Exhibit 1.1 Plan of Merger
MERGER AGREEMENT
THIS AGREEMENT AND PLAN OF MERGER, made and entered into this 17th day of
October 2000, to be effective as of Closing, as subsequently defined, by and
between Professional Educational Consultants, Inc., a Nevada corporation (the
"Public Corporation" or, alternatively, "PRFE")and INID Corp.,(the "Target
Corporation"), a Wyoming corporation,
WITNESSETH:
WHEREAS, Public Corporation intends to acquire Target and its business through a
reverse Merger between Public Corporation and Target;
WHEREAS, Target Corporation is currently a 1934 Act Reporting Company with a
single asset being a wholly owned subsidiary, XXxxxXxXxxx.xxx, Inc., an Arizona
corporation; and
WHEREAS, the boards of Public Corporation, and Target (deeming it advisable for
the benefit of each corporation and their respective stockholders that Target be
merged with and into Public Corporation (the "Merger") and that Public
Corporation thereby acquire the wholly owned subsidiary of Target and succeed to
the reporting requirements of Target) have approved this Agreement and the
Merger, and Target shall forthwith submit the Merger for approval by their
stockholders;
NOW, THEREFORE, in consideration of the above and foregoing premises and the
mutual covenants and conditions set forth herein, and such other and further
consideration, the receipt and sufficiency of which are hereby acknowledged, THE
PARTIES HEREBY ADOPT THE MERGER AS A TAX-FREE REORGANIZATION UNDER SECTION
368(a) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND AGREE AS FOLLOWS:
ARTICLE I
MERGER
1.01.Surviving Corporation. Target Corporation shall be merged with and into
Public Corporation, which is herein sometimes referred as to "Surviving
Corporation". The Merger shall become effective on the filing date of the
Articles of Merger with the Secretary of State in the jurisdiction(s) of
organization for these two corporations.
(a) Articles of lncorporation. The articles of incorporation of
Target, as heretofore amended and as in effect immediately prior to
the execution and delivery of this Agreement, shall be the articles of
Surviving Corporation and shall thereafter continue to be its articles
until duly amended or repealed.
(b) Bylaws. The bylaws of Target, as heretofore amended and as in
effect immediately prior to the execution and delivery of this
Agreement, shall be the bylaws of Surviving Corporation and shall
thereafter continue to be its bylaws until duly amended or repealed.
(c) Directors. The directors of Target, presently and after fulfillment
of the conditions precedent to effectiveness of this Agreement, shall
be Xxxxx Xxxxx - Chairman, Xxxx Xxxxxxxxx, Art Xxxxxxx and Xxxxx
Xxxxxxx, and they shall hold office until their respective successors
are duly elected or appointed and qualified in the manner provided in
the articles and bylaws governing Target, or as otherwise provided by
law. All directors of Public Corporation shall resign at Closing, and
the aforementioned individuals shall be appointed to serve in their
stead. Nothing contained in this paragraph shall be construed to create
any employment or other contractual rights in the aforesaid directors.
(d) Executive Officers. The executive officers of Target, presently and
upon fulfillment of the conditions precedent to effectiveness of this
Agreement, shall be Xxxx Xxxxx - President & CEO, Xxxxx Xxxxxxx - COO,
Xxxx Xxxxxxxxx - V.P. Technology, and Xxxxxx Xxxxxxx - Secretary &
Treasurer. They shall hold office after the execution and delivery
hereof for the term to which they are elected or appointed, subject to
the provisions set forth in the bylaws governing Target. All officers
of Public Corporation shall resign at closing, and the aforementioned
individuals shall be appointed to serve as aforesaid. Nothing contained
in this paragraph shall be construed to create any employment or other
contractual rights in the aforesaid officers.
1.02. Terms of the Merger. Upon the execution and delivery of this Agreement and
the effectiveness of the Merger, each share of stock then issued and outstanding
by Target by virtue of the Merger and without any action on the part of the
holder(s) thereof, no longer be outstanding and shall be canceled and retired
and cease to exist, other than one share of Target's subsidiary, which shall be
owned by Public Corporation, and all other Target shares shall be converted into
the right to receive, upon surrender of the certificate representing such
shares, the consideration set forth under paragraph 1.03 hereof
1.03. Payment for Shares. In consideration for the Merger, Public Corporation
shall issue, upon fulfillment of the conditions precedent hereto, shares of its
"restricted" common stock on the basis of 10 Public Corporation shares for each
Target common share outstanding on the effective date of the Merger.
1.04. Certain Effects of the Merger. Upon effectiveness of this Agreement, the
separate existence of Target Corporation shall cease, and Target's subsidiary
company, XXxxxxxXxxx.xxx, Inc. shall be merged with and into Public Corporation,
which, as Surviving Corporation, shall possess all of the assets, properties,
rights, privileges, powers and franchises of a public or of a private nature,
and be subject to all liabilities, restrictions, disabilities and duties of
Target Corporation. The Public Corporation, being a Pink Sheet listed Issuer
will, upon the effectiveness of this merger, succeed to the Form 10SB
Registration provisions of Target Corporation and be henceforth required to
fulfill all 1934 Act reporting requirements.
1.05. Filing of Certificate of Merger. As soon as practicable after the
effectiveness of this Agreement, Target Corporation shall deliver for filing
duly executed Articles of Merger, and shall take such other and further action
in connection therewith as may be required by applicable law to make the merger
effective as soon as practicable thereafter.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
TARGET
Target and a majority of its shareholders, jointly and severally,
represent and warrant to Public Corporation, without reservation, as of the date
hereof and Closing as follows:
2.01. Corporate Organization. Target is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation and has all corporate power and authority to carry on its business
as now being conducted and to own, lease or operate its properties and assets;
is duly qualified or licensed to do business as a foreign corporation in good
standing in every jurisdiction in which the character or location of the
properties and assets owned, leased or operated by it or the conduct of its
business requires such qualification or licensing A schedule to be initialed and
delivered by Target to Public Corporation at Closing (the "Target Disclosure
Schedule") lists in Paragraph 2.01 thereof all jurisdictions in which Target is
qualified or licensed to do business, and has true, correct and complete copies
of the articles and bylaws of Target as presently in effect attached, as well as
a Certificate of Good Standing from its jurisdiction of incorporation and all
jurisdictions where Target is qualified to do business.
2.02. Capitalization. The authorized capital stock of Target consists of
100,000,000 shares of common stock, $0.001 par value per share, and no shares of
preferred stock. There are 645,000 shares of such common issued and outstanding.
