EXHIBIT 2.1
MERGER AGREEMENT
AGREEMENT AND PLAN OF MERGER
BY AND
AMONG
HY-TECH TECHNOLOGY GROUP, INC.
A DELAWARE CORPORATION,
RWT ACQUISITION, INC.,
A MARYLAND CORPORATION
AND
ROBOTIC WORKSPACE TECHNOLOGIES, INC.
A MARYLAND CORPORATION
LIST OF SCHEDULES AND EXHIBITS
TO
AGREEMENT AND PLAN OF MERGER
SCHEDULES
Company Disclosure Schedule
RWT Disclosure Schedule
EXHIBITS
Exhibit 6.1(a)(1) Company Certified Resolutions
Exhibit 6.1(a)(2) Acquisition Certified Resolutions
Exhibit 6.1(f)(1) Company Officer's Certificate
Exhibit 6.1(f)(2) Acquisition Officer's Certificate
Exhibit 6.2(a) RWT Certified Resolutions
Exhibit 6.2(e) RWT Officer's Certificate
Exhibit A Certificate of Designation of Series A
Preferred
Exhibit J Registration Rights Agreement
Exhibit K Lock Up Agreement
Exhibits L-1 and L-2 Employment Agreements of Xxxxxx Xxxxxx and
Xxxxx Aws
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AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of July 21,
2004, by and among Hy-Tech Technology Group, Inc., a Delaware corporation (the
"Company"), RWT Acquisition, Inc., a Maryland corporation ("Acquisition") and
Robotic Workspace Technologies, Inc., a Maryland corporation ("RWT").
RECITALS
WHEREAS, the Company and RWT desire to merge Acquisition with and into RWT
whereby RWT shall be the surviving entity pursuant to the terms and conditions
set forth herein and whereby the transaction is intended to qualify as a tax
free reorganization pursuant to Section 368(a) of the Internal Revenue Code of
1986, as amended (the "IRC"), to the extent permitted by applicable law;
WHEREAS, in furtherance of such combination, the Boards of Directors of
the Company, Acquisition and RWT have each approved the merger of Acquisition
with and into RWT (the "Merger"), upon the terms and subject to the conditions
set forth herein, in accordance with the applicable provisions of the Delaware
General Corporation Law (the "DGCL") and the Maryland Business Corporation Act
(the "MBCA").
WHEREAS, the stockholders of RWT desire to approve the Merger and exchange
all of their shares of the capital stock of RWT (the "RWT Common Stock") for
shares of the capital stock of the Company (the "Company Capital Stock") as a
tax free reorganization pursuant to Section 368(a) of the IRC, to the extent
permitted by applicable law;
WHEREAS, RWT has issued and outstanding Two Hundred, Forty-eight Thousand
Seven Hundred Thirty (248,730) options to acquire shares of RWT Common Stock
(the "RWT Options"), and the Company and RWT desire that upon the effectiveness
of the Merger that the RWT Options be converted into options to acquire Company
Common Stock (the "Company Options"); and
WHEREAS, the Company has changed or will change its name to Innova
Holdings, Inc. on or after the Effective Date, references to Hy-Tech Technology
Group, Inc., the Company and/or Innova Holdings, Inc. shall all be references to
the parent of RWT Acquisitions, Inc.;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
parties agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. At the Effective Time (as hereinafter defined) and subject
to and upon the terms and conditions of this Agreement and the DGCL and MBCA,
Acquisition shall be merged with and into RWT pursuant to the Merger. Following
the Merger, RWT shall continue as the surviving corporation (the "Surviving
Corporation") and the separate corporate existence of Acquisition shall cease.
As part of the Merger and as more fully described in Section 2.1, (i) the Four
Million, Five Hundred Sixty Seven Thousand, Seven Hundred Ninety-nine
(4,567,799) issued and outstanding shares of RWT Common Stock shall be exchanged
for Company Capital Stock at the Exchange Ratio (as defined below), (ii) the RWT
Options shall be exchanged for Company Options as provided in section 2.8, and
(ii) each share of Acquisition's issued and outstanding common stock, par value
$.001 per share (the "Acquisition Common Stock"), shall be converted into one
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validly issued, fully paid and non-assessable share of common stock, par value
of $.001 per share, of the Surviving Corporation (the "Surviving Corporation
Common Stock"). For all purposes of this Agreement, the Exchange Ratio shall be
determined by dividing Two Hundred and Eighty Million (280,000,000)by the number
of issued and outstanding shares of RWT on the Closing Date and the number so
determined shall equal the number of shares of Company Stock to be exchanged for
one share of outstanding RWT Common Stock.
1.2 Effective Time. The Merger shall be consummated as promptly as
practicable after satisfaction of all conditions to the Merger set forth herein,
by filing with the Secretary of State of the States of Delaware and Maryland a
certificate of merger (the "Certificate of Merger"), and all other appropriate
documents, executed in accordance with the relevant provisions of the DGCL and
MBCA. The Merger shall become effective upon the filing of the Certificate of
Merger. The time of such filing shall be referred to herein as the "Effective
Time."
1.3 Effects of the Merger. At the Effective Time, all the rights,
privileges, immunities, powers and franchises of Acquisition and RWT and all
property, real, personal and mixed, and every other interest of, or belonging to
or due to each of Acquisition and RWT shall vest in the Surviving Corporation,
and all debts, liabilities, obligations and duties of Acquisition and RWT,
including, without limitation, the performance of all obligations and duties of
RWT pursuant to this Agreement, the RWT Debentures and the exhibits, schedules
and all documents executed in connection therewith or any other Transaction
Document (as defined in this Agreement), shall become the debts, liabilities,
obligations and duties of the Surviving Corporation without further act or deed,
all in the manner and to the full extent provided by the DGCL and MBCA. Whenever
a conveyance, assignment, transfer, deed or other instrument or act is necessary
to vest any property or right in the Surviving Corporation, the directors and
officers of the respective constituent corporations shall execute, acknowledge
and deliver such instruments and perform such acts, for which purpose the
separate existence of the constituent corporations and the authority of their
respective directors and officers shall continue, notwithstanding the Merger.
1.4 Certificate of Incorporation. The Certificate of Incorporation of RWT,
as in effect immediately prior to the Effective Time, shall be the Certificate
of Incorporation of the Surviving Corporation and thereafter may be amended or
repealed in accordance with its terms and applicable law.
1.5 By-Laws. At the Effective Time and without any further action on the
part of Acquisition and RWT, the By-laws of RWT shall be the By-laws of the
Surviving Corporation and thereafter may be amended or repealed in accordance
with their terms or the Certificate of Incorporation of the Surviving
Corporation and as provided by law.
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1.6 Directors. The directors of the Company at the Effective Time shall
consist of Xxxxxx Xxxxxxx, Xxxx XxXxxx, Xxxxx Xxxxxxx, Xxxxxx Xxxxxx and one
other nominee selected by RWT. Xxxxxx Xxxxxx shall serve as Chairman of the
Board of Directors. The directors of RWT as of the Closing Date shall select the
persons who shall serve as chairman of any committee of the Board of Directors.
1.7 Officers. The officers of RWT at the Effective Time shall be the
officers of the Surviving Corporation, until the earlier of their resignation or
removal or until their respective successors are duly appointed and qualified,
as the case may be. Xxxxxx Xxxxxx will continue to serve as Chairman and Chief
Executive Officer of the Surviving Corporation. Xxxxxx Xxxxxx will be appointed
as a Senior Executive of the Company. The employment of Xxxxxx Xxxxxx and Xxxxx
Aws by the Company and the Surviving Corporation shall be pursuant to the terms
of their existing Employment Agreements with RWT, as the Surviving Corporation,
copies of which Employment Agreements are annexed hereto as EXHIBITS L-1 AND
L-2. Said Employment Agreements will be assumed by the Company as of the
Effective Date and amended as necessary to include bonus incentives approved by
the Board of Directors of the Company as well as duties specific to the Company.
1.8 Tax-Free Reorganization. The parties intend that the Merger shall be
treated as a tax-free reorganization pursuant to Section 368(a) of the IRC, to
the extent permitted by applicable law.
ARTICLE II
CONVERSION OF RWT SHARES
2.1 Conversion and Cancellation of RWT Common Stock and RWT Options. As of
the Effective Time, by virtue of the Merger and without any action on the part
of the Company, Acquisition or RWT or the holders of any shares of the capital
stock of Acquisition or RWT:
(a) Subject to the provisions of Sections 2.4 and 2.5, each share of RWT
Common Stock (the "RWT Common Stock Shares") issued and outstanding immediately
prior to the Effective Time (other than shares canceled in accordance with
Section 2.1(b)), shall be converted into an aggregate of Two Hundred Eighty
million (280,0000,000) shares of validly issued, fully paid and nonassessable
shares (of which 7,500,000 shares have been delivered to RWT previously) of
Company Common Stock (the "Company" Common Stock Shares); provided further that
immediately prior to the Effective Date, the Stock Certificate representing the
aforementioned 7,500,000 Company shares will be surrendered to the Company and
cancelled. As of the Effective Time, each RWT Common Stock Share shall no longer
be outstanding and shall automatically be canceled and cease to exist, and each
holder of a certificate representing any RWT Common Stock Share shall cease to
have any rights with respect thereto other than the right to receive Company
Common Stock to be issued in consideration therefore upon the surrender of such
certificate, properly endorsed to the Company's stock transfer agent,
Continental Stock Transfer and Trust Company (the "Transfer Agent"). Promptly
after the Effective Time, RWT shall deliver to the Transfer Agent a complete
list of the names, addresses and holdings of each holder of RWT Common Stock and
RWT Options. The Company shall thereafter instruct the Transfer Agent to send a
letter of transmittal to all of such holders that will instruct all of such
holders how to surrender their holdings in exchange for Company Common Stock
Shares and how to receive Company Common Stock upon the exercise of RWT Options.
