AMENDED AND RESTATED MERGER AGREEMENT by and among Galen Capital Corporation a Nevada corporation and Innolog Holdings Corporation, a Nevada corporation on the one hand; and uKarma Corporation, a Nevada corporation, and GCC Merger Sub Corporation, a...
AMENDED
AND RESTATED MERGER AGREEMENT
by
and among
Xxxxx
Capital Corporation
a Nevada
corporation
and
Innolog
Holdings Corporation,
a Nevada
corporation
on the one hand;
and
uKarma
Corporation,
a Nevada
corporation,
and
GCC
Merger Sub Corporation,
a Nevada
corporation,
on
the other hand
August
11, 2010
AMENDED
AND RESTATED MERGER AGREEMENT
This
Amended And Restated Merger Agreement, dated as of August 11, 2010 (this
“Agreement”), is made and entered into by and among Xxxxx Capital Corporation, a
Nevada corporation (“GCC”) and Innolog Holdings Corporation (“Innolog”), on the
one hand; and GCC Merger Sub Corporation, a Nevada corporation (the “Merger
Sub”) and uKarma Corporation, a publicly traded Nevada corporation
(OTCBB: UKMA.OB) (“uKarma”) on the other hand. This
Agreement amends and restates that certain Merger Agreement by and among GCC,
Merger Sub and uKarma dated as of October 15, 2009 and amended by that certain
First Amendment to the Merger Agreement dated as of December 18, 2009 (as
amended, “Prior Agreement”).
WHEREAS, pursuant
to the Agreement, the parties among other things, have agreed that Innolog, not
GCC, shall be merged with and into Merger Sub such that uKarma will acquire
Innolog, not GCC, through the merger of Merger Sub with and into
Innolog (the “Acquisition”) upon the terms and conditions hereinafter set forth
in this Agreement;
WHEREAS, the
respective Board of Directors of GCC, the Merger Sub and uKarma previously
adopted resolutions approving uKarma’s acquisition of GCC through
the Acquisition upon the terms and conditions hereinafter set forth
in this Agreement;
ARTICLE
1
1.1 The
Acquisition. At the Effective Time (as defined below) and
subject to the terms and conditions of this Agreement and the applicable
provisions of Nevada law, the Merger Sub shall be merged with and into Innolog,
the separate coexistence of Merger Sub shall cease and Innolog shall continue as
the surviving corporation (sometimes referred to herein as the “Surviving
Corporation”).
1.2 Effective Time. The
closing of the Acquisition (the “Closing”) shall take place as promptly as
practicable on or before August 16, 2010, or on such other date as may be
mutually agreed upon by the parties. Such date is referred to herein
as the “Closing Date.” This Agreement may be terminated by any
party if the Closing does not occur by August 31, 2010 provided such terminating
party is not in breach of this Agreement. On the Closing Date, the
parties hereto shall cause the Acquisition to be consummated by filing an
Articles of Merger (or like instrument), in substantially the form attached
hereto as Exhibit A (the “Articles of Merger”), with the Secretary of State of
Nevada, in accordance with the relevant provisions of applicable law (the time
of acceptance by the Secretary of State of Nevada of such filing being referred
to herein as the “Effective Time”).
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1.3 Effect of the
Acquisition. At the Effective Time, the effect of the
Acquisition shall be as provided in the applicable provisions of Nevada
law. Without limiting the generality of the foregoing, and subject
thereto, at the Effective Time, all the property, rights, privileges, powers and
franchises of the Merger Sub and Innolog shall vest in the Surviving
Corporation, and all debts, liabilities, obligations, restrictions, disabilities
and duties of the Merger Sub and Innolog shall become the debts, liabilities,
obligations, restrictions, disabilities and duties of the Surviving
Corporation.
1.4 Charter Documents,
Directors, and Officers of the Surviving Corporation. At and as of the
Effective Time, (i) the Articles of Incorporation and the Bylaws of Innolog
shall be the Articles of Incorporation and Bylaws of the Surviving Corporation
until thereafter amended as provided by applicable law, (ii) the directors of
Innolog immediately prior to the Effective Time will be the initial directors of
the Surviving Corporation, until their successors are elected and qualified, and
(iii) the officers of Innolog immediately prior to the Effective Time will be
the initial officers of the Surviving Corporation, until their successors are
elected and qualified.
1.5 Conversion of Capital
Stock. The conversion of shares of Innolog common stock and
preferred stock is intended to cause the current Innolog shareholders on a
fully-diluted basis to hold 95% of the outstanding uKarma common stock
immediately after the Closing while current uKarma shareholders would hold the
other 5% of the outstanding uKarma common stock on a fully-diluted basis
immediately after the Closing.
(a) Common Stock. Each
share of Common Stock of Innolog (the “Innolog Common Stock”) issued and
outstanding immediately prior to the Effective Time shall at the Effective Time,
without any action on the part of any holder thereof, forthwith cease to exist
and be converted into the right to receive that number of shares of
Common Stock of uKarma (“uKarma Common Stock”) equal to the uKarma Exchange
Ratio (as defined below). Except as otherwise provided herein,
commencing immediately after the Effective Time, each certificate which,
immediately prior to the Effective Time, represented issued and outstanding
shares of Innolog Common Stock shall thereafter evidence only the right to
receive that portion of the merger consideration allocable to such shares as
described herein. The “uKarma Exchange Ratio” means the number equal
to the quotient of (1) the number of all outstanding uKarma Common
Stock immediately prior to closing multiplied by 95/5 divided by (2)
that number of all outstanding Innolog Common Stock on a
fully-diluted basis (including Innolog Preferred Stock as if such preferred
stock were converted into common stock and Innolog warrants as if such warrants
were exercised) prior to Closing. In the event that there are
90,199,070 Innolog Common Stock shares on a fully-diluted basis outstanding,
then the uKarma Exchange Ratio shall be one share of uKarma Common Stock for one
share of Innolog Common Stock (on a post-reverse stock split basis as set forth
in Section 5.12).
(b) Preferred
Stock. Each share of Preferred Stock of Innolog (“Innolog
Preferred Stock”) issued and outstanding immediately prior to the Effective Time
shall at the Effective Time, without any action on part of any holder thereof,
forthwith cease to exist and be converted into the right to
receive that number of shares of uKarma Preferred Stock (“uKarma
Preferred Stock”) equal to the uKarma Exchange
Ratio. Except as otherwise provided herein,
commencing immediately after the Effective Time, each certificate which,
immediately prior to the Effective Time, represented issued and outstanding
shares of Innolog Preferred Stock shall thereafter evidence only the right to
receive that portion of the merger consideration allocable to such shares as
described herein.