All of the issued and outstanding shares of Target have been duly authorized,
validly issued and fully paid for and are nonassessable with no personal
liability attaching thereto. There are no shares of capital stock or other
securities of Target outstanding, except as set forth above in this paragraph;
there are no outstanding options, warrants, conversion privileges or other
rights to purchase or acquire any capital stock of Target and there are no
contracts, commitments, understandings, arrangements or restrictions by which
Target was bound to issue any additional shares of its capital stock.
2.03. Subsidiaries and Affiliates. Not applicable.
2.04. Authorization. Target has full corporate power and authority to enter into
this Agreement and to carry out the transactions contemplated hereby. The board
of Target has taken all action required by law, its articles, bylaws and
otherwise to authorize the execution and delivery of this Agreement and the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered and no other corporate action is necessary; other than
shareholder approval. This Agreement is a valid and binding obligation of
Target, enforceable in accordance with its terms, except to the extent that: (i)
the enforcement of certain rights and remedies created by this Agreement is
subject to bankruptcy, insolvency, reorganization and similar laws of general
application affecting the rights and remedies of the parties, and (ii) the
enforceability of any particular provision of this Agreement under principles of
equity or the availability of equitable remedies (such as specific performance,
injunctive relief, waiver or other equitable remedies) is subject to the
discretion of court.
2.05. No Violation. Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will: (a) violate any
provision of the articles or bylaws of Target, (b) violate, or be in conflict
with, or constitute a default (or an event which, with or without due notice or
lapse of time, or both, would constitute a default) under, or cause or permit
the acceleration of the maturity of any debt, obligation, contract, commitment
or other agreement to which Target is a party, (c) result in the creation or
imposition of any mortgage, pledge, lien, security interest, encumbrance or
charge of any kind upon any property or assets of Target under any debt,
obligation, contract, agreement or commitment to which Target is a party or by
which Target is bound, or (d) violate any statute or law or any judgment,
decree, order, regulation or rule of any court or governmental authority.
2.06. Consents and Approvals of Government Authorizations. No consent, approval
or authorization of, or declaration, filing or registration with, any
governmental or regulatory authority is required in connection with the
execution, delivery and performance of this Agreement by Target and the
consummation of the transactions contemplated hereby.
2.07. Litigation. There is no legal, administrative, arbitration or other
proceeding, claim or action of any nature or investigation pending or threatened
against or involving Target, or which questions or challenges the validity of
this Agreement, or any action to be taken by Target pursuant to this Agreement
or in connection with the transactions contemplated hereby, and Target does not
know or have any reason to know of any valid basis for any such legal,
administrative, arbitration or other proceeding, claim or action of any nature
or investigation. Target is not subject to any judgment, order or decree entered
in any lawsuit or proceeding which has an adverse effect on its business
practices or on its ability to acquire any property or conduct its business in
any area.
2.08. Financial Statements. Target has delivered Public Corporation under
paragraph 2.08 of the Target Disclosure Schedule a consolidated balance sheet of
Target as at August 31st, 2000 (the "Target Balance Sheet") and consolidated
statements of income, changes in stockholders' equity and changes in financial
position for the years then ended, all examined and accompanied by the
unqualified reports of Xxxxxxx, Xxxx & Co., CPA's, independent certified public
accountants. All of such financial statements are in accordance with the books
and records of Target. The above consolidated balance sheets and the notes
thereto are complete and fairly present the consolidated assets, liabilities and
financial condition of Target and its Subsidiaries as of the respective dates
thereof, and the consolidated statements of income, changes in stockholders'
equity and changes in financial position and the notes thereto are complete and
fairly present the results of the operations for the periods therein referred
to, all in accordance with generally accepted accounting principles consistently
followed throughout the periods involved.
2.09. No Undisclosed Liabilities or Obligations. Target has no obligations or
liabilities of any nature (absolute, accrued, contingent or otherwise, and
whether due or to become due, herein "liabilities") except (i) liabilities which
are fully reflected or reserved against the Target Balance Sheet, which reserves
are appropriate and reasonable, (ii) liabilities incurred in the ordinary course
of business and consistent with past practice since the date of the Target
Balance Sheet; and (iii) as otherwise set forth in paragraph 2.09 of the Target
Disclosure Schedule.
2.10. Absence of Certain Changes. Since the date of the Balance Sheet, the
Target has not:
(a) Suffered any material or adverse change in its financial condition,
working capital, assets, liabilities, reserves, business, operations or
prospects;
(b) Suffered any loss, damage, destruction or other casualty materially and
adversely affecting any of the properties, assets or businesses of Target
(whether or not covered by insurance);
(c) Borrow or agreed to borrow any funds or incurred, or assumed or became
subject to, whether directly or by way of guarantee of otherwise, any obligation
or liability except obligations and liabilities incurred in the ordinary course
of business and consistent with past practice;
(d) Paid, discharged or satisfied any claims, liabilities or obligations
other than payments, discharge or satisfaction in the ordinary course of
business and consistent with past practice of liabilities or obligations
reflected or reserved against in the Target Balance Sheet or incurred in the
ordinary course of business and consistent with past practice since the date of
the Target Balance Sheet;
(e) Permitted or allowed any of its property or assets (real, personal or
mixed, tangible or intangible) to be subjected to any mortgage, pledge, lien,
security interest, encumbrance, restriction or charge of any kind, except those
of a kind permitted under Section 2.09 hereof;
(f) Written down the value of any inventory or written off as uncollectible
any notes or accounts receivable, except for writedowns and write-offs in the
ordinary course of business and consistent with past practice, none of which is
material;
(g) Canceled any debts or waived any claims or rights of substantial
value, or sold, transferred, or otherwise disposed of any of its
properties or assets (real, personal or mixed, tangible or intangible),
except in the ordinary course of business and consistent with past
practice, none of which is material;
(h) Licensed or disposed of or permitted to lapse any rights to the use
of any patent, trademark trade name, technology, process, or other
intangible asset, copyright, or disposed of or disclosed to any person
any trade secret, formula, technology, process or know-how.