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All of such holders shall execute an agreement setting forth the same covenants,
representations and warranties that were made by such holder when such holder
acquired the RWT Common Stock and RWT Options to confirm that such holder's
receipt of Company Common Stock and Company Options, as the case may be, is
exempt from the registration requirements of the Securities Act of 1933, as
amended. Each holder of a certificate representing any RWT Common Stock Share
shall cease to have any rights with respect thereto other than the right to
receive Company Common Stock Shares to be issued in consideration therefore.
(b) Each share of RWT Capital Stock held in the treasury of RWT and each
share of RWT Capital Stock owned by Acquisition or Company shall be canceled
without any conversion thereof and no payment, distribution or other
consideration shall be made with respect thereto.
(c) Each issued and outstanding share of Acquisition Common Stock shall be
converted into one validly issued, fully paid and nonassessable share of
Surviving Corporation Common Stock.
2.2 Adjustment of the Exchange Ratio. In the event that, prior to the
Effective Time, any stock split, combination, reclassification or stock dividend
with respect to the Company Common Stock or RWT Common Stock, any change or
conversion of Company Common Stock or RWT Common Stock with or into other
securities or any other dividend or distribution with respect to the Company
Common Stock or RWT Common Stock (other than regular quarterly dividends) should
occur or, if a record date with respect to any of the foregoing should occur,
appropriate and proportionate adjustments shall be made to the Exchange Ratio,
and thereafter all references to an Exchange Ratio shall be deemed to be to such
Exchange Ratio as so adjusted.
2.3 No Fractional Shares. No certificates or scrip representing fractional
shares of Company Common Stock shall be issued upon the surrender for exchange
of certificates and such fractional share shall not entitle the record or
beneficial owner thereof to vote or to any other rights as a stockholder of the
Company. The number of shares of Company Common Stock to be issued shall be
rounded up to the nearest whole share.
2.4 Further Assurances. If at any time after the Effective Time the
Surviving Corporation shall consider or be advised that any deeds, bills of
sale, assignments or assurances or any other acts or things are necessary,
desirable or proper (a) to vest, perfect or confirm, of record or otherwise, in
the Surviving Corporation, its right, title or interest in, to or under any of
the rights, privileges, powers, franchises, properties or assets of either RWT
or Acquisition or (b) otherwise to carry out the purposes of this Agreement, the
Surviving Corporation and its proper officers and directors or their designees
shall be authorized (to the fullest extent allowed under applicable law) to
execute and deliver, in the name and on behalf of either RWT or Acquisition ,
all such deeds, bills of sale, assignments and assurances and do, in the name
and on behalf of RWT or Acquisition, all such other acts and things necessary,
desirable or proper to vest, perfect or confirm its right, title or interest in,
to or under any of the rights, privileges, powers, franchises, properties or
assets of RWT or Acquisition, as applicable, and otherwise to carry out the
purposes of this Agreement.
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2.5 RWT Options. At the Effective Time, the RWT Options shall be converted
into Company Options as hereinafter provided. At the Effective Time, each
unexercised RWT Option shall be converted into a Company Option on the same
terms and conditions as the RWT Options, and all references in the RWT Options
to RWT Common Stock shall be deemed thereafter to be references to Company
Common Stock. The Exchange Ratio shall apply to the shares of Company Common
Stock issuable upon the exercise of the RWT Options that have been converted
into Company Options.
2.6 Dissenters' Rights. Any shareholder of RWT who does not consent to the
Merger shall be entitled to assert the dissenters' rights if and to the extent
provided under the MBCA; provided, however, that if RWT shareholders holding
more than one third (1/3) of the outstanding shares of RWT elect to exercise
dissenters' rights, the Company shall have the right to terminate this
Agreement.
2.7 Right to Acquire Preferred Stock. Company shall create a new class of
redeemable convertible Preferred Stock in addition to its outstanding Class A
Preferred Stock consisting of 125,000 shares, which shares were purchased by
five investors who previously owned debentures issued by the Company for $1.00
per share for total consideration of $125,000. Such new class shall be
designated as Class B Preferred Stock and shall consist of 525,000 shares. The
purchase price for one share of Class B Preferred Stock shall be $1.00 per
share. RWT shall offer all of the Class B Preferred Stock to accredited
investors with the first priority to those persons who hold expired RWT
warrants. All proceeds of the sale of the Class B Preferred Stock shall be used
by RWT.
ARTICLE III
CLOSING
Subject to satisfaction of the conditions to closing set forth in this
Agreement and unless this Agreement is otherwise terminated in accordance with
the provisions contained herein, the closing of the Merger shall take place at
the offices of Gottbetter & Partners, LLP, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx as promptly as practicable after satisfaction of the conditions set forth
in this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of the Company and Acquisition. Except
as disclosed in the Reports (as defined below) or in a document of even date
herewith referring to the representations and warranties in this Agreement and
delivered by Company to RWT prior to the execution and delivery of this
Agreement (the "Company Disclosure Schedule"), Acquisition and the Company
hereby make the following representations and warranties to RWT, all of which
shall survive the Closing, subject to the limitations set forth in Section 8.1
hereof:
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(a) Organization and Good Standing. Acquisition is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maryland, with full corporate power and authority to conduct its business as it
is now being conducted, to own or use the properties and assets that it owns or
uses, and to perform all its obligations under this Agreement. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware, with full corporate power and authority to conduct its
business as it is now being conducted, to own or use the properties and assets
that it owns or uses, and to perform all its obligations under this Agreement.
Company has no subsidiaries other than Acquisition and other than as set forth
on the Company Disclosure Schedule 4.1(a) (individually, a "Subsidiary" and
collectively, the "Subsidiaries"). Acquisition has no subsidiaries. Each of the
Company and Acquisition is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction in which either the ownership or
use of the properties owned or used by it, or the nature of the activities
conducted by it, requires such qualification, except for such failures to be so
qualified or in good standing would not have a Material Adverse Effect as
defined in Article IX.
(b) Authority; No Conflict.
i. This Agreement and any agreement executed in connection herewith
by Company or Acquisition constitute the legal, valid and binding obligations of
the Company and Acquisition, as the case may be, enforceable against the Company
and Acquisition, as the case may be, in accordance with their respective terms,
except as such enforceability is limited by bankruptcy, insolvency and other
laws affecting the rights of creditors and by general equitable principles. The
Company has the absolute and unrestricted right, power, authority and capacity
to execute and deliver this Agreement and any agreement executed by it in
connection herewith and to perform its obligations hereunder and there under.
ii. Neither the execution and delivery of this Agreement by each of
the Company and Acquisition, nor the consummation or performance by each of any
of its respective obligations contained in this Agreement or in connection with
the Merger will, directly or indirectly (with or without notice or lapse of
time):
a. contravene, conflict with or result in a violation of (x)
any provision of the certificate of incorporation or by-laws (the
"Organizational Documents") of the Company or Acquisition, as the case may be,
or (y) any resolution adopted by the board of directors or the stockholders of
the Company or Acquisition, as the case may be;
b. contravene, conflict with or result in a violation of, or
give any governmental body or other Person the right to challenge any of the
Merger or to exercise any remedy or obtain any relief under, any legal
requirement or any order to which the Company or Acquisition or any of the
assets owned or used by the Company or Acquisition may be subject;
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c. contravene, conflict with or result in a violation or
breach of any provision of, or give any person the right to declare a default or
exercise any remedy under, or to accelerate the maturity or performance of, or
to cancel, terminate or modify, this Agreement, or any contract or agreement to
which Company and Acquisition are bound;
d. result in the imposition or creation of any material
encumbrance upon or with respect to any of the material assets owned or used by
the Company or Acquisition;
e. cause the Company or Acquisition to become subject to, or
to become liable for the payment of, any tax; or
f. cause any of the assets owned by the Company or Acquisition
to be reassessed or revalued by any taxing authority or other governmental body,
except in connection with the transfer of real estate pursuant to this Agreement
or the Merger, if any.
(c) Capitalization. As of July 15, 2004, the Company had 98,677,406 shares
of Common Stock and 125,000 shares of Class A Preferred Stock issued and
outstanding. The Company has not issued any capital stock since that date other
than pursuant to (i) employee benefit plans disclosed in the Reports (as defined
in Section 4.1(d)), (ii) outstanding warrants, options or other securities
disclosed in the Reports. All of the issued and outstanding shares of the
Company Capital Stock have been duly authorized and validly issued and are fully
paid and non-assessable. Except for this Agreement, the 525,000 shares of Class
B Preferred Stock referenced in Section 2.7, and an additional 37,885,033 that
will issue upon effectiveness of the amendment to the Company's Articles of
Incorporation by which it will increase its authorized shares of Common Stock as
referenced in Section 4.1(m), there are no outstanding options, warrants, scrip,
rights to subscribe to, registration rights, calls or commitments of any
character whatsoever relating to, or securities, rights or obligations
convertible into or exchangeable for, or giving any Person any right to
subscribe for or acquire, any shares of the Company Common Stock, or contracts,
commitments, understandings, or arrangements by which the Company or any
Subsidiary is or may become bound to issue additional shares of the Company
Common Stock, or securities or rights convertible or exchangeable into shares of
the Company Common Stock. None of the outstanding Company Capital Stock was
issued in violation of the Securities Act of 1933 as amended, or any other legal
requirement.
