AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is
made this 7th day of March, 2001, among Encibar, Inc., a Utah corporation
("Encibar"); VersaCOM International, Inc., a Florida corporation ("VersaCOM");
and all of the holders of common and preferred stock (respectively, the
"VersaCOM Common Stockholders" and the "VersaCOM Preferred Stockholders," or
collectively, the "VersaCOM Stockholders"), all of whom are listed on Exhibit
A hereto, and who execute and deliver a copy of the Agreement.
W I T N E S S E T H:
RECITALS
WHEREAS, the respective Boards of Directors of Encibar and
VersaCOM have adopted resolutions pursuant to which Encibar shall acquire and
the VersaCOM Stockholders shall exchange 100% of the outstanding securities of
VersaCOM, and VersaCOM shall become a wholly-owned subsidiary of Encibar; and
WHEREAS, the sole consideration for 100% interest in VersaCOM
shall be the exchange of one mill ($0.001) par value common stock of Encibar
(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 VersaCOM Stockholders shall acquire in exchange the
"restricted securities" of Encibar in a reorganization within the meaning of
Section 368(a)(1)(B), Section 351 or other provisions or sections, laws, rules
and regulations of the Internal Revenue Code of 1986, as amended, as may be
applicable or available;
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 VersaCOM Stockholders agree to
transfer to Encibar at the closing (the "Closing") 100% of the outstanding
securities (both common and preferred stock) of VersaCOM, listed in Exhibit A,
which is attached hereto and incorporated herein by reference (the "VersaCOM
Shares"), in exchange for 10,460,000 shares of common stock of Encibar, pro
rata, as outlined in Exhibit A. Taking into account the number of
outstanding shares of Encibar's common stock that will be outstanding on
Closing as provided in Section 1.7(c) hereof after (i) the conversion of an
outstanding Debenture of Encibar in the amount of $16,000 for 160,000 shares
of Encibar's common stock; (ii) the issuance of up to 200,000 shares of common
stock to certain persons under written compensations agreements and pursuant
to an S-8 Registration Statement to be filed with the Securities and Exchange
Commission immediately after the Closing; (iii) the cancellation of 1,327,500
shares of Encibar's outstanding common stock by certain principal
stockholders; and (iv) assuming that all of the VersaCOM Stockholders execute
and deliver a copy of this Agreement, there will be approximately 11,396,690
post-Agreement outstanding shares of the reorganized Encibar on the Closing.
1.2 Delivery of Certificates by VersaCOM Stockholders.
The transfer of the VersaCOM Shares by the VersaCOM Stockholders shall be
effected by the delivery to Encibar at the Closing of stock 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 Encibar and with all necessary transfer taxes and other
revenue stamps affixed and acquired at the VersaCOM Stockholders' expense.
1.3 Further Assurances. At the Closing, as described in
Section 2, and from time to time thereafter, the VersaCOM Stockholders shall
execute such additional instruments and take such other action as Encibar may
request in order to exchange and transfer clear title and ownership in the
VersaCOM Shares to Encibar.
1.4 Execution of Secured Convertible Promissory Note for
Consulting Services to Related Party; and No Change of Transfer Agent.
Encibar and VersaCOM shall each execute and deliver the Convertible Promissory
Note payable to Xxxxxx Services, Inc., a Utah corporation and financial
consulting firm ("Xxxxxx Services"), in the amount of $350,000, that is
attached hereto as Exhibit B and incorporated herein by reference, and each of
the VersaCOM Stockholders who are named in the Convertible Promissory Note or
attachments thereto as founding stockholders of VersaCOM shall pledge all
shares of common stock of Encibar to be received in exchange under this
Agreement for their VersaCOM Shares as security for the payment of the
Convertible Promissory Note, reserving, however, the right to vote the pledged
securities without qualification; and no change shall be made in the current
transfer and registrar agent of Encibar until this Convertible Promissory Note
is paid in full.
1.5 Resignations of Present Directors and Executive
Officers and Designation of New Directors and Executive Officers. On Closing,
Encibar shall designate the directors and executive officers nominated by
VersaCOM to serve as directors and executive officers of Encibar until the
next respective annual meetings of the stockholders and the Board of Directors
of Encibar, and until their respective successors shall be elected and
qualified or until their respective prior resignations or terminations, who
shall be: Xxxx X. Xxxxxx, President, CEO and Director; Xxxx Xxxxxx, Vice
President and Director; Xxxx X. Xxxxxxxx, Chief Operating Officer, Secretary
and Director; and Xxxxxxx Xxxxxxx, Chief Financial Officer and Treasurer; and
then, the current directors and executive officers shall resign, in seriatim.
1.6 Change of Name. Following the Closing of this
Agreement and subject to the filing of a proxy or information statement with
the Securities and Exchange Commission and the affirmative vote of persons
owning a majority of the post-Agreement outstanding voting securities of
Encibar at a special meeting of stockholders called for this purpose, or by
the written consent of persons owning a majority of the post-Agreement
outstanding voting securities of Encibar, the Articles of Incorporation of
Encibar shall be amended to change its name to "VersaCOM International, Inc."
1.7 Encibar's Reporting Status with the Securities and
Exchange Commission; Quotations of its Common Stock on the OTC Bulletin Board;
and Capitalization at Closing; Assets and Liabilities at Closing; and Payment
of Encibar's Legal Counsel's Fees by VersaCOM. At the Closing:
(a) Encibar is and shall maintain its status as a
publicly-held "reporting issuer" that is
required to file reports with the Securities and
Exchange Commission; and as of the date of this
Agreement, Encibar is "current" in the filing of
all reports that are required to be filed by it
with the Securities and Exchange Commission;
(b) Encibar's common stock is quoted on the OTC
Bulletin Board of the National Association of
Securities Dealers, Inc. (the "NASD") and
Encibar is not aware of any facts or
circumstances which exist as of the date of this
Agreement which will impair Encibar's ability to
continue to have its common stock quoted on the
OTC Bulletin Board;
(c) Encibar's authorized capital shall consist of
not less than 100,000,000 shares of one mill
($0.001) par value common voting stock, of which
approximately 936,690 shares shall or will be
authorized to be issued and outstanding on or
shortly after Closing, all as outlined in the
Consent of Directors adopting this Agreement, an
executed copy of which shall be delivered to
VersaCOM and the VersaCOM Stockholders on
Closing, which amount includes the following:
(i) the conversion of an outstanding Debenture
of Encibar in the amount of $16,000 for 160,000
shares of Encibar's common stock; (ii) the
issuance of up to 200,000 shares of common stock
to certain persons under written compensations
agreements and pursuant to an S-8 Registration
Statement to be filed with the Securities and
Exchange Commission immediately following the
Closing; and (iii) the cancellation of 1,327,500
shares of Encibar's outstanding common stock by
certain principal stockholders;
(d) All assets of Encibar shall have been sold or
otherwise disposed of and the proceeds therefrom
shall have been utilized to pay and satisfy all
outstanding liabilities and expenses of Encibar
that are related to this Agreement or otherwise;
provided, however, legal fees of Encibar's legal
counsel in the amount of $10,000, shall be paid
by VersaCOM as soon as funds therefor are
available, but on or before 30 days from the
Closing.