(i) Granted or promised any increase in the compensation of officers or
employees (including any such increase pursuant to any bonus, pension,
profit-sharing or other plan or commitment) or any increase in the compensation
payable or to become payable to any officer or employee, except fir normal
periodic increases made pursuant to Target's established compensation policies
applied on a basis consistent with that of the prior two years;
(j) Made any capital expenditure or commitment in excess of $ 50,000.00
individually or in excess of $75,000.00 in the aggregate for additions to
property, plant or equipment;
(k) Declared, paid or set aside for payment any dividend or other
distribution in respect of its capital stock or, directly or indirectly,
redeemed, purchased or otherwise acquired any shares of its capital stock or
other securities or agreed to take such action;
(l) Made any change in any method of accounting or accounting practice;
(m) Paid, loaned or advanced any amounts to, or sold, transferred or leased
any properties or assets (real, personal or mixed, tangible or intangible) to,
or entered into any agreement or arrangement with any of its officers or
directors or any affiliate or associate of any of its officers or directors,
except for directors' fees, compensation to officers at rates not exceeding the
rates of compensation paid during the fiscal quarter ended September 30, 2000;
(n) Entered into any other transaction, contract or commitment other than
in the ordinary course of business;
(o) Been subject to any other event or condition of any character that has
or might reasonably have a material and adverse effect upon the financial
condition, business, assets or properties of Target; or
(p) Failed to keep in good standing and in full force and effect all
insurance policies and coverages in such commercially reasonable amounts as are
necessary in order to properly operate the business of Target as presently
operated;
(q) Failed to keep the business records of Target in good order;
(r) Agreed, whether in writing or otherwise, to take any action described
in this paragraph.
2.11. Title to Properties; Encumbrances. Target has good and marketable title
to, or a valid leasehold interest in, all properties, assets, and leasehold
estates (real, personal and mixed, tangible or intangible), including, without
limitation, all of the properties and assets reflected in the Target Balance
Sheet, and all the properties and assets purchased or otherwise acquired by
Target since the date of the Target Balance Sheet. All such properties and
assets have a fitter market or realizable value at least equal to the value
thereof as reflected therein, and none of such properties or assets is subject
to any mortgage, pledge, lien, security interest encumbrance, restriction or
charge of any kind except the following: (a) hens shown on the Target Balance
Sheet securing specified liabilities or obligations with respect to which no
default exists; (b) minor imperfections of title, if any, none of which
(individually or in the aggregate) is substantial in amount, materially detracts
from the value or impairs the existing use of the property subject thereto, or
impairs the operations of the Targets; (c) liens for current taxes not yet due
and payable; and (d) as disclosed in paragraph 2.09 of the Target Disclosure
Schedule.
2.12. Plants and Equipment. Paragraph 2.12 of the Target Disclosure Schedule
sets forth the plants, structures and equipment of Target, all of which are
structurally sound with no material defects and are in good operating condition
and repair and are adequate for the uses to which they are being put, and none
of such plants, structures or equipment is in need of maintenance or repairs,
except for ordinary, routine maintenance and repairs.
2.13. Leases. Paragraph 2.13 of the Target Disclosure Schedule contains: (a) an
accurate and complete list of all leases pursuant to which Target leases real
property, including for each lease a brief description of Target's financial
obligations under such lease, its expiration date and any renewal terms, and (b)
a complete list and description by generic category of all leases pursuant to
which Target leases personal property. All such leases are valid, binding and
enforceable in accordance with their terms, and are in full force and effect.
Except as set forth in Paragraph 2.13 of the Target Disclosure Schedule, there
are no existing defaults by Target or any other party thereunder; no event of
default has occurred which (whether with or without notice, lapse of time or the
happening or occurrence of any other event) would constitute a default
thereunder; and all lessors under such leases have consented (where such consent
is necessary) to the consummation of the transactions contemplated by this
Agreement.
2.14. Patents, Trademarks and Tradenames. Target owns, or is licensed or
otherwise has the full right to use all patents, trademarks, trade names,
copyrights, technology, know-how and processes used in or necessary for the
conduct of its business as heretofore conducted. Target has the sole and
exclusive right to use the licenses, patents, trademarks, trade names,
copyrights, technology, know-how and processes referred to in the Target
Disclosure Schedule, and the consummation of the transactions contemplated
hereby will not alter or impair any such rights; no claims have been asserted by
any person to the use of any such licenses, patents, trademarks, trade names,
copyrights, technology, know-how or processes or challenging or questioning the
validity or effectiveness of any such license or agreement, and there is no
valid basis for any such claim; and the use of such licenses, parents,
trademarks, trade names, copyrights, technology, know-how or processes by Target
does not infringe on the rights of any person.
2.15. Tax Returns. Target has duly filed all federal, state, local and foreign
tax reports and returns required to he filed by it and has duly paid all taxes
and other charges due or claimed to be due from it by federal, state, local and
foreign taxing authorities including, but not limited to, taxes in connection
with property or the use thereof, income, franchise, licenses, duties, excess,
intangible, assets, sales and payroll; further, the reserves for taxes reflected
in the Target Balance Sheet, if any, are adequate, and there are no tax liens
upon any property or assets of Target. No state of facts exists which would
constitute grounds for the assessment of any tax liability by state, local or
foreign tax authorities. All deficiencies and assessments resulting from such
examinations have been paid or finally settled. All deficiencies and
assessments, if any, resulting from any examination of state, local and foreign
tax returns and reports of Target and each Subsidiary, if any, have been paid.
There are no outstanding agreements or waivers extending the statutory period of
limitation applicable to any federal, state, local, or foreign tax return or
report for any period. There are no pending or threatened administrative, legal
or equitable proceedings, or notices thereof, involving, but not limited to, tax
audits or claims assessed for taxes or assessments of Targets.
2.16. Insurance. Paragraph 2.16 of Disclosure Schedule contains an accurate and
complete description of all material policies of fire, liability, worker's
compensation and other forms of insurance owned or held by Target. All such
policies are in full force and effect; are sufficient for compliance with all
requirements of law and of all agreements to which Target is a party; are valid,
outstanding and enforceable policies; provide adequate insurance coverage for
the assets and operations of Target; will remain in full force and effect
through the respective dates set forth in the Target Disclosure Schedule; and
will not in any way be affected by, or terminate or lapse by reason of; the
transactions contemplated by this Agreement.
2.17. Benefit Plan. Neither Target Corporation nor any Subsidiary maintains or
contributes to, or has maintained or contributed to any "employee pension
benefit plan", as such term is defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"). Neither Target nor
any Subsidiary maintains a welfare, pension or other employee benefit plan
outside the United States. Except as set forth in Paragraph 2.17 of the Target
Disclosure Schedule, neither Target nor any Subsidiary maintains or contributes
to any "employee welfare benefit plan" ("Target Corporation Welfare Plans"), as
such term is defined in Section 3(1) of ERISA, whether insured or otherwise, and
each such Target Corporation Welfare Plan is in material compliance with the
provisions of ERISA. Except as set forth in the Target Disclosure Schedule,
neither Target nor any Subsidiary maintains any bonus, incentive compensation,
deferred compensation, stock option or stock purchase or other fringe benefit
plan, whether formal or informal.