(d) Financial Statements. The Company has delivered or made available to
RWT copies of its Form 10-KSB Annual Report for the fiscal years ended February
28, 2003 and 2004 and copies of its quarterly reports on Form 10-QSB for the
quarters ended May 31, 2003, August 31, 2003 and November 30, 2003, each as
filed with the SEC and including, in each case, any amendments thereto
(collectively, the "Reports"). The financial statements contained in the Reports
are in all material respects in accordance with the books and records of the
Company and have been prepared in accordance with GAAP applied on a consistent
basis throughout the periods indicated, all as more particularly set forth in
the notes to such statements. The consolidated balance sheets contained in such
Reports (the "Company Balance Sheets") present fairly in all material respects
as of their dates the consolidated financial condition of the Company and its
subsidiaries. Except as and to the extent reflected or reserved against in the
Company Balance Sheets (including the notes thereto), the Company did not have,
as of the date of any such Company Balance Sheet, any material liabilities or
obligations (absolute or contingent) of a nature customarily reflected in a
balance sheet or the notes thereto. The consolidated statements of operations,
consolidated statements of stockholders' equity and changes in consolidated
statements of cash flows present fairly in all material respects the results of
operations and changes in financial position of the Company and its subsidiaries
for the periods indicated.
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(e) SEC Filings. The Company has filed all reports required to be filed
with the Securities and Exchange Commission (the "SEC") under the rules and
regulations of the SEC and all such reports have complied in all material
respects, as of their respective filing dates and effective dates, as the case
may be, with all the applicable requirements of the Securities Exchange Act of
1934, as amended, except for the current 10-KSB which will be filed late and has
resulted in a temporary E symbol attached to HYTT. As of the respective filing
and effective dates, none of such reports (including without limitation, the
Reports) 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.
(f) Absence of Material Adverse Effect. Since the date of the latest
Company Balance Sheets, there have been no events, changes or occurrences which
have had or are reasonably likely to have, a Material Adverse Effect on Company
or Acquisition.
(g) Issuance of Company Securities. The Company Common Stock Shares and
Company Preferred Stock Shares when issued in accordance with this Agreement,
and when issued the Company Common Stock Shares issuable on conversion of the
Company Preferred Stock, shall be duly authorized, validly issued, fully-paid
and nonassessable. The Company currently has, and at all times while the Company
Preferred Stock Shares are outstanding will maintain, an adequate reserve of
shares of the Company Common Stock to enable it to perform its obligations under
this Agreement. Except as set forth in the Reports, there is no equity line of
credit or convertible security or instrument outstanding of the Company.
(h) Undisclosed Liabilities. Except as disclosed in any Schedule to this
Agreement, none of the Company, Acquisition or the Subsidiaries has any material
obligations and liabilities (contingent or otherwise) except those liabilities
(i) that are reflected in the Company Balance Sheets or in the notes thereto, or
disclosed in the notes therein in accordance with Generally Accepted Accounting
Principles ("GAAP") or, in accordance with GAAP, are not required to be so
reflected or disclosed, or (ii) that were incurred after the date of the Company
Balance Sheets in the ordinary course of business, none of which 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 or could
reasonably be expected to have a Material Adverse Effect.
(i) Taxes.
i. The Company has filed or caused to be filed on a timely basis all
tax returns that are or were required to be filed by it pursuant to applicable
legal requirements. The Company has paid, or made provision for the payment of,
all taxes that have or may have become due pursuant to those tax returns or
otherwise, or pursuant to any assessment received by the Company, except such
taxes, if any, as are listed in the Company Disclosure Schedule and are being
contested in good faith as to which adequate reserves have been provided in the
Company Balance Sheets.
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ii. All tax returns filed by the Company are true, correct and
complete in all material respects.
(j) Employee Benefits. Except as disclosed in the Reports, the Company
does not sponsor or otherwise maintain a "pension plan" within the meaning of
Section 3(2) of ERISA or any other retirement plan other than the Company Profit
Sharing and 401(k) Plan and Trust that is intended to qualify under Section 401
of the IRC, nor do any unfunded liabilities exist with respect to any employee
benefit plan, past or present. No employee benefit plan, any trust created
thereunder or any trustee or administrator thereof has engaged in a "prohibited
transaction," as defined in Section 4975 of the IRC, which may have a Material
Adverse Effect.
(k) Governmental Authorizations. The Company and Acquisition have all
permits that are legally required to enable them to conduct their business in
all material respects as now conducted.
(l) Legal Proceedings; Orders.
i. Except as set forth in the Reports, there is no material pending
legal or administrative proceeding:
a. that has been commenced by or against the Company,
Acquisition or the Subsidiaries, or any of the assets owned or used by, the
Company, Acquisition or the Subsidiaries; or
b. that challenges, or that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with the Merger.
ii. Except as set forth in the Reports:
a. there is no material order to which the Company or the
Subsidiaries, or any of the assets owned or used by the Company, Acquisition or
the Subsidiaries, is subject; and
b. no officer, director, agent, or employee of the Company or
Acquisition is subject to any material order that prohibits such officer,
director, agent or employee from engaging in or continuing any conduct, activity
or practice relating to the business of the Company or Acquisition, as the case
may be.
(m) Absence of Certain Changes and Events. Except as set forth in the
Reports and section 4.1(c) of this Agreement, since the date of the most recent
Company Balance Sheets, the Company and the Subsidiaries and Acquisition, since
the date of its inception, have conducted their business only in the ordinary
course of business, and other than as contemplated by this Agreement or the
Merger there has not been any:
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i. change in the authorized or issued Company Capital Stock except
as set forth in the Form 14C filed with the SEC on or about June 30, 2004, which
authorizes an additional eight hundred million (800,000,000) shares of Company
Common Stock, bringing the total authorized Company Common Stock to nine hundred
million (900,000,000) shares, and nine million (9,000,000) additional shares of
Preferred Stock, bringing the total authorized Preferred Stock to ten million
(10,000,000) shares, or the authorized or issued capital stock of Acquisition
and the Subsidiaries; grant of any stock option or right to purchase shares of
capital stock of the Company; issuance of any equity lines of credit, security
convertible into such capital stock; grant of any registration rights; purchase,
redemption, retirement, or other acquisition or payment of any dividend or other
distribution or payment in respect of shares of capital stock;
ii. amendment to the Organizational Documents of the Company,
Acquisition or the Subsidiaries;
iii. damage to or destruction or loss of any material asset or
property of the Company, Acquisition or the Subsidiaries, whether or not covered
by insurance, causing a Material Adverse Effect;
iv. receipt of notice that any of their substantial customers have
terminated or intends to terminate their relationship, which termination would
have a Material Adverse Effect;
v. entry into any transaction other than in the ordinary course of
business;
vi. entry into, termination of, or receipt of written notice of
termination of any material (i) license, distributorship, dealer, sales
representative, joint venture, credit, or similar agreement, or (ii) contract or
transaction except the licensing of Hy-Tech Computer System's customer list and
website use to Encompass Group, Inc.;
vii. sale (other than sales of inventory in the ordinary course of
business), lease, or other disposition of any asset or property of the Company,
Acquisition or the Subsidiaries or mortgage, pledge, or imposition of any lien
or other encumbrance on any material asset or property of the Company,
Acquisition or the Subsidiaries;
viii. cancellation or waiver of any claims or rights with a value to
the Company in excess of $10,000;
ix. material change in the accounting methods used by the Company,
Acquisition or the Subsidiaries; or
x. agreement, whether oral or written, by the Company, Acquisition
or the Subsidiaries to do any of the foregoing.
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(n) No Default or Violation. The Company, Acquisition and the Subsidiaries
(i) are in material compliance with all applicable material terms and
requirements of each material contract under which they have or had any
obligation or liability or by which they or any of the assets owned or used by
them is or was bound and (ii) is not in material violation of any legal
requirement.
(o) Certain Payments. Since the most recent date of the Company Balance
Sheets, neither the Company, Acquisition or the Subsidiaries, nor any director,
officer, agent or employee of the Company or the Subsidiaries has directly or
indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence
payment, kickback or other payment to any Person, private or public, regardless
of form, whether in money, property or services (i) to obtain favorable
treatment in securing business, (ii) to pay for favorable treatment for business
secured, (iii) to obtain special concessions or for special concessions already
obtained, for or in respect of the Company, Acquisition or the Subsidiaries or
(iv) in violation of any legal requirement, or (b) established or maintained any
fund or asset that has not been recorded in the books and records of the
Company, Acquisition or the Subsidiaries.
(p) Brokers or Finders. The Company and Acquisition have not incurred any
obligation or liability, contingent or otherwise, for brokerage or finders' fees
or agents' commissions or other similar payment in connection with this
Agreement.
4.2 Representations and Warranties of RWT. RWT hereby makes the following
representations and warranties to the Company, all of which shall survive the
Closing, subject to the limitations set forth in Section 8.2 hereof:
(a) Organization, Good Standing and Purpose. RWT is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maryland with full power and authority to conduct its businesses as it is now
being conducted, to own or use the properties and assets that it owns or uses,
and to perform all of its obligations under this Agreement. RWT has no
subsidiary other than listed in Schedule 4.2(a)(1). RWT is duly qualified to do
business and is in good standing as a foreign corporation in each jurisdiction
in which either the ownership or use of the properties owned or used by it, or
the nature of the activities conducted by it, requires such qualification,
except for such failures to be so qualified or in good standing would not have a
Material Adverse Effect.
(b) Authority; No Conflict.
i. This Agreement and any agreement executed in connection herewith
have been duly authorized by all required action of RWT and constitute the
legal, valid and binding obligations of RWT, enforceable against RWT in
accordance with their respective terms. RWT has the absolute and unrestricted
right, power and authority to execute and deliver this Agreement and any
agreements executed in connection herewith and to perform its obligations
hereunder and there under.
ii Neither the execution and delivery of this Agreement by RWT, nor
the consummation or performance by it of any of its obligations contained in
this Agreement or in connection with the Merger by the Company will, directly or
indirectly (with or without notice or lapse of time):
13
a. contravene, conflict with or result in a violation of (x)
any provision of the Organizational Documents of RWT or (y) any resolution
adopted by the board of directors or the stockholders of RWT;
b. contravene, conflict with or result in a violation of, or
give any governmental body or other Person the right to challenge any of the
Merger or to exercise any remedy or obtain any relief under, any Legal
Requirement or any Order to which RWT or any of the assets owned or used by RWT
may be subject;
c. contravene, conflict with or result in a violation or
breach of any provision of, or give any Person the right to declare a default or
exercise any remedy under, or to accelerate the maturity or performance of, or
to cancel, terminate or modify, this Agreement, the RWT Debentures or any
Applicable Contract;
d. result in the imposition or creation of any material
encumbrance upon or with respect to any of the material assets owned or used by
RWT;
e. cause RWT to become subject to, or to become liable for the
payment of, any tax; or
f. cause any of the assets owned by RWT to be reassessed or
revalued by any taxing authority or other governmental body, except in
connection with the transfer of real estate pursuant to this Agreement or the
Merger.
iii. RWT is not required to obtain any consent from any Person in
connection with the execution and delivery of this Agreement or the consummation
or performance of any of the Merger, other than the requisite approval of its
stockholders (the "RWT Stockholders"), which approval is a condition to
completion of the Merger pursuant to Section 6.2(g).