1.8 Limitations on other Registration Statements on Forms
S-8 of S-3 of the Securities and Exchange Commission. Except as provided
otherwise herein and until the Convertible Promissory Note attached hereto as
Exhibit B is paid in full or converted as provided therein, no registration
statements on Forms S-8 or S-3 of the Securities and Exchange Commission shall
be filed by Encibar, except in connection with a Stock Option Plan adopted for
the benefit of employees that will reserve not less than 10% of the
outstanding securities of the reorganized Encibar for issuance thereunder,
provided, however, that no registration statements on Forms S-8 or S-3
covering the securities granted under any such Stock Option Plan shall be
filed while there is any sum due and owing under the Convertible Promissory
Note referenced in Section 1.4 hereof.
1.9 No Reverse Splits for a Period of Two Years. Encibar
shall not reverse split its post-Agreement common stock for a period of two
years from the Closing without the prior written consent of Xxxxxx Services,
and in the event there is any reverse split of Encibar's common stock adopted
or effected by the consent of the Board of Directors, stockholders or
otherwise, all pre-Agreement stockholders of Encibar who are still
stockholders of Encibar shall be immediately issued without further
consideration additional shares of Encibar's common stock so that the reverse
split will have no effect on the number of their pre-reverse split shares of
Encibar's common stock still owned by any of such persons.
1.10 Adoption of Any Consulting Agreements Requiring
VersaCOM to Issue Securities Under Rule 701 of the Securities and Exchange
Commission. To the extent that VersaCOM shall have lawfully committed to
issue shares of its common stock to consultants or employees pursuant to
written compensation agreements and Rule 701 of the Securities and Exchange
Commission, such agreements are hereby adopted, ratified and approved,
respecting the securities designated and "Rule 701" securities on Exhibit A
hereof.
1.11 Closing. This Agreement will be deemed to be
completed on receipt of the signatures of VersaCOM Stockholders collectively
owning not less than 80% of the outstanding VersaCOM Shares; and the remainder
of the VersaCOM Shares shall be acquired under and pursuant to the terms and
provisions of this Agreement as soon as practicable.
Section 2
Closing
The Closing contemplated by Section 1 (the "Closing") 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 calendar days
following the execution and delivery of this Agreement, 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 Encibar
Encibar represents and warrants to, and covenants with, the
VersaCOM Stockholders and VersaCOM as follows:
3.1 Corporate Status. Encibar is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Utah and 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 (Utah only).
Encibar is a publicly- held company, having lawfully offered and sold to the
public a portion of its securities in accordance with applicable federal and
state securities laws, rules and regulations. Its shares of common stock are
quoted on the OTC Bulletin Board of the National Association of Securities
Dealers, Inc. (the "NASD") under the symbol ("ENCB"); however, there is
presently no "established trading market" for its shares of common stock.
3.2 Capitalization. The current pre-Agreement authorized
capital stock of Encibar consists of 100,000,000 shares of one mill ($0.001)
par value common voting stock, of which approximately 936,690 shares are or
will be issued or issuable and outstanding on Closing, all fully paid and non-
assessable and issued in accordance with applicable state corporate law and
federal and state securities laws, rules and regulations. Except as
otherwise provided herein or in the Consent of Directors of Encibar that
authorized the execution and delivery of this Agreement, there are no
outstanding options, warrants or calls pursuant to which any person has the
right to purchase any authorized and unissued common stock or other securities
of Encibar that are not included in the shares of Encibar that are or will be
outstanding on Closing.
3.3 Financial Statements. The financial statements of
Encibar furnished to VersaCOM consisting of audited financial statements for
the years ended March 31, 2000 and 1999, and unaudited financial statements
for the period ended December 31, 2000, attached hereto as Exhibits C and C-1
and incorporated herein by reference, are correct and fairly present the
financial condition of Encibar as of the years and for the period ended, and
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 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. Encibar has no liabilities
of any nature except to the extent reflected or reserved against in its
balance sheets, 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 balance
sheets, except as set forth in Exhibit D, there have been no (1) changes in
financial condition, assets, liabilities or business of Encibar which, in the
aggregate, have been materially adverse; (2) damages, destruction or losses of
or to property of Encibar, payments of any dividend or other distribution in
respect of any class of stock of Encibar, 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. Encibar has good and marketable
title to all properties and assets, real and personal, and the properties and
assets of Encibar are subject to no mortgage, pledge, lien or encumbrance,
except as reflected in its balance sheets 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 Encibar, threatened, against or relating to
Encibar, its properties or business. Further, no officer, director or person
who may be deemed to be an "affiliate" of Encibar is party to any material
legal proceeding which could have an adverse effect on Encibar (financial or
otherwise), and none is party to any action or proceeding wherein any has an
interest adverse to Encibar.
3.8 Books and Records. From the date of this Agreement
to the Closing, Encibar will (1) give to the VersaCOM Stockholders and
VersaCOM or their respective representatives full access during normal
business hours to all of Encibar's offices, books, records, contracts and
other corporate documents and properties so that the VersaCOM Stockholders and
VersaCOM or their respective representatives may inspect and audit them; and
(2) furnish such information concerning the properties and affairs of Encibar
as the VersaCOM Stockholders and VersaCOM or their respective representatives
may reasonably request.
3.9 Tax Returns. Encibar 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), Encibar and its representatives will keep
confidential any information which they obtain from the VersaCOM Stockholders
or from VersaCOM concerning the properties, assets and business of VersaCOM.
If the initial Closing contemplated by this Agreement is not consummated by
March 15, 2001, Encibar will return to VersaCOM all written matter with
respect to VersaCOM obtained by Encibar in connection with the negotiation or
consummation of this Agreement.
3.11 Corporate Authority. Encibar has full corporate
power and authority to enter into this Agreement and to carry out its
obligations hereunder and will deliver to the VersaCOM Stockholders and
VersaCOM or their respective representatives at the Closing a certified copy
of resolutions of its Board of Directors authorizing execution of this
Agreement by Encibar's officers and performance thereunder, and that the
directors adopting and delivering such resolutions are the duly elected and
incumbent directors of Encibar.
3.12 Due Authorization. Execution of this Agreement and
performance by Encibar hereunder have been duly authorized by all requisite
corporate action on the part of Encibar, and this Agreement constitutes a
valid and binding obligation of Encibar and performance hereunder will not
violate any provision of the Articles of Incorporation, Bylaws, agreements,
mortgages or other commitments of Encibar.
3.13 Environmental Matters. Encibar 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 Encibar or its
predecessors. In addition, to the best knowledge of Encibar, there are no
substances or conditions which may support a claim or cause of action against
Encibar or any of its 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, rules or regulations.
"Hazardous Materials Regulations" means any regulations 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 VersaCOM. Encibar
acknowledges that it has been delivered copies of what has been represented to
be documentation containing all material information respecting VersaCOM and
VersaCOM'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 VersaCOM, and with the
legal and accounting firms of VersaCOM, with respect to such documentation;
and that to the extent requested, all questions raised have been answered to
Encibar's complete satisfaction.
