AGREEMENT AND PLAN OF MERGER
Exhibit
10.1
AGREEMENT
AND PLAN OF MERGER
This
Agreement and Plan of Merger (this “Agreement”) is entered into as of November
27, 2007, by and among NANOSENSORS,
INC.,
a
Nevada corporation (“Buyer”),
CUCHULAINN
ACQUISITION INC.,
a
Panamanian corporation and a wholly-owned subsidiary of Buyer (“Merger
Sub”),
and
CUCHULAINN
HOLDINGS INC.,
a
Panamanian corporation (“Seller”).
Buyer, Merger Sub and Seller are sometimes referred to individually as a
“Party”
and
collectively herein as the “Parties.”
RECITALS:
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A.
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The
Board of Directors of Seller, Buyer and Merger Sub believe it is
in the
best interests of their respective companies and the stockholders
of their
respective companies that Seller and Merger Sub combine into a
single
corporation through the statutory merger of Seller with and into
Merger
Sub (“Merger”)
and, in furtherance thereof, have approved the Merger in accordance
with
the laws of their respective jurisdictions and upon the terms and
subject
to the conditions set forth in this
Agreement).
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B.
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Pursuant
to the Merger, among other things, the issued and outstanding shares
of
Seller common stock, $0.0005 par value per share (“Seller
Common Stock”),
shall be converted into the right to receive the Merger Consideration
(as
defined in §2(g)(i))
consisting of shares of Series A preferred stock, par value $0.001
per
share, of Buyer (“Buyer
Preferred Stock”).
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C.
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Seller,
Buyer and Merger Sub desire to make certain representations and
warranties
and other covenants and agreements in connection with the
Merger.
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NOW,
THEREFORE, in consideration of the premises and the mutual promises herein
made,
and in consideration of the representations, warranties, and covenants herein
contained, the Parties agree as follows.
| §1. |
Definitions.
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“Accredited
Investor”
has
the
meaning set forth in Regulation D promulgated under the Securities
Act.
“Affiliate”
has
the
meaning set forth in Rule 12b-2 of the regulations promulgated under the
Securities Exchange Act.
“Agreement
of Merger”
has
the
meaning set forth in §2(b).
“Buyer”
has
the
meaning set forth in the preface above.
“Buyer
Common Stock” has
the
meaning set forth in the preface above.
“Buyer
Preferred Stock”
has
the
meaning set forth in the preface above.
“Buyer
Confidential Information”
has the
meaning set forth in §5(d).
“Buyer
Directors”
has the
meaning set forth in §6(b).
“Buyer
Warrants”
has the
meaning set forth in §2(g)(i)(B.
“Cash”
means
cash and cash equivalents (including marketable securities and short-term
investments) calculated in accordance with GAAP applied on a basis consistent
with the preparation of the Financial Statements.
“Certificates”
has
the
meaning set forth in §2(h)(iii).
“Closing”
has
the
meaning set forth in §2(b).
“Closing
Date”
has
the
meaning set forth in §2(b).
“Code”
means
the Internal Revenue Code of 1986, as amended.
“Effective
Time”
has
the
meaning set forth in §2(c).
“Exchange
Act” means
the
Securities Exchange Act of 1934, as amended.
“Exchange
Agent”
has
the
meaning set forth in §2(h)(i).
“Exchange
Fund”
has
the
meaning set forth in §2(h)(ii).
“Financial
Statements”
has
the
meaning set forth in §3(g).
“GAAP”
means
United States generally accepted accounting principles as in effect from
time to
time, consistently applied.
“Intellectual
Property”
means
all of the following in any jurisdiction throughout the world: (a) all
inventions (whether patentable or unpatentable and whether or not reduced
to
practice), all improvements thereto, and all patents, patent applications,
and
patent disclosures, together with all reissuances, continuations,
continuations-in-part, revisions, extensions, and reexaminations thereof,
(b)
all trademarks, service marks, trade dress, logos, slogans, trade names,
corporate names, Internet domain names and rights in telephone numbers, together
with all translations, adaptations, derivations, and combinations thereof
and
including all goodwill associated therewith, and all applications,
registrations, and renewals in connection therewith, (c) all copyrightable
works, all copyrights, and all applications, registrations, and renewals
in
connection therewith, (d) all mask works and all applications, registrations,
and renewals in connection therewith, (e) all trade secrets and confidential
business information (including ideas, research and development, know-how,
formulas, compositions, manufacturing and production processes and techniques,
technical data, designs, drawings, specifications, customer and supplier
lists,
pricing and cost information, and business and marketing plans and proposals),
(f) all computer software (including source code, executable code, data,
databases, and related documentation), (g) all advertising and promotional
materials, (h) all other proprietary rights, and (i) all copies and tangible
embodiments thereof (in whatever form or medium).
“Knowledge
of Buyer”
or
“Buyer’s
Knowledge”
means
the actual knowledge of the Buyer’s directors, officers, employers,
representatives, agents, consultants and attorneys.
“Knowledge
of Seller”
or
“Seller’s
Knowledge”
means
the actual knowledge of the Seller’s, directors, officers, employees,
representatives, agents, consultants and attorneys.
“Law
32”
means
Law 32 of 1927 of the Republic of Panama.
“Liability”
means
any liability or obligation of whatever kind or nature (whether known or
unknown, whether asserted or unasserted, whether absolute or contingent,
whether
accrued or unaccrued, whether liquidated or unliquidated, and whether due
or to
become due), including any liability for Taxes.
“Lien”
means
any mortgage, pledge, lien, encumbrance, charge, or other security interest.
“Material
Adverse Effect”
or
“Material
Adverse Change”
means
any effect or change that would be (or could reasonably be expected to be)
materially adverse to the business, assets, condition (financial or otherwise),
operating results, operations, or business prospects of Seller taken as a
whole
or to the ability of Seller to consummate timely the transactions contemplated
hereby (regardless of whether or not such adverse effect or change can be
or has
been cured at any time or whether Buyer has knowledge of such effect or change
on the date hereof); provided
that
none of the following shall be deemed to constitute, and none of the following
shall be taken into account in determining whether there has been a Material
Adverse Effect or Material Adverse Change: any adverse change, event,
development, or effect arising from or relating to (1) general business or
economic conditions, including such conditions related to the business of
Seller, (2) national or international political or social conditions,
including the engagement by the United States in hostilities, whether or
not
pursuant to the declaration of a national emergency or war, or the occurrence
of
any military or terrorist attack upon the United States, or any of its
territories, possessions, or diplomatic or consular offices or upon any military
installation, equipment or personnel of the United States, (3) financial,
banking, or securities markets (including any suspension of trading in, or
limitation on prices for, securities on the New York Stock Exchange, American
Stock Exchange, or Nasdaq Stock Market for a period in excess of three hours
or
any decline of either the Dow Xxxxx Industrial Average or the Standard &
Poor’s Index of 500 Industrial Companies by an amount in excess of 15% measured
from the close of business on the date hereof), (4) changes in United States
generally accepted accounting principles, (5) changes in laws, rules,
regulations, orders, or other binding directives issued by any governmental
entity, and (6) the taking of any action contemplated by this Agreement and
the
other agreements contemplated hereby.
2
“Merger”
has
the
meaning set forth in the recitals.
“Merger
Consideration”
has
the
meaning set forth in §2(g)(i).
“Merger
Sub”
has
the
meaning set forth in the preface.
“Ordinary
Course of Business”
means
the ordinary course of business consistent with past custom and practice
(including with respect to quantity and frequency).
“Party”
has
the
meaning set forth in the preface above.
“Person”
means
an individual, a partnership, a corporation, a limited liability company,
an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, any other business entity, or a governmental entity (or any
department, agency, or political subdivision thereof).
“Pre-Closing
Financing”
shall
mean Seller’s receipt of gross proceeds of $619,800 raised in a private
placement offering by Seller.
“Reverse
Stock Split”
has the
meaning set forth in §6(d).
“SEC”
means
the U.S. Securities and Exchange Commission.
“SEC
Reports”
has the
meaning set forth in §4(f).
“Securities
Act”
means
the Securities Act of 1933, as amended.
“Securities
Exchange Act”
means
the Securities Exchange Act of 1934, as amended.
“Seller
Common Stock”
has
the
meaning set forth in the recitals.
“Seller
Confidential Information”
has the
meaning set forth in §5(d).
“Seller”
has the
meaning set forth in the preface above.
“Seller
Stockholder”
means
each person who or that holds any shares of capital stock of Seller set forth
on
Exhibit
A
as of
the Closing Date.
“Seller
Warrants”
has
the
meaning set forth in §2(g)(i)(B).
3
“Tax”
or
“Taxes”
means
any federal, state, local, or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, windfall profits,
environmental (including taxes under Code §59A), customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other
tax of any kind whatsoever, whether computed on a separate or consolidated,
unitary or combined basis or in any other manner, including any interest,
penalty, or addition thereto, whether disputed or not and including any
obligation to indemnify or otherwise assume or succeed to the Tax liability
of
any other Person.
“Subsidiary”
means,
with respect to any Person, any corporation, limited liability company,
partnership, association, or other business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election
of
directors, managers, or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof or (ii) if a limited liability company,
partnership, association, or other business entity (other than a corporation),
a
majority of the partnership or other similar ownership interests thereof
is at
the time owned or controlled, directly or indirectly, by that Person or one
or
more Subsidiaries of that Person or a combination thereof and for this purpose,
a Person or Persons own a majority ownership interest in such a business
entity
(other than a corporation) if such Person or Persons shall be allocated a
majority of such business entity’s gains or losses or shall be or control any
managing director or general partner of such business entity (other than
a
corporation). The term “Subsidiary”
shall
include all Subsidiaries of such Subsidiary.