(c) Capitalization. The entire authorized RWT Capital Stock consists of
fifty million (50,000,000) shares of RWT Common Stock, of which 4,567,799 shares
are issued and outstanding and held by the RWT Stockholders and ten million
(10,000,000) shares of Preferred Stock, of which no shares are issued and
outstanding. RWT has outstanding Two Hundred, Forty-eight Thousand Seven Hundred
Thirty (248,730) RWT Options to acquire RWT Common Stock. With the exception of
the RWT Common Stock Shares and the RWT Options, there are no other outstanding
equity or debt securities of the Company. No legend or other reference to any
purported encumbrance appears upon any certificate representing the RWT Common
Stock outstanding shares, other than applicable Securities Act legends. The
outstanding RWT Common Stock Shares have been duly authorized and validly issued
and are fully paid and non-assessable. Except for the RWT Options, there are no
outstanding options, voting agreements or arrangements, warrants, scrip, rights
to subscribe to, registration rights, calls or commitments of any character
whatsoever relating to, or, securities, rights or obligations convertible into
or exchangeable for, or giving any Person any right to subscribe for or acquire,
any shares of RWT Capital Stock or other securities, or contracts, commitments,
understandings, or arrangements by which RWT is or may become bound to issue
14
additional shares of RWT Capital Stock or other securities, or securities or
rights convertible or exchangeable into shares of RWT Capital Stock or other
securities. Except as set forth in the RWT Financial Statements, RWT has no
outstanding equity, debt, debt or equity equivalent security, or debt or equity
lines of credit. None of the outstanding RWT Common Stock Shares were issued in
violation of the Securities Act or any other legal requirement. RWT does not
own, and, except for this Agreement, has no contract to acquire, any equity
securities or other securities of any Person or any direct or indirect equity or
ownership interest in any other business. The outstanding RWT Common Stock
Shares have been duly authorized, and are fully paid and nonassessable.
(d) Financial Statements. RWT has delivered its financial statements as of
and for the fiscal year ended December 31, 2004 and the five months ended May
31, 2004 (the "RWT Financial Statements"), copies of which RWT Financial
Statements are included in Schedule 4.2(d). The RWT Financial Statements were
prepared in accordance with GAAP and present the financial condition and the
results of operations of RWT as of and for the fiscal year ended December 31,
2004 and the five months ended May 31, 2004. A review of RWT's financial
statements as of and for the fiscal year ended December 31, 2004 and the five
months ended May 31, 2004, is also being prepared by RWT's auditors and will be
delivered to the Company once it is available to RWT.
(e) Absence of Material Adverse Effect. Since the date of the most recent
RWT Balance Sheet provided under Section 4.2(d) hereof, there have been no
events, changes or occurrences which have had or are reasonably likely to have a
Material Adverse Effect on RWT.
(f) Books and Records. The books of account, minute books, stock record
books, and other records of RWT, all of which have been made available to the
Company and original copies of which will be delivered to the Company at the
Closing, are complete and correct in all material respects and have been
maintained in accordance with sound business practices, including the
maintenance of an adequate system of internal controls. The minute books of RWT
contain accurate and complete records of all meetings held of, and corporate
action taken by, the stockholders, the Board of Directors, and any committees of
the Board of Directors of RWT.
(g) No Undisclosed Liabilities. There are no material liabilities of RWT,
whether absolute, accrued, contingent, or otherwise, other than those that are
set forth in the RWT Balance Sheet.
(h) Title to Properties; Encumbrances. RWT has good and marketable title
to all the properties, interest in such properties and assets, real and
personal, reflected in the RWT Balance Sheet or acquired after the date of such
balance sheet, free and clear of all mortgages, liens, pledges, charges or
encumbrances except (i) mortgages and other encumbrances referred to in the
notes to the RWT Balance Sheet. RWT owns no real property. RWT leases two
offices in Ft. Xxxxx, Florida.
15
(i) Legal Proceedings; Orders.
i. Except as set forth in Schedule 4.2(i) hereto, there is no
pending legal or administrative proceeding:
a. that has been commenced or threatened by or against RWT or
any of its officers, directors, agents or employees as such or that otherwise
relates to or may affect the business of, or any of the assets owned or used by,
RWT; or
b. that challenges, or that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with, any Merger.
ii. Except as set forth in Schedule 4.2(i) hereto:
a. there is no order to which RWT, or any of the assets owned
or used by RWT, is subject; and
b. no officer, director, agent, or employee of RWT is subject
to any order that prohibits such officer, director, agent or employee from
engaging in or continuing any conduct, activity or practice relating to the
business of RWT.
(j) [Intentionally omitted]
(k) [Intentionally omitted]
(l) Taxes.
i. RWT has filed or caused to be filed on a timely basis all tax
returns that are or were required to be filed by it pursuant to applicable Legal
Requirements. RWT has paid, or made provision for the payment of, all taxes that
have or may have become due pursuant to those tax returns or otherwise, or
pursuant to any assessment received by RWT, except such taxes, if any, as are
listed in Schedule 4.2(l) hereto and are being contested in good faith as to
which adequate reserves have been provided in the RWT Balance Sheets.
ii. All tax returns filed by RWT are true, correct and complete in
all material respects and no taxes are currently owed or tax returns due by or
on behalf of RWT.
(m) Absence of Certain Changes and Events. Except as set forth in Schedule
4.2(m) hereto, since the date of the RWT Balance Sheet, RWT has conducted its
business only in the Ordinary Course of Business, there has not been any
Material Adverse Effect on RWT, and there has not been any:
i. change in the authorized or issued capital stock of RWT; grant of
any stock option or right to purchase shares of capital stock of RWT; issuance
of any security convertible into such capital stock; grant of any registration
rights; purchase, redemption, retirement, or other acquisition or payment of any
dividend or other distribution or payment in respect of shares of capital stock;
16
ii. amendment to the Organizational Documents of RWT;
iii. damage to or destruction or loss of any asset or property of
RWT, whether or not covered by insurance or any other event or circumstance,
materially and adversely affecting the properties, assets, business, financial
condition, or prospects of RWT;
iv. receipt of notice that any of its substantial customers have
terminated or intends to terminate their relationship, which termination would
have a Material Adverse Effect on RWT;
v. entry into any transaction other than in the ordinary course of
business;
vi. entry into, termination of, or receipt of written notice of
termination of any (i) license, distributorship, dealer, sales representative,
joint venture, credit, or similar agreement, or (ii) contract or transaction;
vii. sale (other than sales of inventory in the ordinary
course of business), lease, or other disposition of any asset or property of RWT
or mortgage, pledge, or imposition of any lien or other encumbrance on any asset
or property of RWT;
viii. cancellation or waiver of any claims or rights with a value to
RWT in excess of $10,000;
ix. material change in the accounting methods used by RWT;
x. accrual or payment of any salaries or other compensation,
increase in salaries, compensation or bonuses or retention or hiring of, any
consultant or employee;
xi. debt or other liability incurred, other than the RWT Debentures;
or
xii. agreement, whether oral or written, by RWT to do any of the
foregoing.
(n) Compliance with Law. Except as set forth in Schedule 4.2(n) hereto:
i. RWT has complied in all material respects with, and is not in
violation of, in any material respect, any Law to which it or its business is
subject; and
ii. RWT has obtained all licenses, permits, certificates or other
governmental authorizations (collectively "Authorizations") necessary for the
ownership or use of its assets and properties or the conduct of its business;
and
(iii) RWT has not received written notice of violation of, or knows
of any material violation of, any Laws to which it or its business is subject or
any Authorization necessary for the ownership or use of its assets and
properties or the conduct of its business.
17
(o) Environmental Laws. RWT has not received any notice or claim (and is
not aware of any facts that would form a reasonable basis for any claim), or
entered into any negotiations or agreements with any other person, and, to the
best knowledge of RWT, RWT is not the subject of any investigation by any
governmental or regulatory authority, domestic or foreign, relating to any
material or potentially material liability or remedial action under any
environmental laws. There are no pending or, to the knowledge of RWT,
threatened, actions, suits or proceedings against RWT or any of its properties,
assets or operations asserting any such material liability or seeking any
material remedial action in connection with any environmental laws.
(p) Intellectual Property. (i) RWT owns, or is validly licensed or
otherwise has the right to use, all patents, and patent rights ("Patents") and
all trademarks, trade secrets, trademark rights, trade names, trade name rights,
service marks, service xxxx rights, copyrights and other proprietary
intellectual property rights and computer programs (the "Intellectual Property
Rights"), in each case, which are material to the conduct of the business of
RWT.
(i) To the best knowledge of RWT, RWT has not interfered with,
infringed upon (without license to infringe), misappropriated or otherwise come
into conflict with any Patent of any other Person. RWT has not interfered with,
infringed upon, misappropriated or otherwise come into conflict with any
Intellectual Property Rights of any other Person. RWT has not received any
written charge, complaint, claim, demand or notice alleging any such
interference, infringement, appropriation or violation (including any claim that
RWT must license or refrain from using any Patents or Intellectual Property
Rights of any other Person) which has not been settled or otherwise fully
resolved. Except as set forth on Schedule 4.2(p) to the best knowledge of RWT,
no other Person has interfered with, infringed upon (without license to
infringe), misappropriated or otherwise come into conflict with any Patents or
Intellectual Property Rights of RWT.