3.15 Accuracy of Section 1.7. Encibar represents and
warrants that all of the information in Section 1.7 is true and correct.
3.16 Encibar Shares Free and Clear of All Liens. Except
as otherwise provided herein or in the Promissory Note attached hereto as
Exhibit B, all of the Encibar shares of common stock deliverable to the
VersaCOM Stockholders under this Agreement are free and clear of any liens or
encumbrances of any type or nature whatsoever, validly issued, are non-
assessable and are not subject to any restrictions or conditions except as set
forth in this Agreement or as may result from such securities being designated
as "restricted securities" under Rule 144 of the Securities and Exchange
Commission. Encibar has full right, power and authority to issue the such
shares to the VersaCOM Stockholders without qualification and no corporate
action, filings (except "notice" filings under Regulation D of the Securities
and Exchange Commission and similar state filings, none of which have any
effect on the validity of the securities to be issued) or other conditions are
required to be satisfied to make the representations in this Section 3.16 true
and correct.
Section 4
Representations, Warranties and Covenants of VersaCOM
and the VersaCOM Stockholders
VersaCOM and the VersaCOM Stockholders represent and warrant to, and
covenant with, Encibar as follows, provided, however, VersaCOM Stockholders
owning less than 10% of the outstanding voting securities of VersaCOM shall
only be responsible for the representations and warranties contained in
Sections 4.1, 4.11, 4.12, 4.15 and 4.16 hereof:
4.1 Ownership. The VersaCOM Stockholders respectively
own the VersaCOM Shares set forth opposite their respective names in Exhibit
A, 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
VersaCOM Shares owned without qualification.
4.2 Corporate Status. VersaCOM is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Florida and is licensed or qualified as a foreign corporation in all states
or foreign countries and provinces in which the nature of VersaCOM's business
or the character or ownership of VersaCOM properties makes such licensing or
qualification necessary.
4.3 Capitalization. The authorized capital stock of
VersaCOM consists of 100,000,000 shares of common stock, $0.0001 par value per
share, of which 10,260,000 shares are issued and outstanding; and 25,000,000
shares of preferred stock, $0.0001 par value per share, of which no shares are
issued and outstanding; and all of which are fully paid and non-assessable and
issued in accordance with applicable state corporate law and federal and state
securities laws, rules and regulations. Except as otherwise provided herein
and in Exhibit A, and except for the shares of preferred stock which the
holders of a $100,000 promissory note executed and delivered by VersaCOM can
convert to 200,000 shares of Series A Preferred Stock of VersaCOM as outlined
in Exhibit A, there are no outstanding options, warrants or calls pursuant to
which any person has the right to purchase any authorized and unissued common
or preferred stock or other securities of VersaCOM.
4.4 Financial Statements. The financial statements of
VersaCOM furnished to Encibar, consisting of unaudited financial statements
for the year ended December 31, 1999, and an unaudited balance sheet and
income statement for the nine month period ended September 30, 2000 attached
hereto as Exhibit E and incorporated herein by reference, are correct and
fairly present the financial condition of VersaCOM as of the years and for the
period ended, and 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. VersaCOM has no liabilities
of any nature except to the extent reflected or reserved against in its
balance sheets, whether accrued, absolute, contingent or otherwise, including,
without limitation, tax liabilities and interest due or to become due, except
as set forth in Exhibit F.
.
4.6 Interim Changes. Since the date of its balance
sheets, except as set forth in Exhibit F, there have been no (1) changes in
the financial condition, assets, liabilities or business of VersaCOM, which,
in the aggregate, have been materially adverse; (2) damages, destruction or
loss of or to the property of VersaCOM, payment of any dividend or other
distribution in respect of the capital stock of VersaCOM, or any direct or
indirect redemption, purchase or other acquisition of any such stock; or (3)
increases paid or agreed to in the compensation, retirement benefits or other
commitments to their employees.
4.7 Title to Property. VersaCOM has good and marketable
title to all properties and assets, real and personal, proprietary or
otherwise, reflected in its balance sheets, and the properties and assets of
VersaCOM are subject to no mortgage, pledge, lien or encumbrance, except as
reflected in the balance sheets 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 VersaCOM, threatened, against or
relating to VersaCOM 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 VersaCOM is party to any material legal proceeding which could
have an adverse effect on VersaCOM (financial or otherwise), and none is party
to any action or proceeding wherein any has an interest adverse to VersaCOM.
4.9 Books and Records. From the date of this Agreement
to the Closing, the VersaCOM Stockholders will cause VersaCOM to (1) give to
Encibar 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 Encibar may inspect and audit them; and (2) furnish
such information concerning the properties and affairs of VersaCOM as Encibar
may reasonably request.
4.10 Tax Returns. VersaCOM 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), VersaCOM, the VersaCOM Stockholders and their
representatives will keep confidential any information which they obtain from
Encibar concerning its properties, assets and business. If the initial
Closing contemplated by this Agreement is not consummated by March 15, 2001,
VersaCOM and the VersaCOM Stockholders will return to Encibar all written
matter with respect to Encibar obtained by them in connection with the
negotiation or consummation of this Agreement.
4.12 Investment Intent. The VersaCOM Stockholders are
acquiring the shares to be exchanged and delivered to them under this
Agreement for investment and not with a view to the sale or distribution
thereof, and the VersaCOM Stockholders have no commitment or present intention
to liquidate Encibar or to sell or otherwise dispose of the Encibar shares.
The VersaCOM Stockholders shall execute and deliver to Encibar on the Closing
an Investment Letter attached hereto as Exhibit G and incorporated herein by
reference, acknowledging: (i) the "unregistered" and "restricted" nature of
the shares of Encibar being received under this Agreement in exchange for the
VersaCOM Shares and receipt of certain material information regarding Encibar;
(ii) that Except as set forth in Exhibit A hereto, there are no "registration
rights" applicable to the VersaCOM Shares or any shares of common stock of
Encibar to be received in exchange for their VersaCOM Shares under this
Agreement; (iii) the compromise and waiver of any and all pre-emptive rights
each has or may have had with respect to any prior issuance of VersaCOM Shares
or any predecessor thereof; and (iv) whereby each compromises and/or waives
any claim each has or may have had against VersaCOM by reason of the purchase
of the VersaCOM Shares or any securities from VersaCOM or from any of the
VersaCOM Stockholders prior to the Closing of this Agreement, including claims
existing or arising under applicable federal and state securities laws, rules
and regulations.
4.13 Corporate Authority. VersaCOM has full corporate
power and authority to enter into this Agreement and to carry out its
obligations hereunder and will deliver to Encibar or its representative at the
Closing a certified copy of resolutions of its Board of Directors authorizing
execution of this Agreement by its officers and performance thereunder.
4.14 Due Authorization. Execution of this Agreement and
performance by VersaCOM hereunder have been duly authorized by all requisite
corporate action on the part of VersaCOM, and this Agreement constitutes a
valid and binding obligation of VersaCOM and performance hereunder will not
violate any provision of the Articles of Incorporation, Bylaws, agreements,
mortgages or other commitments of VersaCOM.
