MERGER AGREEMENT
Agreement made the 19th day of May, 2000, by and among iiGroup, Inc., a
Delaware corporation (the "Company"), SV Acquisition Corp., a Delaware
corporation ("Newco") and Silicon Ventures, Inc., a Delaware corporation
("Silicon").
RECITALS
WHEREAS, the parties intend that, subject to the terms and conditions
hereinafter set forth, Newco will merge with and into Silicon in a reverse
triangular merger (the "Merger"), with Silicon to be the surviving corporation
of the Merger, all pursuant to the terms and conditions of this Agreement and
the applicable provisions of the Delaware General Corporation Law (the "DCGL").
The Merger is intended to be treated as a tax-free reorganization pursuant to
the provisions of Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as
amended (the "Code"), by virtue of the provisions of Section 368(a)(2)(E) of the
Code; and
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties and agreements herein contained, the parties hereto
agree as follows:
ARTICLE I
INCORPORATION OF RECITALS
All of the recitals set forth above are incorporated herein by
reference.
ARTICLE II
DEFINITIONS
The following terms, as used herein, have the following meanings:
2.1 "Affiliate" of a Person means a Person, who directly or
indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, such person.
2.2 "Agreement" has the meaning set forth in the introductory
paragraph.
2.3 "Closing" has the meaning set forth in Section 3.9.
2.4 "Closing Date" has the meaning set forth in Section 3.9.
2.5 "Common Stock" means the voting common stock of the Company.
2.6 "Company" means iiGroup, Inc.
2.7 "Holdings" means shares held by Silicon in companies listed in
Section 4.5.
2.8 "DGCL" means the Delaware General Corporation Law, as amended.
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2.9 "Effective Time" means the time indicated in the Articles of
Merger when the merger pursuant hereto shall become effective for
corporate law purposes.
2.10 "Environmental Permits" means federal, state and local
governmental liens, permits and other authorizations and
approvals, whether foreign or domestic, which relate to the
business of a Person as it may be affected by the environment, or
to public health and safety, or worker health and safety, as they
may be affected by the environment.
2.11 "ERISA" means the Employment Retirement Income Security Act of
1974, as amended.
2.12 "Financial Statement" has the meaning set forth in Section 4.10.
2.13 "Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended.
2.14 "Intellectual Property" has the meaning set forth in Section
4.16.
2.15 "Leases" and "Lease" have the meanings set forth in Section 4.15.
2.16 "Licenses and Permits" has the meaning set forth in Section 4.8.
2.17 "Material Contract" means each contract, agreement or commitment
of a Person other than Leases:
(a) upon which any substantial part of such Person's
business is dependent or which, if breached, could reasonably be
expected to affect, materially and adversely, the earnings, assets,
financial condition or operations of the business of such Person;
(b) which provides for aggregate future payments of
more than $10,000, except for purchase orders or sale orders arising in
the ordinary and usual course of business, in which case they are
listed only if any party thereto is obligated to make payments pursuant
thereto aggregating more than $20,000;
(c) which extends for more than one year from the
date hereof and is not cancelable by either party on 30 days' notice;
(d) which provides for the sale, after the date
hereof and other than in the ordinary course of business, of any of its
assets;
(e) which relates to the employment, retirement or
termination of the services of any officer of former officer; or
(f) which contains covenants pursuant to which any
other Person has agreed not to compete with any business conducted by
such Person or not to disclose to other information concerning such
Person.
Collectively, the material contracts of such Person are referred to as
"Material Contracts."
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2.18 "Pension Plans" means all employee benefit plans and programs
including, without limitation, all retirement, savings and other pension plans.
2.19 "Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
governmental or political subdivision or an agency of instrumentality thereof.
2.20 "Real Property" means all of the real property, together with the
fixtures and other improvements located thereon and the appurtenances thereto,
owned by a Person.
2.21 "Securities Act" means the Securities Act of 1933, as amended.
2.22 "Tax" or "Taxes" means any federal, state, local, or foreign
income, gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, windfall profits, environmental (including taxes under
Internal Revenue Code section 59A), customs duties, capital stock, franchise
profits, withholding, social security (or similar), unemployment, disability,
real property, personal property, sales, use, transfer, registration, value
added, alterative or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition thereto, whether
disputed or not.
2.23 "Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.
2.24 "Welfare Plans" means all health, severance, insurance, disability
and other employee welfare plans.
ARTICLE III
MERGER
3.1 Merger. On the terms and subject to the conditions contained in
this Agreement, on the Closing Date and at the Effective Time, Newco shall be
merged with and into Silicon and the separate corporate existence of Newco shall
thereupon cease. Silicon shall be the surviving corporation in the Merger and
shall be a wholly-owned subsidiary of the Company. The separate corporate
existence of the Company with all its rights, privileges, powers and franchises
shall continue unaffected by the Merger. The Merger shall have the effects
specified in the DGCL. From and after the Effective Time, Silicon is sometimes
referred to herein as the "Surviving Corporation".
3.2 Certificate of Merger. On the Closing Date, the parties hereto
shall cause the Certificate of Merger (the "Articles of Merger"), meeting the
requirements of Section 252 of the DGCL, to be properly executed and filed in
accordance with the DGCL. The Merger shall be effective, for corporate law
purposes, at the Effective Time.
3.3 Articles of Incorporation; Bylaws. The Articles of Incorporation of
the Company in effect immediately prior to the Effective Time shall be the
Articles of Incorporation of the
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Surviving Corporation. The Bylaws of the Company in effect immediately prior to
the Effective Time shall be the Bylaws of the Surviving Corporation.
3.4 Officers. The officers of the Company at the Effective Time shall
be as follows:
Chief Executive Officer - Xxxx Xxxxxx
President - Xxxx Xxxxxxxx
Chief Financial Officer
Secretary/Treasurer - Xxxxx Xxxxxxx
Such persons will hold office until their successors are duly elected
or appointed and qualify in the manner provided in the Articles of Incorporation
or Bylaws of the Surviving Corporation or as otherwise provided by law, or until
their earlier death, resignation or removal.
3.5 Directors. The directors of the Company at the Effective Time shall
be as follows:
Xxxx Xxxxxx
C. Xxxxxxxx Xxxxxxxx
Xxxxx Xxxxxxx
Xxxx Xxxxxxxx
Xxxxx Xxxxxx
The directors of the Surviving Corporation will serve until their
successors are duly elected or appointed and qualify in the manner provided in
the Articles of Incorporation or Bylaws of the Surviving Corporation or as
otherwise provided by law, or until their earlier death, resignation or removal.