(q) Employees. (a) RWT has complied in all respects with all
applicable Laws respecting employment and employment practices, terms and
conditions of employment, wages and hours, and RWT is not liable for any arrears
of wages or any taxes or penalties for failure to comply with any such Laws; (b)
RWT believes that RWT's relations with its employees is satisfactory; (c) there
are no controversies pending or, to the best knowledge of RWT, threatened
between RWT and any of its employees or former employees; (d) RWT is not a party
to any collective bargaining agreement or other labor union contract applicable
to persons employed by RWT, nor, to the best knowledge of RWT, are there any
activities or proceedings of any labor union to organize any such employees; (e)
there are no unfair labor practice complaints pending against RWT before the
National Labor Relations Board or any current union representation questions
involving employees of RWT; (f) there is no strike, slowdown, work stoppage or
lockout existing, or, to the best knowledge of RWT, threatened, by or with
respect to any employees of RWT; (g) no charges are pending before the Equal
Employment Opportunity Commission or any state, local or foreign agency
responsible for the prevention of unlawful employment practices with respect to
RWT; (h) there are no claims pending against RWT before any workers'
compensation board; (i) RWT has not received notice that any Federal, state,
local or foreign agency responsible for the enforcement of labor or employment
laws intends to conduct an investigation of or relating to RWT and, to the best
knowledge of RWT, no such investigation is in progress; and (j) RWT has no
consultants or independent contractors.
18
(r) Employee Benefit Plans. There are no "employee pension benefit plans"
(as defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) or "employee welfare benefit plans" (as defined in
Section 3(1) of ERISA) maintained, or contributed to, by RWT for the benefit of
any current or any former employees, officers or directors of RWT.
(s) Governmental Authorizations. RWT has all permits that are legally
required to enable it to conduct their business in all material respects as now
conducted.
(t) No Default or Violation. Except as set forth on Schedule 4.2(t), RWT
(i) is in material compliance with all applicable material terms and
requirements of each material contract under which it has or had any obligation
or liability or by which it or any of the assets owned or used by it is or was
bound and (ii) is not in material violation of any legal requirement.
(u) Certain Payments. Since the most recent date of RWT Balance Sheets,
neither RWT, nor any director, officer, agent or employee of RWT has directly or
indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence
payment, kickback or other payment to any Person, private or public, regardless
of form, whether in money, property or services (i) to obtain favorable
treatment in securing business, (ii) to pay for favorable treatment for business
secured, (iii) to obtain special concessions or for special concessions already
obtained, for or in respect of RWT or (iv) in violation of any legal
requirement, or (b) established or maintained any fund or asset that has not
been recorded in the books and records of RWT.
(v) Brokers or Finders. RWT has not incurred any obligation or liability,
contingent or otherwise, for brokerage or finders' fees or agents' commissions
or other similar payment in connection with this Agreement.
ARTICLE V
COVENANTS
5.1 Covenants of the Company and Acquisition.
(a) Conduct of Business. Between the date hereof and up to and including
the Closing Date, each of the Company and Acquisition shall:
i. conduct its business only in the ordinary course of business;
ii. use its commercially reasonable efforts to preserve intact the
current business organization of the Company and Acquisition, as the case may
be, keep available the services of the current officers, employees and agents of
the Company and Acquisition, as the case may be, and maintain the relations and
good will with suppliers, customers, landlords, creditors, employees, agents and
others having business relationships with the Company and Acquisition, as the
case may be;
19
iii. not pay, incur or declare any dividends or distributions with
respect to its stockholders or amend its Certificate of Incorporation or
By-Laws;
iv. not authorize [except as described in the Form 14C filed with
the SEC and delivered to shareholders on or about June 30, 2004, which
authorizes an additional eight hundred million (800,000,000) shares of Company
Common Stock (bringing the total authorized Company Common Stock to nine hundred
million (900,000,000) shares, and an additional nine million (9,000,000) shares
of Preferred Stock (bringing the total authorized Preferred Stock to ten million
(10,000,000) shares], issue, sell, purchase or redeem any shares of its capital
stock or any options or other rights to acquire ownerships interests, except for
37,885,033 shares that are issuable to Company employees if and when the Company
amends its Organizational Documents as described in said Form 14C or elsewhere
in this Agreement;
v. not incur any indebtedness for money borrowed or issue any debt
securities, or incur or suffer to be incurred any liability or obligation of any
nature whatsoever, except those incurred in the ordinary course of business, or
cause or permit any material lien, encumbrance or security interest to be
created or arise on or in respect of any material portion of its properties or
assets;
vi. not make any investment of a capital nature either by purchased
stock or securities, contribution to capital, property transfer or otherwise, or
by the purchase of any property or assets of any other Person;
vii. not do any other act which would cause any representation or
warranty of the Company in this Agreement to be or become untrue in any material
respect or that is not in the Ordinary Course of Business;
(b) Proposals; Other Offers. Commencing on the date of execution of this
Agreement up to and including the Closing Date, each of the Company and
Acquisition shall not, directly or indirectly (whether through an employee, a
representative, an agent or otherwise), solicit or encourage any inquiries or
proposals, engage in negotiations for or consent to or enter into any agreement
providing for the acquisition of its business, except for the divesture of
Company's subsidiary, Hy-Tech Computer Systems, Inc. to Aegis. Each of the
Company and Acquisition shall not, directly or indirectly (whether through an
employee, a representative, an agent or otherwise) disclose any nonpublic
information relating to the Company and Acquisition or afford access to any of
the books, records or other properties of the Company and Acquisition to any
person or entity that is considering, has considered or is making any such
acquisition inquiry or proposal relating to the Company's and Acquisition's
business.
(c) Further Assurances. Prior to the Closing Date, with the cooperation of
RWT where appropriate, each of the Company and Acquisition shall use
commercially reasonable efforts to:
i. promptly comply with all filing requirements which federal, state
or local law may impose on the Company or Acquisition, as the case may be, with
respect to the Merger and this Agreement; and
20
ii. take all actions necessary to be taken, make any filing and
obtain any consent, authorization or approval of or exemption by any
governmental authority, regulatory agency or any other third party (including
without limitation, any landlord or lessor of the Company and any party to whom
notification is required to be delivered or from whom any form of consent is
required) which is required to be filed or obtained by the Company or
Acquisition in connection with the Merger by this Agreement.
(d) Post Closing Covenants. From and after the Closing Date, the Company
agrees that it shall:
i. in the event that the Company issues any shares of its Common
Stock in settlement of any debt or obligation that existed at Closing, excluding
Allowable Debt as defined in Section 6.1(c), (the "Debt Settlement Shares"),
then as promptly as practical, the Company shall, in addition to the Company
Common Stock Shares issued pursuant to Section 2.1(a), issue in the aggregate to
all of the holders of RWT Common Stock at Closing, an amount of shares of Common
Stock equal to the Debt Settlement Shares, such issuance to be pro rata in
proportion to such holders' holdings of RWT Common Stock at Closing.
ii. in the event that the Company is unable to pay its attorneys or
if RWT is unable to pay its attorneys in cash for services rendered, then the
Company shall issue to all such attorneys shares of its Common Stock in payment
for such services and file a registration statement on Form S-8 under the
Securities Act of 1933, as amended, in order to allow the resale of the common
stock so issued, provided further that the parties hereto agree that this
Section 4(d)ii is being relied upon by said attorneys and that they shall have
an absolute right to xxx under this Section 4(d)ii as third party beneficiaries
hereof.
iii. in the event that prior to the Closing Date the Company issues
any shares of its Common Stock in excess of one hundred forty million
(140,000,000) of such shares (such amount the "Excess Pre-closing Shares"), then
at the Closing the Company shall, in addition to the Company Common Stock Shares
to be issued pursuant to Section 2.1(a), issue in the aggregate to all of the
holders of RWT Common Stock at Closing, an amount of shares of Common Stock
equal to the Excess Pre-closing Shares, such issuance to be pro rata in
proportion to such holders' holdings of RWT Common Stock.
5.2 Covenants of RWT.
(a) Conduct of Business. Between the date hereof and up to and including
the Closing Date, RWT shall:
i. conduct its business only in the Ordinary Course of Business;
ii. use its commercially reasonable efforts to preserve intact the
current business organization of RWT, keep available the services of the current
officers, employees and agents of RWT, and maintain the relations and good will
with suppliers, customers, landlords, creditors, employees, agents and others
having business relationships with RWT;
21
iii. not pay, incur or declare any dividends or distributions with
respect to its stockholders or amend its Certificate of Incorporation or
By-Laws;
iv. not authorize, issue, sell, purchase or redeem any shares of its
capital stock or any options or other rights to acquire ownerships interests;
v. not incur any indebtedness for money borrowed or issue and debt
securities, or incur or suffer to be incurred any liability or obligation of any
nature whatsoever, or cause or permit any material lien, encumbrance or security
interest to be created or arise on or in respect of any material portion of its
properties or assets;
vi. not make any investment of a capital nature either by purchased
stock or securities, contribution to capital, property transfer or otherwise, or
by the purchase of any property or assets of any other person;
vii. not do any other act which would cause representation or
warranty of RWT in this Agreement to be or become untrue in any material respect
or that is not in the ordinary course of business consistent with past practice;
(b) Proposals; Other Offers. Commencing on the date of execution of this
Agreement through the Closing Date, RWT shall not, directly or indirectly
(whether through an employee, a representative, an agent or otherwise), solicit
or encourage any inquiries or proposals, engage in negotiations for or consent
to or enter into any agreement providing for the acquisition of its business.
