,863 10,254
TOTAL LIABILITIES 11,863 10,254
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: 50,000,000 shares authorized of
$0.001 par value, 50,000,000 shares issued and
outstanding 50,000 50,000
Additional paid-in capital 257,293 255,500
Deficit accumulated during the development stage (319,156) (315,754)
Total Stockholders' Equity (Deficit) (11,863) (10,254)
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ - $ -
FIRST TARGET ACQUISITION, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
From
Inception on
April 15,
For the Three Months Ended For the Six Months 1977 Through
December 31, December 31, December 31,
1998 1997 1998 1997 1998
REVENUES $ - $ - $ - $ - $ -
EXPENSES (399) - (3,402) (750) (319,156)
NET LOSS $ (399) $ - (3,402) (750) $ (319,156)
BASIC LOSS PER SHARE $ (0.00) $ (0.00) $ (0.00) $ (0.00)
BASIC WEIGHTED AVERAGE
NUMBER OF SHARES
OUTSTANDING 50,000,000 50,000,000 50,000,000 50,000,000
FIRST TARGET ACQUISITION, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated Additional
During the
Common Stock Paid-in Development
Shares Amount Capital Stage
Balance, April 15, 1977 - $ - $ - $ -
Common stock issued at an
average of $0.01 per share 50,000,000 50,000 253,500 -
Additional capital contributed - - 500 -
Net loss from the year ended
June 30, 1994 - - - (304,000)
Balance, June 30, 1995 50,000,000 50,000 254,000 (304,000)
Net loss for the year ended
June 30, 1996 - - - -
Balance, June 30, 1996 50,000,000 50,000 254,000 (304,000)
Additional capital contributed - - 750 -
Net loss for the year ended
June 30, 1997 - - - (2,750)
Balance, June 30, 1997 50,000,000 50,000 254,750 (306,750)
Additional capital contributed - - 750 -
Net loss for the year ended
June 30, 1998 - - - (9,004)
Balance, June 30, 1998 50,000,000 $ 50,000 $ 255,500 (315,754)
Additional capital contributed
(unaudited) - - 1,793 -
Net loss for the three months
ended September 30, 1998
(unaudited) - - - (3,402)
Balance, December 31, 1998
(unaudited) 50,000,000 $ 50,000 $ 257,293 $(319,156)
FIRST TARGET ACQUISITION, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From
Inception on
For the Three For the Six April 15,
Months Ended Months Ended 1977 Through
December 31, December 31, December 31,
1998 1997 1998 1997 1998
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (399) $ - $ (3,402) $ (750) $(319,156)
Changes in operating assets
and liabilities:
Increase (decrease)
in accounts payable (1,027) - 1,609 - 11,863
Net Cash Used By Operating
Activities (1,426) - (1,793) (750) (307,293)
CASH FLOWS FROM INVESTING
ACTIVITIES - - - - -
CASH FLOWS FROM FINANCING
ACTIVITIES
Contributed capital for expenses 1,426 - 1,793 750 3,793
Issuance of common stock for cash - - - - 303,500
Net Cash Provided By Financing
Activities 1,426 - 1,793 750 307,293
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS - - - - -
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD - - - - -
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ - $ - $ - $ - $ -
Cash Paid For:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
FIRST TARGET ACQUISITION, INC.
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1998 and June 30, 1998
NOTE 1 - ORGANIZATION AND HISTORY
a. Organization
The financial statements presented are those of Cookie Cup International (the
Company). The Company was originally incorporated under the laws of the State
of Utah on April 15, 1977. Subsequently the Corporation was "re-incorporated"
under the laws of the State of Nevada on May 11, 1987.
The Company is an outgrowth of a merger between Sierra Development, (A Utah
corporation that became public via an offering in October, 1977) and Cookie
Cup International, (A Nevada Corporation) that merged in 1987. Sierra
Development was organized as a "blind pool" corporation. Cookie Cup
International was organized to engage in the retail and wholesale business of
ice cream and frozen dessert novelties. The intended business of the
corporation was not successful and the corporation has been dormant and
operationally inactive for many years. The Company has been seeking new
business opportunities believed to hold a potential profit or to merge with an
existing, operating company.
b. Accounting Method
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected a June 30, year end.
c. Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with maturities
of three months or less at the time of acquisition.
d. Basic Loss Per Share
The computations of basic loss per share of common stock are based on the
weighted average number of shares outstanding during the period of the
financial statements.
e. Provision for Taxes
At December 31, 1998, the Company has net operating loss carryforwards of
approximately $14,000 that may be offset against future taxable income through
2013. No tax benefit has been reported in the financial statements because
the Company believes there is a 50% or greater chance the carryforwards will
expire unused. Accordingly, the potential tax benefits of the loss
carryforwards are offset by a valuation allowance of the same amount.
f. Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company does not have an established source of
revenues sufficient to cover its operating costs and to allow it to continue
as a going concern. It is the intent of the Company to seek a merger with an
existing, operating company. In the interim, shareholders of the Company have
committed to meeting its minimal operating expenses.