“Surviving
Corporation”
has
the
meaning set forth in §2(a).
“Tax
Return”
means
any return, declaration, report, claim for refund, or information return
or
statement relating to Taxes, including any schedule or attachment thereto,
and
including any amendment thereof.
| §2. |
Basic
Transaction.
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(a)
The
Merger.
Upon the
terms and subject to the conditions of this Agreement and in accordance with
Law
32, Seller will merge with and into Merger Sub at the Effective Time of the
Merger. Following the Merger, the separate corporate existence of Seller
shall
cease, and Merger Sub shall continue as the surviving corporation (the
“Surviving
Corporation”)
under
the name of Xxxxxxxxxx.xxx S.A., and as a wholly-owned subsidiary of Buyer.
(b)
Closing.
The
closing of the transactions contemplated by this Agreement (the “Closing”)
shall
take place at the offices of Xxxxxx & Xxxxxxxxx, LLP, 00 Xxxxxxxx,
00xx
Xxxxx,
Xxx Xxxx, XX 00000 commencing at 9:00 a.m. local time on the second business
day
following the satisfaction or waiver of all conditions to the obligations
of the
Parties to consummate the transactions contemplated hereby (other than
conditions with respect to actions the respective Parties will take at the
Closing itself) or such other date as the Parties may mutually determine
(the
“Closing
Date”);
provided,
however,
that
the Closing Date shall be no later than December 15, 2007. At the Closing,
(i)
Seller will deliver to Buyer the various certificates, instruments and documents
referred to in §7(a)
below;
(ii) Buyer will deliver to Seller the various certificates, instruments and
documents referred to in §7(b)
below;
and (iii) Merger Sub and Seller will cause to be filed with the Public Registry
of the Republic of Panama an Agreement of Merger in the form attached hereto
as
Exhibit
B
(“Agreement
of Merger”),
executed in accordance with Law 32, which, for purposes of such filing, shall
be
translated into the Spanish language together with all other filings or
recordings as may be required. The English text of the Agreement of Merger,
to
the extent permitted by Panamanian law, shall also be filed, provided that
if
said English text is not permitted to be filed, it shall nevertheless be
the
operative and prevailing document with respect to the rights and obligations
among the parties hereto and not the Spanish language translation
thereof.
4
(c)
Effective
Time.
The
Merger shall become effective at the time of that the Agreement of Merger
is
accepted for filing in said Public Registry (such time as the Merger becomes
effective being referred to herein as the “Effective
Time”).
(d)
Effect
of the Merger.
The
Merger shall have the effect set forth in Law 32 and in the Agreement of
Merger.
Without limiting the generality of the foregoing and subject to this Agreement,
the Agreement of Merger and Law 32, all the property, rights, privileges,
powers
and franchises of Seller and Merger Sub shall vest in the Surviving Corporation,
and all debts, liabilities and duties of Seller and Merger Sub shall become
the
debts, liabilities and duties of the Surviving Corporation.
(e)
Articles
of Incorporation of the Surviving Corporation.
The
articles of incorporation of Merger Sub as set forth in the Agreement of
Merger,
shall become the articles of incorporation of the Surviving Corporation after
the Effective Time, until thereafter amended as provided by Law 32 and such
articles of incorporation.
(f)
Directors
and Officers. After
the
Effective Time, the directors and officers of Merger Sub shall be as set
forth
in the Agreement of Merger. Directors and officers shall serve for the periods
provided in the articles of incorporation of Merger Sub, as in effect at
the
Effective Time.
(g)
Effect
on Seller Common Stock.
At the
Effective Time, by virtue of the Merger and without any action on the part
of
Merger Sub, Buyer, Seller or the holders of any securities of Merger Sub,
Buyer
or Seller:
(i)
Seller
Common Stock; Warrants to Purchase Seller Common Stock .
Subject
to §2(g)(iv)
below,
(A) each share of Seller Common Stock issued and outstanding immediately
prior
to the Effective Time shall be converted, without any action on the part
of the
holders thereof, into the right to receive .000565
share of Buyer Preferred Stock which upon the terms and subject to the
conditions set forth in the Certificate of Designation to be agreed upon
by the
parties hereto, shall vote on all matters with shares of Buyer Common Stock
as a
single class. Each share of Buyer Preferred Stock for voting purposes shall
be
equal to 168,729.068 shares of Buyer Common Stock; and (B) each warrant to
purchase Seller Common Stock (“Seller Warrants”) issued and outstanding
immediately prior to the Effective Time shall be exchanged for warrants to
purchase Buyer Preferred Stock (“Buyer Warrants”) exercisable on the same terms
and conditions for .000565 share
of
Buyer Preferred Stock.
The
shares of Buyer Preferred Stock and Buyer Warrants are sometimes referred
to as
“Merger Consideration”. Notwithstanding the foregoing, no fractional shares
shall be issuable and the Merger Consideration payable to any Seller Stockholder
shall be rounded down to the nearest whole share of Buyer Preferred Stock.
No
cash will be issued in lieu of fractional shares.
(ii)
Capital
Stock of Merger Sub.
The
shares of the capital stock of Merger Sub shall be unaffected by the Merger,
and
at and after the Effective Time, Merger Sub shall continue as a wholly-owned
subsidiary of Buyer.
(iii)
Adjustment
of the Merger Consideration.
If,
subsequent to the date of this Agreement but prior to the Effective Time,
the
outstanding shares of Buyer Common Stock or Seller Common Stock shall have
been
changed into a different number of shares or a different class as a result
of a
stock split, stock dividend, subdivision, reclassification, split, combination,
exchange, recapitalization or other similar transaction, the Merger
Consideration shall be appropriately adjusted so that the aggregate amount
payable pursuant to this Agreement shall not have increased or decreased
as a
result of such adjustment.
(iv)
Certificate
Legends.
The
shares of Buyer Preferred Stock to be issued pursuant to §2(g)
shall
not have been registered and shall be characterized as “restricted securities”
under the Securities Act, and such shares may be resold without registration
under the Securities Act only in certain limited circumstances. Each certificate
evidencing shares of Buyer Preferred Stock to be issued pursuant to §2(g)
shall
bear the following legend (and any legends required by state securities
laws):
5
“THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY
NOT
BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION WITHOUT
AN
EXEMPTION UNDER THE SECURITIES ACT OR AN OPINION OF LEGAL COUNSEL REASONABLY
ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”
(h)
Surrender
of Certificates.
(i)
Exchange
Agent.
Continental Stock Transfer & Trust Co. shall act as Exchange Agent
(“Exchange Agent”) in the Merger.
(ii)
Buyer
to Provide Preferred Stock.
Promptly
after the Effective Time, Buyer shall supply or cause to be supplied to the
Exchange Agent for exchange in accordance with this §2(h)
through
such reasonable procedures as Buyer may adopt certificates evidencing the
shares
of Buyer Preferred Stock pursuant to §2(g)(i)
to be
exchanged for shares of Seller Common Stock outstanding immediately prior
to the
Effective Time (collectively, all shares issuable are referred to as the
“Exchange
Fund”).
Buyer
shall further supply or cause to be supplied agreements representing the
Buyer
Warrants in exchange for Seller Warrants.
(iii)
Exchange
Procedures.
Promptly
after the Effective Time, the Surviving Corporation shall cause to be mailed
to
each holder of record of a certificate or certificates (“Certificates”)
that
immediately prior to the Effective Time represented outstanding shares of
Seller
Common Stock whose shares were converted into the right to receive shares
of
Buyer Preferred Stock pursuant to §2(g)(i):
(A) a
letter of transmittal (which shall specify that delivery shall be effected,
and
risk of loss and title to the Certificates shall pass, only upon receipt
of the
certificates by the Exchange Agent, and shall be in such form and have such
other provisions as Buyer may reasonably specify); (B) such other customary
documents as may be required pursuant to such instructions; and (C) instructions
for use in effecting the surrender of the Certificates in exchange for
certificates representing shares of Buyer Preferred Stock and the agreements
representing the Buyer Warrants. Upon surrender of a Certificate for
cancellation to the Exchange Agent or to such other agent or agents as may
be
appointed by Buyer, together with such letter of transmittal and other
documents, duly completed and validly executed in accordance with the
instructions thereto, the holder of such Certificate shall be entitled to
receive in exchange therefor the number of whole shares of Buyer Preferred
Stock
into which such holder’s shares of Seller Common Stock have been converted.
Until so surrendered, each outstanding Certificate that prior to the Effective
Time represented shares of Seller Common Stock will be deemed from and after
the
Effective Time, for all corporate purposes other than the payment of dividends,
to evidence the ownership of the number of whole shares of Buyer Preferred
Stock
into which such shares of Seller Common Stock shall have been so
converted.
(iv)
Distributions
With Respect to Unexchanged Shares.
No
dividends or other distributions with respect to Buyer Preferred Stock with
a
record date after the Effective Time will be paid to the holder of any
unsurrendered Certificate with respect to the shares of Buyer Preferred Stock
to
be delivered in exchange therefor until the holder of record of such Certificate
shall surrender such Certificate in the manner provided in §2(h) (iii), above.
Subject to applicable law, following such surrender, there shall be paid
to the
record holder of the certificates representing whole shares of Buyer Preferred
Stock issued in exchange therefore, without interest, at the time of such
surrender, the amount of any such divided or other distributions with a record
date after the Effective Time theretofore payable but for the provisions
of this
§2(h)(iv)
with
respect to such shares of Buyer Preferred Stock.
(v)
Transfer
of Ownership.