The parties agree that the Board of Directors of the company, immediately after
the Closing, shall be a maximum of five (5) directors and that of those
directors the now existing shareholders of Silicon shall the right to elect one
(1) director.
3.6 Conversion of Silicon Shares. At Closing there shall be 15,967,000
shares of common stock of Silicon issued and outstanding, and 7,625,660 (as of
May 15, 2000) shares of the Company's Common Stock issued and outstanding. At
the Effective Time, as a result of the Merger, the issued and outstanding shares
of Common Stock of Silicon shall be converted into 3,714,286 shares of Common
Stock of the Company, so that each issued and outstanding share of Silicon shall
be converted into .2326 shares of the Company's Common Stock. No fractional
shares shall be issued.
3.7 Shares Restricted. The Shares of Common Stock to be issued to
holders of Silicon Common Stock and the holders of options for the purchase of
Silicon Common Stock shall be "restricted" shares within the meaning of
Securities and Exchange Commission Rule 144 promulgated under the Securities Act
of 1933, as amended (the "Act"), and accordingly the certificate or certificates
representing such shares shall bear a restrictive legend in accordance with the
requirements of Rule 144.
3.8 No Representation of Value. Silicon, for itself and its security
holders, hereby confirms that neither the Company, nor any officer, director or
shareholder of the Company, or any agent of or professional employed by either
of them, has made any representation to Silicon or any of its shareholders as to
the present or future value of the Company's common stock or any other
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securities of the Company, nor has the Company or any such person made any
representation with respect to the ability of Silicon's shareholders to sell all
or any part of the shares of common stock of the Company at any price, nor that
an active or liquid trading market in the Company's common stock will develop or
continue in the future. Further, Silicon, for itself and its securities holders,
hereby confirms its understanding that the future bid or asking price of the
Company's common stock may not bear any relationship to the net tangible book
value of the Company's common stock and, further, may be unrelated to any other
generally accepted method of valuation of the Company's shares.
3.9 Closing. The closing of the purchase and sale contemplated herein
(the "Closing") shall take place at the offices of the Company, 0000 X. Xxxxxxxx
Xxxx Xxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000, on or about May 19, 2000 (the
"Closing Date"), or at another time or location mutually agreeable to the
parties.
3.10 Deliveries at Closing by Silicon . At Closing, Silicon, as
appropriate, shall deliver to the Company (i) the stock books, stock ledgers,
minute books and seals of Silicon; (ii) a current certificate of good standing
for Silicon issued by the California and Delaware Secretaries of State; (iii) a
balance sheet (including schedules of cash on hand and accounts receivable and
payable) dated as of Closing in a form satisfactory to the Company; (iv)
consents to the assumption of Silicon's real estate lease and other material
contracts; (v) originals of all material contracts; and (vi) all other items
required to be delivered by Silicon or Silicon shareholders to the Company at or
prior to Closing under this Agreement.
3.11 Deliveries at Closing by the Company.
At Closing, the Company shall deliver to Silicon or its
shareholders as appropriate:
a. The Company's certificate or certificates for shares of the
Company's common stock issued in the names of Silicon's shareholders
individually, allocated in proportion to their respective holdings of issued and
outstanding common stock of Silicon.
b. An employment agreement for Xxxx Xxxxxxxx in a form to
which Xx. Xxxxxxxx and the Company shall agree.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SILICON
Silicon represents and warrants the following:
4.1 Organization, Qualification. Silicon is a corporation duly
organized, validly existing and in good standing under the laws of Delaware and
has corporate power and authority to own all of its properties and assets and to
carry on its business as it is presently being conducted. Silicon is duly
qualified and in good standing to do business in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business conducted
by it makes such qualification necessary except in those jurisdictions where the
failure to be duly qualified and in good standing would not have a material
adverse effect on Silicon or the business conducted by it. Silicon has
heretofore delivered to the Company complete and correct copies of the Articles
of Incorporation and Bylaws of Silicon, as currently in effect.
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4.2 Capitalization of Silicon. The authorized capital stock of Silicon
consists of 50,000,000 shares of common stock, the par value of which is $.001
per share, of which, as of the date hereof, 15,967,000 shares are validly issued
and outstanding, fully paid and nonassessable, and were not issued in violation
of any preemptive rights. Silicon warrants that there are no outstanding options
and/or warrants for the purchase of Silicon's common stock.
4.3 Consents and Approvals. Except as set forth in Exhibit "A" there is
no requirement applicable for Silicon to make any filing with, or to obtain any
permit, authorization, consent or approval of, any public body as a condition to
the consummation of the Merger. Except as set forth in Schedule 4.3, there is no
requirement that any party to any Material Contract of Silicon, or any license
or permit for the use of Intellectual Property of Silicon or loan agreement to
which Silicon is a party or by which it is or was bound, consent to the
execution of this Agreement by Silicon or to the consummation of the Merger.
4.4 Non-Contravention. Except as set forth in Schedule 4.4, the
execution and delivery by Silicon of this Agreement do not, and the consummation
of the Merger will not, (i) violate or result in a breach of any provision of
the Articles of Incorporation or Bylaws of Silicon, (ii) result in a default (or
give rise to any right of termination, cancellation or acceleration) under the
terms, conditions or provisions of any note, bond, mortgage, indenture, license,
agreement, lease or other instrument or obligation to which Silicon is a party
or by which the Company or the business conducted by it may be bound, or (iii)
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to Silicon or to the business conducted by Silicon, excluding from
the foregoing clauses (ii) and (iii) such defaults and violations as would not
have a material adverse effect on Silicon .
4.5 Holdings. Silicon has no assets except as provided in Schedule 4.5
hereto, with respect to the ownership of 650,000 shares of Solutions Media,
Inc., 300,000 shares of On-Line Yellow Pages, Inc., 1,799,907 shares of Nucell
Wireless Corporation, and 100,000 shares of Xxxxxxxxxxxx.xxx, Inc., all of which
Silicon owns free and clear of all liens and encumbrances and which shares are
fully paid and non-assessable. Silicon will provide evidence of such ownership
prior to the Closing.
4.6 Name. Silicon has the right to use the name Silicon Ventures, Inc.
in California and as part of the Merger, assigns the right to the name Silicon
Ventures to the Company.
4.7 Licenses and Permits. The term "Licenses and Permits" as used
herein means federal, state and local governmental licenses, permits, approvals
and authorizations, whether foreign or domestic, other than Environmental
Permits. Silicon has all of the Licenses and Permits required to conduct its
business as it is presently being conducted, all of which are in full force and
effect. No written notice of a violation of any such License or Permit has been
received by Silicon, or, to the knowledge of Silicon, threatened, and no
proceeding is pending or, to the knowledge of Silicon, threatened, to revoke or
limit any of them. Silicon has no reason to believe that any of its Licenses and
Permits in effect on the date hereof will not be renewed or can not be assumed
by the Company at or after Closing without material interruption in the
Company's ability to lawfully carry on the business of Silicon after Closing.