4.15 Environmental Matters. VersaCOM and the VersaCOM
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 VersaCOM or its predecessors. In addition, to the best
knowledge of VersaCOM and the VersaCOM Stockholders, there are no substances
or conditions which may support a claim or cause of action against VersaCOM 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 regulations 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 Encibar. VersaCOM and the
VersaCOM Stockholders acknowledge that they have had access to all
registration statements and reports filed by Encibar with the Securities and
Exchange Commission during the past 12 months through the XXXXX archives of
the Securities and Exchange Commission at xxx.xxx.xxx, and if they have made a
request in writing, that they have been delivered copies of such registration
statements and reports; that they have had a reasonable opportunity to review
such documentation and discuss it, to the extent desired, with their legal
counsel and the directors and executive officers of VersaCOM and/or Encibar;
that they have had, to the extent desired, the opportunity to ask questions of
and receive responses from the directors and executive officers of Encibar,
and with the legal and accounting firms of Encibar, with respect to such
documentation; and that to the extent requested, all questions asked have been
answered to their complete satisfaction.
Section 5
Conditions Precedent to Obligations of VersaCOM
and the VersaCOM Stockholders
All obligations of VersaCOM and the VersaCOM Stockholders under this
Agreement 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 Encibar contained in this Agreement 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. Encibar shall have performed and
complied with all of the terms and conditions required by this Agreement to be
performed or complied with by it before the Closing.
5.3 Officers' Certificate. VersaCOM and the VersaCOM
Stockholders shall have been furnished with a certificate signed by the
President of Encibar, in such capacity, attached hereto as Exhibit H and
incorporated herein by reference, dated as of the Closing, certifying (1) that
all representations and warranties of Encibar contained herein are true and
correct; and (2) that since the date of the financial statements (Exhibit C),
there has been no material adverse change in the financial condition, business
or properties of Encibar, taken as a whole.
5.4 Satisfaction of Certain Conditions by Encibar
Precedent to the Closing. All of the conditions respecting Encibar that are
outlined in Section 1.7 hereof shall have been satisfied by Encibar prior to
the Closing.
5.5 Resignation of Directors and Executive Officers and
Designation of New Directors and Executive Officers. The present directors
and executive officers of Encibar shall resign, and shall have previously
designated the nominees of VersaCOM as outlined in Section 1.5 hereof as
directors and executive officers of Encibar to serve in their place and stead,
until the next respective annual meetings of the stockholders and Board of
Directors of Encibar, and until their respective successors shall be elected
and qualified or until their respective prior resignations or terminations.
5.6 Stockholders' Consent. Persons owning not less than
80% of the outstanding VersaCOM Shares shall have executed and delivered the
Agreement.
Section 6
Conditions Precedent to Obligations of Encibar
All obligations of Encibar under this Agreement are subject, at
Encibar'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 VersaCOM and the VersaCOM Stockholders
contained in this Agreement 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. VersaCOM and the VersaCOM
Stockholders shall have performed and complied with all of the terms and
conditions required by this Agreement to be performed or complied with by them
before the Closing.
6.3 Officers' Certificate. Encibar shall have been
furnished with a certificate signed by the President of VersaCOM, in such
capacity, attached hereto as Exhibit I and incorporated herein by reference,
dated as of the Closing, certifying (1) that all representations and
warranties of VersaCOM and the VersaCOM 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 VersaCOM, taken as a whole.
6.4 Books and Records. The VersaCOM Stockholders or the
Board of Directors of VersaCOM shall have caused VersaCOM to make available
all books and records of VersaCOM, including minute books and stock transfer
records; provided, however, only to the extent requested in writing by Encibar
at Closing.
6.5 Conditions of Section 1. All of the conditions
enumerated in Section 1 of this Agreement, except Sections 1.3, 1.6, 1.7(a)
and(b), 1.8 and 1.9 shall have been fully satisfied.
6.6 Stockholders' Consent. Persons owning not less than
80% of the outstanding VersaCOM Shares shall have executed and delivered the
Agreement.
Section 7
Termination
Prior to Closing, this Agreement may be terminated (1) by mutual
consent in writing; (2) by either the directors of Encibar or VersaCOM and the
VersaCOM 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 Encibar or VersaCOM and the VersaCOM 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 Agreement.
8.2 Waiver. Any failure on the part of any party hereto
to comply with any of its or their 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
Agreement, 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 each.
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 Encibar: Xxxxx X. Xxxxx Xxxxxx, President
0000 Xxxxx 000 Xxxx, #000
Xxxx Xxxx Xxxx, Xxxx 00000
With a copy to: Xxxxxxx X. Xxxxxxxxxx, Esq.
455 East 000 Xxxxx, #000
Xxxx Xxxx Xxxx, Xxxx 00000
If to VersaCOM: Xxxx X. Xxxxxx, President
000 X. X. 00xx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
With a copy to: Xxxx X. X. Xxxxxxxx, Esq.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
If to the VersaCOM
Stockholders: To the addresses listed on
Exhibit A
8.5 Entire Agreement. This Agreement 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 Agreement are inserted for convenience only and shall not affect in any
way the meaning or interpretation of this Agreement.
8.7 Governing Law and Venue of Actions. This Agreement
shall be governed by and construed and enforced in accordance with the laws of
the State of Utah, except to the extent pre-empted by federal law, in which
event (and to that extent only), federal law shall govern; and any action
respecting this Agreement or any Exhibits attached hereto shall only be
maintained in the courts of the State of Utah, and each signatory hereto
submits to the jurisdiction of such courts for any such purpose.
8.8 Assignment. This Agreement shall inure to the
benefit of, and be binding upon, the parties hereto and their successors and
assigns.
8.9 Counterparts. This Agreement 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.
8.10 Survival of Representations and Warranties. The
representations, warranties, covenants and agreements contained herein shall
survive Closing until the expiration of the applicable statute of limitations
period.
IN WITNESS WHEREOF, the parties have executed this Agreement and Plan of
Reorganization effective the day and year first above written.
ENCIBAR, INC.
Date: 3/7/01. By /s/ Xxxxx X. Xxxxx Xxxxxx, President
VERSACOM INTERNATIONAL, INC.
Date: 3/7/01. By /s/ Xxxx X. Xxxxxx, President
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 7th day of March,
2001, among Encibar, Inc., a Utah corporation ("Encibar"); VersaCOM Holdings,
Inc., a Florida corporation ("VersaCOM"); and all of the holders of common and
preferred stock (respectively, the "VersaCOM Common Stockholders" and the
"VersaCOM Preferred Stockholders," or collectively, the "VersaCOM
Stockholders"), all of whom are listed on Exhibit A hereto and who are
signatories thereto, is executed by the undersigned, a VersaCOM 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 this Agreement.
/s/ Xxxx X. Xxxxxx
/s/ Kaiser Family Trust
/s/ Xxxx Xxxx Xxxxxx
/s/ Xxxxxxxx Xxxxxx
/s/ Xxxxxx Xxxxxx
/s/ Xxxxxx Xxxxxx
/s/ Xxxx and Xxx Xxxxxxxx Trust
/s/ Xxxx and Xxx Xxxxxxxx
/s/ Xxxxxx Xxxxxxxx
/s/ Xxxxxx Xxxxxxxx
/s/ Avi Mirman
/s/ Terenceuyrne Bryne
/s/ Xxxx X. Xxxxxx
/s/ Xxxxx Xxxxxxxxxxx
/s/ Xxxxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxxx
/s/ Xxxxxxx X. Xxxxxxx
/s/ Xxxxx Xxxxxxxx
/s/ Boston Business Group, Inc.