At the
Effective Time, the stock transfer books of Seller shall be closed, and there
shall be no further registration of transfers of Seller Common Stock thereafter
on the records of Seller. If any certificate for shares of Buyer Preferred
Stock
is to be issued in a name other than that in which the Certificate surrendered
in exchange therefore is registered, it will be a condition of the issuance
thereof that the Certificate so surrendered will be properly endorsed and
otherwise in proper form for transfer and that the person requesting such
exchange will have paid to Buyer or any agent designated by it any transfer
or
other taxes required by reason of the issuance of a certificate for shares
of
Buyer Preferred Stock in any name other than that of the registered holder
of
the Certificate surrendered, or established to the satisfaction of Buyer
or any
agent designated by it that such tax has been paid or is not
payable.
6
(vi)
Termination
of Exchange Fund.
Any
portion of the Exchange Fund which remains undistributed to the Seller
Stockholders one hundred eighty (180) days after the Effective Time shall
be
delivered to Buyer upon demand, and any shareholders of Seller who have not
previously complied with this §2(h)
shall
thereafter look only to Buyer for payment of their claim for the Merger
Consideration and any dividends or distributions with respect to Buyer Preferred
Stock.
(vii)
No
Liability.
Neither
Seller, Buyer, Merger Sub, the Surviving Corporation nor the Exchange Agent
shall be liable to any person with respect to any amount properly paid to
a
public official pursuant to any applicable abandoned property, escheat or
similar law.
(i)
No
Further Ownership Rights in Seller Capital Stock. The
Merger Consideration delivered upon the surrender for exchange of shares
of
Seller Common Stock in accordance with the terms hereof (including any dividends
or distributions) shall be deemed to have been issued in full satisfaction
of
all rights pertaining to such shares of Seller Common Stock.
(j)
Lost,
Stolen or Destroyed Certificates.
In the
event any Certificate shall been lost, stolen or destroyed, the Exchange
Agent
shall issue in exchange for such lost, stolen or destroyed Certificate, upon
the
making of an affidavit of that fact by the holder thereof such Merger
Consideration (and dividends and distributions) as may be required pursuant
to
§2(g).
(k)
Taking
of Necessary Action; Further Action. Each
of
Buyer, Merger Sub and Seller will take all such reasonable and lawful action
as
may be necessary or desirable in order to effectuate the Merger in accordance
with this Agreement as promptly as possible. If, at any time after the Effective
Time, any further action is necessary or desirable to carry out the purposes
of
this Agreement and to vest the Surviving Corporation with full right, title
and
possession to all assets, property, rights, privileges, powers and franchises
of
Seller and Merger Sub, the officers and directors of Seller and Merger Sub
are
fully authorized in the name of their respective corporations or otherwise
to
take, and will take, all such lawful; and necessary action, so long as such
action is not inconsistent with this Agreement.
(l)
Warrants.
The
Buyer Warrants to be issued pursuant to §2(g)(i)(B)
above
upon the exchange of Seller Warrants will be exercisable for a period of
five
years commencing on the day following the Closing Date and exercisable for
shares of Buyer Preferred Stock based upon the exchange ratio of shares of
Buyer
Preferred Stock for each share of Seller Common Stock. If Buyer effects a
Reverse Stock Split (as defined in §6(d)) with respect to Buyer Common Stock,
the exercise price and the number of shares of Buyer Preferred Stock that
the
Buyer Warrants are exercisable into following the Closing will not adjust,
provided that upon such Reverse Stock Split with respect to Buyer Common
Stock,
the number of shares of Buyer Common Stock into which shares of Buyer Preferred
Stock are convertible shall be adjusted.
| §3. |
Seller’s
Representations and Warranties.
|
Seller
represents and warrants to Buyer and Merger Sub that the statements contained
in
this §3
are
correct and complete as of the date of this Agreement and will be correct
and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this
§3),
except
as disclosed in writing to Buyer prior to the execution of this
Agreement.
(a)
Organization,
Qualification and Power of Seller.
Seller
is a corporation duly organized, validly existing, and in good standing under
the laws of the jurisdiction of its incorporation. Seller has the corporate
power to own its properties and to carry on its business as now being conducted
and as proposed to be conducted and is duly qualified to do business and
is in
good standing in each jurisdiction in which the failure to be so qualified
and
in good standing could reasonably be expected to have a Material Adverse
Effect
on Seller. Seller has delivered a true and correct copy of its articles of
incorporation as amended to date, to Buyer. Seller has no Bylaws.
7
(b)
Authorization
of Transaction.
Subject
to the approval of the Seller Stockholders, Seller has full power and authority
(including full corporate or other entity power and authority) to execute
and
deliver this Agreement and to perform its obligations hereunder. Upon the
approval of the Seller Stockholders, this Agreement shall constitute the
valid
and legally binding obligation of Seller, enforceable in accordance with
its
terms and conditions, except that enforcement hereof may be limited by any
court
having jurisdiction in an appropriate action with respect to (i) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other similar
laws now or hereafter in effect relating to creditors’ rights generally, and
(ii) general principles of equity (regardless of whether such enforceability
is
considered in a proceeding in equity or at law). The execution, delivery
and
performance of this Agreement and all other agreements contemplated hereby
have
been duly authorized by Seller.
(c)
Non-contravention.
Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or
other
restriction of any government, governmental agency, or court to which Seller
is
subject or any provision of the articles of incorporation of Seller, or (ii)
conflict with, result in a breach of, constitute a default under, result
in the
acceleration of, create in any party the right to accelerate, terminate,
modify,
or cancel, or require any notice under any agreement, contract, lease, license,
instrument, or other arrangement to which Seller is a party or by which it
is
bound or to which any of its assets is subject (or result in the imposition
of
any Lien upon any of its assets). Seller is not required to give any notice
to,
make any filing with, or obtain any authorization, consent, or approval of
any
government or governmental agency in order for the Parties to consummate
the
transactions contemplated by this Agreement, except for (i) filing of the
Agreement of Merger as provided in §2(b)
; and
(ii) filings required under Regulation D promulgated under the Securities
Act of
1933.
(d)
Brokers’
Fees.
Seller
has no Liability to pay any fees or commissions to any broker, finder, or
agent
with respect to the transactions contemplated by this Agreement for which
Buyer
could become liable or obligated.
(e)
Title
to Assets.
Seller
has good and marketable title to, or a valid leasehold interest in, the
properties and assets shown on the audited Financial Statements (as defined
in
(g) below) or acquired after the date thereof, free and clear of all
Liens.
(f)
Subsidiaries.
Seller
has no subsidiaries. Seller does not control directly or indirectly or have
any
direct or indirect equity participation in any corporation, partnership,
trust,
or other business association that is not a Subsidiary of Seller. Seller
does
not own or have any right to acquire, directly or indirectly, any outstanding
capital stock of, or other equity interests in, any Person.
(g)
Financial
Statements; Capitalization.
Seller
will prepare and will cause audited financial statements of Seller to be
prepared by Seller’s auditors (collectively the “Financial
Statements”).
The
Financial Statements (including the notes thereto) when prepared will present
fairly the financial condition of Seller as of such dates and the results
of
operations of Seller for such periods, will be correct and complete in all
material respects, and will be consistent with the books and records of Seller
(which books and records are correct and complete in all material
respects.
The
authorized capital stock of Seller consists of 20,000,000 shares of Seller
Common Stock, of which there are issued and outstanding as of the close of
business on the date hereof 17,700,000 shares. All outstanding shares of
Seller
Common Stock are duly authorized, validly issued, fully paid and non-assessable
and are free of any Liens other than any Liens created by or imposed upon
the
holders thereof and are not subject to pre-emptive rights or rights of first
refusal created by statute or the articles of incorporation of Seller or
any
agreement to which Seller is a party or by which it is bound. As of the same
date, there were 6,200,000 shares of Seller Common Stock reserved for issuance
in connection with Seller Warrants. Seller has delivered to Buyer true and
complete copies of each form of agreement or common stock warrant evidencing
each Seller Stock Warrant. Except for the rights created pursuant to this
Agreement and the rights disclosed in this §3(g),
there
are no other options, warrants, calls, rights, commitments or agreements
of any
character to which Seller is a party or by which it is bound, obligating
Seller
to issue, deliver, sell, repurchase or redeem or cause to be issued, delivered,
sold, repurchased or redeemed, any shares of Seller Common Stock or obligating
Seller to grant, extend, accelerate the vesting of, change the price of,
or
otherwise amend or enter into any such option, warrant, call, right, commitment
or agreement.
8
(h)
Absence
of Certain Events. Since
the
date of formation of Seller, there has not been any Material Adverse Change.