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(c) Innolog Derivative
Securities. At the Effective Time all unexpired and
unexercised options and warrants to purchase shares of Innolog Common Stock
(“Innolog Options”) then outstanding, whether vested or unvested together with
Innolog’s Stock Option Plan shall be assumed by uKarma in accordance with the
provisions herein. Each Innolog Option assumed herein shall continue
to have, and be subject to, the same terms and conditions as were applicable to
such Innolog Option immediately prior to the Effective Time except that such
Innolog Option shall be exercisable for that number of Innolog Options as set
forth on Schedule 1.5(c) (together with Innolog Options, “Innolog
Derivative Securities”). Innolog represents that it has no
convertible debt . The exercise price at which uKarma options or
warrants into uKarma Preferred Stock may be exercised (as applicable) into
uKarma Common Stock shall be based on the exercise price of the Innolog
Derivative Security and also proportional to the ratio at which Innolog Common
Stock may be exchanged for uKarma Common Stock.
(d) Fractional
Shares. No fraction of a share of uKarma securities will be
issued in the Acquisition, but in lieu thereof, the shares to be distributed to
each holder of shares of Innolog Common Stock, Innolog Preferred Stock or
Innolog Derivative Securities (collectively, the “Innolog Capital Stock”) shall
be rounded up to the nearest whole share (after aggregating all fractional
shares of uKarma Shares to be received by such holder).
(e) Merger
Sub. Each share of common stock of the Merger Sub, issued and
outstanding immediately prior to the Effective Time shall remain outstanding as
one validly issued, fully paid and nonassessble share of common stock of the
Surviving Corporation. From and after the Effective Time, each share
certificate of the Merger Sub theretofore evidencing ownership of any such
shares shall continue to evidence ownership of such shares of capital stock of
the Surviving Corporation.
1.6 Dissenting
Shares. Notwithstanding any provision of this Agreement to the
contrary, any shares of Innolog Capital Stock held by a holder who
has demanded and perfected appraisal rights for such shares in accordance with
Nevada law and who, as of the Effective Time, has not effectively withdrawn or
lost such appraisal or dissenters’ rights (“Dissenting Shares”) shall not be
converted into or represent a right to receive uKarma Shares pursuant to Section
1.5 but the holder thereof shall only be entitled to such rights as are granted
under Nevada law. Notwithstanding the foregoing, if any holder of
shares of Innolog Capital Stock who demands appraisal of such shares under
Nevada law shall effectively withdraw or lose the right to appraisal, then, as
of the later of (i) the Effective Time or (ii) the occurrence of such event,
such holder’s shares shall automatically convert into and represent only the
right to receive uKarma Shares as provided herein, without interest thereon,
upon surrender to uKarma of the certificate representing such shares in
accordance with Section 1.7 of this Agreement.
1.7 Exchange
Procedures. As the Effective Time, Innolog shall deliver to
uKarma the Innolog certificates, which prior to the Effective Time, represented
all of the issued and outstanding shares of capital stock of Innolog (the
“Certificates”). Upon surrender of a Certificate for cancellation to
uKarma or such other agent or agents as may be appointed by uKarma, together
with any documents reasonably requested, the holder of such Certificate shall be
entitled to receive in exchange therefor the number of shares such holder has a
right to receive pursuant to the provisions of this Article 1, and the
Certificate so surrendered shall be cancelled. In the event any
Certificates have been lost, stolen or destroyed, uKarma or its agent or agents
shall issue that number of uKarma shares deliverable in respect thereof pursuant
to this Article 1 in exchange for such lost, stolen or destroyed Certificates,
upon the making of an affidavit of that fact by the holder thereof and, at the
discretion of uKarma or its agents, the delivery of a bond in such sum as
indemnity against any claim that may be made against uKarma or its agents with
respect to the Certificates alleged to have been lost, stolen or
destroyed.
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1.8 Payment
Advances. Innolog shall pay to uKarma an amount equal to
$525,000 (“Cash Payment”). The parties acknowledge that $475,000 of
the Cash Payment has already been paid to uKarma as a non-refundable deposit;
all of which has been paid to uKarma by GCC prior to the date of this
Agreement. The remaining $50,000 of the Cash Payment shall be due and
payable from Innolog to uKarma’s subsidiary Amazing Living, Inc. (“ALI”) upon
the Closing pursuant to the Escrow Agreement (of which ALI will immediately
transfer $25,000 to Xxxxxxxxxx & Xxxxx LLP). Innolog shall also
pay Xxxxxxxxxx & Xxxxx LLP $25,000 through an escrow amounts pursuant to the
Escrow Agreement.
An extra
$12,500 has been advanced by Innolog to uKarma prior to execution of this
Agreement to pay accounting and other associated charges for the
Company’s Form 10-Q for the quarter ended June 30, 2010. If Xxxxxxx
and Associates, LLP bills uKarma for an additional $11,500 in order to add
financial projections of Innolog into uKarma’s 10-Q, then such amount would also
be immediately due and payable to uKarma. In addition, legal expenses related to
the Company’s 10-Q shall be paid directly to Xxxxxxxxxx & Xxxxx by
Innolog. If the Closing has not occurred by August 15, 2010, Innolog
and uKarma may negotiate (at each party’s sole discretion) to extend the date of
the Closing but only if Innolog and uKarma also negotiate payment of additional
interim advances prior to the Closing. At Closing,
the remaining portion of the Cash Payment, will be delivered via wire transfer
by Innolog to uKarma to a wire account designated in writing by uKarma’s Chief
Executive Officer. After the Closing, Innolog shall pay for the other
out-of-pocket costs associated with Company’s Form 10-Q, including without
limitation, legal costs.
ARTICLE
2
Except as
set forth in the Disclosure Schedule, if any, Innolog hereby represents and
warrants to uKarma as follows:
2.1 Organization. Innolog
has been duly organized, is validly existing as a corporation and is duly
qualified to do business as a corporation and is in good standing in each
jurisdiction in which the ownership of its properties, the employment of its
personnel or the conduct of its business requires it to be so qualified, except
where the failure to be so qualified would not have a material adverse effect on
Innolog’s financial condition, results of operations or business.