NOTE 3 - RELATED PARTY TRANSACTIONS
A shareholder of the Company contributed $750 for expenses paid on behalf of
the Company in 1997. An additional $1,793 was contributed by the shareholder
in 1998.
EXHIBIT D
None.
EXHIBIT E
XXXXXXXX.XXX, INC.
UNAUDITED FINANCIAL STATEMENTS
FOR THE CALENDAR YEAR ENDED DECEMBER 31, 1998
COOPERATIVE IMAGES & ELECTIVE INVESTMENTS
CONSOLIDATED BALANCE SHEET
PERIODS ENDING 1998
(UNAUDITED)
December
Current Assets
Cash $ 175,462
Doctors receivable 215,165
In-House loans 13,770
Patients' loans receivable 6,708,262
Allowance for doubtful accounts (721,957)
Prepaid expenses and other 147,287
Current Assets 6,537,989
Furniture & fixtures 58,026
Equipment 55,386
Computer 340,145
Leasehold improvements 11,421
Total 464,978
Accumulated depreciation 78,085
Net property 386,893
Total assets $ 6,924,882
Current Liabilities
Accounts payable $ 1,791,553
Accrued liabilities 617,042
Total current liabilities 2,408,595
Notes payable 205,500
Loans payable to shareholders 638,650
Lines of credit 8,582,967
Holdback Leasecomm (479,666)
Total long-term liabilities 8,947,451
Common Stock 1,012
Additional pain-in-capital ----
Retained earnings (4,432,176)
Total shareholders' equity (4,431,164)
Total Liab. & shareholders equity 6,924,882
Cooperative Images, Inc. and Elective Investments, Inc.
Combined Statement of Loss
For year ended December 31, 1998
(Unaudited) (Draft)
1998
Loan sales $2,513,341
Cost of loans 1,879,481
Gross profit on loans 633,860
Fee income 4,412,423
Interest income 1,387,040
Net revenue 6,433,323
Salaries 2,267,719
Payroll taxes 206,338
Advertising & promotions 2,660,722
Bad debt expense 985,906
Computer expenses 13,423
Credit reports and bank charges 241,458
Depreciation 46,438
Group benefits 40,292
Insurance 19,626
Interest expense 1,299,696
Miscellaneous 20,047
Office supplies & printing expense 116,180
Postage 118,008
Professional fees 468,107
Profit sharing expense 6,948
Rent and utilities 151,969
Repairs and maintenance 36,459
Telephone 500,598
Travel & entertainment 181,714
Total expenses 9,381,648
Net income (loss) $(2,948,325)
EXHIBIT F
See attached descriptions of pending litigation and licensure status and
letter of Crossway Ventures.
PENDING LEGAL ISSUES
NEXT
FILE LEGAL DATE ACTION
NUMBER MATTER RECEIVED DATE
0001 Xxxxxxx, Xxxxxxx
0002 Iadevaaia, Xxxxxxxxxx 2/16/99
0003 Widcosa, Xxxxxx 2/16/99 3/19/99
0004 Dresnen, Xxxxxxxxx X. (Dr.) 2/22/99
0005 Xxxxxx, Xxx and Xxxxxxx
0006 Cosmedix/New Horizons 4/1/99
0007 E.S.P.C. 2/11/99 T/B/A
PENDING LEGAL ISSUES CONTINUED
FAXED
PLAINTIFF LEGAL DOLLAR TO
DEFENDANT FEE EXPOSURE NOTE ATTORNEY
Plaintiff ($1,000.00) $6,757.00 2/17/99
(100.00) 0.00 2/16/99
Defendant (250.00) (1,000.00) Closed 2/17/99
(250.00) 7,000.00 3/2/99
Defendant (10,000.00) (50,000.00)
Plaintiff (1,000.00) 14,100.00 4/8/99
Defendant (2,000.00) (10,008.19)
TOTAL (14,600.00) (33,251.19)