2.18. Contracts and Commitments; No Default.
(a) Except as set forth in Paragraph 2.18 of the Target Disclosure
Schedule:
(i) Target has no employment agreement with any officer, employee
or agent, nor any agreement that contains any severance or
termination pay liabilities or obligations;
(ii) Target has no employee to whom it is paying aggregate direct
remuneration at the annual rate of more than $200,000.00 for
services rendered or commissions at a rate which (based on sales by
such employee during the last fiscal year,) would exceed
$300,000.00
(iii)Target has no collective bargaining or union contract
agreements;
(iv) Target is not restricted by agreement from carrying on its
business or any part thereof anywhere in the world or from
competing in any line of business with any person;
(v) Target has no debt obligation for borrowed money, including
guarantees of or agreements to acquire any such debt obligation of
others other than that disclosed;
(vi) Target has no outstanding loan or monetary obligation to any
person or entity other than that disclosed;
(vii)Target has no obligation or liability as guarantor, surety,
co-xxxxxx, endorser, co-maker, indemnitor or otherwise in respect
of the obligation of any other person;
(viii) Target is not subject to any obligation or requirement to
provide funds to or make any investment (in the form of a loan,
capital contribution or otherwise) in any person;
(ix) Target is not a party to any agreement, contract, commitment
or loan to which any of its officers or directors or any affiliate
of Target or its officers and directors is a party other than that
disclosed;
(x) There are no outstanding sales or purchase contracts,
commitments or proposals of Target which will result in any loss
exceeding $100,000.00 upon completion or performance thereof after
allowance for direct distribution expenses, except sales or
purchase contracts, commitments or proposals which, in the
aggregate, call for fixed and/or contingent payments thereunder &
less than $200,000.00 per year:
(xi) Target is not a party to any purchase or sale contract or
agreement which continues for a period of more than twelve months
(including periods covered by any option to renew by either party);
(xii) Target is not under any liability or obligation with respect
to the return of inventory or merchandise in the possession &
wholesalers, distributors, retailers or other customers;
(xiii) Target has not given any irrevocable power of attorney to
any person, firm, corporation or other entity for any purpose
whatsoever, except the appointment of agents to accept service of
process; and
(xiv) Except for agreements, contracts, commitments or restrictions
referred to in Subsections 2.18(a)(i)-(xiii) or elsewhere
specifically disclosed pursuant to this Agreement, Target has no
agreements, contracts, commitments or restrictions which are
material to its business, operations or prospects (for the purpose
of this subsection, any agreement, contract, commitment or
restriction may be deemed "immaterial" if it may be canceled on 30
days' notice without premium, penalty or forfeiture and it calls
for fixed and/or contingent payments thereunder of less than
$100,000.00 per year).
(b) True and complete copies of all documents (including all amendments
thereto) referred to in Section 2.18(a) have either been delivered to Public
Corporation or shall be delivered upon written request. All contracts,
agreements, commitments or restrictions referred to in Section 2.18(a) are valid
and enforceable in accordance with their respective terms; Target is not in
default in the performance of any of its obligations thereunder; no event of
default has occurred which (whether with or without notice, lapse of time, or
both, or the happening or the occurrence of any other event) would constitute a
default thereunder and, to the best knowledge of Target, all other parties
thereto are not in default thereunder.
2.19. Inventory. Except as set forth in Paragraph 2.19 of the Target Disclosure
Schedule, all inventory of Target, whether reflected in the Target Balance Sheet
or otherwise, consists of a quality and quantity usable and salable in the
ordinary course of business, except for items of obsolete materials and
materials below standard quality, all of which have been provided herein, and
the present quantities of all inventory of Target are reasonable in the present
circumstances of its business.
2.20. Accounts and Notes Receivable. All accounts receivable of Target, whether
reflected in the Target Balance Sheet or otherwise, represent sales actually
made in the ordinary course of business, and are current and collectible net of
any reserves shown on the Target Balance Sheet (which reserves are adequate and
were established in accordance with past practice).
2.21. Orders, Commitments and Returns. As of the date of this Agreement, the
aggregate of all accepted and unfulfilled orders for the sale of products
entered into by Target does not exceed $800,000.00 and is not less than $100.00
and the aggregate of all contracts or commitments for the purchase of supplies
by them does not exceed $500,000.00. all of which orders, contracts and
commitments were made in the ordinary course of business. As of the date of this
Agreement, there are no claims against Target to return in excess of an
aggregate of $500,000.00 of products by reason of alleged over shipments,
defective products or otherwise, or of products in the hands of customers,
retailers or distributors under an understanding that such products would be
returnable.
2.22. Labor Difficulties.
(a) Target has been in compliance with all applicable laws respecting
employment and employment practices, terms and conditions of employment and
wages and hours, including, without limitation, any such laws respecting
employment discrimination and occupational safety and health requirements, and
are not engaged in any unfair labor practice;
(b) there are no unfair labor practice complaints against Target pending or
threatened before the National Labor Relations Board;
(c) there are no labor strikes, disputes, slowdowns or stoppages actually
pending or threatened against or directly affecting Target;
(d) no union representation question exists respecting the employees of
Target;
(e) no grievance nor any arbitration proceeding arising out of or under a
collective bargaining agreement is pending and no claims exist thereunder;
(f) no collective bargaining agreement is binding upon Target; and
(g) Target has not experienced any work stoppage or other material labor
difficulty.
2.23. Customers and Suppliers. Not applicable.
2.24. Permits and Licenses. Target has obtained all necessary permits, licenses,
franchises, certificates, trademarks, trade names, patents, patent applications
and copyrights required in the operation and conduct of the business of Target,
all of which are now valid and in good standing; further, none of such unduly
burdens or restricts Target in the ordinary course of its business; Further,
Target has complied with all commitments and obligations under all such items.
2.25. Compliance with Law. Target is in compliance with all laws, regulations
and orders applicable to its business. Target has not received any notification
that it is in violation of any law, regulation or order and no such violation
exists. Neither the Target nor any of its employees or agents, to the best of
their knowledge, has made any payments to any persons which violate any statute
or law.