2.2 Capitalization. The
authorized capital stock of Innolog consists of (a) 100,000,000 shares of its
common stock, $.001 par value, of which immediately prior to the Closing,
8,802,533 shares shall be issued and outstanding and (b) 50,000,000 shares of
its preferred stock, $.001 par value, of which immediately prior to the Closing
36,964,758 shall be issued and outstanding. All of the
issued and outstanding shares of capital stock of Innolog, as of the Closing,
are duly authorized, validly issued, fully paid, non-assessable and free of
preemptive rights. Except for warrants to purchase
43,851,857 shares of Innolog common stock, there are no outstanding options,
warrants, scrip rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or
exercisable or exchangeable for, or giving any Person any right to subscribe for
or acquire any Innolog Shares, or contracts, commitments, understandings or
arrangements by which Innolog or any of its subsidiaries is or may become bound
to issue additional Innolog Shares or Innolog Derivative
Securities. A “Person” shall refer to any natural person,
partnership, corporation, trust, or other organization or entity.
5
2.3 Certain Corporate
Matters. Innolog has full corporate power and authority and all
authorizations, licenses and permits necessary to carry on the business in which
it is engaged and to own and use the properties owned and used by
it.
2.4 Authority Relative to this
Agreement. Innolog has the requisite power and authority to
enter into this Agreement and to carry out its obligations hereunder. The
execution, delivery and performance of this Agreement by Innolog and the
consummation by Innolog of the transactions contemplated hereby have been duly
authorized by the Board of Directors of Innolog and no other actions on the part
of Innolog are necessary to authorize this Agreement or the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by Innolog and constitutes a valid and binding agreement of Innolog,
enforceable against Innolog in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors’ rights generally or by general
principles of equity.
2.5 Consents and Approvals; No
Violations. Except for applicable requirements of federal
securities laws and state securities or blue-sky laws, no filing with, and no
permit, authorization, consent or approval of, any third party, public body or
authority is necessary for the consummation by Innolog of the transactions
contemplated by this Agreement. Neither the execution and delivery of this
Agreement by Innolog nor the consummation by Innolog of the transactions
contemplated hereby, nor compliance by Innolog with any of the provisions
hereof, will (a) conflict with or result in any breach of any provisions of the
charter or Bylaws of Innolog, (b) result in a violation or breach of, or
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation or acceleration) under, any
of the terms, conditions or provisions of any note, bond, mortgage, indenture,
license, contract, agreement or other instrument or obligation to which Innolog
or any Subsidiary (as hereinafter defined) is a party or by which
they any of their respective properties or assets may be bound or (c) violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
Innolog or any Subsidiary, or any of their respective properties or assets,
except in the case of clauses (b) and (c) for violations, breaches or defaults
which are not in the aggregate material to Innolog or any Subsidiary taken as a
whole.
2.6 Books and Records.
The books and records of Innolog delivered to uKarma prior to the Closing fully
and fairly reflect the transactions to which Innolog is a party or by which they
or their properties are bound.
2.7 Financial
Statements.
(a) Innolog
shall deliver to uKarma prior to with the closing are the audited consolidated
balance sheet of Innolog as of December 31, 2009 and the audited
financial statements of Innovative Logistics Techniques, Inc for December 31,
2009 and December 31, 2008 and the related statement of operations,
shareholders’ equity and cash flows for the period since inception, together
with the unqualified report thereon (except with respect to continuation as a
going concern) of Xxxxxxx & Associates
LLP, independent auditors (collectively, “Innolog Audited Financials”)
and the unaudited consolidated balance sheet of Innolog and
Innovative Logistics Techniques, Inc. as of March 31, 2010 and the
related statement of operations, shareholders’ equity and cash flows for the
period since inception, together with the unqualified report thereon (except
with respect to continuation as a going concern) (“Innolog Interim
Financials”).
6
(b) Innolog’s
Audited Financials and Innolog Interim Financials (together, “Innolog’s
Financial Statements”) are (i) prepared and delivered in accordance with the
books and records of Innolog, (ii) correct and complete, (iii) fairly present
the financial position and results of operations of Innolog and each Subsidiary
as of the dates indicated, and (iv) prepared in accordance with U.S. GAAP
(except that (x) unaudited financial statements may not be in accordance with
GAAP because of the absence of footnotes normally contained therein, and (y)
interim (unaudited) financials are subject to normal year-end audit adjustments
that in the aggregate will not have a material adverse effect on Innolog or any
Subsidiary, their respective businesses, financial conditions or results of
operations.
2.8 Intellectual
Property. Innolog has no knowledge of any claim that, or
inquiry as to whether, any product, activity or operation of Innolog infringes
upon or involves, or has resulted in the infringement of, any trademarks,
trade-names, service marks, patents, copyrights or other proprietary rights of
any other person, corporation or other entity; and no proceedings have been
instituted, are pending or are threatened.
2.9 Litigation. Innolog
is not subject to any judgment or order of any court or administrative agency of
any jurisdiction, domestic or foreign, nor is there any charge, complaint,
lawsuit or governmental investigation pending against Innolog. Innolog is not a
plaintiff in any action, domestic or foreign, judicial or administrative. There
are no existing actions, suits, proceedings against or investigations of
Innolog, and Innolog knows of no basis for such actions, suits, proceedings or
investigations. There are no unsatisfied judgments, orders, decrees or
stipulations affecting Innolog or to which Innolog is a party.
2.10 Legal Compliance. To
the best knowledge of Innolog, after due investigation, no claim has been filed
against Innolog alleging a violation of any applicable laws and regulations of
foreign, federal, state and local governments and all agencies thereof. Innolog
hold all of the material permits, licenses, certificates or other authorizations
of foreign, federal, state or local governmental agencies required for the
conduct of their respective businesses as presently conducted.
2.11 Disclosure. The
representations and warranties and statements of fact made by Innolog in this
Agreement are, as applicable, accurate, correct and complete and do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements and information contained herein not
false or misleading.
ARTICLE
3
Except as
set forth in the Disclosure Schedule, if any, and the SEC Documents, uKarma
hereby represents and warrants to Innolog as follows:
3.1 Organization. uKarma
and Merger Sub is a corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation, and has the requisite
corporate power to carry on its business as now conducted.