/s/ Xxxxxxx X. Xxxxxx
/s/ Noble House of Boston, Inc.
/s/ Gordian Investments Ltd.
/s/ Huggermugger Limited
/s/ Camisado Ventures Inc.
/s/ New York New York International
Ltd.
/s/ Outback Capital Ltd.
EXHIBIT A
Common Stockholders
Number of
Exchanged
Shares
Number of Subject to
Shares of Rule 701
Number of Shares Encibar to be or with
Owned of Received in Registration
Name VersaCOM Exchange Rights
Xxxx X. Xxxxxx 3,000,000 3,000,000 50,000 RR
00000X Xxxxxxxx Xxxx Xx.
Xxxx Xxxxx, XX 00000
Kaiser Family Trust 300,000 300,000 -0-
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
Xxxxxx Xxxxxx (minor) 200,000 200,000 -0-
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
Xxxxxx Xxxxxx (minor) 200,000 200,000 -0-
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
Xxxxxxxx Xxxxxx (minor) 200,000 200,000 -0-
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
Xxxx Xxxx Kaiser (minor) 200,000 200,000 -0-
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
Xxxxxxx Xxxxxx 500,000 500,000 500,000 701
000 Xxxx Xx.
Xxxxxxxx, XX 00000
Xxxx Xxxxxx 750,000 750,000 375,000 RR
0000 X.X. 0xx Xxx.
Xxxx Xxxxx, XX 00000
Terenceuyrne Xxxxx 1,000,000 1,000,000 1,000,000 XX
000 Xxxx
Xx. Xxxxxxx, Xxxx Xxxxx XX
Xxxxxx H3Y239
Xxxxx Xxxxxxxxxxx 200,000 200,000 25,000 RR
00000 X. 00xx X. Xxx.
Xxxxx, XX 00000
Noble House of Boston, Inc. 250,000 250,000 250,000 RR
000 Xxxxx Xxxxx Xx.
Xxxxxxxxxxxx, XX 00000
Xxxxx Xxxxxxxxx 20,000 20,000 -0-
00000 X.X. 00xx Xx.
Xxxxx Xxxxxxx, XX 00000
Xxxxxx Xxxxxx 5,000 5,000 -0-
0000 X.X. 00xx Xxx.
Xxxxx, XX 00000
Certus, LTDA 375,000 375,000 375,000 RR
c/o Union Securities
Attn: Xxxxxx Xxxxx
Pacific Center
900-609 Xxxxxxxxx
Xxxxxxxxx, XX X0X0X0
Inversiones Y Proyectos
Vastus, LTDA 375,000 375,000 375,000 RR
c/o Union Securities
Attn: Xxxxxx Xxxxx
Pacific Center
900-609 Xxxxxxxxx
Xxxxxxxxx, XX X0X0X0
Xxxx and Xxx Xxxxxxxx,
JTWROS 440,000 440,000 50,000 RR
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxxx Xxxxxxxx 20,000 20,000 20,000 RR
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxxxx Xxxxxxxx (minor) 20,000 20,000 -0-
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxxxx Xxxxxxxx (minor) 20,000 20,000 -0-
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxxxxx Xxxxxxxx 20,000 20,000 -0-
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxx and Xxx Xxxxxxxx Trust 100,000 100,000 -0-
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
Xxxxxx Xxxxx 75,000 75,000 75,000 XX
000 Xxxxx Xxxx Xxxxxx Xx.
Xxxxxx, XX 00000
Xxxxx Xxxxxxxx 100,000 100,000 20,000 RR
000 XX 0xx Xxx.
Xxxxxxx Xxxxx, XX 00000
Xxxxxxx Xxxxxxx 25,000 25,000 5,000 RR
0000 X. Xxxxx Xxxx., #00X
Xx. Xxxxxxxxxx, XX 00000
Job Van Vliet 25,000 25,000 5,000 RR
0000 XX 00xx Xx #000
Xx. Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxxx 200,000 200,000 200,000 XX
0000 Xxxxxxx Xxx
Xxxx Xxxxx, XX 00000
Xxxxxxx Xxxxxxx 60,000 60,000 5,000 RR
0000 X.X. 00xx Xxx
Xxxxx Xxxxxxx, XX 00000
Xxxxxxx Xxxxxxx 60,000 60,000 5,000 RR
000 X. 00 Xxx.
Xxxxxxxxx, XX 00000
Xxxxx Xxxxx 5,000 5,000 5,000 RR
0000 Xxxxxxxxx Xx.
Xxxx Xxxxx, XX 00000
Xxxxxxxxx Xxxxx 5,000 5,000 5,000 RR
0000 Xxxxxxxxx Xx.
Xxxxxxxxx, XX 00000
Xxxx Ruyevcan 34,000 34,000 5,000 RR
000 Xxxxxxxx Xxxxx Xxx.
Xxxxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxx 33,000 33,000 5,000 RR