Without limiting the generality of the foregoing and except as disclosed
in
writing to Buyer prior to execution of this Agreement, since that
date:
(i)
Seller has not amended or authorized the amendment of its original articles
of
incorporation;
(ii)
Seller has not sold, leased, transferred, or assigned any of its assets,
tangible or intangible, other than for a fair consideration in the Ordinary
Course of Business;
(iii)
Seller has not entered into any agreement, contract, lease, or license (or
series of related agreements, contracts, leases, and licenses), except for
an
existing license with Plus 44 Holdings, Inc., a Panamanian
corporation;
(iv)
no
party (including Seller) has accelerated, terminated, modified, or cancelled
any
agreement, contract, lease, or license (or series of related agreements,
contracts, leases, and licenses) to which Seller is a party or by which any
of
them is bound;
(v)
Seller has not imposed or permitted to exist any Lien upon any of its assets,
tangible or intangible;
(vi)
Seller has not made any capital expenditure (or series of related capital
expenditures);
(vii)
Seller has not made any capital investment in, any loan to, or any acquisition
of the securities or assets of, any other Person (or series of related capital
investments, loans, and acquisitions);
(viii)
Seller has not issued any note, bond, or other debt security or created,
incurred, assumed, or guaranteed any indebtedness for borrowed money or
capitalized lease obligation;
(ix)
Seller has not delayed or postponed the payment of accounts payable and other
Liabilities;
(x)
Seller has not cancelled, compromised, waived, or released any right or claim
(or series of related rights and claims);
(xi)
Seller has not transferred, assigned, or granted any license or sublicense
of
any rights under or with respect to any Intellectual Property;
(xii)
Seller has not issued, sold, or otherwise disposed of any of its capital
stock,
or granted any options, warrants, or other rights to purchase or obtain
(including upon conversion, exchange, or exercise) any of its capital stock,
except in connection with the Pre-Closing Financing;
(xiii)
Seller has not declared, set aside, or paid any dividend or made any
distribution with respect to its capital stock (whether in cash or in kind)
or
redeemed, purchased, or otherwise acquired any of its capital
stock;
9
(xiv)
Seller has not experienced any damage, destruction, or loss (whether or not
covered by insurance) to its property;
(xv)
Seller has not made any loan to, or entered into any other transaction with,
any
of its directors, officers, and employees;
(xvi)
Seller has not entered into any employment contract or collective bargaining
agreement, written or oral, or modified the terms of any existing such contract
or agreement;
(xvii)
Seller has not granted any increase in the base compensation of any of its
directors, officers, and employees;
(xviii)
Seller has not adopted any Employee Benefit Plan;
(xix)
Seller has no employment arrangements with any of its directors, officers,
and
employees;
(xx)
Seller has not made or pledged to make any charitable or other capital
contribution;
(xxi)
Seller has not paid any amount to any third party with respect to any Liability
(including any costs and expenses Seller has incurred or may incur in connection
with this Agreement and the transactions contemplated hereby) that would
not
constitute an Assumed Liability if in existence as of the Closing;
(xxii)
there has not been any other material occurrence, event, incident, action,
failure to act, or transaction outside the Ordinary Course of Business involving
Seller;
(xxiii)
Seller has not discharged a material Liability or Lien outside the Ordinary
Course of Business;
(xxiv)
Seller has not made any loans or advances of money;
(xxv)
Seller has not disclosed any Seller Confidential Information as defined in
§5(e)
otherwise than in accordance with this Agreement; and
(xxvi)
Seller has not committed to any of the foregoing.
(i)
Undisclosed
Liabilities.
To
Seller’s Knowledge, Seller does not have any Liability, except for
(i) Liabilities set forth in the Financial Statements and (ii) Liabilities
that have arisen in the Ordinary Course of Business (none of that results
from,
arises out of, relates to, is in the nature of, or was caused by any breach
of
contract, breach of warranty, tort, infringement, or violation of law).
(j)
Legal
Compliance.
To
Seller’s Knowledge, Seller has complied with all applicable laws (including
rules, regulations, codes, plans, injunctions, judgments, orders, decrees,
rulings, and charges thereunder and including the Foreign Corrupt Xxxxxxxxx
Xxx,
00 X.X.X. § 00xx-0 et
seq.)
of
federal, state, local, and foreign governments (and all agencies thereof),
and
Seller has not received any written notice that any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, demand, or notice has been
filed or commenced against Seller alleging any failure so to
comply.
(k)
Tax
Matters.
(i)
Seller is not and has not been required to file any Tax Return. All Taxes
owed
by Seller (whether or not shown or required to be shown on any Tax Return)
have
been paid. There are no Liens on any of the assets of Seller that arose in
connection with any failure (or alleged failure) to pay any Tax.
10
(ii)
Seller is not and has not been required to withhold or pay any tax.
(l)
Tangible
Assets.
Seller
owns or leases no buildings, machinery, equipment, and other tangible assets.
(m)
Intellectual
Property.
(i)
Seller owns or possesses, has obtained, or can obtain on commercially reasonable
terms, the right to use pursuant to a valid and enforceable written license,
sublicense, agreement, or permission all Intellectual Property necessary
or
desirable for the operation of the business of Seller as presently conducted
and
as presently proposed to be conducted. Each item of Intellectual Property
owned
or used by Seller immediately prior to the Closing will be owned or available
for use by the Surviving Corporation on identical terms and conditions
immediately subsequent to the Closing hereunder.
(ii)
To
the Knowledge of Seller, Seller has not interfered with, infringed upon,
misappropriated, or otherwise come into conflict with any Intellectual Property
rights of third parties, and Seller has not received any charge, complaint,
claim, demand, or notice alleging any such interference, infringement,
misappropriation, or violation (including any claim that Seller must license
or
refrain from using any Intellectual Property rights of any third party).
To the
Knowledge of Seller, no third party has interfered with, infringed upon,
misappropriated, or otherwise come into conflict with any Intellectual Property
rights of Seller.
(iii)
Seller owns no patent or registration with respect to any Intellectual Property,
has no pending patent application or application for registration, has granted
no license, sublicense, agreement, or other permission with respect to any
of
its Intellectual Property, has no unregistered trademark, service xxxx, trade
name, corporate name or Internet domain name, computer software item and
uses no
material unregistered copyright used by Seller in connection with its business.
(iv)
Seller has disclosed in writing to Buyer each item of Intellectual Property
that
any third party owns and that Seller uses pursuant to license, sublicense,
agreement, or permission. Seller has delivered to Buyer correct and complete
copies of all such licenses, sublicenses, agreements, and permissions (as
amended to date). With respect to each such item of Intellectual Property
required to be disclosed to Buyer, to Seller’s Knowledge:
(A)
the
license, sublicense, agreement, or permission covering the item is legal,
valid,
binding, enforceable, and in full force and effect;
(B)
the
license, sublicense, agreement, or permission will continue to be legal,
valid,
binding, enforceable, and in full force and effect on identical terms following
consummation of the transactions contemplated hereby;
(C)
no
party to the license, sublicense, agreement, or permission is in breach or
default, and to Seller’s Knowledge, no event has occurred that with notice or
lapse of time would constitute a breach or default or permit termination,
modification, or acceleration thereunder;
(D)
no
party to the license, sublicense, agreement, or permission has repudiated
any
provision thereof;
11
(E)
with
respect to each sublicense, the representations and warranties set forth
in
subsections
(A) through (D)
above
are true and correct with respect to the underlying license;
(F)
the
underlying item of Intellectual Property is not subject to any outstanding
injunction, judgment, order, decree, ruling, or charge;
(G)
Seller has not received any written notice that any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand is pending that
challenges the legality, validity, or enforceability of the underlying item
of
Intellectual Property, and to Seller’s Knowledge, none is threatened;
and
(H)
Seller has not granted any sublicense or similar right with respect to the
license, sublicense, agreement, or permission.
(v)
To
the Knowledge of Seller: (A) Seller has not interfered with, infringed upon,
misappropriated, or otherwise come into conflict with, any Intellectual Property
rights of third parties as a result of the continued operation of its business
as presently conducted; and (B) no notices regarding any of the foregoing
(including, without limitation, any demands or offers to license any
Intellectual Property from any third party) have been received.
(vi)
To
the Knowledge of Seller, the owners of any of the Intellectual Property licensed
to Seller have taken all necessary and desirable actions to maintain and
protect
the Intellectual Property covered by such license.
(vii)
Seller has complied in all material respects with and is presently in compliance
in all material respects with all foreign, federal, state, local, governmental
(including, but not limited to, the Federal Trade Commission and State Attorneys
General), administrative or regulatory laws, regulations, guidelines and
rules
applicable to any Intellectual Property.
(n)
Inventory.
Seller
possesses no inventory.
(o)
Contracts.
Seller
has delivered to Buyer a correct and complete copy of said license agreement.
With respect to said license agreement, (A) it is legal, valid, binding,
enforceable and in full force and effect; (B) the agreement will continue
to be legal, valid, binding, enforceable, and in full force and effect on
identical terms immediately following the consummation of the transactions
contemplated hereby; and (C) to Seller’s Knowledge, (i) no party is in breach or
default, and no event has occurred that with notice or lapse of time would
constitute a breach or default, or permit termination, modification, or
acceleration, under the agreement; and (ii) no party has repudiated any
provision of the license agreement.
(p)
Notes
and Accounts Receivable. Seller
has no outstanding notes and accounts receivable.
(q)
Powers
of Attorney.
There
are no outstanding powers of attorney executed on behalf of Seller.
(r)
Insurance.
Seller
holds no insurance
policy (including policies providing property, casualty, liability, and workers’
compensation coverage and bond and surety arrangements).
(s)
Litigation.
Seller
is a party to no actions, suits, proceedings, hearings, and investigations.
(t)
Employees.
Seller
has no employees.
(u)
Guaranties.
Seller
is not a guarantor or otherwise is liable for any Liability (including
indebtedness) of any other Person.
12
(v)
Customers
and Suppliers.
Except
as disclosed by Seller to Buyer pursuant to §3(p), Seller presently has no, and
has never had any, customers and suppliers.
(w)
Disclosure.
The
representations and warranties contained in this §3
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
in this
§3
not
misleading.
(x)
Investment.