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4.8 Compliance with Laws. To the best of Silicon's knowledge Silicon
has operated its business in compliance with all laws, regulations, orders,
policies, guidelines, judgments or decrees of any federal, state, local or
foreign court or governmental authority applicable to it or its business
including, without limitation, those related to antitrust and trade matters,
civil rights, zoning and building codes, public health and safety, worker health
and safety and labor and nondiscrimination, the failure to comply with which
could reasonably be expected to affect, materially and adversely, the earnings,
assets, financial condition or operations of Silicon . Except as is disclosed in
Schedule 4.8, Silicon has not received any notice alleging non-compliance with
any of the aforementioned laws, regulations, policies, guidelines, orders,
judgments or decrees.
4.9 Financial Statements. Silicon has previously furnished to the
Company true and complete copies of: (a) Silicon' s federal income tax return
for the calendar year ended December 31, 1999; (b) unaudited financial
statements of Silicon for the four months ended April 30,2000. The Financial
Statements fairly represent the financial position of Silicon as of such dates
and the results of its operations and changes in financial position for such
periods. Silicon has also furnished to the Company a statement of cash on hand,
accounts receivable and accounts payable dated no earlier than May 15, 2000
which statement shall be a true and complete accounting of the matters to which
it pertains.
4.10 Litigation. Except as set forth in Schedule 4.10, there are no
actions, suits, claims, investigations or proceedings (legal, administrative or
arbitrative) pending or, to the knowledge of Silicon, threatened, against
Silicon , whether at law or in equity and whether civil or criminal in nature,
before any federal, state, municipal or other court, arbitrator, governmental
department, commission, agency or instrumentality, domestic or foreign, nor are
there any judgments, decrees or orders of any such court, arbitrator,
governmental department, commission, agency or instrumentality outstanding
against Silicon which have, or if adversely determined could reasonably be
expected to have, a material adverse effect on the earnings, assets, financial
condition or operations of the business conducted by Silicon , or which seek
specifically to prevent, restrict or delay consummation of the Merger or
fulfillment of any of the other conditions of this Agreement.
4.11 No Undisclosed Liabilities. Except as set forth in Schedule 4.11,
Silicon does not have any material liabilities or obligations, whether absolute,
accrued, contingent or otherwise, including, without limitation, any uninsured
liabilities which were not accrued or reserved against in the Financial
Statements other than those incurred in the ordinary course of business or which
in the aggregate do not or cannot reasonably be expected to have a material
adverse effect upon the earnings, assets, financial condition or operations of
Silicon.
4.12 Title to Properties. Silicon does not own any Real Property.
Silicon has good title to all of the personal property, tangible and intangible,
owned by it, free and clear of any liens, charges, pledges, security interest or
other encumbrances other than those reflected in Schedule 4.12.
4.13 Leases. Schedule 4.13 sets forth a complete and correct list of
each agreement to lease into which Silicon has entered, whether as a lessor or
lessee, which relates to either real or personal property, other than monthly
leases of personal property which may be canceled upon not more than 60 days
notice or require the payment of not more than $100 per month. The agreements
listed in Schedule 4.13 are referred to herein as the "Leases" (each a "Lease").
Except as set forth in Schedule 4.13, Silicon has not breached any such Lease
and in no event has occurred which, with
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the giving of notice or the passage of time or both, would cause a default
under, or permit the termination, modification or acceleration of any such Lease
by any party thereto. Complete copies of all of the Leases have been delivered
to the Company.
4.14 Intellectual Property. Schedule 4.5 sets forth a schedule of
Silicon' s Intellectual Property. The term "Intellectual Property" as used
herein means the rights of the owner thereof in all trade names, trademarks and
service marks, patents, patent rights, copyrights, whether domestic or foreign,
(as well as applications, registrations or certificates for any of the
foregoing), inventions, trade secrets, proprietary processes, software and other
industrial and intellectual property rights. Silicon owns or is licensed or
otherwise has the right to use all of the Intellectual Property which is being
used in its business as it is presently being conducted. There is no claim,
suit, action or proceeding, pending or, to the knowledge of Silicon, threatened,
against Silicon asserting that its use of any Intellectual Property infringes
the rights of any third party or otherwise contesting Silicon' s rights with
respect to any Intellectual Property, and no third party is known to Silicon to
be infringing upon the rights of Silicon in the Intellectual Property of
Silicon. Furthermore, no party is infringing upon the rights of Silicon in
Silicon' s Intellectual Property. All letters, patents, registrations and
certificates issued by any governmental agency relating to the Intellectual
Property of Silicon are valid and subsisting and have been properly maintained.
4.15 Material Contracts. Schedule 4.15 sets forth a complete and
correct list of each Material Contract of Silicon. Except as set forth in
Schedule 4.15, all of the Material Contracts of Silicon are in full force and
effect and to the knowledge of Silicon there has not occurred, with respect to
any such Material Contract, any default or event of default, which, with or
without due notice of with the lapse of time, or both, would constitute a
default or event of default on the part of Silicon or, to the knowledge of
Silicon, any other party thereto. Complete copies of all the Material Contracts
of Silicon have been delivered to the Company.
4.16 Condition of Tangible Assets. The tangible personal property which
belongs to Silicon shall be operable on the Closing Date. In all other respects,
such property shall be accepted by the Company in "as is, where is" condition.
4.17 Insurance. Silicon has no insurance contracts in force.
4.18 Labor Matters. There are no collective bargaining agreements
covering employees of Silicon. There are no controversies pending or, to the
knowledge of Silicon, threatened between Silicon and any of its employees which
affect, or can reasonably be expected to affect, materially and adversely, its
earnings, assets, financial condition or operations of the business conducted by
Silicon, or relate to any specific effort to prevent, restrict or delay
consummation of the Merger.
4.19 Employee Benefit Plans.
a. Silicon has never had, does not now have, and will not have at
Closing Pension Plans, Welfare Plans or other employee benefit plans, nor
incentive, vacation and other similar plans that are maintained by Silicon with
respect to its employees or to which Silicon has contributed or is now
contributing on behalf of its employees.
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b. Silicon has not incurred any material liability to the PBGC
under Section 4001, et seq. of ERISA and no condition exists that could
reasonably be expected to cause Silicon to incur any such liability. Any premium
payable to the PBGC has been paid when due.