00000 Xxxxx Xxx.
Xxxxxx, XX 00000
Xxxx XxXxx 33,000 33,000 5,000 XX
0000 X.X., 00xx Xx.
Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxxx 10,000 10,000 5,000 RR
0000 Xxxxxxxxx Xx.
Xxxxxxxxx, XX 00000
Xxxxxx Xxxx 25,000 25,000 5,000 RR
0000 X. Xxxxxxxx Xxxxx
Xxxxx, XX 00000
Xxxx St. Xxxx 25,000 25,000 5,000 RR
000 X. Xxxxxxx Xxx
Xxxx Xxxxx, XX 00000
X. X. Xxxxx, III 15,000 15,000 5,000 RR
000 Xxxxxxxx Xxxx
Xxxxxxxxxx Xx Xxx Xxx, XX 00000
Xxxxx Xxxxxxxx 10,000 10,000 -0-
0000 Xxxxxxxxx Xxxxx
Xxxx Xxxxx, XX 00000
Avi Birman 800,000 800,000 800,000 XX
000 Xxxx Xx.
Xxx Xxxxxxx, Xxxxxxxx XX
Xxxxxx H3Y239
Xxxxxxx Xxxxxxx 25,000 25,000 5,000 RR
0000 X. Xxxxxx Xxxxx
Xxxx Xxxxx, XX 00000
Boston Business Group, Inc. 500,000 500,000 500,000 RR
000 Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Totals: 10,260,000 10,260,000 4,685,000
Preferred Stockholders
Outback Capital Ltd. 32,400 64,800 64,800 RR
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
New York New York
International Ltd. 32,400 64,800 64,800 RR
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
Camisado Ventures Ltd. 25,200 50,400 50,400 RR
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
Huggermugger Limited 5,000 10,000 10,000 RR
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
Gordian Investments Ltd. 5,000 10,000 10,000 RR
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
Totals: 100,000 200,000 200,000
EXHIBIT B
CONVERTIBLE PROMISSORY NOTE
The undersigned, jointly and severally, promise to pay to the order of
Xxxxxx Services, Inc. at 0000 Xxxxx 000 Xxxx, Xxxxx 000, Xxxx Xxxx Xxxx, Xxxx
00000, or at such other place as the holder hereof may designate in writing,
the sum of THREE HUNDRED AND FIFTY THOUSAND DOLLARS ($350,000), payable as
follows: The first Thirty-five cents ($0.35) from each and every dollar
raised from the sale of any privately placed or publicly offered securities of
VersaCOM Holdings, Inc., a Florida corporation, or Encibar, Inc., a Utah
corporation, including the sale of common, preferred or other stock, payable
on receipt of proceeds by the undersigned, until the entire principal balance
of this note is paid, with the entire unpaid balance being due six months from
the date hereof; provided, however, that such six month period may be extended
by an additional 60 days following the effective date of any registration
statement on Form SB-2 of the Securities and Exchange Commission that is filed
by the undersigned to publicly offer any securities, provided that the
undersigned diligently pursue such filing to effectiveness; and provided,
further, however, regardless of any such extension, that the entire unpaid
principal of this note shall be due and payable on or before one year from the
date hereof.
Prepayment of this note with interest to date of payment may be made at
any time without penalty. All amounts due under this note after six months
(unless extended as provided above) from the date hereof shall bear interest
at the rate of 10% per annum.
If the holder deems itself insecure or if default be made in payment of
the whole or any part of any installment at the time when or the place where
the same becomes due and payable as aforesaid, then the entire unpaid balance,
with interest as aforesaid, shall, at the election of the holder hereof and
without notice of said election at once become due and payable. In event of
any such default or acceleration, the undersigned, jointly and severally,
agree to pay to the holder hereof reasonable attorney's fees, legal expenses
and lawful collection costs in addition to all other sums due hereunder.
Presentment, demand, protest, notice of dishonor and extension of time
without notice are hereby waived and the undersigned consent to the release of
any security, or any part thereof, with or without substitution.
This note shall be secured by certain securities of Encibar, Inc., a
Utah corporation ("Encibar"), that are described in Exhibit 1 hereto, and that
will be held in escrow pending payment of this note or foreclosure in the
event of default by Xxxxxxx X. Xxxxxxxxxx, Esq; provided, however, that the
pledgors of these securities who are listed in Exhibit 1 hereof have reserved
all voting rights attendant to the pledged securities, without qualification.
If during any consecutive six month period during the period of time
that this note is outstanding 450,000 or more shares of Encibar's common stock
have publicly traded on the OTC Bulletin Board of the National Association of
Securities Dealers, Inc. (the "NASD") or any other recognized national medium
at a price of at least $3.50, this note shall automatically convert into
"restricted securities" of Encibar at the six month average trading price of
all securities publicly traded during such six month period, on notice by
Xxxxxx Services, the undersigned or any pledgor of securities hereunder. A
sufficient number of shares of common stock of Encibar shall be included in
any registration statement filed with the Securities and Exchange Commission
by Encibar to register such shares for resale following any such conversion.
Any action on this note shall be brought in the courts of Salt Lake
County, Utah, only, and the makers and pledgors submit to the jurisdiction of
such courts for all purposes hereunder.
VersaCOM Holdings, Inc.-Maker
Dated: 3/7/01. By /s/ Xxxx X. Xxxxxx
Its President
Encibar, Inc.-Maker
Dated: 3/7/01. By /s/ Xxxxx Xxxxx Xxxxxx
Its President
Exhibit 1
Collateral for Promissory Note
Pledgors Encibar Shares Pledged
Xxxx X. Xxxxxx 3,000,000
Kaiser Family Trust 300,000
Xxxx and Xxx Xxxxxxxx, JTWROS 440,000
Xxxx and Xxx Xxxxxxxx Trust 100,000
Xxxx Xxxxxx 750,000
Dated: 3/7/01. /s/ Xxxx X. Xxxxxx
Dated: 3/7/01. /s/ Kaiser Family Trust
Xxxx X. Xxxxxx Trustee
Dated: 3/7/01. /s/ Xxxx and Xxx Xxxxxxxx, XX
Xxxx Xxxxxxxx, Trustee
Dated: 3/7/01. /s/ Xxxx and Xxx Xxxxxxxx Trust
Xxxx Xxxxxxxx, Trustee
Dated: 3/7/01. /s/ Xxxx Xxxxxx
EXHIBIT C
ENCIBAR, INC.
FINANCIAL STATEMENTS
FOR THE YEARS ENDED
MARCH 31, 2000 AND 1999
See the Form 10-KSB Annual Report for the fiscal year ended March
31, 2000, which has been previously filed with the Securities and Exchange
Commission.
EXHIBIT C-1
ENCIBAR, INC.
UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED
DECEMBER 31, 2000
See the Form 10-QSBA Quarterly Report for the quarter ended
December 31, 2000, which has been previously filed with the Securities and
Exchange Commission.
EXHIBIT D
ENCIBAR DISCLOSURES OF EXCEPTIONS TO
REPRESENTATIONS AND WARRANTIES
None.
EXHIBIT E
VERSACOM HOLDINGS, INC.
UNAUDITED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 2000, AND FOR THE YEAR ENDED
DECEMBER 31, 1999
VERSACOM INTERNATIONAL, INC.
BALANCE SHEETS
AS OF DECEMBER 31, 2000 AND DECEMBER 31, 1999
ASSETS 2000 1999
CURRENT ASSETS
Cash (Note 1) $ 19,114 $ 200
Accounts Receivable, net (Notes 1 and 2) 213,459 236,847
Inventory (Note 1) 49,372 30,000
Total Current Assets $281,945 $267,047
PROPERTY, PLANT & EQUIPMENT, NET
(Notes 1, 3, and 5) $118,053 $ 90,118
DEPOSITS $ 8,717 $ 4,021
INVESTMENT, NET OF RESERVE OF $30,000
AND $0 (Note 4) $ 10,000 $100,000
TOTAL ASSETS $418,715 $461,186
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Current portion of obligations under capital
leases (Note 6) $ 13,343 $ 15,258
Current portion of long-term debt (Note 5) 67,607 4,114
Notes Payable (Note 5) 20,000 0
Accounts Payable (Note 1) 648,612 271,516
Current Portion of stockholder loans (Note 7) 186,043 27,991
Accrued wages and related taxes and benefits 199,132 28,667
Sales tax payable 84,640 17,574
Customer deposits 500 64,439
Other accrued liabilities 30,220 19,114
Total Current Liabilities $1,250,097 $448,674
OBLIGATIONS UNDER CAPITAL LEASES $ 9,989 $ 12,787
LONG-TERM DEBT (Note 5) $ 61,531 $ 29,517
STOCKHOLDER LOANS (Note 7) $ 3,313 $155,547
STOCKHOLDERS' DEFICIT
Common Stock, $1.00 par value, 10,000 shares
authorized, 200 shares and 300 shares issued
and outstanding $ 200 $ 300
Paid in Capital 100,200 0
Accumulated Deficit ($1,006,615) ($185,639)
TOTAL STOCKHOLDERS' DEFICIT ($ 906,215) ($185,339)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 418,715 $461,186
VERSACOM INTERNATIONAL, INC.