Except
as previously disclosed by Seller to Buyer with respect to certain Seller
Stockholders,
Seller
understands that the shares of Buyer Preferred Stock to be issued in the
Merger
to the Seller Stockholders have not been, and will not be, registered under
the
Securities Act, or under any state securities laws, and are being offered
and
sold in reliance upon federal and state exemptions for transactions not
involving any public offering. To Seller’s Knowledge, each Seller Stockholder
(i) is acquiring the shares of Buyer Preferred Stock solely for his, her
or its
own account for investment purposes, and not with a view to the distribution
thereof, (ii) is a sophisticated investor with knowledge and experience in
business and financial matters, (iii) has received certain information
concerning Buyer and has had the opportunity to obtain additional information
as
desired in order to evaluate the merits and the risks inherent in holding
the
shares of Buyer Preferred Stock, (iv) is able to bear the economic risk and
lack
of liquidity inherent in holding the shares of Buyer Preferred Stock, and
(v) is
an Accredited Investor (as defined in Regulation D adopted pursuant to the
Securities Act). To Seller’s Knowledge, the investment representations statement
(in the form as set forth in Exhibit D) executed by each Seller Stockholder
is
true and correct as of the date executed.
| §4. |
Representations
and Warranties of Buyer and Merger Sub.
|
Buyer
and
Merger Sub represent and warrant to Seller that the statements contained
in this
§4
are
correct and complete as of the date of this Agreement and will be correct
and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this
§4),
except
as previously disclosed in writing by Buyer to Seller.
(a)
Organization
of Buyer and Merger Sub.
Each of
Buyer and Merger Sub is a corporation duly organized, validly existing, and
in
good standing under the laws of the jurisdiction of its incorporation. Each
of
Buyer and Merger Sub has the corporate power to own its properties and to
carry
on its business as now being conducted and as proposed to be conducted and
is
duly qualified to do business and is in good standing in each jurisdiction
in
which the failure to be so qualified and in good standing could reasonably
be
expected to have a Material Adverse Effect on Buyer. Buyer has delivered
a true
and correct copy of the Certificate of Incorporation and, in the case of
Buyer,
the Bylaws (or other comparable charter documents), as applicable, of Buyer
and
Merger Sub, respectively, each as amended to date, to Seller. Neither Buyer
nor
Merger Sub is in violation of any of the provisions of its corporate charter
or
bylaws.
(b)
Authorization
of Transaction.
Each of
Buyer and Merger Sub has full power and authority (including full corporate
or
other entity power and authority) to execute and deliver this Agreement and
to
perform its obligations hereunder. This Agreement constitutes the valid and
legally binding obligation of Buyer, enforceable in accordance with its terms
and conditions, except as enforcement may be limited by any court having
jurisdiction in an appropriate action with respect to bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or transfer, or other similar
laws, now or hereafter in effect, relating to creditors’ rights generally and
(ii) general principles of equity (regardless of whether such enforceability
is
considered in a proceeding in equity or at law). The execution, delivery
and
performance of this Agreement and all other agreements contemplated hereby
have
been duly authorized by Buyer and Merger Sub.
(c)
Non-contravention.
Neither
the execution and delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will (i) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or
other
restriction of any government, governmental agency, or court to which Buyer
or
any of its Subsidiaries is subject or any provision of its charter, bylaws,
or
other governing documents or (ii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any
party
the right to accelerate, terminate, modify, or cancel, or require any notice
under any agreement, contract, lease, license, instrument, or other arrangement
to which Buyer or any of its Subsidiaries is a party or by which it is bound
or
to which any of its assets are subject, except in the case of each of clauses
(i) and (ii), such as could not, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect. Neither Buyer
nor
Merger Sub needs to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency
in
order for the Parties to consummate the transactions contemplated by this
Agreement, other than (i) the filing of the Agreement of Merger, together
with
any required officers’ certificates as provided in §2;
(ii)
any filings required any filings required by state securities laws, (iii)
the
filing of a Notice of a Sale of Securities on Form D with the SEC under
Regulation D of the Securities Act, (iv) those that have been made or obtained
prior to or contemporaneously with the date of this Agreement; (v) the approval
of Buyer’s stockholders for Buyer to amend its Certificate of Incorporation in
order to effect the Reverse Stock Split and as contemplated by §6(d)
of this
Agreement; and (vi) the filing of any Form 8-K with the SEC with respect
to this
Agreement or the transactions contemplated hereby.
13
(d)
Capitalization.
Buyer
is
authorized to issue 950,000,000 shares of Buyer Common Stock and 20,000,000
shares of Buyer Preferred Stock. As of the date hereof, 421,822,670 shares
of
Buyer Common Stock are issued and outstanding, Buyer Options to purchase
36,621,348 shares of Buyer Common Stock are issued and outstanding, 240,831,660
Buyer Warrants are issued and outstanding and no shares of Buyer Preferred
Stock
issued and outstanding. No securities of Buyer are entitled to preemptive
or
similar rights, and no entity or person has any right of first refusal,
preemptive right, right of participation, or any similar right to participate
in
the transactions contemplated by this Agreement unless any such rights have
been
waived. Except as disclosed above in this §4(d)or
in
writing to Buyer prior to execution of this Agreement, 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 exchangeable for, or giving any entity or person any
right
to subscribe for or acquire, any shares of Buyer Common Stock, or contracts,
commitments, understandings or arrangements by which Buyer is or may become
bound to issue additional shares of Buyer Common Stock, or securities or
rights
convertible or exchangeable into shares of Buyer Common Stock.
Merger
Sub is authorized to issue 10,000 shares of common stock of Merger Sub
(“Merger
Sub Common Stock”),
all
of which are issued and outstanding. Merger Sub has no other class of securities
authorized, issued or outstanding as of the date hereof. No securities of
Merger
Sub are entitled to preemptive or similar rights, and no entity or person
has
any right of first refusal, preemptive right, right of participation, or
any
similar right to participate in the transactions contemplated by this Agreement
unless any such rights have been waived. 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
exchangeable for, or giving any entity or person any right to subscribe for
or
acquire, any shares of Merger Sub Common Stock, or contracts, commitments,
understandings or arrangements by which Merger Sub is or may become bound
to
issue additional shares of Merger Sub Common Stock, or securities or rights
convertible or exchangeable into shares of Merger Sub Common Stock.
(e)
Buyer
Preferred Stock Issuable at Closing.
Each
of
the
shares of Buyer Preferred Stock and the Buyer Warrants issuable at the Closing
has been duly authorized and, when issued and delivered in exchange for shares
of Seller Common Stock, will be duly and validly issued, fully paid and
nonassessable, will not be issued in violation of any preemptive or other
rights
of any stockholder, and will be issued free and clear of all liens and
encumbrances, other than restrictions on transfer under applicable securities
laws. Buyer has reserved (i) all shares of Buyer Preferred Stock issuable
upon
exercise of Buyer Warrants from its duly authorized capital stock and (ii)
all
shares of Buyer Common Stock issuable upon conversion of Buyer Preferred
Stock,
subject, in each case, to the effect of the Reverse Stock Split.
(f)
Buyer’s
SEC Reports.
Except
as disclosed in writing by Buyer to Seller, since December 1, 2005, Buyer
has
filed all reports, schedules, forms, statements and other documents with
the SEC
(collectively, and in each case, including all exhibits and schedules thereto
and documents incorporated by reference therein, the “SEC
Reports”)
required to be filed by Buyer under the Securities Act and the Exchange Act,
including reports, schedules, forms, statements and other documents required
to
be filed pursuant to Section 13(a) or 15(d) thereof, on a timely basis or
has
timely filed a request for extension of such time of filing and has filed
any
such SEC Reports prior to the expiration of any such extension. As of their
respective dates, Buyer SEC Reports complied in all respects with the
requirements of the Securities Act and the Exchange Act and the rules and
regulations of the SEC promulgated thereunder, and none of the SEC Reports,
when
filed, contained any untrue statement of a material fact or omitted to state
a
material fact required to be stated therein or necessary in order to make
the
statements therein, in light of the circumstances under which they were made,
not misleading. The financial statements of Buyer included in Buyer’s SEC
Reports comply in all respects with applicable accounting requirements and
the
rules and regulations of the SEC with respect thereto as in effect at the
time
of filing. Such financial statements have been prepared in accordance with
GAAP
applied
on a consistent basis during the periods involved, except as may be otherwise
specified in such financial statements or the notes thereto, and fairly present
in all material respects the financial position of Buyer as of and for the
dates
thereof and the results of operations and cash flows for the periods then
ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end
audit adjustments.
14
(g)
Litigation.
There is no pending or, to the best knowledge of Buyer, threatened action,
suit,
proceeding or investigation before any court, governmental agency or body,
or
arbitrator having jurisdiction over Buyer or any of its Affiliates that would
affect the execution by Buyer or the performance by Buyer of its obligations
under this Agreement, and all other agreements entered into by Buyer relating
hereto. There is no pending or, to the best knowledge of Buyer, threatened
action, suit, proceeding or investigation before any court, governmental
agency
or body, or arbitrator having jurisdiction over Buyer, or any of its Affiliates
which litigation if adversely determined could have a Material Adverse Effect
on
Buyer.
(h)
No
Undisclosed Liabilities.
Except for Buyer’s obligation to pay certain liquidated damages with respect to
the registration rights agreement in connection with Buyer’s 2006 private
placement arising out of Buyer’s failure to keep effective its registration
statement that was declared effective on December 19, 2006, Buyer has no
liabilities or obligations which are material, individually or in the aggregate,
other than those incurred in the Ordinary Course of Business of Buyer since
January 1, 2007 or which, individually or in the aggregate, would reasonably
be
expected to have a Material Adverse Effect on Buyer.
(i)
No
Undisclosed Events or Circumstances.
Since January 1, 2007, no event or circumstance has occurred or exists with
respect to Buyer or its businesses, properties, operations or financial
condition, that, under applicable law, rule or regulation, requires public
disclosure or announcement prior to the date hereof by Buyer but which has
not
been so publicly announced or disclosed in Buyer’s SEC Reports.