4.20 Tax Matters.
a. The provisions made for taxes in the Financial Statements are
sufficient for the payment of all Taxes of Silicon, whether or not disputed,
which are properly accruable. There are no agreements by Silicon for the
extension of time, or waiver of any statute of limitations, for the assessment
of any taxes, and all taxes due and payable by Silicon on or before the date of
this Agreement have been paid or provided for, and are not delinquent, except as
otherwise provided in Schedule 4.20.
b. Silicon has filed all Tax Returns that it was required to
file. All such Tax Returns were correct and complete in all respects. No claim
has ever been made by an authority in a jurisdiction where Silicon does not file
Tax Returns that it is or may be subject to taxation by that jurisdiction. There
are no liens on any of the assets of Silicon that arose in connection with any
failure (or alleged failure) to pay any Tax.
c. Silicon has withheld and paid all Taxes required to have
been withheld and paid through May 19, 2000, in connection with the amounts paid
or owing to any employee, independent contractor, creditor, stockholder or other
third party.
d. Silicon does not expect any authority to assess any
additional Taxes for any period for which Tax Returns have been filed. Except as
set forth in Schedule 4.20, there is no dispute or claim concerning any Tax
liability of Silicon either claimed or raised by any authority in writing.
Silicon has delivered to the Company correct and complete copies of all federal
income Tax Returns, examination reports, and statements of deficiencies assessed
against or agreed to by Silicon since its incorporation.
4.21 Finders. No broker, finder or investment banker is entitled to any
fee or commission from Silicon for services rendered on behalf of Silicon in
connection with the transactions contemplated by this Agreement, except as
otherwise provided in Schedule 4.21.
4.22 . Full Disclosure. None of the representations and warranties of
Silicon which are made in Article IV of this Agreement contains an untrue
statement of a material fact or omits to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
4.23 Insider Interests. Except as listed in Schedule 4.23 no Affiliate
of Silicon (i) competes with or is involved in or has a direct or indirect
interest in any business entity which competes with the business conducted by
Silicon, (ii) has any agreement with Silicon, or (iii) has any interest, direct
or indirect, in any property, real or personal, tangible or intangible,
including, without limitation, Intellectual Property, used in or pertaining to
the business of Silicon, except as a stockholder or employee of Silicon .
4.24 Insider Transactions. Schedule 4.24 sets forth a correct and
complete statement of (a) the amounts and other essential terms of indebtedness
or other obligations, liabilities or
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commitments (contingent or otherwise) of Silicon to or from any past or present
officer, director, employee, partner or stockholder thereof or any person
related to, controlled by or under common control of any of the foregoing and
(b) all transactions, together with their essential terms, between such persons
and Silicon.
4.25 No Interest in Competitors, Etc. Except as set forth in Schedule
4.25, no officer or director of Silicon, nor any Affiliate of any of the
foregoing, directly or indirectly owns any interest in or controls or is an
employee, agent, member, principal, officer, director, or partner of, or
participant in, or consultant to any corporation, partnership, limited liability
company, sole proprietorship, limited partnership, joint venture, association,
or other entity which is a competitor, supplier or customer, of Silicon.
4.26 Books and Records. The books of account and other financial and
corporate records of Silicon are in all material respects complete and correct,
are maintained in accordance with good business practices, and are accurately
reflected in the Financial Statements. The minute books of Silicon as previously
made or to be made available to the Company contained accurate records of all
meetings.
4.27 Bank and Safe Deposit Arrangements. Schedule 4.27 sets forth a
correct and complete list of each bank account and safe deposit box maintained
by Silicon, and the names of all persons authorized to deal with such accounts
and safe deposit boxes.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants as of the date of execution of this
Agreement and as of Closing as follows:
5.1 Organization, Qualification. The Company and Newco each is a
corporation duly organized, validly existing and in good standing under the laws
of Delaware and has corporate power and authority to own all of its properties
and assets and to carry on its business as it is presently being conducted. The
Company is duly qualified and in good standing to do business in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualification necessary except in
those jurisdictions where the failure to be duly qualified and in good standing
would not have a material adverse effect on the Company or the business
conducted by it. Newco has been formed for the sole purpose of effecting the
Merger and, except as contemplated by this Agreement, Newco has not conducted
any business activities and does not have any material liabilities or
obligations. The Company has delivered to Silicon complete and correct copies of
its articles of incorporation and bylaws as currently in effect.
5.2 Capitalization of the Company. The authorized capital stock of the
Company consists of (i) 50,000,000 shares of common stock, $.01 par value, of
which 7,625,650 shares are validly issued and outstanding, fully paid and
non-assessable, and (ii) 5,000,000 shares of preferred stock $ 1.00 par value,
none of which are issued or outstanding. The Company has outstanding options for
300,000 shares of common stock. In addition, the company has issued $40,000 of
6% convertible notes. The notes are convertible into 80,000 shares of common
stock. Other than the foregoing, there are no options, warrants, convertible
debt or other rights to acquire any equity
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interest in the Company, whether upon exchange for or conversion of other
securities or otherwise, are outstanding or shall be granted prior to the
Effective Time.
5.3 Consents and Approvals. There is no requirement applicable for the
Company to make any filing with, or to obtain any permit, authorization, consent
or approval of, any public body as a condition to the consummation of the
Merger, nor is there any requirement that any party to any Material Contract of
the Company, or any license or permit for the use of Intellectual Property of
the Company or loan agreement to which the Company is a party, or by which it is
bound, consent to the execution of this Agreement by the Company or the
consummation of the Merger.
5.4 Non-Contravention. The execution and delivery by the Company of
this Agreement does not, and the consummation of the Merger will not, (i)
violate or result in a breach of any provision of the Articles of Incorporation
or Bylaws of the Company, (ii) result in a default (or give rise to any right of
termination, cancellation or acceleration) under the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, agreement, lease or
other instrument or obligation to which the Company is a party or by which the
Company or the business conducted by it may be bound, or (iii) violate any
order, writ, injunction, decree, statute, rule or regulation applicable to the
Company or to the business conducted by the Company, excluding from the
foregoing clauses (ii) and (iii) such defaults and violations as would not have
a material adverse effect on the Company.
5.5 Corporate Authority and Resolutions. The Board of Directors of the
Company have adopted resolutions authorizing the execution of this Agreement by
the Company as of the date hereof and shall adopt such additional resolutions as
may be necessary authorizing the execution of documents and closing by the
Company as contemplated by this Agreement.