2.26. Disclosure. No representations or warranties by Target in this Agreement
and no statement contained in any document (including, without limitation,
financial statements and the Target Disclosure Schedule attached hereto),
certificate, or other writing furnished by Target to Public Corporation pursuant
to the provisions hereof or in connection with the transactions contemplated
hereby, contain any untrue statement of material fact or omit to state any
material fact necessary in order to make the statements herein or therein, in
light of the circumstances under which they were made, not misleading; further,
there are no facts known to Target which (either individually or in the
aggregate) could or would materially and adversely affect or involve any
substantial possibility of having a material, adverse effect upon the condition
(financial or otherwise), results of operations, assets, liabilities or
businesses of Target which have not been disclosed in this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
PUBLIC CORPORATION
Public Corporation represents and warrants to Target, without
reservation, as follows as of the date hereof and Closing:
3.01. Corporate Organization. Public Corporation is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all corporate power and authority to carry
on its business as now being conducted and to own, lease or operate its
properties and assets; is duly qualified or licensed to do business as a foreign
corporation in good standing in every jurisdiction in which the character or
location of the properties and assets owned, leased or operated by it or the
conduct of its business requires such qualification or licensing A schedule to
be initialed and delivered by Public Corporation to Target at Closing (the
"Public Corporation Disclosure Schedule") lists in Paragraph 3.01 thereof all
jurisdictions in which Public Corporation is qualified or licensed to do
business, and has true, correct and complete copies of the articles and bylaws
of Public Corporation as presently in effect attached, as well as a Certificate
of Good Standing from its jurisdiction of incorporation.
3.02. Capitalization. The authorized capital stock of Public Corporation
consists of 100,000,000 shares of common stock, $.001 par value per share, and
no shares of preferred stock. There are 6,000,000 shares of such common stock
issued and outstanding. All of the issued and outstanding shares of Public
Corporation have been duly authorized, validly issued and fully paid for and are
nonassessable. There were no shares of capital stock or other securities of
Public Corporation outstanding, except as set forth above in this paragraph;
there are no outstanding options, warrants, conversion privileges or other
rights to purchase or acquire any capital stock of Public Corporation and there
are no contracts, commitments, understandings, arrangements or restrictions by
which Public Corporation was bound to issue any additional shares of its capital
stock.
3.03. Authorization. Public Corporation has full corporate power and authority
to enter into this Agreement and to carry out the transactions contemplated
hereby. The board of Public Corporation has taken all action required by law,
its articles, bylaws and otherwise to authorize the execution and delivery of
this Agreement and the transactions contemplated hereby. This Agreement has been
duly and validly executed and delivered and no other corporate action is
necessary. This Agreement is a valid and binding obligation of Public
Corporation, enforceable in accordance with its terms, except to the extent
that: (i) the enforcement of certain rights and remedies created by this
Agreement is subject to bankruptcy, insolvency, reorganization and similar laws
of general application affecting the rights and remedies of the parties, and
(ii) the enforceability of any particular provision of this Agreement under
principles of equity or the availability of equitable remedies (such as specific
performance, injunctive relief, waiver or other equitable remedies) is subject
to the discretion of court.
3.04. No Violations. Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby will: (a) violate any
provision of the articles or bylaws of Public Corporation, (b)violate, or be in
conflict with, or constitute a default (or an event which, with or without due
notice or lapse of time, or both, would constitute a default) under, or cause or
permit the acceleration of the maturity of any debt, obligation, contract,
commitment or other agreement to which Public Corporation is a party, (c) result
in the creation or imposition of any mortgage, pledge, lien, security interest,
encumbrance or charge of any kind upon any property or assets of Public
Corporation under any debt, obligation, contract, agreement or commitment to
which Public Corporation is a party or by which Public Corporation is bound, or
(d) violate any statute or law or any judgment, decree, order, regulation or
rule of any court or governmental authority.
3.05. Consents and Approvals of Government Authorizations. No consent, approval
or authorization of, or declaration, filing or registration with, any
governmental or regulatory authority is required in connection with the
execution, delivery and performance of this Agreement by Public Corporation and
the consummation of the transactions contemplated hereby.
3.06. Litigation. There is no legal, administrative, arbitration or other
proceeding claim or action of any nature or investigation pending or threatened
against or involving Public Corporation, or which questions or challenges the
validity of this Agreement, or any action to be taken by Public Corporation
pursuant to this Agreement or in connection with the transactions contemplated
hereby, and Public Corporation does not know or have any reason to know of any
valid basis for any such legal, administrative, arbitration or other proceeding,
claim or action of any nature or investigation. Public Corporation is not
subject to any judgment, order or decree entered in any lawsuit or proceeding
which has an adverse effect on its business practices or on its ability to
acquire any property or conduct its business in any area.
3.07. Financial Statements. Public Corporation has delivered to Target under
Paragraph 3.07 of the Public Corporation Disclosure Schedule its audited balance
sheets dated as of December 31st, 1999 (the "Public Corporation balance Sheet"),
and income statement and cash flows for the year then ended, as well as its
unaudited balance sheet dated as of June 30, 2000. All of such financial
statements have been prepared in accordance with the books and records of Public
Corporation and in accordance with Generally Accepted Accounting Principles
consistently followed. The Public Corporation Balance Sheet completely and
fairly presents the assets, liabilities and financial condition of Public
Corporation as of the date thereof, and such, as well as all other financial
statements, are complete and fairly present the results of the operations for
the yearly period then ended.
3.08. No Undisclosed Liabilities or Obligations. Public Corporation has no
obligations or liabilities of any nature (absolute, accrued, contingent or
otherwise, and whether due or to become due, herein "liabilities") except (i)
liabilities which are fully reflected or reserved against the Public Corporation
Balance Sheet, which reserves are appropriate and reasonable, (ii) liabilities
incurred in the ordinary course of business and consistent with past practice
since the date of the Public Corporation Balance Sheet; and (iii) as otherwise
set forth in paragraph 3.08 of the Public Corporation Disclosure Schedule.