(j)
Brokers’
Fees.
Buyer
has no Liability to pay any fees or commissions to any broker, finder, or
agent
with respect to the transactions contemplated by this Agreement for which
Seller
could become liable or obligated.
(l)
Interim
Operations of Merger Sub. Merger
Sub was formed solely for the purpose of engaging in the transactions
contemplated by this Agreement, has engaged in no other business activities,
and
has conducted its operations only as contemplated by this
Agreement.
(m)
Disclosure.
The
representations and warranties contained in this §4
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
in this
§4
not
misleading. The disclosures contained in Buyer’s SEC Reports 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 in Buyer’s SEC Reports
not misleading.
(n)
No
Amendments. Since
January 1, 2007, neither Buyer nor Merger Sub has amended its respective
articles of incorporation.
(o)
Subsidiaries,
Rights of Participation and Rights to Acquire. Except
for Merger Sub, Buyer has no subsidiaries. Buyer does not control directly
or
indirectly or have any direct or indirect equity participation in any
corporation, partnership, trust, or other business association that is not
a
Subsidiary of Buyer. Buyer does not own or have any right to acquire, directly
or indirectly, any outstanding capital stock of, or other equity interests
in,
any Person other than under this Agreement.
15
(p)
Employees.
Except
as
disclosed in Buyer’s SEC Reports, Buyer has only one employee and does not
maintain, nor is it a party to, any employee benefit plan.
| §5. |
Pre-Closing
Covenants.
|
The
Parties agree as follows with respect to the period between the execution
of
this Agreement and the Closing:
(a)
General.
Each of
the Parties will use its reasonable best efforts to take all actions and
to do
all things necessary, proper, or advisable in order to consummate and make
effective the transactions contemplated by this Agreement (including
satisfaction, but not waiver, of the Closing conditions set forth in
§7
below).The Parties will give any notices to, make any filings with, and use
its
commercially reasonable efforts to obtain any authorizations, consents, and
approvals of governments and governmental agencies in connection with the
matters referred to in §3(c) and §4(c) above.
(b)
Operation
of Business.
Seller
and Buyer will not engage in any practice, take any action, or enter into
any
transaction involving an aggregate consideration of greater than $5,000 and
outside the Ordinary Course of Business, without the prior written consent
of
the other, which consent will not be unreasonably withheld, except with respect
to expenses incurred in connection with this Agreement. Without limiting
the
generality of the foregoing, neither party will (i) declare, set aside, or
pay
any dividend or make any distribution with respect to its capital stock,
or (ii)
engage in any practice, take any action, or enter into any transaction of
the
sort described in §3(h)
above
without the prior consent of the other. During the period between execution
of
this Agreement and the Closing Date, neither Seller nor Buyer shall enter
into
any extraordinary contract or agreement or increase any employee’s compensation
without the prior written consent of the other Party, which consent may not
be
unreasonably withheld, except with respect to expenses incurred in connection
with this Agreement.
(c)
Preservation
of Business.
The
parties will keep their respective businesses and properties substantially
intact, including their respective present operations, physical facilities,
working conditions, insurance policies, and relationships with lessors,
licensors, suppliers, customers, and employees.
(d)
Full
Access; Confidentiality; Right to Interview.
Seller
will permit representatives of Buyer (including legal counsel and accountants)
to have full access at all reasonable times, and in a manner so as not to
interfere with the normal business operations of Seller, to all premises,
properties, personnel, books, records (including Tax records), contracts,
and
documents of or pertaining to Seller. Any materials and information provided
to
Buyer by Seller shall be deemed confidential and proprietary (“Seller
Confidential Information”).
Buyer
shall not disclose any Seller Confidential Information except to its officers,
employees and advisors specifically retained by Buyer in connection with
the
transactions contemplated by this Agreement. All information provided to
Buyer
by Seller shall, to Seller’s Knowledge, be accurate and shall not be false or
misleading.
Buyer
will permit representatives of Seller (including legal counsel and accountants)
to have full access at all reasonable times, and in a manner so as not to
interfere with the normal business operations of Buyer, to all premises,
properties, personnel, books, records (including Tax records), contracts,
and
documents of or pertaining to Buyer. Any materials and information provided
to
Seller by Buyer that are not included in Buyer’s SEC Reports or other publicly
available information shall be deemed confidential and proprietary
(“Buyer
Confidential Information”).
Seller shall not disclose any Buyer Confidential Information except to its
officers, employees and advisors specifically retained by Seller in connection
with the transactions contemplated by this Agreement. All information provided
to Seller by Buyer shall, to Buyer’s Knowledge, be accurate and shall not be
false or misleading.
16
Buyer
and
Seller shall have the right to interview the other Party’s employees, and each
Party agrees to use its reasonable discretion with respect to any such
interview.
(e)
Notice
of Developments.
Each
Party will give prompt written notice to the other Party of any material
adverse
development causing a breach of any of its own representations and warranties
in
§3
and
§4
above.
No disclosure by any Party pursuant to this §5(e),
however, shall be deemed to prevent or cure any misrepresentation, breach
of
warranty, or breach of covenant to the extent that such information was known
to, or should have been known by, the disclosing Party as of the date of
execution of this Agreement.
(f)
Exclusivity.
Until
the earlier of December 15, 2007 or
the
date on which this Agreement is terminated pursuant to §8
hereof,
without the prior written consent of Buyer, Seller will not, directly or
indirectly through any officer, director agent, representative or otherwise
take
any action to (i) solicit, initiate, or encourage the submission of any proposal
or offer from any Person relating to the acquisition of any capital stock
or
other voting securities, or any substantial portion of the assets, of Seller
(including any acquisition structured as a merger, consolidation, or share
exchange) or (ii) participate in any discussions or negotiations regarding,
furnish any information with respect to, assist or participate in, or facilitate
in any other manner any effort or attempt by any Person to do or seek any
of the
foregoing. Seller will notify Buyer immediately if any Person makes any
proposal, offer, inquiry, or contact with respect to any of the foregoing.
(g)
No
Other Issuances of Buyer Common Stock.
Buyer
will not purchase, sell (including through short sales) or issue any securities
prior to the Closing Date except for shares of Buyer Common Stock issuable
upon
the exercise of outstanding Buyer Options and Buyer Warrants or enter into
any
agreement or commitment to do so.
(h)
Seller
Stockholders’ Approval.
Prior
to the Closing Date, Seller shall obtain approval of the Seller Stockholders
to
the proposed transactions contemplated by this Agreement.
(i)
Audited
Financials of Seller. Seller
will provide audited Financial Statements for the period ended November 30,
2007
with respect to Seller’s business and operations, audited by Lic. Xxxxx X.
Xxxxxx, a Panamanian authorized public accountant, or another auditor selected
by Seller, subject to the approval of Buyer, which shall not unreasonably
be
withheld or delayed.
(j)
Prohibition
in Trading Buyer Common Stock. From
the
date hereof until the earlier of the Closing Date or the termination of this
Agreement, neither Seller nor any Affiliate of Seller shall, directly or
indirectly, purchase or sell (including short sales) any shares of Buyer
Common
Stock in any public market.
(k)
Sales
of Shares Pursuant to Regulation D.
The
Parties hereto acknowledge and agree that the shares of Buyer Preferred Stock
issuable to Seller pursuant to Section 2(g) shall constitute “restricted
securities” under the Securities Act. The certificates of Buyer Preferred Stock
shall bear the legend set forth in §2(g).
Each
Seller Stockholder shall execute and deliver to Buyer an Investor Representation
Statement in the form attached as Exhibit
D.
Seller
acknowledges and understands that Buyer is relying on the written
representations made by each Seller Stockholder in the Investor Representation
Statement.
(l)
Blue
Sky Laws. Buyer
shall take such steps as may be necessary to comply with the securities and
blue
sky laws of all jurisdictions applicable to the issuance of Buyer Preferred
Stock in connection with this Agreement and the transactions contemplated
hereby. Seller shall use its commercially reasonable efforts to assist Buyer
to
comply with the securities and blue sky laws of all jurisdictions applicable
to
the issuance of Buyer Preferred Stock in connection with this Agreement and
the
transactions contemplated hereby.
| §6 |
Post-Closing
Covenants.
|
(a)
Board of Directors of Buyer Following Closing Date. At
the
Effective Time, Buyer shall elect to the Board the following individuals:
Xxxxxx
Xxxxx, Xxx Xxxxxxx and Xxxxxxx Xxxx. Immediately prior to the Effective Time,
Xxxxxx Xxxxx will submit his resignation as a director of Buyer.
17
(b)
Registration
Rights Agreement. Concurrently
with the issuance of the shares of Buyer Preferred Stock, each of the Seller
Stockholders who will receive shares of Buyer Preferred Stock shall execute
a
registration rights agreement, substantially in the form to be agreed upon
by
the parties hereto prior to the Closing (the “Registration
Rights Agreement”).
(c)
Executive
Officers and Management Structure of Buyer Following the
Closing.
Between
the date hereof and 5 days before the Closing Date, Buyer and Seller will
cooperate and agree to establish a new management structure for Buyer including
the new executive officers of Buyer who shall be appointed by the board of
directors of Buyer immediately prior to the Closing.
(d)
Reverse
Stock Split. Subsequent
to the consummation of the Merger, the board of directors of Buyer will approve,
and submit to the stockholders of Buyer for their approval, a 100-to-1 reverse
stock split (or such other ration as determined by the board of directors
of
Buyer ) of shares of Buyer Common Stock (“Reverse
Stock Split”).
(e)
Buyer
Stockholder Approval; Buyer Proxy Solicitation; Buyer Stockholder
Meeting.