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
AND FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
2000 1999
NET REVENUE $3,246,130 $1,866,563
COST OF GOODS SOLD ($1,173,549) ($ 991,164)
GROSS PROFIT $2,072,581 $ 875,399
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES ($2,766,106) ($1,147,436)
LOSS FROM OPERATIONS ($ 693,525) ($ 272,037)
OTHER INCOME/(EXPENSE)
Other income $ 20,078 $ 100,000
Interest expense ($ 17,229) ($ 13,602)
Reserve for asset impairment (Note 4)($ 30,000) $ 0
Total other income/(expense), net ($ 27,151) $ 86,398
NET LOSS ($ 720,676) ($ 185,639)
VERSACOM INTERNATIONAL, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
FOR THE YEAR ENDED DECEMBER 31, 2000 AND 1999
Additional
Common Stock Paid-in
Shares Amount Capital Total
Issuance of 200 shares, January
27, 1999 200 $ 200 $ 0 $ 200
Issuance of 100 shares, September
7, 1999 100 100 0 100
Net loss ($ 185,639)($ 185,639)
Balance at December 31, 1999 300 300 ($ 185,639)($ 185,339)
Repurchase 100 shares, August 18,
2000 (100) (100) ($ 100,300)($ 100,400)
Net loss ($ 720,676)($ 720,676)
Balance at December 31, 2000 200 200 ($1,006,615)($1,006,415)
VERSACOM INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
FOR DECEMBER 31, 2000 AND 1999
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($720,676) ($185,639)
Adjustments to reconcile net loss to
net cash provided by/(used in)
Operating Activities:
Bad debts $ 0 $ 0
Depreciation and amortization 25,009 10,104
Loss on asset impairment 30,000 0
Changes in operating assets and
liabilities:
Decrease/(increase) in:
Accounts Receivable ($23,388) ($236,848)
Inventory ($19,372) ($ 30,000)
Increase/(decrease) in:
Accounts payable $377,096 $271,518
Accrued wages and related taxes 170,465 28,667
Sales tax payable 67,066 17,574
Other accrued liabilities 11,106 19,114
Customer deposits (63,939) 64,439
Total adjustments $574,043 $144,568
Net cash provided by/(used in)
Operating Activities ($146,633) ($ 41,071)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment ($ 55,960) ($100,222)
Deposits 4,696 (4,022)
Investments 0 ($100,000)
Net cash proved by/(used in)
Investing Activities $216,811 $245,515
NET INCREASE IN CASH $ 18,914 $ 200
CASH AT BEGINNING OF YEAR $ 200 $ 0
CASH AT END OF YEAR $ 19,114 $ 200
VERSACOM INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2000 AND 1999
(CONTINUED)
Supplemental Disclosures of Cash Flow Information:
Interest paid $ 3,109 $ 5,592
During 1999, the Company acquired two telephone systems under capital ease
obligations of $32,153 and a company vehicle in exchange for a stockholder
loan of $13,146.
During 2000, the Company acquired two company vehicles in exchange for a note
payable of $20,271.
On August 18, 2000, the Company repurchased 100 shares of its common stock
from a stockholder in exchange for cash of $50,000 and a note payable of
$50,400.
EXHIBIT F
VERSACOM DISCLOSURES OF EXCEPTIONS TO
REPRESENTATIONS AND WARRANTIES
None.
EXHIBIT G
Atlas Stock Transfer
0000 Xxxxx Xxxxx
Xxxxxx, Xxxx 00000
Encibar, Inc.
0000 Xxxxx 000 Xxxx, Xxxxx #000
Xxxx Xxxx Xxxx, Xxxx 00000
Re: Exchange of shares of VersaCOM Holdings, Inc., a
Florida corporation ("VersaCOM"), for shares of
Encibar, Inc., a Utah corporation ("Encibar or the
"Company")
Dear Ladies and Gentlemen:
Pursuant to that certain Agreement and Plan of Reorganization (the
"Agreement") between the undersigned, VersaCOM, the other stockholders of
VersaCOM and Encibar, I acknowledge that I have voted for and approved this
exchange; that I am aware of all of the terms and conditions of the Agreement;
that I have had ready access to any and all material documents regarding the
Company, including, but not limited to all Reports filed with the Securities
and Exchange Commission during the past twelve months through the XXXXX
Archives of the Securities and Exchange Commission. I represent and warrant
that no director or executive officer of the Company or any associate of
either has solicited this exchange; that I am an "accredited investor" as that
term is known under the Rules and Regulations of the Securities and Exchange
Commission (see Exhibit "A" hereto); and/or, I represent and warrant that I am
a "sophisticated investors," and I have sufficient knowledge and experience to
understand the nature of the exchange, and that I am fully capable of bearing
the economic risk of the loss of my entire cost basis.
The undersigned specifically acknowledges the following:
(i) the "unregistered" and "restricted" nature of the
shares of Encibar being received under this Agreement
in exchange for the VersaCOM Shares and receipt of
certain material information regarding Encibar;
(ii) except as set forth in Exhibit A to the Agreement,
there are no "registration rights" applicable to the
VersaCOM Shares or any shares of common stock of
Encibar to be received in exchange for their VersaCOM
Shares under this Agreement;
(iii) the compromise and waiver of any and all pre-emptive
rights each has or may have had with respect to any
prior issuance of VersaCOM Shares or any predecessor
thereof; and
(iv) the compromise and/or waiver any claim each has or
may have had against VersaCOM by reason of the
purchase of the VersaCOM Shares or any securities
from VersaCOM or from any of the VersaCOM
Stockholders prior to the Closing of this
Agreement, including claims existing or arising under
applicable federal and state securities laws, rules
and regulations.
I further understand that immediately prior to the completion of
the Agreement, Encibar had little, if any assets, of any measurable value, and
that in actuality, the completion of the Agreement and the exchange of my
shares of VersaCOM for shares of Encibar results in a decrease in the actual
percentage of ownership that my shares of VersaCOM represented in VersaCOM
prior to the completion of the Agreement.
I understand that you have and will make books and records of your
Company available to me for my inspection in connection with the contemplated
exchange of my shares, and that I have been encouraged to review the
information and ask any questions I may have concerning the information of any
director or officer of the Company or of the legal and accounting firms for
the Company. I understand that the accounting firm for Encibar is Xxxxxxx,
XxXxxxxxxx & Assoc., Certified Public Accountants, 0000 Xxxxx 000 Xxxx, #000,
Xxxx Xxxx Xxxx, Xxxx 00000; Telephone #000-000-0000; and that legal counsel
for Encibar is Xxxxxxx X. Xxxxxxxxxx, Esq., 000 Xxxx 0xx Xxxxx, Xxxxx 000,
Xxxx Xxxx Xxxx, Xxxx 00000, Telephone #000-000-0000.