5.6 Validity of Shares to be Issued. The Company's shares to be issued
to the Silicon shareholders as a result of the Merger have been duly authorized
as required under all applicable laws and, upon delivery thereof pursuant to the
provisions of this Agreement, will be validly issued, fully paid and
non-assessable, and not subject to any preemptive rights.
5.7 Current Information. The Company has previously delivered to
Silicon (a) a true and complete copy of the Company's audited financial
statements sheet dated July 31, 1999, and unaudited financial statements for the
six months ended January 31, 2000; and (b) certain other non-public information
relating to the business and affairs of the Company, and will continue to
furnish such information to Silicon until the Closing. The financial information
with respect to the Company included in the aforementioned documents fairly
represents the financial condition of the Company.
5.8 Authorizations of Transactions; Securities Compliance. By the
Closing Date, the shares to be issued to Silicon' s shareholders on the
consummation of the transactions contemplated hereunder will be exempt from
registration under the Securities Act pursuant to Section 4(2) thereof, and
shall have been exempt or registered or qualified under the securities or blue
sky laws of California for issuance upon the Closing Date. Such shares, when
issued in accordance with the terms of this Agreement, will be fully paid and
non-assessable.
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5.9 No Registration Rights. There is no agreement granting or providing
for registration rights with respect to the shares to be delivered to Silicon
shareholders pursuant to this Agreement except as provided in Section 7.6.
5.10 No Brokers or Commissions. The Company has not engaged any broker,
finder or similar individual in connection with this transaction.
5.11 Binding Agreement. The execution, delivery and performance of this
Agreement and the other instruments contemplated by this Agreement by the
Company have been duly authorized by all necessary corporate action of the
Company. This Agreement has been duly executed and delivered to Silicon by the
Company and constitutes the legal, valid and binding agreement of the Company,
enforceable in accordance with its terms.
5.12 No Violation. The execution, delivery and performance of this
Agreement by the Company and the consummation of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time or
both, violate, contravene or conflict with or result in a breach of or
constitute a default under (i) any writ, order, judgment or decree of any court
arbitrator or governmental agency applicable to the Company, (ii) the Articles
of Incorporation or Bylaws of the Company; (iii) any contract, lease or other
agreement to which the Company is a party or by which the Company is bound; or
(iv) to the best knowledge of the Company, any law, rule or regulation
applicable to the Company.
5.13 Litigation. There are no actions, suits, claims, investigations or
proceedings (legal, administrative or arbitrative) pending or, to the knowledge
of the Company, threatened, against the Company, whether at law or in equity and
whether civil or criminal in nature, before any federal, state, municipal or
other court, arbitrator, governmental department, commission, agency or
instrumentality, domestic or foreign, nor are there any judgments, decrees or
orders of any such court, arbitrator, governmental department, commission,
agency or instrumentality outstanding against the Company which have, or if
adversely determined could reasonably be expected to have, a material adverse
effect on the earnings, assets, financial condition or operations of the
business conducted by the Company, or which seek specifically to prevent,
restrict or delay consummation of the sale of the Merger or fulfillment of any
of the other conditions of this Agreement.
5.14 Compliance with Laws; Regulatory Matters. The Company is in
compliance in all material respects with all laws, rules and regulations, all
orders, directives and supervisory letters of, and all agreements, memoranda of
understanding or similar arrangements with, regulatory authorities and all other
legal requirements applicable to the Company or the Company's businesses; and
the Company is not subject to any order, directive or supervisory letter of, or
agreement, memorandum or understanding or similar arrangement (including board
resolutions adopted at the request of regulatory authority) with, any regulatory
authority restricting its operations or, restricting it from taking any action
or requiring that certain actions be taken, and the Company has no knowledge
that any such order, directive, supervisory letter, agreement, memorandum or
understanding or similar arrangement is threatened, contemplated or under
consideration by any regulatory authority.
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ARTICLE VI
INVESTMENT REPRESENTATIONS
Silicon hereby represents, warrants, acknowledges and covenants to the
Company, as follows:
6.1 Opportunity to Examine. Silicon and its shareholders have examined
or have had an opportunity to examine, and to ask questions of the management of
the Company about all applicable documents and such applicable information as
are relevant to the transactions described herein, including the delivery by the
Company of its shares and about the Company and its business.
6.2 No Representations as to Profit or Loss. No representation or
warranty of any kind has been made to the Silicon or its shareholders with
respect to the percentage of profit and/or amount or type of consideration,
profit or loss that are to be realized, if any, as a result of the Merger and
the acquisition of common stock in the Company and that in entering into this
transaction Silicon and its shareholders are not relying upon any information
other than that derived from the results of their own independent investigation,
or the investigation of their counsel and other professional advisors, or from
information furnished in writing by the Company to them.
6.3 Shares Not Registered. Silicon and its shareholders understand that
the shares to be issued to Silicon' s shareholders have not been registered
under the Act nor under the securities laws of any state in reliance on
exemptions therefrom for non-public offerings, and further understand that the
shares have not been approved or disapproved by the Securities and Exchange
Commission nor has any state securities administrator or agency passed on the
accuracy or adequacy of any written information provided by the Company.
6.4 Investment Intent. The Silicon shareholders are acquiring the
shares in the Company for their own account for investment purposes only and not
with a view to the sale or other distribution thereof, in whole or in part.
6.5 Legend. The newly issued shares shall have the following
restrictive legend:
The shares represented by this certificate have not been registered
under the Securities Act of 1933 and are "restricted securities" as
that term is defined in Rule 144 under the Act. The shares may not be
sold or offered for sale except pursuant to an effective registration
statement under the Securities Act of 1933 or an opinion of counsel for
the corporation that registration is not required under such Act.
ARTICLE VII
ADDITIONAL AGREEMENTS
7.1 Conduct of Business by Silicon and the Company.
a. Silicon warrants and represents that from the date hereof
until the Closing, Silicon will (a) conduct its business only in the ordinary
and usual course and in a manner consistent with past practices, (b) maintain in
good repair, at its expense, all of its properties, and (c) use its best efforts
to preserve its relationship with suppliers, customers, dealers and others
having business relationships with Silicon. Silicon will notify the Company of
any emergency or material change in the normal conduct of the business or
operations of Silicon, the threat of or initiation of
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any material litigation against Silicon, and the initiation of any investigation
of Silicon by any party, whether private or governmental.
b. The Company warrants and represents that from the date
hereof until the Closing, the Company will (a) conduct its business only in the
ordinary and usual course and in a manner consistent with past practices, (b)
maintain in good repair, at its expense, all of its properties, and (c) use its
best efforts to preserve its relationship with suppliers, customers, dealers and
others having business relationships with the Company. The Company will notify
Silicon of any emergency or material change in the normal conduct of the
business or operations of the Company, the threat or initiation of any material
litigation against the Company, and the initiation of any investigation of the
Company by any party, whether private or governmental.