Buyer,
acting through its board of directors, shall, in accordance with applicable
law,
as promptly as practicable after the consummation of the Merger, call for
a
special meeting of the stockholders of Buyer, at the earliest practicable
time,
at which Buyer will submit to its stockholders for approval (i) the Reverse
Stock Split, (ii) any amendments to the by-laws of Buyer and/or the articles
of
incorporation of Buyer, as applicable, to effect those changes to the board
of
directors of Buyer as contemplated by §6(a)
above,
and (iii) any necessary amendments to Buyer’s articles of incorporation to
implement a reduction in the total authorized shares of Buyer Common Stock
as
determined by the board of directors of Buyer, provided that all such amendments
are in compliance with the Nevada General Corporation Law and Buyer’s articles
of incorporation and by-laws.
| §7. |
Conditions
to Obligation to Closing.
|
(a)
Conditions
to Obligations of Buyer.
Buyer’s
obligation to consummate the transactions to be performed by it in connection
with the Closing is subject to satisfaction of the following conditions:
(i)
the
representations and warranties set forth in §3
above
shall be true and correct in all material respects at and as of the Closing
Date, except to the extent that such representations and warranties are
qualified by the term “material,” or contain terms such as “Material Adverse
Effect” or “Material Adverse Change,” in which case such representations and
warranties (as so written, including the term “material” or “Material”) shall be
true and correct in all respects at and as of the Closing Date;
(ii)
Seller shall have performed and complied with all of its covenants hereunder
in
all material respects through the Closing, except to the extent that such
covenants are qualified by the term “material,” or contain terms such as
“Material Adverse Effect” or “Material Adverse Change,” in which case Seller
shall have performed and complied with all of such covenants (as so written,
including the term “material” or “Material”) in all respects through the
Closing;
(iii)
Seller shall have procured all of the third-party consents, if any, required
to
effect the Merger;
(iv)
no
action, suit, or proceeding shall be pending or threatened before any court
or
quasi-judicial or administrative agency of any federal, state, local, or
foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (A) prevent consummation
of any of the transactions contemplated by this Agreement, or (B) cause any
of
the transactions contemplated by this Agreement to be rescinded following
consummation;
18
(v)
Seller shall have delivered to Buyer a certificate to the effect that each
of
the conditions specified above in §7(a)(i)-(iv)
is
satisfied in all material respects;
(vi)
all
certificates, opinions, instruments, and other documents required to effect
the
transactions contemplated hereby shall be reasonably satisfactory in form
and
substance to Buyer;
(vii)
Seller shall have delivered to Buyer copies of the articles of incorporation
of
Seller, certified soon before the Closing Date by the Public Registry of
the
Republic of Panama;
(viii)
Seller shall have delivered to Buyer copies of the certificate of good standing
of Seller, issued soon before the Closing Date by the Public Registry of
the
Republic of Panama;
(ix)
Seller shall have delivered to Buyer a certificate of the secretary or an
assistant secretary of Seller, dated the Closing Date, in form and substance
reasonably satisfactory to Buyer, as to: (i) no amendments to the articles
of
incorporation of Seller since the date specified in clause (vii) above; (ii)
the
resolutions of the board of directors of Seller authorizing the execution,
delivery, and performance of this Agreement and the transactions contemplated
hereby;(iii) the approval of the Agreement of Merger by the shareholders
of
Seller; and (v) incumbency and signatures of the officers of Seller executing
this Agreement or any other agreement contemplated by this Agreement;
(x)
Seller shall have received the full amount of the Pre-Closing Financing and
an
officer of Seller shall have certified in writing to Buyer that the required
amounts are currently in Seller’s bank accounts. Buyer may waive any condition
specified in this §7(a)
if it
executes a writing so stating at or prior to the Closing;
(xi)
Buyer and Seller shall have agreed upon the management structure for Buyer
including approving the new executive officers of Buyer; and
(xii)
Seller shall have delivered a fully executed copy of the Software License
and
Services Agreement between Plus 44 Holdings Inc. and Seller.
(b)
Conditions
to Seller’s Obligation.
Seller’s
obligation to consummate the transactions to be performed by it in connection
with the Closing is subject to satisfaction of the following conditions:
(i)
the
representations and warranties set forth in §4
above
shall be true and correct in all material respects at and as of the Closing
Date, except to the extent that such representations and warranties are
qualified by the term “material,” or contain terms such as “Material Adverse
Effect” or “Material Adverse Change,” in which case such representations and
warranties (as so written, including the term “material” or “Material”) shall be
true and correct in all respects at and as of the Closing Date;
(ii)
Buyer and Merger Sub shall have performed and complied with all of their
respective covenants hereunder in all material respects to the Closing, except
to the extent that such covenants are qualified by the term “material,” or
contain terms such as “Material Adverse Effect” or “Material Adverse Change,” in
which case Buyer shall have performed and complied with all of such covenants
(as so written, including the term “material” or “Material”) in all respects
through the Closing;
(iii)
no
action, suit, or proceeding shall be pending or threatened before any court
or
quasi-judicial or administrative agency of any federal, state, local, or
foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (A) prevent consummation
of any of the transactions contemplated by this Agreement or (B) cause any
of
the transactions contemplated by this Agreement to be rescinded following
consummation (and no such injunction, judgment, order, decree, ruling, or
charge
shall be in effect);
19
(iv)
Buyer shall have procured all of the third-party consents, if any, required
to
effect the Merger;
(v)
Buyer
and Merger Sub shall have delivered to Seller a certificate to the effect
that
each of the conditions specified above in §7(b)(i)-(iv)
is
satisfied in all respects;
(v)
Seller shall have obtained the full amount of the Pre-Closing
Financing;
(vi)
all
actions to be taken by Buyer or Merger Sub in connection with consummation
of
the transactions contemplated hereby and all certificates, opinions,
instruments, and other documents required to effect the transactions
contemplated hereby will be reasonably satisfactory in form and substance
to
Seller;
(vii)
Buyer shall have delivered to Seller copies of its articles of incorporation
as
amended, certified soon before the Closing Date by Secretary of State of
the
State of Nevada and the articles of incorporation of Merger Sub, certified
soon
before the Closing Date by the Public Registry of the Republic of
Panama;
(viii)
Buyer shall have delivered to Seller copies of certificates of good standing
of
itself and Merger Sub, respectively issued soon before the Closing Date by
Secretary of State of the State of Nevada and the Public Registry of the
Republic of Panama, respectively;
(ix)
Buyer shall have executed and delivered the Registration Rights Agreement;
and
(x)
This
Agreement and the Merger have received the approval of the holders of a majority
of the issued and outstanding shares of capital stock of Seller entitled
to vote
hereon.
(xi)
Buyer shall have delivered to Seller a certificate of the secretary or an
assistant secretary of Buyer, dated the Closing Date, in form and substance
reasonably satisfactory to Buyer, as to: (i) no amendments to the certificate
of
incorporation or By-laws of Buyer since the date specified in clause
(vii) above;
(ii) the by-laws of Buyer; (iii) the resolutions of the board of directors
(or a
duly authorized committee thereof) of Buyer authorizing the execution, delivery,
and performance of this Agreement and the transactions contemplated hereby
and
(iv) incumbency and signatures of the officers of Buyer executing this Agreement
or any other agreement contemplated by this Agreement;
(xii)
Merger Sub shall have delivered to Seller a certificate of the secretary
or an
assistant secretary of Merger Sub, dated the Closing Date, in form and substance
reasonably satisfactory to Seller, as to: (i) no amendments to its articles
of
incorporation of Merger Sub since the date specified in clause
(vii)
above;
(ii) the resolutions of the board of directors of Merger Sub authorizing
the
execution, delivery, and performance of this Agreement and the transactions
contemplated hereby;(iii) the approval of the Agreement of Merger by the
shareholders of Merger Sub; and (iv) incumbency and signatures of the officers
of Merger Sub executing this Agreement or any other agreement contemplated
by
this Agreement; and
(xiii)
Xxxxxx Xxxxx shall have submitted his resignation as a director of Buyer
prior
to the Effective Time.
Seller
may waive any condition specified in this §7(b)
if it
executes a writing so stating at or prior to the Closing.
| §8. |
Termination.
|
(a)
Termination
of Agreement.
This
Agreement may be terminated at any time prior to the Closing Date as provided
below:
20
(i)
Buyer
and Seller may terminate this Agreement by mutual written consent at any
time
prior to the Closing;
(ii)
Buyer may terminate this Agreement by giving written notice to Seller at
any
time prior to the Closing (A) in the event Seller has breached any material
representation, warranty, covenant or agreement contained in this Agreement,
Buyer has notified Seller of the breach, and the breach has continued without
cure for a period of 30 days after the written notice of breach or (B) if
the
Closing shall not have occurred on or before December 15, 2007, by reason
of the
failure of any condition precedent under §7(a)
hereof
(unless the failure results primarily from Buyer or Merger Sub itself breaching
any representation, warranty, covenant or agreement contained in this
Agreement);
(iii)
Seller may terminate this Agreement by giving written notice to Buyer and
Merger
Sub at any time prior to the Closing (A) in the event Buyer or Merger Sub
has
breached any material representation, warranty, covenant or agreement contained
in this Agreement in any material respect, Seller has notified Buyer and
Merger
Sub of the breach, and the breach has continued without cure for a period
of 30
days after the written notice of breach, (B) if the Closing shall not have
occurred on or before December 15, 2007, by reason of the failure of any
condition precedent under §7(b)
hereof
(unless the failure results primarily from Seller itself breaching any
representation, warranty, covenant or agreement contained in this Agreement);
and
(iv)
Buyer or Seller may terminate this Agreement in the event that this Agreement
and the Merger fail to receive the approval of a majority of the stockholders
of
Seller by giving written notice to the other Party of such failure at any
time
after the stockholder meeting at which such failure occurred.