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3.2 Capitalization. uKarma’s
authorized capital stock consists of 120,000,000 shares of capital stock (but
will be increased to 250,000,000 shares at Closing), including 100,000,000 of
which is designated as Common Stock, par value $0.001 (which will be increased
to 200,000,000 shares at Closing), of which 52,791,982 shares are issued and
outstanding as of this date (and 4,747,095 will be issued and outstanding as of
the Closing Date, subject to slight adjustment for additional shares due to
rounding) and 20,000,000 of which is designated as Preferred Stock (which will
be increased to 50,000,000 designated shares of Preferred Stock at Closing), par
value $0.001, of which no shares are issued and outstanding. When
issued, uKarma Shares and the securities into which uKarma Shares can be
converted into will be duly authorized, validly issued, fully paid,
non-assessable and free of preemptive rights. Except as set forth in
SEC Documents, (a) there are no outstanding or authorized options, rights,
warrants, calls, convertible securities, rights to subscribe, conversion rights
or other agreements or commitments to which uKarma is a party or which are
binding upon uKarma providing for the issuance by uKarma or transfer by uKarma
of additional shares of uKarma’s capital stock and uKarma has not reserved any
shares of its capital stock for issuance, nor are there any outstanding stock
option rights, phantom equity or similar rights, contracts, arrangements or
commitments to issue capital stock of uKarma; (b) there are no voting
trusts or any other agreements or understandings with respect to the voting of
uKarma’s capital stock; (c) here are no obligations of uKarma
to repurchase, redeem or otherwise require any shares of its capital stock as of
the Closing and (d) there are no obligations of uKarma to
register any shares of its outstanding common stock, or shares of common stock
issuable upon exercise or conversion of any outstanding securities, either on
demand, piggybacked on other registrations, or otherwise.
3.3 Certain Corporate
Matters. Each of uKarma and Merger Sub has full corporate power and
authority and all authorizations, licenses and permits necessary to carry on the
business in which it is engaged or in which it proposes presently to engage and
to own and use the properties owned and used by it. uKarma has delivered to
Innolog true, accurate and complete copies of its and Merger Sub’s certificate
or articles of incorporation and bylaws, which reflect all restatements of and
amendments made thereto at any time prior to the date of this Agreement. The
records of meetings of the shareholders and Board of Directors of uKarma are
complete and correct in all material respects. The stock records of uKarma and
the shareholder lists of uKarma that uKarma has previously furnished to Innolog
are complete and correct in all material respects and accurately reflect the
record ownership and the beneficial ownership of all the outstanding shares of
uKarma’s capital stock and any other outstanding securities issued by
uKarma. Except as set forth in the SEC Documents, uKarma is not in
default under or in violation of any provision of its certificate or articles of
incorporation or bylaws in any material respect. uKarma is not in any
material default or in violation of any restriction, lien, encumbrance,
indenture, contract, lease, sublease, loan agreement, note or other obligation
or liability by which it is bound or to which any of its assets is
subject.
3.4 Authority Relative to this
Agreement. uKarma and Merger Sub have the requisite power and
authority to enter into this Agreement and carry out its obligations
hereunder. The execution, delivery and performance of this Agreement
by uKarma and Merger Sub and the consummation of the transactions contemplated
hereby have been duly authorized by the Board of Directors of uKarma and Merger
Sub and no other actions on the part of uKarma and Merger Sub are necessary to
authorize this Agreement or the transactions contemplated
hereby. This Agreement has been duly and validly executed and
delivered by uKarma and Merger Sub and constitutes a valid and binding
obligation of uKarma and Merger Sub, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency or other
similar laws affecting the enforcement of creditors’ rights generally or by
general principles of equity.
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3.5 Consents and Approvals; No
Violations. Except for applicable requirements of federal securities laws
and state securities or blue sky laws, no filing with, and no permit,
authorization, consent or approval of, any third party, public body or authority
is necessary for the consummation by uKarma of the transactions contemplated by
this Agreement. Neither the execution and delivery of this Agreement by uKarma
nor the consummation by uKarma of the transactions contemplated hereby, nor
compliance by uKarma with any of the provisions hereof, will (a) conflict with
or result in any breach of any provisions of the charter or Bylaws of uKarma,
(b) result in a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any right of
termination, cancellation or acceleration) under, any of the terms, conditions
or provisions of any note, bond, mortgage, indenture, license, contract,
agreement or other instrument or obligation to which uKarma or any Subsidiary
(as hereinafter defined) is a party or by which they any of their
respective properties or assets may be bound or (c) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to uKarma or any
Subsidiary, or any of their respective properties or assets, except in the case
of clauses (b) and (c) for violations, breaches or defaults which are not in the
aggregate material to uKarma or any Subsidiary taken as a whole.
3.6 SEC
Documents. uKarma hereby makes reference to all documents it
has filed with the United States Securities and Exchange Commission (the “SEC”),
some of which are posted on the SEC’s website, xxx.xxx.xxx (collectively,
the “SEC Documents”). The SEC Documents constitute all of the
documents and reports that uKarma was required to file with the SEC pursuant to
the Securities Act and the rules and regulations promulgated thereunder by the
SEC since the effectiveness of uKarma’s Form SB-2. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Securities Act and/or the Exchange Act, as the case may
require, and the rules and regulations promulgated thereunder and none of the
SEC Documents contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The consolidated financial statements of uKarma
included in the SEC Documents comply as to form in all material respects with
applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto, have been prepared in accordance with generally
accepted accounting principles in the United States (except, in the case of
unaudited statements, as permitted by the applicable form under the Securities
Act and/or the Exchange Act) applied on a consistent basis during the periods
involved (except as may be indicated in the notes thereto) and fairly present
the financial position of uKarma as of the dates thereof and its consolidated
statements of operations, shareholders’ equity and cash flows for the periods
then ended (subject, in the case of unaudited statements, to normal and
recurring year-end audit adjustments which were and are not expected to have a
material adverse effect on uKarma, its business, financial condition or results
of operations). Except as and to the extent set forth on the balance
sheet of uKarma as of March 31, 2010, including the notes thereto, uKarma has no
liability or obligation of any nature (whether accrued, absolute, contingent or
otherwise and whether required to be reflected on a balance sheet or
not). Neither uKarma nor its officers or directors have received any
correspondence from the SEC commenting on any SEC Document.
3.7 Financial
Statements.
(a) Included
in the SEC Documents are the audited consolidated balance sheet of uKarma as at
December 31, 2009 and 2008 and the related statement of operations,
shareholders’ equity and cash flows for the two years then ended, together with
the unqualified report thereon (except with respect to continuation as a going
concern) of Xxxxxxx and Xxxx, LLP (“Xxxxxxx”), independent auditors
(collectively, “uKarma’s Audited Financials”).
(b) uKarma’s
Audited Financials (“uKarma’s Financial Statements”) are (i) in accordance with
the books and records of uKarma, (ii) correct and complete, (iii) fairly present
the financial position and results of operations of uKarma and each Subsidiary
as of the dates indicated, and (iv) prepared in accordance with U.S. GAAP
(except that (x) unaudited financial statements may not be in accordance with
GAAP because of the absence of footnotes normally contained therein, and (y)
interim (unaudited) financials are subject to normal year-end audit adjustments
that in the aggregate will not have a material adverse effect on uKarma or any
Subsidiary, their respective businesses, financial conditions or results of
operations.