7.2 Investigation of Business and Properties; Additional Data. From the
date hereof until the Closing, Silicon and the Company shall each afford the
other and their attorneys, accountants, financial advisors and other
representatives complete access at all reasonable times to their offices, and to
their officers, employees, properties, contracts, and books and records. In
addition, Silicon and the Company shall furnish to each other such financial,
operating and additional data as they may reasonably request concerning the
business, operations, properties and personnel of either of them.
7.3 Efforts to Consummate. Subject to the terms and conditions herein
provided, each of the parties hereto agrees to use its reasonable best efforts
to take, or cause to be taken, all action and to do, or cause to be done, all
things necessary, proper or advisable to consummate, as promptly as practicable,
the transactions contemplated hereby, including, but not limited to, the
obtaining of all necessary consents, waivers, authorizations, orders and
approvals of third parties, whether private or governmental, required of it to
enable it to comply with the conditions precedent to consummating the
transactions contemplated by this Agreement. Each party agrees to cooperate
fully with the other party in assisting it to comply with this Section.
Notwithstanding the foregoing, neither party shall be required to initiate any
litigation, make any substantial payment or incur any material economic burden,
except for a payment otherwise required of it, to obtain any consent, waiver,
authorization, order or approval, and if, despite such efforts, either party is
unable to obtain any consent, wavier, authorization, order of approval the other
party may terminate this Agreement and shall have no liability therefor.
7.4 Further Assurances. The parties will use reasonable efforts to
implement the provisions of this Agreement, and for such purpose, the parties
will, at the request of any other party, at or after the closing, without
further consideration, promptly execute and deliver, or cause to be executed and
delivered, such additional documents as any other party may reasonably deem
necessary or desirable to implement any provision of this Agreement.
7.5 Expenses. Whether or not the Merger is consummated all expenses
incurred in connection with this Agreement and the transactions contemplated
hereby will be paid by the party incurring such expenses.
7.6 Registration Rights.
a. If the Company shall determine to register any of its
securities for the account of a security holder or holders other than in a
registration relating solely to employee benefit plans,
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a registration relating solely to a Rule 145 transaction, or a registration on
any registration form that does not permit secondary sales, the Company will (i)
promptly give to each person who is a holder of its common stock at the
effective date and (ii) use its best efforts to include in such registration
(and any related qualification under blue sky laws or other compliance), and in
any underwriting involved therein, all the Registerable Securities of such
security holders made by any holder and received by the Company within twenty
(20) days after the Company delivers written notice of any proposed registration
to such holder by mail or other form of delivery, which notice shall commence on
the date of mailing or delivery, as appropriate to the method of notice. Such
written request may specify all or part of the holders Registerable Securities.
As used in this Section 7.6, the term Registerable Securities shall mean shares
of the Company's common stock issued or issuable to a holder as of Closing and
any common stock issued as a dividend or other distribution with respect to or
in exchange for or in replacement of the shares referenced in this Section,
except that Registerable Securities shall not include any shares of common stock
previously registered or which have been sold to the public pursuant to a
registration statement or an offering under Section 3(b) of the Securities Act
of 1933, as amended, or which may be sold under Rule 144(k).
b. At the time of registration, if the offering is an
underwritten offering, the Company and a registering securities holder shall
enter into mutual indemnification agreements of the kind normally provided in an
underwriting agreement.
c. If any securities held by selling shareholders cannot be
included in a registration as a result of limitations of the aggregate number of
shares of Registerable Securities that may be so included, the number of shares
of Registerable Securities that may be included shall be allocated among the
holders requesting inclusion of shares pro rata on the basis of the number of
shares of Registerable Securities, provided that such allocation shall not
operate to reduce the aggregate number of Registerable Securities that may be
included in such registration if any holder does not request inclusion of the
maximum number of shares of Registerable Shares allocated to him pursuant to the
procedure described in this Section, and the remaining portion of his allocation
shall be reallocated among those requesting holders whose allocations did not
satisfy the request pro rata on the basis of the number of shares of
Registerable Securities which will be held by such holders and selling
shareholders.
d. Notwithstanding the obligations of the Company to register
shares, the Company shall have no such obligation to any shareholder in the
event that it is advised by its underwriter or other selling agent that the
underwriter is not willing to register shares held by any proposed selling
shareholder by reason of market conditions or any other reason relating to the
primary obligation of such underwriter or agent to sell the shares of the
Company, it being the intention of the parties that the Company's ability to
sell all of the shares that it wishes to sell pursuant to any registration
statement shall be paramount to, and shall supersede, the rights of any
shareholder provided in this Section 7.6.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY
The following are certain conditions precedent to the obligation of the
Company to consummate the Merger, which conditions must be fulfilled (or waived
in writing by the Company) on or before the Closing Date.
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8.1 Accuracy of Representations and Warranties. The representations and
warranties of Silicon herein contained shall be true on and as of Closing with
the same force and effect as though made on and as of Closing, except as
affected by transactions contemplated hereby and except to the extent that such
representations and warranties were made as of a specified date and as to such
representations and warranties the same shall have been true as of the specified
date.
8.2 Absence of Default. No condition or event which constitutes an
event of default hereunder by Silicon or which, after notice and lapse of time,
or both, would constitute an event of default hereunder by Silicon shall have
occurred and be continuing.
8.3 Absence of Material Damage to or Expropriation of Property. Between
the date of this Agreement and the Closing, there shall not have occurred (1)
any material casualty to any facility, property, equipment or inventory owned by
Silicon, or (2) any material condemnation, seizure, expropriation or liquidation
by any governmental authority or any officer or instrumentality thereof of
facilities, property, equipment or inventory owned by Silicon.
8.4 Absence of Liens. There will have been no liens recorded after the
execution of this Agreement but prior to Closing with respect to any personal,
real or mixed property owned by Silicon.
8.5 Actions, Proceedings, Etc. All actions, proceedings, instruments
and documents required to carry out the transactions contemplated by this
Agreement or incidental thereto and all other related legal matters shall have
been satisfactory to and approved by counsel for the Company in the exercise of
reasonable discretion, and such counsel shall have been furnished with such
certified copies of actions and proceedings and such other instruments and
documents as they shall have reasonably requested.
8.6 Satisfaction with Respect to Financial Condition and Performance.
The Company must be satisfied that each and every representation made by Silicon
regarding the Financial Statements and the financial condition of Silicon shall
be true, complete and accurate in all material respects as of Closing. Without
limiting the foregoing, the Company must be satisfied that: (i) the Financial
Statements shall have been prepared on an accrual basis of accounting,
consistent with prior years; and (ii) except as specifically disclosed in the
Financial Statements, there has been no distribution to shareholders or others
or bonuses made to employees.