RWT shall not, directly or indirectly (whether through an employee, a
representative, an agent or otherwise) disclose any nonpublic information
relating to RWT or afford access to any of the books, records or other
properties of RWT to any person or entity that is considering, has considered or
is making any such acquisition inquiry or proposal relating to the RWT's
business.
(c) Further Assurances. Prior to the Closing Date, with the cooperation of
the Company where appropriate, RWT shall:
i. promptly comply with all filing requirements which federal, state
or local law may impose on RWT with respect to the Merger and this Agreement and
cooperate with the Company regarding the same; and
ii. take all actions necessary to be taken, make any filing and
obtain any consent, authorization or approval of or exemption by any
governmental authority, regulatory agency or any other third party (including
without limitation, any landlord or lessor of RWT and any party to whom
notification is required to be delivered or from whom any form of consent is
required) which is required to be filed or obtained by RWT in connection with
the Merger and this Agreement.
(d) Actions by RWT. RWT shall take no action or enter into any agreements
or arrangements except as may be required by this Agreement.
(e) No Change in Capital Stock. Prior to the Effective Time, no change
will be made in the authorized, issued or outstanding capital stock of RWT, and
no subscriptions, options, rights, warrants, calls, commitments or agreements
relating to the authorized, issued or outstanding capital stock of RWT will be
entered into, issued, granted or created.
22
(f) Access to Additional Agreements and Information. Prior to the Closing
Date, RWT shall make available to the Company (as well as its counsel,
accountants and other representatives) any and all agreements, contracts,
documents, other instruments and personnel material of RWT's business, including
without limitation, those contracts to which RWT is a party and those by which
its business or any of RWT's assets are bound.
(g) Name Change of the Company. If the Company has not effected a change
of its name to Innova Holdings, Inc., prior to the Effective Date, RWT will
assist the Company in its solicitation of RWT stockholders who became
stockholders of the Company by virtue of this Agreement, it being understood
however, that such stockholders may not so approve the name change, and no
representation to that effect is being made by RWT hereby.
5.3 Governmental Filings and Consents. The Company, Acquisition and RWT
shall cooperate with one another in filing any necessary applications, reports
or other documents with any federal or state agencies, authorities or bodies
having jurisdiction with respect to the business of the Company, Acquisition or
RWT and in seeking any necessary approval, consultation or prompt favorable
action of, with or by any of such agencies, authorities or bodies. In addition,
the Company and RWT shall cooperate with one another in taking steps necessary
to cause the financial statements of RWT for its fiscal years 2002 and 2003 to
be audited within 60 days of the Effective Time.
5.4 Publicity. Any public announcement or press release relating to this
Agreement or the Merger must be approved by RWT and the Company in writing
before being made or released. The Company shall have the right to issue a press
release or make other disclosure without RWT's written approval if in the
opinion of the Company's counsel such a release is necessary to comply with SEC
Rules and Regulations or other Law; provided that, RWT receives a copy of such
prepared press release or other disclosures for purposes of review at least 24
hours before it is issued. This 24 hour period may be shortened if in the
opinion of the Company's counsel it is required by Law; provided that, RWT
receives a copy of such release as long as reasonably practical before it is
issued.
5.5 Tax Returns. The current officers of the Company shall have the right
to prepare any tax returns of the Company with respect to any period that ends
on or before the Closing Date. Such tax returns shall be timely filed by the
Company. RWT shall cooperate with said officers in the preparation of such tax
returns.
CONDITIONS
6.1 Conditions to Obligations of RWT. The obligation of RWT to consummate
the Merger is subject to the fulfillment of each of the following conditions,
any of which may be waived by RWT in its sole discretion:
(a) Copies of Resolutions. At the Closing (i) the Company shall have
furnished RWT with a certificate of its CEO or President, as the case may be, in
the form of EXHIBIT 6.1(a)(1) annexed hereto, certifying that attached thereto
are copies of resolutions duly adopted by the board of directors of the Company
23
authorizing the execution, delivery and performance of this Agreement and all
other necessary or proper corporate action to enable the Company to comply with
the terms of this Agreement and (ii) Acquisition shall have furnished RWT with a
certificate of its CEO or President, as the case may be, in the form of EXHIBIT
6.1(A)(2) annexed hereto, certifying that attached thereto are copies of
resolutions duly adopted by the board of directors of Acquisition authorizing
the execution, delivery and performance of this Agreement and all other
necessary or proper corporate action to enable Acquisition to comply with the
terms of this Agreement.
(b) [Intentionally omitted].
(c) Matters Concerning the Company. On the Closing Date (i) the Company
shall have no more than one hundred forty million (140,000,000) outstanding
shares of Company Common Stock; (ii) the Company shall have negotiated the
divesture of its subsidiary, Hy-Tech Computer Systems, Inc., which divestiture
shall (A) include payment to the purchaser of shares of Company Common Stock and
not more than one hundred fifty thousand dollars ($150,000) cash and (B) close
as soon as practicable following the Effective Time; and (iii) and all
outstanding debt of the Company shall have been paid or provided for with
arrangements satisfactory to RWT, in its discretion, except for an aggregate of
not more than two hundred thirty thousand dollars ($230,000) of Convertible Debt
(the "Allowable Debt"). On the Closing Date, the Company shall have total
authorized Company Common Stock of nine hundred million (900,000,000) shares,
and total authorized Preferred Stock of ten million (10,000,000) shares. [On the
Closing Date, the Company's Common Stock shall be trading under the symbol
HYTT.OB]
(d) Employment Agreements. At Closing, documentation necessary to reflect
the assumption by the Company of the Employment Agreements with Xxxxxx Xxxxxx
and Xxxxx Aws, annexed hereto as EXHIBITS L-1 AND L-2, shall have been executed
and delivered.
(e) Accrued Salaries Due Personnel and/or Consultants of Company and RWT.
The Company shall offer to pay all consultants and personnel of Company and RWT
all accrued salaries and consulting fees by issuance of Company shares of common
stock valued at $.01 per share (the "Compensation Shares"), said Compensation
Shares to comprise 16,133,333 Shares to be issued to Altos Bancorp; 13,951,700
Shares to be issued to Xxxxxx Xxxxxxx; 3,900,000 Shares to be issued to Xxxx
XxXxxx; and 3,900,000 Shares to be issued to Xxxxx Xxxxxxx. All of the
Compensation Shares shall be registered on a Form S-8 (to the extent permitted
under the rules for use of Form S-8) and the holders shall have the right to
sell up to 1/4th of the Compensation Shares each quarter subject only to a right
of the Board of Directors to limit the amount and timing if believed to be
reasonably necessary. If any limitation is imposed, such limitation shall be
applied prorate to the holders of Compensation Shares based on the number of
Compensation Shares held by a holder to the total Compensation Shares proposed
to be sold. All of the Company personnel and consultants will be required to
agree to accept the Compensation Shares in full payment of the Company
obligation to them before the issuance of such shares.
(f) Accuracy of Representations and Warranties; Performance of Covenants.
Each of the representations and warranties of the Company and Acquisition set
forth in this Agreement was true, correct and complete in all material respects
24
when made (except for representations and warranties that speak as of a specific
date, which representations and warranties shall be true, correct and complete
in all material respects as of such date) and shall also be true, correct and
complete in all material respects at and as of the Closing Date (except for
representations and warranties that speak as of a specific date, which
representations and warranties shall be true, correct and complete in all
material respects as of such date), with the same force and effect as if made at
and as of the Closing Date. The Company shall have performed and complied in all
material respects with all agreements and covenants required by this Agreement
to be performed by the Company and Acquisition at or prior to the Closing Date.
(g) Delivery of Certificate. (A) The Company shall have delivered to RWT a
certificate, in the form of EXHIBIT 6.1(F)(1) annexed hereto, dated the Closing
Date, and signed by the CEO or President of the Company affirming that the
representations and warranties as set forth in Section 4.1 were and are true,
correct and complete as required by Section 6.1(e) and (B) Acquisition shall
have delivered to RWT a certificate, in the form of EXHIBIT 6.1(F)(2) annexed
hereto, dated the Closing Date, and signed by the CEO or President of
Acquisition affirming that the representations and warranties as set forth in
Section 4.1 were and are true, correct and complete as required by Section
6.1(e).
(h) Consents and Waivers. At the Closing, any and all necessary consents,
authorizations, orders or approvals shall have been obtained, except as the same
shall have been waived by RWT.
(i) Litigation. On the Closing Date, there shall be no effective
injunction, writ or preliminary restraining order or any order of any kind
whatsoever with respect to the Company issued by a court or governmental agency
(or other governmental or regulatory authority) of competent jurisdiction
restraining or prohibiting the consummation of the Merger or making consummation
thereof unduly burdensome to RWT. On the Closing Date and immediately prior to
consummation of the Merger, no proceeding or lawsuit shall have been commenced,
be pending or have been threatened by any governmental or regulatory agency or
authority or any other Person restraining or prohibiting the consummation of the
Merger.
(j) Delivery of Documents and Other Information. Prior to the Closing
Date, the Company and Acquisition shall have made available or delivered to RWT
all of the agreements, contracts, documents and other instruments requested by
RWT.
(k) Registration Rights Agreement. The Company shall have executed and
delivered the Registration Rights Agreement annexed hereto as EXHIBIT J.
(l) Lock Up Agreement. Each of Xxxxxx Xxxxxxx, Xxxx XxXxxx, Xxxxx Xxxxxxx
and Altos BanCorp, Inc. shall have entered into a Lock Up Agreement in the form
of EXHIBIT K hereto.
(m) Indemnification. Company shall indemnify Xxxxxx Xxxxxx (1) against any
personal liability he may have as a result of his personal guarantee of the
indebtedness and liabilities of RWT and its subsidiaries incurred in the
Ordinary Course of Business (2) for actions taken as an officer or director of
RWT or its subsidiaries to the fullest extent allowed by Delaware law.