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3.8 Events Subsequent to
Financial Statements. Except as disclosed in Schedule 3.8, since March
31, 2010, there has not been:
(a) Any
incurrence of indebtedness or liability or assumption of obligations by uKarma
or any Subsidiary other than incurrences of indebtedness by ALI;
(b) Any
change made or authorized in the Certificate of Incorporation or Bylaws of
uKarma or any Subsidiary, except as contemplated under this
Agreement;
(c) Any
loan to or other transaction with any officer, director or shareholder of uKarma
or any Subsidiary giving rise to any claim or right of uKarma or any Subsidiary
against any such person or of such person against uKarma or any
Subsidiary.
3.9 Liabilities. Except
as otherwise disclosed in uKarma’s Financial Statements and SEC Documents or the
Disclosure Schedule, neither uKarma nor any Subsidiary has any liability or
obligation whatsoever, either direct or indirect, matured or unmatured, accrued,
absolute, contingent or otherwise except as contemplated in the remainder of
this section below. In addition, uKarma represents that upon Closing,
neither uKarma nor any Subsidiary (except for Awesome Living, Inc.) will have
any material liability or obligation whatsoever, either direct or indirect,
matured or unmatured, accrued, absolute, contingent or otherwise, and uKarma is
not a party to any executory agreement except as contemplated by the remainder
of this section below. uKarma has or at closing, will have either, (a)
discontinued all of its business operations without any material adverse effect
upon uKarma, (b) assigned its business operations (including all assets and
liabilities of uKarma) to a wholly-owned subsidiary whose equity securities will
be held by a liquidating trust and distributed to uKarma shareholders prior to
the Closing, pending compliance with Federal securities regulations governing
spin-offs or (c) assigned its business operations to a wholly-owned subsidiary
whose equity securities will be spun-off by uKarma to either (i) an affiliate of
uKarma management in exchange for a promissory note equal to the dollar amount
of such business operations offset by assumed liabilities or (ii) the holders of
uKarma common stock immediately prior to the Closing, pending compliance with
Federal securities regulations governing spin-offs .
3.10 Tax Matters. Except
as disclosed in Schedule 3.10:
(a) uKarma
and each Subsidiary have duly filed all material federal, state, local and
foreign tax returns required to be filed by or with respect to them with the
Internal Revenue Service or other applicable taxing authority, and no extensions
with respect to such tax returns have been requested or granted;
(b) uKarma
and each Subsidiary have paid, or adequately reserved against in uKarma’s
Financial Statements, all material taxes due, or claimed by any taxing authority
to be due, from or with respect to them;
(c) To
the best knowledge of uKarma, there has been no material issue raised or
material adjustment proposed (and none is pending) by the Internal Revenue
Service or any other taxing authority in connection with any of uKarma’s or any
Subsidiary’s tax returns;
10
(d) No
waiver or extension of any statute of limitations as to any material federal,
state, local or foreign tax matter has been given by or requested from uKarma or
any Subsidiary; and
For
the purposes of this Section 3.10, a tax
is due (and must therefore either be paid or adequately reserved against in
uKarma’s Financial Statements) only on the last date payment of such tax can be
made without interest or penalties, whether such payment is due in respect of
estimated taxes, withholding taxes, required tax credits or any other
tax.
3.11 Real
Property. Neither uKarma nor any Subsidiary owns or leases any
real property.
3.12 Books and Records.
The books and records of uKarma and each Subsidiary delivered to Innolog prior
to the Closing fully and fairly reflect the transactions to which uKarma each
Subsidiary is a party or by which they or their properties are
bound.
3.13 Intellectual
Property. uKarma has no knowledge of any claim that, or inquiry as to
whether, any product, activity or operation of uKarma or any Subsidiary
infringes upon or involves, or has resulted in the infringement of, any
trademarks, trade-names, service marks, patents, copyrights or other proprietary
rights of any other person, corporation or other entity; and no proceedings have
been instituted, are pending or are threatened.
3.14 Litigation. Neither
uKarma nor any Subsidiary is subject to any judgment or order of any court or
administrative agency of any jurisdiction, domestic or foreign, nor is there any
charge, complaint, lawsuit or governmental investigation pending against uKarma
or any Subsidiary other than as stated in the SEC documents related to Xxxxxxx v
uKarma et al. Neither uKarma nor any Subsidiary is a plaintiff in any action,
domestic or foreign, judicial or administrative. Other than as set forth in the
SEC Documents, there are no existing actions, suits, proceedings against or
investigations of uKarma or any Subsidiary, and uKarma knows of no basis for
such actions, suits, proceedings or investigations. There are no unsatisfied
judgments, orders, decrees or stipulations affecting uKarma or any Subsidiary or
to which uKarma or any Subsidiary is a party.
3.15 Subsidiaries. Except
as set forth in Schedule 3.15, uKarma does not own any capital stock or have any
interest of any kind whatsoever in any corporation, partnership, or other form
of business organization (any such organization is referred to as a
“Subsidiary”).
3.16 Internal Accounting
Controls. uKarma
maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management’s general or specific authorizations, (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
GAAP and to maintain asset accountability, (iii) access to assets is permitted
only in accordance with management’s general or specific authorization, and (iv)
the recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences. uKarma has established disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for uKarma and
designed such disclosure controls and procedures to ensure that material
information relating to uKarma is made known to the certifying officers by
others within those entities, particularly during the period in which uKarma’s
Form 10-KSB or 10-QSB, as the case may be, is being
prepared. uKarma’s certifying officers have evaluated the
effectiveness of uKarma’s controls and procedures as of end of the filing period
prior to the filing date of the Form 10-Q for the quarter ended June 30, 2009
(such date, the “Evaluation
Date”). uKarma presented in its most recently filed Form 10-K
or Form 10-Q the conclusions of the certifying officers about the effectiveness
of the disclosure controls and procedures based on their evaluations as of the
Evaluation Date. Since the Evaluation Date, there have been no
significant changes in uKarma’s internal controls (as such term is defined in
Item 307(b) of Regulation S-K under the Exchange Act) or, to the Company’s
knowledge, in other factors that could significantly affect the Company’s
internal controls.
11
3.17 Listing and Maintenance
Requirements. Except as set forth on Schedule 3.17, uKarma is
currently quoted on the OTC Bulletin Board and uKarma has not, in the 12 months
preceding the date hereof, received any notice from the OTC Bulletin Board or
the NASD or any trading market on which uKarma’s common stock is or has been
listed or quoted to the effect that uKarma is not in compliance with the
quoting, listing or maintenance requirements of the OTCBB or such other trading
market. uKarma is, and has no reason to believe that it will not, in
the foreseeable future continue to be, in compliance with all such quoting,
listing and maintenance requirements.