3.09. Tax Returns. Public Corporation has duly filed all federal, state, local
and foreign tax reports and returns required to be filed by it and has duly paid
all taxes and other charges due or claimed to be due from it by federal, state,
local and foreign taxing authorities; further, the reserves for taxes reflected
in the Public Corporation Balance Sheet, if any, are adequate, and there are no
tax liens upon any property or assets of Public Corporation. No state of facts
exists which would constitute grounds for the assessment of any tax liability by
the state, local, or foreign tax authorities. All deficiencies and assessments,
if any, resulting from any examination of state, local and foreign tax returns
and reports of Public Corporation, if any, have been paid. There are no
outstanding agreements or waivers extending the statutory period of limitation
applicable to any federal, state, local, or foreign tax return or report for any
period. Any taxes or tax liens unknown to the Company, should any existence or
knowledge of such be discovered after the date of this Agreement, may be
submitted to the former sole director and officer for immediate payment.
3.10. Compliance with Law. Public Corporation is in compliance with all laws,
regulations and orders applicable to its business. Public Corporation has not
received any notification that it is in violation of any law, regulation or
order and no such violation exists. Neither the Public Corporation nor any of
its employees or agents, to the best of their knowledge, have made any payments
to any persons which violate any statute or law.
3.11. Disclosure. No representations or warranties by Public Corporation in this
Agreement and no statement contained in any document (including, without
limitation, financial statements and the Public Corporation Disclosure Schedule
attached hereto), certificate, or other writing furnished by Public Corporation
to Target pursuant to the provisions hereof or in connection with the
transactions contemplated hereby, contain any untrue statement of material fact
or omit to state any material fact necessary in order to make the statements
herein or therein, in light of the circumstances under which they were made, not
misleading; further, there are, no facts known to Public Corporation which
(either individually or in the aggregate) could or would materially and
adversely affect or involve any substantial possibility of having a material,
adverse effect upon the condition (financial or otherwise), results of
operations, assets, liabilities or businesses of Public Corporation which have
not been disclosed in this Agreement.
ARTICLE IV
CONDUCT OF TARGET BUSINESS PENDING CLOSING
Pending Closing, and except as otherwise consented to or approved by
Public Corporation in writing:
4.01. Regular Course of Business. Target shall carry on its business diligently
and substantially in the same manner as heretofore conducted, and Target shall
not institute any new methods of manufacture, purchase, sale, lease, management,
distribution, accounting or operation or engage in any transaction or activity,
enter into any agreement or make any commitment except in the ordinary course of
business and consistent with past practice.
4.02. Amendments. No change or amendment shall be made in the articles or bylaws
of Target or in the articles or bylaws of any Subsidiary.
4.03. Capital Changes. Neither Target nor any Subsidiary shall issue or sell, or
issue options, warrants to purchase, conversion privileges or other rights to
subscribe to (except for the issuance of stock upon exercise of outstanding
options, warrants, conversion privileges or other rights Target has heretofore
disclosed to in accordance with the terms as in effect on the date hereof), or
enter into any arrangement or contract with respect to, any shares of its
capital stock or any of its other securities, or make any other changes in its
capital structure.
4.04. Dividends. Neither Target nor any Subsidiary shall declare, pay or set
aside for payment any dividend or other distribution in respect of its capital
stock other than dividends by a Subsidiary to Target, nor shall Target or any
Subsidiary, directly or indirectly, redeem, purchase or otherwise acquire any
shares of its capital stock.
4.05. Subsidiaries. Not applicable.
4.06. Organization. Target shall use its best efforts to preserve its corporate
existence and business organization intact, to keep available to Target its
officers and key employees, and to preserve for Target its relationships with
suppliers, dealers, licensor, licensees, franchisees, distributors, customers
and others having business relations with it.
4.07. Certain Changes. Target will not, except as contemplated in the Target
Disclosure Schedule:
(a) Borrow or agree to borrow any funds or incur, or assume or become
subject to, whether directly or indirectly or by way of guarantee or otherwise,
any obligation or liability;
(b) Pay, discharge or satisfy any claim, liability or obligation other than
the payment, discharge or satisfaction in the ordinary course of business and
consistent with past practice of liabilities or obligations reflected or
reserved against in the Target Balance Sheet or incurred in the ordinary course
of business and consistent with past practice since the date of the Target
Balance Sheet;
(c) Permit or allow any of its property or assets (real, personal or mixed,
tangible or intangible) to be subjected to any mortgage, pledge, lien, security
interest, encumbrance, restriction or charge of any kind, except for those of a
kind permitted under Section 2.09 hereof;
(d) Write down the value of any inventory or write off as uncollectible any
notes or accounts receivable;
(e) Cancel any debts or waive any claims or rights of substantial value or
sell, transfer, or otherwise dispose of any of its properties or assets (real,
personal or mixed, tangible or intangible);
(f) License or dispose of, or permit to lapse any rights to the use of any
patent, trademark, trade name, technology, process, copyright or other
intangible asset of material value, or dispose of or disclose to any person any
trade secret, formula, process or know-how of material value not theretofore a
matter of public knowledge;
(g) Grant any general increase in the compensation of its officers or
employees (including any such increase pursuant to any bonus, pension,
profit-sharing or other plan or commitment) or any increase in the compensation
payable or to become payable to any officer or employee;
(h) Make any capital expenditure or commitment therefore in excess of
$300,000.00 individually or in excess of $500,000.00 in the aggregate for
additions to property, plant or equipment;
(i) Pay, loan or advance any amount to, or sell, transfer or lease any
properties or assets (real, personal or mixed, tangible or intangible) to, or
enter into any agreement or arrangement with, any of its officers or directors
or any affiliate or associate of any of its officers or directors except for
directors' fees and compensation to officers at rates not exceeding the rates of
compensation set forth in the Target Disclosure Schedule;
(j) Enter into any other merger transaction; or
(k) Agree, whether in writing or otherwise, to do any of the foregoing.
4.08. Insurance; Property. All property (real, personal and mixed) whether owned
or leased by Target, shall be insured in the manner contemplated by Section 2.16
hereof, and all such property shall be used, operated, maintained and repaired
in a careful and reasonably efficient manner.
4.09. No Default; Amendment. Target shall not do any act or omit to do any act,
or permit any act or omission to act which shall cause a material breach of any
material contract or commitment of Target. Target shall not materially amend any
material contract.
4.10. Compliance with Laws. Target shall duly comply with all laws applicable to
it and its properties, operations, businesses and employees.
4.11. Tax Returns; Consent. Target shall, and shall cause each of its
Subsidiaries to, promptly prepare and file all federal, state, local and foreign
tax returns and amendments thereto required to be filed by it.