8.7 Continuity of Business Relationships. The Company shall be
satisfied that Silicon's customer, vendor, financial institution(s), insurance
carrier and employee relations are satisfactory as at the Closing Date.
ARTICLE IX
CONDITIONS PRECEDENT TO SILICON'S OBLIGATIONS
The following are certain conditions precedent to Silicon's obligation
to consummate the Merger, which conditions must be fulfilled (or waived in
writing by Silicon) on or before the Closing Date.
9.1 Accuracy of Representations and Warranties. The representations and
warranties of the Company herein contained shall be true on and as of Closing
with the same force and effect
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as though made on and as of Closing, except as affected by transactions
contemplated hereby and except to the extent that such representations and
warranties were made as of a specified date and as to such representations and
warranties the same shall have been true as of the specified date.
9.2 Absence of Default. No condition or event which constitutes an
event of default hereunder by the Company or which, after notice and lapse of
time, or both, would constitute an event of default hereunder by the Company
shall have occurred and be continuing.
9.3 Absence of Material Damage to or Expropriation of Property. Between
the date of this Agreement and the Closing, there shall not have occurred (1)
any material casualty to any facility, property, equipment or inventory owned by
the Company, or (2) any material condemnation, seizure, expropriation or
liquidation by any governmental authority or any officer or instrumentality
thereof of facilities, property, equipment or inventory owned by the Company.
9.4 Actions, Proceedings, Etc. All actions, proceedings, instruments
and documents required to carry out the transactions contemplated by this
Agreement or incidental thereto and all other related legal matters shall have
been satisfactory to and approved by counsel for Silicon, and such counsel shall
have been furnished with such certified copies of actions and proceedings and
such other instruments and documents as they shall have reasonably requested.
9.5 Satisfaction with Respect to Financial Condition and Performance.
Silicon must be satisfied that each and every representation made by the Company
regarding the financial condition of the Company shall be true, complete and
accurate in all material respects as of Closing.
9.6 Continuity of Business Relationships. Silicon shall be satisfied
that the Company's customer, vendor, financial institution(s), insurance carrier
and employee relations are satisfactory as at the Closing Date.
ARTICLE X
INDEMNIFICATION
10.1 The Company's Right to Indemnification. Silicon's stockholders
undertake and agree to hold the Company harmless against any and all losses,
costs, liabilities, claims, obligations and expenses, including reasonable
attorneys' fees, incurred or suffered by the Company arising from (i) the
breach, misrepresentation or other violation of any covenants, warranty or
representation of or by Silicon contained in this Agreement, and (ii) all
liabilities of Silicon not disclosed in writing to the Company prior to the
execution of this Agreement. This indemnity provision shall survive Closing for
a period of one (1) year.
10.2 Silicon' s Right to Indemnification. The Company undertakes and
agrees to hold Silicon harmless against any and all losses, costs, liabilities,
claims, obligations and expenses, including reasonable attorneys' fees incurred
or suffered by Silicon arising from the breach, misrepresentation or other
violation of any covenants, warranty or representation by the Company contained
in this Agreement. This indemnity provision shall survive Closing for a period
of one (1) year.
10.3 Procedure. If any claim or proceeding covered by the foregoing
agreements to indemnify and hold harmless shall arise, the party who seeks
indemnification (the "Indemnified
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Party") shall given written notice thereof to the other party (the "Indemnitor")
promptly (but in no event more than ten (10) days) after it learns of the
existence of such claim or proceeding. Any claim for indemnification hereunder
shall be accompanied by evidence demonstrating the Indemnified Party's right or
possible right to indemnification, including a copy of all supporting documents
relevant thereto. The Indemnitor shall have the right to employ counsel
reasonably acceptable to the Indemnified Party to defend against any such claim
or proceeding, or to compromise, settle or otherwise dispose of the same;
provided, however, that no settlement or compromise shall be effected without
the consent of the Indemnified Party, which consent shall not be unreasonably
withheld, and provided further that in the event the Indemnified Party does not
consent to a bona fide offer of settlement made by a third party and the
settlement involves only the payment of money, then the Indemnitor may, in lieu
of payment of such settlement to such third party, pay such amount to the
Indemnified Party. After the payment to the Indemnified Party, the Indemnitor
shall have no further liability with respect to such claim or proceeding and the
Indemnified Party shall assume full responsibility to defend the same. After
notice from the Indemnitor to the Indemnified Party of its election to assume
the defense of such claim or proceeding, the Indemnitor shall not be liable to
the Indemnified Party under this paragraph for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof; provided, however, that the Indemnified Party shall have the right to
employ counsel to represent it if, in the Indemnified Party's reasonable
judgment, it is advisable for the Indemnified Party to be represented by
separate counsel, and in that event the fees and expenses of such separate
counsel shall be paid by the Indemnified Party. The parties will fully cooperate
in any such action, making available to each other books or records for the
defense of any such claim or proceeding. If the Indemnitor fails to acknowledge
in writing its obligation to defend against or settle such claim or proceeding
within ten (10) days after receiving notice of the claim or proceeding from the
Indemnified Party (or such shorter time specified in the notice as the
circumstances of the matter may dictate), the Indemnified Party shall be free to
dispose of the matter, at the expense of the Indemnitor (but subject to the
Indemnitor's right subsequently to contest through appropriate proceedings its
obligation to provide indemnification), in any way which the Indemnified Party
deems in its best interest.
10.4 Limitations on Indemnification Rights. Indemnification shall be
due only to the extent of the loss or damage actually suffered (i.e., reduced by
any offsetting or related asset or service received and by any recovery from any
third party, such as an insurer), net after the amount equal to any reduction in
federal, state or local income, franchise or other taxes occasioned by such loss
or damage (even though the tax return by which such reduction would have been
realized is not yet due), but including an amount equal to any increase in
federal, state and local income, franchise or other taxes occasioned by the
indemnification payment and then only to the extent of the excess over the
Agreed De Minimis Amount (hereinafter defined). The Indemnitor shall be
subrogated to all rights of the Indemnified Party against any third party with
respect to any claim for which indemnification is paid. Notwithstanding the
foregoing, the Indemnitor shall not be liable to the Indemnified Party for any
individual misrepresentation, breach of warranty or violation of covenant where
the otherwise indemnifiable amount does not exceed $5,000 and, as regards all
such indemnifiable misrepresentations or breaches of warranty that do not exceed
$5,000, the Indemnitor shall not be liable except to the extent that the
aggregate amount thereof exceeds $5,000 (such sum being herein referred to as
the "Agreed De Minimis Amount").