3.18 No SEC or NASD
Inquiries. Neither uKarma nor any of its past or present
officers or directors is, or has ever been, the subject of any formal or
informal inquiry or investigation by the SEC or NASD.
3.19 Disclosure. The
representations and warranties and statements of fact made by uKarma in this
Agreement are, as applicable, accurate, correct and complete and do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements and information contained herein not
false or misleading.
ARTICLE
4
4.1 Mutual
Indemnification. Each of uKarma and Innolog (“Indemnifying
Party”) agree to indemnify the other party (“Indemnified Signing Party”) and its
shareholders and each of the officers, agents and directors of the Indemnified
Signing Party (each an “Indemnified Party”) against any loss,
liability, claim, damage or expense (including, but not limited to, any and all
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever)
(“Loss”) to which it or they may become subject arising out of or based on (i)
any breach of or inaccuracy in any of the representations and warranties or
covenants or conditions made by the Indemnifying Party herein in this
Agreement; and (ii) any and all liabilities existing prior to the
Closing, including without limitation, any liabilities arising from the claim
filed on June 17, 2009 against uKarma by Xxxxxxx Xxxxxxx, or arising
out of or in connection with: (A) any of the assets of the Indemnifying Party or
any Subsidiary prior to the Closing; or (B) the operations of the Indemnifying
Party prior to the Closing. Innolog shall indemnify uKarma’s
officers, directors, shareholders and agents prior to Closing for all Losses to
which such Indemnified Parties may become subject arising out of or based on the
operations of uKarma or any Subsidiary (other than ALI, a subsidiary of uKarma
as described in Section 5.10 below) subsequent to the Closing. ALI
shall indemnify uKarma’s officers, directors, shareholders and agents subsequent
to Closing for all Losses to which such Indemnified Parties may become subject
arising out of or based on the operations of ALI subsequent to the
Closing.
4.2 Indemnification
Procedures. If any action shall be brought against any
Indemnified Party in respect of which indemnity may be sought pursuant to this
Agreement, such Indemnified Party shall promptly notify the Indemnifying Party
in writing, and the Indemnifying Party shall have the right to assume the
defense thereof with counsel of its own choosing. Any Indemnified
Party shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party except to the extent that the
employment thereof has been specifically authorized by the Indemnifying Party in
writing, the Indemnifying Party has failed after a reasonable period of time to
assume such defense and to employ counsel or in such action there is, in the
reasonable opinion of such separate counsel, a material conflict on any material
issue between the position of the Indemnifying Party and the position of such
Indemnified Party. The Indemnifying Party will not be liable to any
Indemnified Party under this Article 5 for any settlement by an Indemnified
Party effected without the Indemnifying Party’s prior written consent, which
shall not be unreasonably withheld or delayed; or to the extent, but only to the
extent that a loss, claim, damage or liability is attributable to any
Indemnified Party’s indemnification pursuant to this Article 5.
12
ARTICLE
5
5.1 Corporate Examinations and
Investigations. Prior to the Closing, each party shall be
entitled, through its employees and representatives, to make such investigations
and examinations of the books, records and financial condition of Innolog and
uKarma (and any Subsidiary) as each party may request. In order that
each party may have the full opportunity to do so, Innolog and uKarma shall
furnish each party and its representatives during such period with all such
information concerning the affairs of Innolog or uKarma or any Subsidiary as
each party or its representatives may reasonably request, including without
limitation, customary schedules listing material contracts; real and personal
properties; pending, threatened and contemplated legal proceedings; employees;
assets and liabilities, including contingencies and
commitments. Innolog and uKarma shall cause Innolog or uKarma and
their respective officers, employees, consultants, agents, accountants and
attorneys to cooperate fully with each party’s representatives in connection
with such review and examination and to make full disclosure of all information
and documents requested by each party and/or its representatives. Any
such investigations and examinations shall be conducted at reasonable times and
under reasonable circumstances, it being agreed that any examination of original
documents will be at each party’s premises, with copies thereof to be provided
to each party and/or its representatives upon request.
5.2 Cooperation;
Consents. Prior to the Closing, each party shall cooperate
with the other parties to the end that the parties shall (i) in a timely manner
make all necessary filings with, and conduct negotiations with, all authorities
and other persons the consent or approval of which, or the license or permit
from which is required for the consummation of the Closing and (ii) provide to
each other party such information as the other party may reasonably request in
order to enable it to prepare such filings and to conduct such
negotiations.
5.3 Conduct of
Business. Subject to the provisions hereof and unless
contemplated by this Agreement, from the date hereof through the Closing, each
party hereto shall (i) conduct its business in the ordinary course
and in such a manner so that the representations and warranties contained herein
shall continue to be true and correct in all material respects as of the Closing
as if made at and as of the Closing and (ii) not enter into any material
transactions or incur any material liability not required or specifically
contemplated hereby, without first obtaining the written consent of Innolog and
Innolog Shareholders on the one hand and uKarma on the other
hand;. Without the prior written consent of Innolog, Innolog
Shareholders, and uKarma, except as required or specifically contemplated
hereby, each party shall not undertake or fail to undertake any action if such
action or failure would render any of said warranties and representations untrue
in any material respect as of the Closing.
13
5.4 Litigation. From
the date hereof through the Closing, each party hereto shall promptly notify the
representative of the other parties of any lawsuits, claims, proceedings or
investigations which after the date hereof are threatened or commenced against
such party or any of its affiliates or any officer, director, employee,
consultant, agent or shareholder thereof, in their capacities as such, which, if
decided adversely, could reasonably be expected to have a material adverse
effect upon the condition (financial or otherwise), assets, liabilities,
business, operations or prospects of such party or any of its
subsidiaries.
5.5 Notice of
Default. From the date hereof through the Closing, each party
hereto shall give to the representative of the other parties prompt written
notice of the occurrence or existence of any event, condition or circumstance
occurring which would constitute a violation or breach of this Agreement by such
party or which would render inaccurate in any material respect any of such
party’s representations or warranties herein.
5.6 D & O
Insurance. Immediately after the Closing, Innolog shall cause
uKarma to obtain directors and officers liability insurance with a minimum
coverage of $2.0 million that also covers past directors and officers of uKarma,
including without limitation, Xxxx Xxxxxx. In the event that Innolog
fails to obtain such insurance for uKarma within 30 days of the Closing, at Xxxx
Xxxxxx’x option Innolog shall pay to ALI $25,000, and an additional
$25,000 per 30 days thereafter that Innolog has not caused uKarma to purchase
such D & O insurance of at least $2.0 million in coverage on behalf of
uKarma directors and officers that will resign immediately prior to or
immediately following the Closing.