4.12. No Acquisitions. Neither Target nor any Subsidiary will approve or
undertake, either as the surviving, disappearing, acquiring or selling
corporation, any other merger, consolidation, assets acquisition or disposition
or tender offer or other takeover transaction or furnish or cause to be
furnished any information concerning its business, properties or assets to any
person which is interested in any such transaction, or solicit or encourage any
inquiries or proposals for the acquisition of all or any part of the capital
stock, assets or business of Target or any Subsidiary thereof
ARTICLE V
OBLIGATIONS PENDlNG THE EFFECTIVE DATE
Target Corporation hereby covenants and agrees with Public
Corporation, and Public Corporation hereby covenants and agrees with Target
Corporation, that:
5.01. Full Access. Target shall afford to Public Corporation, its counsel,
accountants and other authorized representatives full access to Target's plants,
properties, books and records in order that Public Corporation may have an
opportunity to make such investigations as it shall desire to make of the
affairs of Target Corporation; provided, however, that any such investigation
shall be conducted in such a manner as not to interfere unreasonably with the
operation of the business of Target; and Target will cause its officers and
accountants to furnish such additional financial and operating data and other
information as Public Corporation shall from time to time reasonably request
including access to the working papers of Target's independent certified public
accountants. Public Corporation shall afford Target the same opportunity.
5.02. Confidentiality. Public Corporation shall, and shall cause its officers
and authorized representatives to, hold in confidence, and not disclose to
others for any reason whatsoever, all information received by it from Target in
connection with the transactions contemplated hereby that Target identifies with
reasonable specificity in writing as proprietary ("Proprietary Information"),
except to the extent that such Proprietary Information was previously known to
Public Corporation or otherwise available from third persons without restriction
on its further use or disclosure or otherwise not legally protectible as
proprietary information; provided that nothing herein contained shall be deemed
to preclude Public Corporation from (a) asserting that any document or
information (whether or not embodied in a document) asserted by Target to be
proprietary are not entitled to protection as such on the ground that such
Proprietary Information was previously known to Public Corporation or otherwise
available from third persons without restriction on its further use or
disclosure or otherwise not legally protectible as proprietary information, and
(b) thereafter freely using or disclosing such Proprietary Information unless a
court of competent jurisdiction finally determines that this provision does not
apply to such Proprietary Information. Target shall afford Public Corporation
the same.
5.03. Approval of Stockholders; Proxy Statement. Target shall: (a) cause a
meeting of its stockholders to be duly called and held as soon as practicable
for the purpose of voting on the Merger; (b) actively recommend approval of the
Merger to its stockholders; (c) use its reasonable efforts to obtain the
necessary approval of its stockholders; and (d) mail notice of stockholders'
approval of the Merger, if it be approved, to all stockholders immediately
following such stockholders' meeting.
5.04. Further Assurances. Each party hereto shall execute and deliver such
instruments and take such other actions as the other party or parties, as the
case may be, may reasonably require in order to carry out the intent of this
Agreement.
5.05. Supplements to Disclosure Schedules. From time to time prior to Closing,
Target shall promptly supplement or amend the Target Disclosure Schedule with
respect to any matter hereafter arising which, if existing or occurring at or
prior to the date of this Agreement, would have been required to be set forth or
described in the Target Disclosure Schedule or in any representation and
warranty of Target which has been rendered inaccurate thereby. For purposes of
determining the accuracy of the representations and warranties of Target
contained in Article II in order to determine the fulfillment of the condition
set forth in Section 6.01, the Target Disclosure Schedule delivered by Target
shall be deemed to include only that information contained therein on the date
of this Agreement and shall be deemed to exclude any information contained in
any subsequent supplement or amendment thereto. Public Corporation shall have
similar obligations.
5.06. Public Announcements. Target and Public Corporation shall consult with
each other before issuing any press releases or otherwise making any public
statements with respect to the transactions contemplated herein and shall not
issue any such press release or make any such public statement prior to such
consultation. Approval by Target or Public Corporation of such press releases
and public statements shall not be unreasonably withheld.
ARTICLE VI
CONDITIONS TO PUBLIC CORPORATION'S OBLIGATIONS
The obligation of Public Corporation to effect the transactions
contemplated herein shall be subject to the satisfaction, on or before Closing,
of each of the following conditions:
6.01. Representations and Warranties True. The representations and warranties of
Target contained herein, in the Target Disclosure Schedule, and in all
certificates and other documents delivered by Target to Public Corporation
pursuant hereto or in connection with the transactions contemplated hereby shall
be in all material respects true and accurate as of the date when made and at
and as of Closing as though such representations and warranties were made at and
as of such dates, except for changes permitted or contemplated by the terms of
this Agreement.
6.02. Performance. Target shall have performed and complied with all agreements,
obligations and conditions required by this Agreement to be performed or
complied with by it on or prior to Closing.
6.03. Approval of Target Corporation Shareholders. The approval of the
stockholders of Target referred to in Section 5.03 hereof and all consents from
third parties and government agencies required to consummate this Agreement
shall have been obtained.
6.04. Adverse Changes. No material adverse change shall have occurred in the
financial condition, working capital, assets, liabilities, reserves, business,
operations or prospects of Target and its Subsidiaries taken as a whole, since
the date of the Target Balance Sheet.
6.05. No Governmental Proceeding or Litigation. No suit, action, investigation,
inquiry or other proceeding by any governmental body or other Person or entity
or legal or administrative proceeding shall have been instituted or threatened
which questions the validity or legality of the transactions contemplated hereby
or which if successfully asserted would otherwise have a material adverse effect
on the conduct of Target's business or on its properties..
6.06. Opinion of Target Corporation Counsel. Not applicable.
6.07. Certificates. Target shall furnish Public Corporation with such
certificates of its officers and others to evidence compliance with the
conditions set forth in this Article VI as may be reasonably requested by Public
Corporation.
6.08. Board of Directors Authorization. All action required to be taken by the
Board of Directors of Target to authorize the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby shall have been duly and validly taken by the Board of
Directors of Target.
ARTICLE VII
CONDITIONS TO TARGET CORPORATIONS OBLIGATIONS
The obligation of Target to effect the transactions contemplated herein
shall be subject to the satisfaction, on or before the Effective Date, of each
of the following conditions:
7.01. Representations and Warranties True. The representations and warranties of
Public Corporation contained herein, in the Public Corporation Disclosure
Schedule, and in all certificates and other documents delivered by Public
Corporation to Target pursuant hereto or in connection with the transactions
contemplated hereby shall be in all material respects true and accurate as of
the date when made and at and as of Closing as though such representations and
warranties were made at and as of such dates, except for changes permitted or
contemplated by the terms of this Agreement.