25
6.2 Conditions to Obligations of the Company and Acquisition. The
obligation of the Company and Acquisition to consummate the Merger is subject to
the fulfillment of each of the following conditions, any of which may be waived
by the Company and Acquisition, in their sole discretion:
(a) Copies of Resolutions. At the Closing, RWT shall have furnished the
Company with a certificate of its President, in the form of EXHIBIT 6.2(A)
annexed hereto, certifying that attached thereto are copies of resolutions duly
adopted by the board of directors of RWT authorizing the execution, delivery and
performance of the terms of this Agreement and all other necessary or proper
corporate action to enable RWT to comply with the terms of this Agreement.
(b) [Intentionally omitted]
(c) RWT Debt. At the Closing, RWT's outstanding debt shall consist of not
more than (i) an SBA loan of one million dollars ($1,000,000); (ii) bank debt of
Two Hundred Fifty Thousand Dollars ($250,000); and (iii) accounts payable not to
exceed Two Hundred Fifty Thousand Dollars ($250,000).
(d) Accuracy of Representations and Warranties; Performance of Covenants.
Each of the representations and warranties of RWT was true, correct and complete
in all material respects when made (except for representations and warranties
that speak as of a specific date, which representations and warranties shall be
true, correct and complete in all material respects as of such date) and shall
also be true, correct and complete in all material respects at and as of the
Closing Date (except for representations and warranties that speak as of a
specific date, which representations and warranties shall be true, correct and
complete in all material respects as of such date), with the same force and
effect as if made at and as of the Closing Date. RWT shall have performed and
complied in all material respects with all agreements and covenants required by
this Agreement to be performed by RWT at or prior to the Closing Date.
(e) Delivery of Certificate. RWT shall have delivered to the Company a
certificate, in the form of EXHIBIT 6.2(E) annexed hereto, dated the Closing
Date and signed by the CEO or President of RWT, affirming that the
representations and warranties of RWT as set forth in Section 4.2 were and are
true, correct and complete and RWT's agreements and covenants have been
performed as required by Section 6.2(d).
(f) [Intentionally omitted].
(g) Consents and Waivers. On or prior to the Closing Date, any and all
necessary consents, authorizations, orders or approvals, including approval by
not less than two thirds (2/3) of the outstanding RWT Common Stock Shares, shall
have been obtained, except as the same shall have been waived by the Company,
provided however, that in no event may the requirement of approval by not less
than two thirds (2/3) of the outstanding RWT Common Stock Shares be waived.
26
(h) Litigation. On the Closing Date, there shall be no effective
injunction, writ or preliminary restraining order or any order of any kind
whatsoever with respect to RWT issued by a court or governmental agency (or
other governmental or regulatory authority) of competent jurisdiction
restraining or prohibiting the consummation of the Merger or making the
consummation thereof unduly burdensome to the Company or RWT. On the Closing
Date, no proceeding or lawsuit shall have been commenced, threatened or be
pending or by any governmental or regulatory agency or authority or any other
person with respect to the Merger.
(i) Delivery of Documents and Other Information. Prior to the Closing
Date, RWT shall have made available or delivered to the Company all of the
agreements, contracts, documents and other instruments required to be delivered
pursuant to the provisions of this Agreement.
(j) Accrued Salaries Due Personnel and/or Consultants of Company and RWT.
The Company shall offer to pay all consultants and personnel of Company and RWT
all accrued salaries and consulting fees by issuance of Company shares of common
stock valued at $.01 per share (the "Compensation Shares"). All of the
Compensation Shares shall be registered on a Form S-8 (to the extent permitted
under the rules for use of Form S-8) and the holders shall have the right to
sell up to 1/4th of the Compensation Shares each quarter subject only to a right
of the Board of Directors to limit the amount and timing if believed to be
reasonably necessary. If any limitation is imposed, such limitation shall be
applied prorate to the holders of Compensation Shares based on the number of
Compensation Shares held by a holder to the total Compensation Shares proposed
to be sold. All of the RWT personnel and consultants will be required to agree
to accept the Compensation Shares in full payment of the RWT obligation to them
before the issuance of such shares.
(k) Indemnification. Company shall indemnify Xxxxxx Xxxxxxx, Xxxx XxXxxx
and Xxxxx Xxxxxxx against any personal liability they may have as a result of
(1) their personal guarantees of the indebtedness and liabilities incurred of
Company and its subsidiaries incurred in the Ordinary Course of Business (2) for
actions taken as an officer or director of HYTT or its subsidiaries to the
fullest extent allowed by Delaware law.
ARTICLE VII
TERMINATION
7.1 Termination by Mutual Agreement. This Agreement may be terminated at
any time by mutual consent of the parties hereto, provided that such consent to
terminate is in writing and is signed by each of the parties hereto.
7.2 Termination for Failure to Close. This Agreement shall be
automatically terminated if the Closing shall not have occurred within
forty-five (45) days of the date hereof (except if such 45th day is not a
Business Day, then the next Business Day).
7.3 Termination by Operation of Law. This Agreement may be terminated by
any party hereto if there shall be any statute, rule or regulation that renders
consummation of the Merger illegal or otherwise prohibited, or a court of
competent jurisdiction or any government (or governmental authority) shall have
27
issued an order, decree or ruling, or has taken any other action restraining,
enjoining or otherwise prohibiting the consummation of such transactions and
such order, decree, ruling or other action shall have become final and
nonappealable.
7.4 Termination for Failure to Perform Covenants or Conditions. This
Agreement may be terminated prior to the Closing Date:
(a) By RWT if: (i) any of the representations and warranties
made in this Agreement by the Company or Acquisition shall not be materially
true and correct, when made or at any time prior to consummation of the Merger
as if made at and as of such time; (ii) any of the conditions set forth in
Section 6.1 hereof have not been fulfilled in all material respects by the
Closing Date; (iii) the Company or Acquisition shall have failed to observe or
perform any of its material obligations under this Agreement; or (iv) as
otherwise set forth herein; or
(b) by the Company or Acquisition if: (i) any of the
representations and warranties of RWT or the RWT Stockholder shall not be
materially true and correct when made or at any time prior to consummation of
the Merger as if made at and as of such time; (ii) any of the conditions set
forth in Section 6.2 hereof have not been fulfilled in all material respects by
the Closing Date; (iii) RWT shall have failed to observe or perform any of their
material respective obligations under this Agreement; or (iv) as otherwise set
forth herein.
7.5 Effect of Termination or Default; Remedies. In the event of
termination of this Agreement as set forth above, this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto,
provided that such party is a Non-Defaulting Party (as defined below). The
foregoing shall not relieve any party from liability for damages actually
incurred as a result of such party's breach of any term or provision of this
Agreement.
7.6 Remedies; Specific Performance. In the event that any party shall fail
or refuse to consummate the Merger or if any default under or beach of any
representation, warranty, covenant or condition of this Agreement on the part of
any party (the "Defaulting Party") shall have occurred that results in the
failure to consummate the Merger, then in addition to the other remedies
provided herein, the non-defaulting party (the "Non-Defaulting Party") shall be
entitled to seek and obtain money damages from the Defaulting Party, or may seek
to obtain an order of specific performance thereof against the Defaulting Party
from a court of competent jurisdiction, provided that the Non-Defaulting Party
seeking such protection must file its request with such court within forty-five
(45) days after it becomes aware of the Defaulting Party's failure, refusal,
default or breach. In addition, the Non-Defaulting Party shall be entitled to
obtain from the Defaulting Party court costs and reasonable attorneys' fees
incurred in connection with or in pursuit of enforcing the rights and remedies
provided hereunder.
ARTICLE VIII
SURVIVAL; INDEMNIFICATION
8.1 Survival of Representations and Warranties of the Company. All
representations and warranties of the Company shall survive the execution and
delivery of this Agreement and the Closing hereunder and shall thereafter
28
survive until the first anniversary of the Closing Date and shall then terminate
except to the extent that notice of the Company's or Acquisition liability in
respect of any inaccuracy in or breach of any representation or warranty shall
have been given on or prior to such date.
8.2 Survival of Representations and Warranties of RWT. All representations
and warranties of RWT shall survive the execution and delivery of this Agreement
and the Closing hereunder and shall thereafter survive until the first
anniversary of the Closing Date and shall then terminate except to the extent
that notice of RWT's liability in respect of any inaccuracy in or breach of any
representation or warranty shall have been given on or prior to such date.
8.3 Obligation of the Company to Indemnify. The Company agrees to
indemnify, defend and hold harmless RWT (and its directors, officers, employees,
affiliates, stockholders, debenture holders, agents, attorneys, successors and
assigns) from and against all losses, liabilities, damages, deficiencies, costs
or expenses (including interest, penalties and reasonable attorneys' and
consultants' fees and disbursements) (collectively, "Losses") based upon,
arising out of or otherwise in respect of any (i) inaccuracy in any
representation or warranty of the Company contained in this Agreement or in the
Schedules and Exhibits hereto or (ii) breach by the Company of any covenant or
agreement contained in this Agreement.
8.4 Obligation of and RWT to Indemnify. RWT agrees to indemnify, defend
and hold harmless the Company (and its directors, officers, employees,
affiliates, stockholders, agents, attorneys, successors and assigns) from and
against any Losses based upon, arising out of or otherwise in respect of any (i)
inaccuracy in any representation or warranty of RWT contained in this Agreement
or in the Schedules and Exhibits hereto or (ii) breach by RWT of any covenant or
agreement contained in this Agreement.
8.5 Notice and Opportunity to Defend. (a) Promptly after receipt by any
Person entitled to indemnity under this Agreement (an "Indemnitee") of notice of
any demand, claim or circumstances which, with the lapse of time, would or might
give rise to a claim or the commencement (or threatened commencement) of any
action, proceeding or investigation (an "Asserted Liability") that may result in
a Loss, the Indemnitee shall give notice thereof (the "Claims Notice") to any
other party (or parties) who is or may be obligated to provide indemnification
pursuant to Section 8.3 or 8.4 (the "Indemnifying Party"). The Claims Notice
shall describe the Asserted Liability in reasonable detail and shall indicate
the amount (estimated, if necessary and to the extent feasible) of the Loss that
has been or may be suffered by the Indemnitee.