I also understand that I must bear the economic risk of ownership
of any of the Encibar shares for a long period of time, the minimum of which
will be one (1) year, as these shares are "unregistered" shares 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
and those in the Accredited/Sophisticated Investor Questionnaire that I
provided to Encibar as they are made to induce you to issue me the shares of
Encibar under the Agreement, 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 shares being acquired are 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 "unregistered shares" and
know that they are not freely tradeable;
4. That any stock certificate issued by you to me in connection
with the shares being acquired shall be imprinted with a legend restricting
the 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 shares being acquired unless I
shall first have obtained an opinion of legal counsel to the effect that the
shares 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 shares;
6. That I shall not sell, offer to sell, transfer, assign,
hypothecate or make any other disposition of any interest in the shares being
acquired except as may be pursuant to any applicable laws, rules and
regulations;
7. I fully understand that my shares which are being exchanged
for shares of the Company are "risk capital," and I am fully capable of
bearing the economic risks attendant to this investment, without
qualification; and
8. I also understand that without approval of counsel for
Encibar, all shares of Encibar to be issued and delivered to me in exchange
for my shares of VersaCOM shall be represented by one stock certificate only
and which 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 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. Encibar will attempt to accommodate
any stockholders' request where Encibar views the request is made for valid
business or personal reasons so long as in the sole discretion of Encibar, the
granting of the request will not facilitate a "public" distribution of
unregistered shares of common voting stock of Encibar.
You are requested and instructed to issue a stock certificate as
follows, to-wit:
Xxxx X. Xxxxxx
00000X Xxxxxxxx Xxxx Xx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx
Kaiser Family Trust
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx, Trustee
Xxxxxx Xxxxxx (minor)
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx, Trustee
Xxxxxx Xxxxxx (minor)
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx, Trustee
Xxxxxxxx Xxxxxx (minor)
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx, Trustee
Xxxx Xxxx Xxxxxx (minor)
00000X Xxxxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
/s/ Xxxx X. Xxxxxx
Xxxxxxx Xxxxxx
000 Xxxx Xx.
Xxxxxxxx, XX 00000
/s/ Xxxxxxx Xxxxxx
Xxxx Xxxxxx
0000 X.X. 0xx Xxx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx Xxxxxx
Terenceuyrne Xxxxx
000 Xxxx
Xx. Xxxxxxx, Xxxx Xxxxx XX
Xxxxxx H3Y239
/s/ Terenceuyrne Xxxxx
Xxxxx Xxxxxxxxxxx
00000 X. 00xx X. Xxx.
Xxxxx, XX 00000
/s/ Xxxxx Xxxxxxxxxxx
Noble House of Boston, Inc.
000 Xxxxx Xxxxx Xx.
Xxxxxxxxxxx, XX 00000
/s/ Xxxxxxx X. Xxxxxx
Xxxx and Xxx Xxxxxxxx,
JTWROS
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx Xxxxxxxx, Trustee
Xxxxxx Xxxxxxxx (minor)
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx Xxxxxxxx, Trustee
Xxxxxx Xxxxxxxx (minor)
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx Xxxxxxxx, Trustee
Xxxx and Xxx Xxxxxxxx Trust
000 X.X. 00xx Xx.
Xxxx Xxxxx, XX 00000
/s/ Xxxx Xxxxxxxx, Trustee
Xxxxx Xxxxxxxx
000 XX 0xx Xxx.
Xxxxxxx Xxxxx, XX 00000
/s/ Xxxxx Xxxxxxxx
Xxxxxxx Xxxxxxx
0000 X. Xxxxx Xxxx., #00X
Xx. Xxxxxxxxxx, XX 00000
/s/ Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxxxx
0000 X.X. 00xx Xxx
Xxxxx Xxxxxxx, XX 00000
/s/ Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxxxx
000 X. 00 Xxx.
Xxxxxxxxx, XX 00000
/s/ Xxxxxxx Xxxxxxx
Avi Mirman
San Antoine, Westmont PQ
Canada H3Y239
/s/ Avi Mirman
Boston Business Group, Inc.
000 Xxxxxx Xxxx
Xxxxxxxx, XX 00000
/s/ Xxxxxxx Xxxxxx
Outback Capital Ltd.
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
/s/ Xxxxx X. Xxxxxxxx, Director
New York New York
International Ltd.
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
/s/ Xxxxx X. Xxxxxxxx, Director
Camisado Ventures Ltd.
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
/s/ Xxxxx X. Xxxxxxxx, Director
Huggermugger Limited
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
/s/ Xxxxx X. Xxxxxxxx, Director
Gordian Investments Ltd.
P. O. Box 2097
Third Floor, Whitehall House
North Church Street
Georgetown, Grand Cayman, B.W.I.
/s/ Xxxxx X. Xxxxxxxx, Director
EXHIBIT H
CERTIFICATE OF OFFICER PURSUANT TO
AGREEMENT AND PLAN OF REORGANIZATION
The undersigned, the President of Encibar, Inc., a Utah
corporation ("Encibar"), represents and warrants the following as required by
the Agreement and Plan of Reorganization (the "Agreement") between Encibar and
VersaCOM Holdings, Inc., a Florida corporation ("VersaCOM"), and the common
and preferred stockholders of VersaCOM (the "VersaCOM Stockholders"):
1. That she is the President of Encibar and has been authorized
and empowered by its Board of Directors to execute and deliver this
Certificate to VersaCOM and the VersaCOM Stockholders.
2. Based on her personal knowledge, information, belief and
opinions of counsel for Encibar regarding the Agreement:
(i) All representations and warranties of Encibar
contained within the Agreement are true and correct;
(ii) Encibar has complied with all terms and provisions
required of it pursuant to the Agreement; and
(iii) There have been no material adverse changes in the
financial position of Encibar as set forth in its
financial statements for the years ended March 31,
2000 and 1999, and the period ended December 31, 2000,
except as set forth in Exhibit D to the Agreement.
ENCIBAR, INC.
By /s/ Xxxxx X. Xxxxx Xxxxxx, President
EXHIBIT I
CERTIFICATE OF OFFICER PURSUANT TO
AGREEMENT AND PLAN OF REORGANIZATION
The undersigned, the President of VersaCOM Holdings, Inc., a
Florida corporation ("VersaCOM"), represents and warrants the following as
required by the Agreement and Plan of Reorganization (the "Agreement") between
VersaCOM, its common and preferred stockholders (the "VersaCOM Stockholders")
and Encibar, Inc., a Utah corporation ("Encibar"):
1. That he is the President of VersaCOM and has been authorized
and empowered by its Board of Directors to execute and deliver this
Certificate to Encibar.
2. Based on his personal knowledge, information, belief:
(i) All representations and warranties of VersaCOM
contained within the Agreement are true and correct;
(ii) VersaCOM has complied with all terms and provisions
required of it pursuant to the Agreement; and
(iii) There have been no material adverse changes in the
financial position of VersaCOM as set forth in its
financial statements for the year ended December 31,
1999, and an unaudited balance sheet and income
statement for the period ended September 30, 2000,
except as set forth in Exhibit F to the Agreement.
VERSACOM HOLDINGS, INC.
By /s/ Xxxx X. Xxxxxx, CEO