5.7 Audit. Innolog
shall have completed its consolidated audited financial statements for the
fiscal years ended December 31, 2009 and Innovative Logistics Techniques, Inc.
for 2008 and 2009 and its consolidated unaudited finacial statements for the
quarter ended March 31, 2010 before the date of this Agreement.
5.8 Innolog Preferred
Stock. Innolog has authorized a series of preferred stock called “Series
A Preferred Stock” (“Innolog Preferred Stock”) Innolog has authorize 50,000,000
shares of Innolog Preferred Stock for issuance and has issued 36,964,758
shares. The Innolog Preferred Stock shall be convertible into Innolog
common stock on a one-for-one basis; have a liquidation preference equal to
$2.00 per share over Innolog common stock as to distributions in the event of a
full or partial liquidation or sale of the Corporation or any of its
subsidiaries; will accrue an annual dividend equal to 10% of net
income preferred dividend allocated pro rata among the preferred stockholders;
and will, in all other respects have the same rights and privileges as the
Innolog common stock.
5.9 Assignment of Existing
uKarma Business into Subsidiary. The parties contemplate that
uKarma may assign all of its current assets and liabilities of its current
business prior to the Acquisition to a Subsidiary (“ALI”) whose shares of equity
securities are intended to be spun-off to the uKarma shareholders as of a record
date that is immediately prior to the Acquisition (“Pre-Closing Shareholders”)
after all applicable SEC laws and regulations have been complied (including
without limitation, possible filing of a Form 10 by ALI. The parties
agree that the Chief Executive Officer, secretary and sole director of ALI shall
be Xxxx Xxxxxx at all times, including periods after the
Closing. Further, the parties agree that Innolog may not: (a) attach
a lien to or other encumber any of ALI's assets or pledge any of ALI’s equity
securities; (b) issue or otherwise sell any equity interests (or rights to own
equity interests in ALI; (c) modify, amend, or delete ALI’s certificate of
incorporation or bylaws or other charter documents; (d) cause ALI to enter into
any agreement without the consent of Xx. Xxxxxx; (e) take any action that
directly or indirectly affects ALI without the prior written approval of Xx.
Xxxxxx; and (f) enter into any agreement to effect any action in (a) through
(e). The parties agree that after the Closing, uKarma shall take all
necessary actions, if any, to appoint any additional person selected by Xx.
Xxxxxx to serve as a director or officer of ALI. uKarma, ALI and
Innolog will fully cooperate to make all securities and corporate law filings
necessary in order to spin-off ALI equity securities to uKarma shareholders
immediately prior to the Closing.
14
5.10 Escrowed
Account. GCC, Innolog, and uKarma shall have entered into an
Escrow Agreement, under which GCC or Innolog shall have deposited
$75,000. At Closing, $25,000 of this deposit shall be released to
Awesome Living and $50,000 shall be released to uKarma’s legal counsel,
Xxxxxxxxxx & Xxxxx LLP.
5.11 Reverse Stock
Split. uKarma shall have conducted a 1-for-11.120904 reverse
stock split.
5.12 Bylaws. uKarma
shall have amended and restated its Bylaws in accordance with the Bylaws as
reasonably requested by Innolog prior to the date of this Agreement in
writing.
ARTICLE
6
6.1 Conditions to Obligations of
Innolog and Innolog Shareholders. The obligations of Innolog
and Innolog Shareholders under this Agreement shall be subject to each of the
following conditions:
(a) Closing
Deliveries. At the Closing, uKarma shall have
delivered or caused to be delivered to Innolog and Innolog Shareholders the
following:
(i) resolutions
duly adopted by the Board of Directors of uKarma and Merger Sub authorizing and
approving the Acquisition and the execution, delivery and performance of this
Agreement;
(ii) a
certificate of good standing for uKarma and each Subsidiary from their
respective jurisdictions of incorporation, dated not earlier than five days
prior to the Closing Date;
(iii) written
resignations of all officers and directors of uKarma and each
Subsidiary in office immediately prior to the Closing, and board resolutions
appointing the following individuals to the positions with uKarma and each
Subsidiary listed opposite their names below:
|
Name
|
Position
|
|
Xxxxxxx
Xxxxxxxxxx
|
Executive
Chairman
|
|
Xxxxxxx
Xxxx
|
Secretary/Treasurer
and Director
|
|
Xxx
Xxxxxx
|
Director
|
|
Xxxxx
Xxxxx
|
Director
|
|
Xxxxx
Xxxxxx
|
Director
|
|
Xxx
Xxxxxxxx
|
Director
|
|
Xxxxx
Xxxxxxx
|
Director
|
|
Xxxxx
Xxxxxxx
|
Director
|
15
(iv) all
corporate records, agreements, seals and any other information reasonably
requested by Innolog’s representatives with respect to
uKarma;
(v) such
other documents as Innolog and/or Innolog Shareholders may reasonably request in
connection with the transactions contemplated hereby.
(b) Representations and
Warranties to be True. The representations and
warranties of uKarma herein contained shall be true in all material
respects at the Closing with the same effect as though made at such
time. uKarma shall have performed in all material respects
all obligations and complied in all material respects with all covenants and
conditions required by this Agreement to be performed or complied with by it at
or prior to the Closing.
(c) Assets and
Liabilities. At
the Closing, uKarma shall not have any material assets or liabilities,
contingent or otherwise, or any tax obligations or any material adverse changes
to its business or financial condition; provided that uKarma may have assigned
all its assets and liabilities to a newly-formed corporation (“ALI”) established
to spin-off the current uKarma business to its shareholders as of record
immediately prior to Closing pending compliance with Federal securities laws and
regulations. At the Closing, an officer of uKarma shall execute a
certificate that (1) payment of all liabilities or (2) assignment of all
liabilities to a Subsidiary that owns the remainder of the uKarma business shall
have been made.
(d) SEC
Filings. At the Closing, uKarma will be current in all SEC
filings required by it to be filed.
(e) Audit. Innolog
shall have delivered prior to or simultaneous with the closing are the Innolog
Audited Financials.
(f) Shareholder
Approval. Innolog shall have obtained the necessary votes of
its shareholders at a duly authorized meeting (or by written consent of
shareholders) in order to close this transaction.
6.2 Conditions to Obligations of
uKarma. The obligations of uKarma under this Agreement shall be subject
to each of the following conditions:
(a) Closing
Deliveries. On the Closing Date, Innolog and/or
Innolog Shareholders shall have delivered to uKarma the following:
|
|
(i)
|
this
Agreement duly executed by Innolog;
|
|
|
(ii)
|
stock
certificates representing Innolog Shares to be delivered pursuant to this
Agreement duly endorsed or accompanied by duly executed stock powers;
and
|
16
(iii) such
other documents as uKarma may reasonably request in connection with the
transactions contemplated hereby.