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ARTICLE XI
GENERAL PROVISIONS
11.1 Expenses. Each party shall pay its own expenses incident to the
negotiation and preparation of this Agreement and the transactions contemplated
hereby. All other recording costs for bills of sale and other instruments of
transfer, and all stamp, sales, use and transfer taxes in connection with the
purchase and sale of shares shall be paid by the transferring party.
11.2 Notices. All notices, requests, demands and other communications
pertaining to this Agreement shall be in writing and shall be deemed duly given
when delivered personally with a receipt, when delivered by an overnight courier
service or mailed by certified mail, return receipt requested, postage prepaid,
addressed as follows:
(a) To the Company: iiGroup, Inc.
0000 X. Xxxxxxxx Xxxx Xxxx Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
With a copy to: Xxxxxxx Xxxxxx, Esquire
Broad and Xxxxxx
0000 Xxxxxx Xxxx Xxxxx 000
Xxxx Xxxxx, XX 00000
(b) To Silicon: Silicon Ventures, Inc.
0000 0xx Xxxxxx # 000
Xxxxx Xxxxxx. XX 00000
11.3 Certain Breaches. Neither party shall have any liability to the
other party with respect to a breach by a party of which the other party has
received written notice at or prior to Closing.
11.4 Prior Negotiations. This Agreement supersedes in all respects all
prior and contemporaneous oral and written negotiations, understandings and
agreements between the parties with respect to the subject matter hereof. All of
said prior and contemporaneous negotiations, understandings and agreements are
merged herein and superseded hereby.
11.5 Entire Agreement; Amendment. This Agreement and the Exhibits to
this Agreement set forth the entire understanding between the parties in
connection with the transaction contemplated herein, there being no terms,
conditions, warranties or representations other than those contained herein,
referenced herein or provided for herein. Neither this Agreement nor any term or
provision hereof may be altered or amended in any manner except as an instrument
in writing signed by the party against whom the enforcement of any such change
is sought.
11.6 Exhibits. The Exhibits attached hereto or referred to herein are a
material part of this Agreement, as if set forth in full herein.
11.7 Severability. If any term of this Agreement is illegal or
enforceable at law or in equity, the validity, legality and enforceability of
the remaining provisions contained herein shall not in any way be affected or
impaired thereby. Any illegal or unenforceable term shall be deemed to be void
and of no force and effect only to the minimum extent necessary to bring such
term within the provisions of any applicable law or laws and such term,
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as so modified, and the balance of this Agreement shall then be fully
enforceable.
11.8 Survival of Representations and Warranties. Unless otherwise
specifically noted herein, the several representations, warranties and covenants
of the parties contained herein shall survive the closing for a period of three
(3) years from the Closing date. Thereafter neither party shall have any
liability to the other based upon any of the representations, warranties and
covenants set forth herein.
11.9 Waiver. Unless otherwise specifically agreed in writing to the
contrary: (i) the failure of any party at any time to require performance by
another party of any provision of this Agreement shall not affect such party's
right thereafter to enforce the same, (ii) no waiver by either party of any
default by the other shall be taken or held to be a waiver by such party of any
other preceding or subsequent default, and (iii) no extension of time granted by
any party for the performance of any obligation or act by the another party
shall be deemed to be an extension of time for the performance of any other
obligation or act hereunder.
11.10 Number and Gender. Whenever the context so requires, words used
in the singular shall be construed to mean or include the plural and vice versa,
and pronouns of any gender shall be construed to mean or include any other
gender or genders.
11.11 Headings and Cross-References. The headings of this Agreement are
included for convenience of reference only, and shall in no way limit or affect
the meaning or interpretation of the specific provisions hereof. All
cross-references to paragraphs herein shall mean the paragraphs of this
Agreement unless otherwise stated or clearly required by the context. All
references to Exhibits herein shall mean the Exhibits to this Agreement. Words
such as "herein" and "hereof" shall be deemed to refer to this Agreement as a
whole and not to any particular provision of this Agreement unless otherwise
stated or clearly required by the context.
11.12 Choice of Laws. This Agreement is to be construed and governed by
the laws of the State of Florida, except for the choice of law rules utilized in
that jurisdiction.
11.13 Arbitration. Any dispute arising under or related to this
Agreement that the parties are unable to resolve by themselves shall be settled
by arbitration in Palm Beach County, Florida, by a panel of three arbitrators.
The parties shall each designate one disinterested arbitrator and the two
arbitrators so designated shall select the third arbitrator. The persons
selected as arbitrators need not be professional arbitrators, and persons such
as accountants, appraisers and bankers shall be acceptable. Before undertaking
to resolve the dispute, each arbitrator shall be duly sworn faithfully and
fairly to hear and examine the matters in controversy and to make a just award
according to the best of his or her understanding. The arbitration hearing shall
be conducted in accordance with the rules of the American Arbitration
Association. The written decision of a majority of the arbitrators shall be
final and binding on the parties. Costs and expenses of the arbitration
proceeding shall be assessed between the parties in a manner to be decided by a
majority of the arbitrators, and the assessment shall be set forth in the
decision and award of the arbitrators. No action at law or suit in equity based
upon any claim arising out of or relating to this Agreement shall be instituted
in any court by a party against another except an action to compel arbitration
pursuant to this paragraph, an action to enforce the award of the arbitration
-20-
panel rendered in accordance with this paragraph, or a suit for specific
performance as may be specifically provided herein.
11.14 Successors. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and assigns.
11.15 Third Parties. Nothing in this Agreement, whether expressed or
implied, is intended to (i) confer any rights or remedies on any person other
than the parties and their respective successors and assigns, (ii) relieve or
discharge the obligation or liability of any third party, or (iii) or give any
third party any right of subrogation or action against any party hereto.
11.16 Counterparts. This Agreement may be signed in counterparts with
the same effect as if the signature on each counterpart were on the same
instrument. Each of the counterparts, when signed, shall be deemed to be an
original, and all of the signed counterparts together shall be deemed to be one
and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date and year first above written.
WITNESS/ATTEST: iiGROUP, INC., a Delaware corporation
_____________________________ By: _________________________________
Xxxx Xxxxxx, Chief Executive Officer
SV ACQUISITION CORP.
_____________________________ By: _________________________________
Xxxx Xxxxxx, President
SILICON VENTURES, INC.,
a Delaware corporation
By: _________________________________
Xxxx Xxxxxxxx, President
SILICON STOCKHOLDERS
_____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
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