(b) Effect
of Termination.
If any
Party terminates this Agreement pursuant to §8(a)
above,
all rights and obligations of the Parties hereunder shall terminate without
any
Liability of any Party to any other Party (except for any Liability of any
Party
then in breach), except that the provisions of §5(d)
with
respect to Buyer Confidential Information and Seller Confidential Information
and §10
shall
remain in full force and effect and survive any termination of this
Agreement.
| §9. |
Reliance
on and Survival of Representations and Warranties; No Indemnification
Rights.
|
All
of
the representations and warranties of the Parties contained in this Agreement,
and any certificate delivered at the Closing by Seller or Buyer shall be
deemed
to have been relied upon notwithstanding any investigation heretofore or
hereafter made or omitted by any party hereto. None of the representations
and
warranties of the Parties contained in this Agreement shall survive the Closing
after the Effective Time.
No
party
shall have any rights of indemnification with respect to any other party
hereto.
| §10. |
Miscellaneous.
|
(a) Press
Releases and Public Announcements.
Unless
otherwise permitted by this Agreement, Buyer and Seller shall consult with
each
other before issuing any press release or otherwise making any public statement
or making any other public (or nonconfidential) disclosure (whether or not
in
response to an inquiry) regarding the terms of this Agreement and the
transactions contemplated hereby. No Party shall issue any press release
or make
any public announcement relating to the subject matter of this Agreement
prior
to the Closing without the prior written approval of the other Party;
provided,
however,
that
any Party may make any public disclosure it believes in good faith is required
by applicable law or any listing or trading agreement concerning its publicly
traded securities (in which case the disclosing Party will use its reasonable
best efforts to advise the other Party prior to making the
disclosure).
(b)
No
Third-Party Beneficiaries.
This
Agreement shall not confer any rights or remedies upon any Person other than
the
Parties and their respective successors and permitted assigns.
21
(c)
Entire
Agreement.
This
Agreement (including the documents referred to herein) constitutes the entire
agreement between the Parties and supersedes any prior understandings,
agreements, or representations by or between the Parties, written or oral,
to
the extent they relate in any way to the subject matter hereof.
(d)
Succession
and Assignment.
This
Agreement shall be binding upon and inure to the benefit of the Parties named
herein and their respective successors and permitted assigns. No Party may
assign either this Agreement or any of its rights, interests, or obligations
hereunder without the prior written approval of the other Party; provided,
however,
that
Buyer may (i) assign any or all of its rights and interests hereunder to
one or
more of its Affiliates and (ii) designate one or more of its Affiliates to
perform its obligations hereunder (in any or all of which cases Buyer
nonetheless shall remain responsible for the performance of all of its
obligations hereunder).
(e)
Counterparts.
This
Agreement may be executed in one or more counterparts (including by means
of
facsimile), each of which shall be deemed an original but all of which together
shall constitute one and the same instrument.
(f)
Headings.
The
section headings contained in this Agreement are inserted for convenience
only
and shall not affect in any way the meaning or interpretation of this
Agreement.
(g)
Notices.
All
notices, requests, demands, claims, and other communications hereunder shall
be
in writing. Any notice, request, demand, claim, or other communication hereunder
shall be deemed duly given (i) when delivered personally to the recipient,
(ii)
2 business days after being sent to the recipient by reputable overnight
courier
service (charges prepaid), addressed to the intended recipient as set forth
below, or (iii) 1 business day after being sent to the recipient by facsimile
transmission or electronic mail:
|
If
to Seller:
|
with
a copy to:
|
|
Cuchulainn
Holdings, Inc.
|
Xxxxx
Xxxxxx, Esq.
|
|
x/x
Xxxxxxx x Xxxxxxxxx
|
Xxxx
0, Xxxxx 0, Xxxxx Xxxxx
|
|
Edificio
ADR, Piso 00
|
Xxx
Xxxxxxx, Xxxxxxxx of Panama
|
|
Xxxxxxx
Xxxxxx Xxxxx, Xxxxxxx
|
|
|
Xxxxxx
Xxxx, Xxxxxxxx of Panama
|
|
|
T:
x000 000-0000
|
T:
x000 0000-0000
|
|
F:
x000 000-0000
|
F:
+ 1 248.479-5395
|
|
If
to Buyer and Merger Sub:
|
with
a copy to:
|
|
NanoSensors,
Inc.
|
Xxxxxx
& Poliakoff, LLP
|
|
Attn:
Xxxx Xxxxx
|
Attn:
Xxxxxx X. XxXxxxx, Esq.
|
|
0000
Xxxxxxxx Xxxx.
|
00
Xxxxxxxx, 00xx Xxxxx
|
|
Xxxxxxx
Xxxx, XX 00000
|
Xxx
Xxxx, XX 00000
|
|
P:
408.306.5956
|
P:
212.599.3322
|
|
F:
650.618.1483
|
F:
212.557.0295
|
Any
Party
may change the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Party notice
in
the manner herein set forth.
(h)
Governing
Law. This
Agreement shall be governed by and construed in accordance with the domestic
laws of Panama without giving effect to any choice or conflict of law provision
or rule that would cause the application of the laws of any
jurisdiction.
22
(i)
Amendments
and Waivers.
The
Parties may mutually amend any provision of this Agreement at any time prior
to
the Effective Time with the prior authorization of their respective boards
of
directors; provided, however, that any amendment effected subsequent to
stockholder approval will be subject to the restrictions contained in the
Law
32. No amendment of any provision of this Agreement shall be valid unless
the
same shall be in writing and signed by Buyer, Merger Sub and Seller. No waiver
by any Party of any provision of this Agreement or any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be valid unless the same shall be in writing and
signed by the Party making such waiver nor shall such waiver be deemed to
extend
to any prior or subsequent default, misrepresentation, or breach of warranty
or
covenant hereunder or affect in any way any rights arising by virtue of any
prior or subsequent such default, misrepresentation, or breach of warranty
or
covenant.
(j)
Severability.
Any term
or provision of this Agreement that is invalid or unenforceable in any situation
in any jurisdiction shall not affect the validity or enforceability of the
remaining terms and provisions hereof or the validity or enforceability of
the
invalid or unenforceable term or provision in any other situation or in any
other jurisdiction.
(k)
Expenses.
Each
Party will bear its own costs and expenses (including legal fees and expenses)
incurred in connection with this Agreement and the transactions contemplated
hereby, except as otherwise provided in this Agreement.
(l)
Construction.
The
Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event that an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring
or
disfavoring any Party by virtue of the authorship of any of the provisions
of
this Agreement. Any reference to any federal, state, local, or foreign statute
or law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word “including” shall
mean including without limitation. Nothing disclosed by one party to the
other
party shall be deemed adequate to disclose an exception to a representation
or
warranty made herein unless such disclosure identifies the exception with
reasonable particularity and describes the relevant facts in reasonable detail.
Without limiting the generality of the foregoing, the mere listing (or inclusion
of a copy) of a document or other item shall not be deemed adequate to disclose
an exception to a representation or warranty made herein (unless the
representation or warranty has to do with the existence of the document or
other
item itself).
(m)
Incorporation
of Exhibits and Schedules.
The
Exhibits and Schedules identified in this Agreement are incorporated herein
by
reference and made a part hereof.
(n)
Specific
Performance.
Each
Party acknowledges and agrees that the other Party would be damaged irreparably
in the event any provision of this Agreement is not performed in accordance
with
its specific terms or otherwise is breached, so that a Party shall be entitled
to injunctive relief to prevent breaches of the provisions of this Agreement
and
to enforce specifically this Agreement and the terms and provisions hereof,
in
addition to any other remedy to which such Party may be entitled, at law
or in
equity.
(o)
Submission
to Jurisdiction.
Each of
the Parties submits to the jurisdiction of the State of Nevada, in any action
or
proceeding arising out of or relating to this Agreement and agrees that all
claims in respect of the action or proceeding may be heard and determined
in any
such court; except that any action or proceeding arising out of the Agreement
of
Merger attached hereto as Exhibit B shall be heard before the Courts of Panama.
Except as provided in the previous sentence, each Party agrees not to bring
any
action or proceeding arising out of or relating to this Agreement in any
other
court. Each of the Parties waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety,
or other security that might be required of any other Party with respect
thereto.
(p)
Governing
Language.
This
Agreement has been negotiated and executed by the Parties in English. In
the
event any translation of this Agreement is prepared for convenience or any
other
purpose, the provisions of the English version shall prevail, except as
otherwise provided by law.
*
* * * *
23
IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement on as of
the
date first above written.
| NANOSENSORS, INC. | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxx | |
|
Name: Xxxxxx Xxxxx |
||
| Title: Interim CEO | ||
| CUCHULAINN ACQUISITION INC. | ||
| |
|
|
| By: | /s/ GuillermoVergara | |
|
Name: Xxxxxxxxx Xxxxxxx |
||
| Title: President | ||
| CUCHULAINN HOLDINGS, INC. | ||
| |
|
|
| By: | /s/ Xxxx Xxxxxx | |
|
Name: Xxxx Xxxxxx |
||
| Title: President | ||
24
EXHIBIT
INDEX
|
Exhibit
|
Description
|
|
A
|
List
of Seller Stockholders
|
|
B
|
Agreement
of Merger
|
|
C
|
Articles
of Incorporation of Merger Sub (See Exhibit B)
|
|
D
|
Form
of Investment Representation Statement
|
25