7.02. Performance. Public Corporation shall have performed and complied with all
agreements, obligations and conditions required by this Agreement to be
performed or complied with by it on or prior to Closing.
7.03. Approval of Target Corporation Stockholders. The approval of the
stockholders of Target referred to in Section 5.03 hereof and the other consents
from third parties or government agencies required to consummate this Agreement
shall have been obtained.
7.04. Adverse Changes. No material adverse change shall have occurred in the
financial condition, working capital, assets, liabilities, reserves, business,
operations or prospects of Public Corporation since the date of the Public
Corporation Balance Sheet.
7.05. No Governmental Proceeding or Litigation. No suit, action, investigation,
inquiry or other proceeding by any governmental body or other person or legal or
administrative proceeding shall have been instituted or threatened which
questions the validity or legality of the transactions contemplated hereby or
which if successfully asserted would otherwise have a material and adverse
effect on the conduct of Public Corporation's business or on its properties.
7.06. Certificates. Public Corporation shall furnish Target with such
certificates of its officers and others to evidence compliance with the
conditions set forth in this Article VII as may be reasonably requested by
Target.
7.07. Board of Directors' Authorization. All action required to be taken by the
Board of Directors of Public Corporation to authorize the execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby shall have been duly and validly taken by the Board of
Directors of Public Corporation.
ARTICLE VIII
CLOSING; EFFECTIVE DATE
8.01. Closing. Unless this Agreement shall have been terminated and the Merger
herein contemplated shall have been abandoned pursuant to a provision of Article
IX hereof; a closing (the "Closing") will be held, as soon as practicable after
the approval of Target stockholders is obtained, at the law firm of Xxxx &
Valentine, LLP located in McLean, Virginia, (unless the parties hereto otherwise
agree), at which time and place the documents referred to in Articles VI and VII
hereof shall be exchanged by the parties and, immediately thereafter, the
Articles of Merger will be filed by Public Corporation with the Secretary of
State; provided, however, that if any of the conditions provided for in Article
VI or VII shall not have been met or waived by such date, then the party to this
Agreement which is unable to meet such condition or conditions, despite the
reasonable efforts of such party, shall be entitled to postpone the Closing by
notice to the other parties until such condition or conditions shall have been
met (which such notifying party will seek to cause to happen at the earliest
practicable date) or waived, but in no event shall the Closing occur later than
October 20, 2000, unless further extended by mutual consent of all parties to
this Agreement.
8.02. Effective Date. The effective date of the Merger (the "Effective Date")
shall be the time at which the filing of the Articles of Merger with the
Secretary of State shall have occurred.
ARTICLE IX
TERMINATION AND ABANDONMENT
9.01. Methods of Termination. This Agreement may be terminated and the Merger
abandoned at any time notwithstanding approval thereof by the stockholders of
Target, but not later than the Effective Date:
(a) By mutual written consent of the board of Public and Target
Corporations;
(b) By the board of Target on or after sixty (60) days after approval of
the Target stockholders is obtained or such later date as may be
established pursuant to Section 8.01 hereof; if any of the conditions
provided for in Article VII of this Agreement shall not have been met or
waived in writing by Target prior to such date;
(c) By the board of Public Corporation on or after sixty (60) days after
approval of the Target stockholders is obtained or such later date as
may be established pursuant to Section 8.01 hereof; if any of the
conditions provided for in Article VII of this Agreement shall not have
been met or waived in writing by Public Corporation prior to such date;
or
(d) Target's shareholder's failure to approve the Merger.
9.02. Procedure Upon Termination. In the event of termination and abandonment
pursuant to Section 9.01 hereof; written notice thereof shall forthwith be given
by the terminating party to the other party, and this Agreement shall terminate,
and the Merger shall be abandoned, without further action. If this Agreement is
terminated as provided herein:
(a) Each party shall redeliver all documents, work papers and other material
of any other party relating to the transactions contemplated hereby, whether so
obtained before or after the execution hereof; to the party furnishing the same;
and
(b) All Proprietary Information received by any party hereto with respect to
the business of any other party or its subsidiaries shall not at any time be
used for the advantage of; or disclosed to third Persons by, such party for any
reason whatsoever except as contemplated in Section 5.02 hereof
ARTICLE X
GENERAL PROVISIONS
10.01. Waiver. Any failure on the part of any party to comply with any of their
respective obligations, agreements or conditions hereunder may be waived in
writing by the party to whom such compliance is owed; however, waiver on one
occasion does not operate to effectuate a waiver on any other occasion.
10.02. 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, or
by facsimile as follows: Public Corporation at (000) 000-0000 and to Target at
(000) 000-0000.
10.03. Entire Agreement. This Agreement (and the documents, notes and other
agreements executed in connection and on even date herewith) 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 this Merger.
10.04. Headings. The article and paragraph headings in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
10.05. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Nevada.
10.06. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall but
constitute one and the same instrument.
10.07. No Oral Modification. This Agreement may be amended solely in writing,
and only after the mutual agreement of the parties affected thereby.
10.08. Survival of Representations, Warranties and Covenants. The
representations, warranties, covenants and agreements contained herein shall
survive the execution and delivery of this Agreement and the effectiveness of
the Merger.
10.09. Severability.. The invalidity or unenforceability of one or more
provisions of this Agreement shall not affect the validity or enforceability of
any of the other provisions hereof, and this Agreement shall be construed in all
respects as if such invalid or unenforceable provisions were omitted.
10.10. Successor and Assigns. Subject to the restrictions set forth herein, this
Agreement, and each and every provision hereof, shall be binding upon and inure
to the benefit of the parties, their respective successors, successors-in-title,
heirs and assigns, and each and every successor-in-interest to any party,
whether such successor acquires such interest by way of gift, purchase,
foreclosure, or by any other method, who shall hold such interest subject to all
the terms and conditions of this Agreement.
10.11. Brokers. Neither Public nor Target have engaged or are otherwise liable
for any amount due or to become due to any broker or sales agent in regards of
the transactions giving rise to and evidenced hereby. In the event that any
claim (other than those described in the preceding sentence) is asserted by any
person claiming a commission or finders fee with respect to this Agreement or
the transactions contemplated hereby arising from any act, representation or
promise of a party or its representatives, such party shall indemnify, save,
defend and hold every other party harmless from and against any and all such
claims, as well as against all costs and expenses related thereto, including
attorneys' fees and costs.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
the day and year first above written.
PUBLIC CORPORATION TARGET CORPORATION
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