(b) Representations and
Warranties to be True. The representations and
warranties of Innolog and Innolog Shareholders herein contained shall be true in
all material respects at the Closing with the same effect as though made at such
time. Innolog and Innolog Shareholders shall have performed in all
material respects all obligations and complied in all material respects with all
covenants and conditions required by this Agreement to be performed or complied
with by them at or prior to the Closing.
(c) Cash
Payment. Innolog shall have paid uKarma the remaining balance
of the Cash Payment.
(d) Governmental
Approval. Approvals from any governmental authority necessary
for the transactions contemplated hereby.
ARTICLE
7
7.1 Shareholder Written
Consent. Unless already approved by the shareholders prior to
the closing, uKarma put forth, and have its board of directors recommend, a
proposal to the shareholders to amend uKarma’s charter in order to change the
corporation’s name to “Innolog Holdings Corporation” and to increase its
authorized number of shares of preferred stock from 20 million to 50 million, to
increase its authorized number of shares of common stock to 200 million and to
amend its Bylaws as designated by Innolog. Innolog shall reimburse
uKarma for all applicable filing fees and pay Xxxxxxxxxx & Xxxxx legal fees
in connection with such actions at Closing.
ARTICLE
8
8.1 Notices. All notices
and other communications hereunder shall be in writing and shall be deemed to
have been duly given if delivered personally, sent by overnight courier or
mailed by registered or certified mail (postage prepaid and return receipt
requested) to the party to whom the same is so delivered, sent or mailed at
addresses set forth below (or at such other address for a party as shall be
specified by like notice):
If notice
is to be given to Innolog, any Innolog Shareholder or uKarma (subsequent to
Closing):
Innolog
Holdings Corporation
0000
Xxxxxx Xxxx Xxxxx 000
Xxxxxxx,
XX 00000
Telephone:
(000) 000-0000
Facsimile:
(703) 766 -1425
17
If notice
is to be given to uKarma (prior to Closing) or uKarma Shareholder, Xxxx Xxxxxx
or Awesome Living, Inc.:
uKarma
Corporation
000 X.
Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000
Attention:
Xxxx Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
8.2 Interpretation. The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
References to Sections and Articles refer to sections and articles of this
Agreement unless otherwise stated.
8.3 Severability. If
any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated and the parties shall negotiate in good faith to modify this
Agreement to preserve each party’s anticipated benefits under this
Agreement.
8.4 Miscellaneous. This
Agreement (together with all other documents and instruments referred to
herein): (a) constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof; (b) except as expressly set forth herein,
is not intended to confer upon any other person any rights or remedies hereunder
and (c) shall not be assigned by operation of law or otherwise, except as may be
mutually agreed upon by the parties hereto.
8.5 Separate
Counsel. Each party hereby expressly acknowledges that it has
been advised to seek its own separate legal counsel for advice with respect to
this Agreement, and that no counsel to any party hereto has acted or is acting
as counsel to any other party hereto in connection with this
Agreement.
8.6 Governing Law; Venue.
This Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the State of Nevada. Any and all actions brought
under this Agreement shall be brought in the state and/or federal courts of the
United States sitting in the City of Las Vegas, Nevada and each party hereby
waives any right to object to the convenience of such venue.
8.7 Counterparts and Facsimile
Signatures. This Agreement may be executed in two or more counterparts,
which together shall constitute a single agreement. This Agreement
and any documents relating to it may be executed and transmitted to any other
party by facsimile, which facsimile shall be deemed to be, and utilized in all
respects as, an original, wet-inked document.
8.8 Amendment. This
Agreement may be amended, modified or supplemented only by an instrument in
writing executed by all parties hereto.
8.9 Parties In Interest; No
Third Party Beneficiaries. Except as otherwise provided herein, the terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective heirs, legal representatives, successors and assigns of the
parties hereto. This Agreement shall not be deemed to confer upon any person not
a party hereto any rights or remedies hereunder.
18
8.10 Waiver. No waiver by
any party of any default or breach by another party of any representation,
warranty, covenant or condition contained in this Agreement shall be deemed to
be a waiver of any subsequent default or breach by such party of the same or any
other representation, warranty, covenant or condition. No act, delay, omission
or course of dealing on the part of any party in exercising any right, power or
remedy under this Agreement or at law or in equity shall operate as a waiver
thereof or otherwise prejudice any of such party’s rights, powers and remedies.
All remedies, whether at law or in equity, shall be cumulative and the election
of any one or more shall not constitute a waiver of the right to pursue other
available remedies.
8.11 Expenses. At
or prior to the Closing, the parties hereto shall pay all of their own expenses
relating to the transactions contemplated by this Agreement, including, without
limitation, the fees and expenses of their respective counsel and financial
advisers.
[SIGNATURES
FOLLOW]
19
IN WITNESS WHEREOF, the
parties have executed this Amended and Restated Merger Agreement as of the date
first written above.
Xxxxx
Capital Corporation
By: /s/ Xxxxxxx
Danielczyk_________
Name:
Xxxxxxx Xxxxxxxxxx
Title: Chairman
Address:
0000 Xxxxxx Xxxx Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Innolog
Holdings Corporation
By: /s/ Xxxxxxx
Danielczyk_________
Name:
Xxxxxxx Xxxxxxxxxx
Title: Executive
Chairman
Address: 0000
Xxxxxx Xxxx Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
uKarma
Corporation
By: /s/ Xxxx
Glaser________________
Name: Xxxx
Xxxxxx
Title:
Chief Executive Officer
GCC
Merger Sub Corporation
By: /s/ Xxxx
Glaser________________
Name:
Xxxx Xxxxxx
Title: Chief
Executive Officer
Address:
20
EXHIBIT
A
FORM OF
ARTICLES OF MERGER
21
Schedule
I
Innolog
Shareholders
22
Schedule
3.9
Liabilities
The
following liabilities were assumed by Awesome Living, Inc. but such assumption
was not confirmed by the applicable creditor:
|
|
·
|
Business
wire $709.75
|
|
|
·
|
Xxxxxxxx
Xxxxxx $15,750.00
|
|
|
·
|
Praesidium
$180.00
|
Awesome
Living agrees to indemnify Innolog and uKarma against these
liabilities.
Schedule
3.15
Subsidiaries
Awesome
Living, Inc.
GCC
Merger Sub Corp.
Schedule
3.17
SEC
Filings
The Form
10-K for the year ended December 31, 2009 for uKarma was filed
late.
23