(a) The Indemnifying Party may elect to compromise or defend,
at its own expense and by its own counsel, any Asserted Liability. If the
Indemnifying Party elects to compromise or defend such Asserted Liability, it
shall within 30 days after the date the Claims Notice is given (or sooner, if
the nature of the Asserted Liability so requires) notify the Indemnitee of its
intent to do so, and the Indemnitee shall cooperate, at the expense of the
Indemnifying Party, in the compromise of, or defense against, such Asserted
Liability. If the Indemnifying Party elects not to compromise or defend the
Asserted Liability, fails to notify the Indemnitee of its election as herein
provided or contests its obligation to indemnify under this Agreement, the
29
Indemnitee may pay, compromise or defend such Asserted Liability and all
reasonable expenses incurred by the Indemnitee in defending or compromising such
Asserted Liability, all amounts required to be paid in connection with any such
Asserted Liability pursuant to the determination of any court, governmental or
regulatory body or arbitrator, and amounts required to be paid in connection
with any compromise or settlement consented to by the Indemnitee, shall be borne
by the Indemnifying Party. Except as otherwise provided in the immediately
preceding sentence, the Indemnitee may not settle or compromise any claim over
the objection of the Indemnifying Party. In any event, the Indemnitee and the
Indemnifying Party may participate, at their own expense, in (but the Indemnitee
may not control) the defense of such Asserted Liability. If the Indemnifying
Party chooses to defend any claim, the Indemnitee shall make available to the
Indemnifying Party any books, records or other documents within its control that
are necessary or appropriate for such defense.
ARTICLE IX
DEFINITIONS
The following terms, which are capitalized in this Agreement, shall have
the meanings set forth below for the purpose of this Agreement.
"Contract" means any Contract (a) to which the Company, Acquisition or
RWT, is a party and under which the Company, Acquisition or RWT, has or may
acquire any material rights, (b) under which the Company, Acquisition or RWT, as
the case may be, is a party and has or may become subject to any material
obligation or material liability or (c) by which the Company, Acquisition or
RWT, as the case may be, or any of the material assets owned or used by it is or
may become bound.
"Environmental Laws" means all applicable federal, state, local or foreign
laws, rules and regulations, orders, decrees, judgments, permits, filings and
licenses relating (i) to protection and clean-up of the environment and
activities or conditions related thereto, including those relating to the
generation, handling, disposal, transportation or release of hazardous
substances and (ii) the health or safety of employees in the workplace
environment, all as amended from time to time, and shall also include any common
law theory based on nuisance, trespass, negligence or other tortuous conduct.
"ERISA" means the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to such law or any
successor law.
"GAAP" means generally accepted accounting principles in the United
States, applied on a consistent basis.
"Law" means all applicable laws, statutes, ordinances, rules, regulations,
orders, writs, injunctions, judgments or decrees entered, enacted, promulgated,
enforced or issued by any court or other governmental or regulatory authority,
domestic or foreign.
"Legal Requirement" means any federal, state, local, municipal, foreign,
international, multinational or other administrative law, ordinance, principle
of common law, regulation, statute, treaty, court or arbitrator.
30
"Material Adverse Effect" means a material adverse effect upon the
business or financial condition of the Company (when used in Section 4.1) or RWT
(when used in Section 4.2), taken as a whole with any subsidiaries.
"Order" means any award, decision, injunction, judgment, order, ruling,
subpoena or verdict entered, issued, made or rendered by any court,
administrative agency or other governmental body or by any arbitrator.
"Ordinary Course of Business" means an action taken by a Person where:
(1) such action is consistent with the past practices of such Person and
is taken in the ordinary course of the normal day-to-day operations of such
Person;
(2) such action is not required to be authorized by the board of directors
of such Person (or by any Person or group of Persons exercising similar
authority); and
(3) such action is similar in nature and magnitude to actions customarily
taken, without any authorization by the board of directors (or by any Person or
group of Persons exercising similar authority), in the ordinary course of the
normal day-to-day operations of other Persons that are in the same line of
business as such Person.
"Organizational Documents" means the articles or certificate of
incorporation and the by-laws of a corporation and any amendment thereto.
"Person" means any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union or other entity
or governmental body.
"Proceeding" means any action, arbitration, audit, hearing, investigation,
litigation or suit (whether civil, criminal, administrative, investigative or
informal) commenced, brought, conducted or heard by or before, or otherwise
involving, any governmental body or arbitrator.
"SEC" means the United States Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
ARTICLE X
MISCELLANEOUS
10.1 Fees and Expenses. Except as otherwise provided in this Agreement,
each party hereto will bear its own legal, accounting and other fees and
expenses incident to the Merger herein. Any fees and expenses required to be
paid by any party hereunder shall be limited to reasonable and necessary fees
and expenses.
10.2 Modification, Amendments and Waiver. The parties hereto may amend,
modify or otherwise waive any provision of this Agreement by mutual consent,
provided that such consent and any amendment, modification or waiver is in
writing and is signed by each of the parties hereto.
31
10.3 Assignment. Neither the Company, Acquisition nor RWT shall have the
authority to assign its respective rights or obligations under this Agreement.
10.4 Successors. This Agreement shall be binding upon and, to the extent
permitted in this Agreement, shall inure to the benefit of the parties and their
respective successors and permitted assigns.
10.5 Entire Agreement. This Agreement and the exhibits, schedules and
other documents referred to herein contain the entire agreement among the
parties hereto with respect to the Merger and supersede all prior agreements
with respect thereto, whether written or oral.
10.6 Governing Law. This Agreement and the exhibits hereto shall be
governed by and construed in accordance with the laws of the State of Florida,
without giving effect to principles of conflicts or choice of laws thereof. Any
action to enforce the terms of this Agreement or any of its exhibits shall be
brought exclusively in the state and/or federal courts situated in the County
and State of Florida. Service of process in any action by either party to
enforce the terms of this Agreement may be made by serving a copy of the summons
and complaint, in addition to any other relevant documents, by commercial
overnight courier to the other party at its principal address set forth in this
Agreement.
10.7 Notices. Any notice, request, demand, waiver, consent, approval, or
other communication which is required or permitted to be given to any party
hereunder shall be in writing and shall be deemed given only if delivered to the
party personally or sent to the party by facsimile upon electronic confirmation
of receipt (promptly followed by a hard-copy delivered in accordance with this
Section 10.7) or three days after being mailed by registered or certified mail
(return receipt requested), with postage and registration or certification fees
thereon prepaid, or if sent by nationally recognized overnight courier, one day
after being mailed, addressed to the party at its address set forth below:
If to RWT: Robotic Workspace Technologies, Inc.
00000 Xxx Xxxxxx Xxxx., Xxxxx X0000
Fort Xxxxx Xxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, CEO
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: Xxxxx Xxxxxxx
0000 X. Xxxx Xxxxx, Xxxx X-000
Xxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
00
Xxxxxx Xxxxxxx Xxxxx Xxxxx PLLC
00 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
If to Acquisition: RWT Acquisition, Inc.
c/o Robotic Workspace Technologies, Inc.
00000 Xxx Xxxxxx Xxxx., Xxxxx X0000
Fort Xxxxx Beach, FL 33931
Attn: Xxxx XxXxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: Gottbetter & Partners, LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxxxxxx, Esq.
Tel: 000-000-0000
Fax: 000- 000-0000
If to Company: Hy-Tech Technology Group, Inc.
00000 Xxx Xxxxxx Xxxx., Xxxxx X0000
Xxxx Xxxxx Xxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: Gottbetter & Partners, LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxxxxxx, Esq.
Tel: 000- 000-0000
Fax: 000- 000-0000
or to such other persons or addresses as may be designated in writing by the
party to receive such notice. If mailed as aforesaid, the day of mailing or
transmission shall be the date any such notice shall be deemed to have been
delivered.
10.8 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be an original, but all of which shall
constitute but one agreement. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
33
10.9 Rights Cumulative. All rights, powers and privileges conferred
hereunder upon the parties, unless otherwise provided, shall be cumulative and
shall not be restricted to those given by law. Failure to exercise any power
given any party hereunder or to insist upon strict compliance by any other party
shall not constitute a waiver of any party's right to demand exact compliance
with any of the terms or provisions hereof.
10.10 Severability of Provisions. The provisions of this Agreement shall
be considered severable in the event that any of such provisions are held by a
court of competent jurisdiction to be invalid, void or otherwise unenforceable.
Such invalid, void or otherwise unenforceable provisions shall be automatically
replaced by other provisions which are valid and enforceable and which are as
similar as possible in term and intent to those provisions deemed to be invalid,
void or otherwise unenforceable and the remaining provisions hereof shall remain
enforceable to the fullest extent permitted by law.
10.11 Headings. The headings set forth in the articles and sections of
this Agreement and in the exhibits and the schedules to this Agreement are
inserted for convenience of reference only and shall not be deemed to constitute
a part hereof.
[SIGNATURE PAGE FOLLOWS]
34
IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
have caused this Agreement to be executed and delivered on the date and year
first above written.
HY-TECH TECHNOLOGY GROUP, INC.
By: /s/ Xxxx XxXxxx
-------------------------------------
Xxxx XxXxxx,
CFO
ROBOTIC WORKSPACE TECHNOLOGIES, INC.
By: /s/ Xxxxxx Xxxxxx
-------------------------------------
Xxxxxx Xxxxxx,
CEO
RWT ACQUISITION, INC.
By: /s/ Xxxx X. XxXxxx
-------------------------------------
Name: /s/ Xxxx X. XxXxxx
-------------------------------------
Title: Director
------------------------------------
35
