AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF
MERGER
THIS AGREEMENT AND PLAN OF
MERGER (the "Agreement") is made and
entered into as of the 30th day of
June 2009 by and among SOLAR
THIN FILMS, INC., a Delaware corporation ("SLTN"); SOLAR THIN POWER, INC., a
Nevada corporation and majority owned subsidiary of SLTN ("ST Power"); and the Persons
listed on the signature pages hereto who are holders of ST Power Common Stock
are hereinafter collectively referred to as the “ST Power Principal
Shareholders” and SLTN, ST Power, and the ST Power Principal Shareholders
are hereinafter sometimes collectively referred to as the “Parties.”
Recitals
A. ST
Power is a majority owned subsidiary of SLTN.
B. SLTN
specializes in the design and construction of turn-key production facilities and
equipment related to solar photovoltaic (“PV”) thin-film
manufacturing.
C. ST
Power has been formed to participate in joint ventures and other arrangements to
market, construct and implement power projects with utilities and other third
parties for the production of electricity using solar power.
D. The
Parties hereto all deem it necessary and advisable to enter into this Agreement,
pursuant to which, inter
alia, ST Power will be merged with and into SLTN (the “Merger”) whereupon ST Power
will be operated as a division of SLTN to facilitate power projects and joint
ventures designed to provide solar electricity using thin film a-Si solar
modules.
E. Pursuant
to the terms of this Agreement, upon consummation of the Merger (a) each share
of common stock of ST Power, $0.001 par value per share (the “ST Power Common Stock”) held
by Persons, other than SLTN, shall be automatically converted into and exchanged
for one and one-half (1.5) full shares of common stock of SLTN, $0.01 par value
per share (the “SLTN Common
Stock”), (b) all shares of Common Stock held by SLTN shall be cancelled,
(c) all outstanding options and warrants to purchase shares of ST Power Common
Stock will be converted into an option or warrant to purchase shares of SLTN
Common Stock upon the same terms and conditions, and (d) all commitments to
issue shares of ST Power Common Stock, as contemplated hereby, shall be assumed
by SLTN.
F. The
Board of Directors of SLTN deems the Merger advisable and in the best interest
of said corporation and its shareholders and has approved and adopted the form,
terms and provisions of this Agreement and the Merger.
G. The
Board of Directors of ST Power and the ST Power Principal Shareholders each
deems the Merger advisable and in the best interest of said corporation and its
shareholders and the Board of Directors of ST Power and the ST Power
Principal Shareholders have each approved and adopted the form, terms and
provisions of this Agreement and the Merger.
Agreement
NOW,
THEREFORE, in consideration of the premises and of the mutual covenants
contained herein, the Parties agree as follows:
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ARTICLE
I. - THE MERGER
1.1 The
Merger. Upon the terms and subject to the conditions set forth
in this Agreement, and in accordance with the General Corporation Laws of the
States of Nevada and Delaware (the "Corporation Laws"), ST Power
shall be merged with and into SLTN at the Effective Time. Following
the Effective Time, the separate corporate existence of ST Power shall cease and
SLTN shall continue as the surviving corporation of the Merger (the "Surviving Corporation") and
shall succeed to and assume all the rights and obligations of ST Power in
accordance with the Corporation Laws.
1.2 Effective
Time. Subject to the provisions of this Agreement, as soon as
practicable on or after the Effective Time, the Parties shall file a certificate
of merger or other appropriate documents (in any such case, the "Certificate of Merger")
executed in accordance with the relevant provisions of the Corporation Laws and
shall make all other filings or recordings required under the Corporation
Laws. The Merger shall become effective at such time and on such date
as the Certificate of Merger is duly filed with the Nevada and Delaware
Secretary of State, or at such other time as SLTN and ST Power shall agree
should be specified in the Certificate of Merger (the time the Merger becomes
effective being referred to herein as the "Effective Time").
1.3 Effects of the
Merger. The Merger shall have the effects set forth in the
applicable provisions of the Corporation Laws.
1.4 Certificate of Incorporation
and Bylaws.
(a) The
SLTN certificate of incorporation as in effect immediately following the
Effective Time shall be the certificate of incorporation of the Surviving
Corporation until thereafter changed or amended as provided therein or by
applicable law.
(b) The
bylaws of SLTN as in effect immediately following the Effective Time shall be
the bylaws of the Surviving Corporation until thereafter changed or amended as
provided therein or by applicable law.
1.5 Directors. The
board of directors of SLTN immediately prior to the Effective Time shall
constitute the entire members of be the board of directors of the Surviving
Corporation until the earlier of their resignation or removal or until their
respective successors are duly elected and qualified, as the case may
be.
1.6 Officers. The
officers of SLTN immediately prior to the Effective Time shall constitute all of
the officers of the Surviving Corporation until the earlier of their resignation
or removal or until their respective successors are duly elected and qualified,
as the case may be.
1.7 Effect on Securities. As
of the Effective Time, by virtue of the Merger and without any action on the
part of the holder of any shares of the outstanding capital stock, notes or
other evidences of indebtedness of SLTN or ST Power:
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(a) SLTN Common Stock and Other
SLTN Securities. Each of the shares of SLTN Common Stock that are
issued and outstanding as at the Effective Time of the Merger shall remain
issued and outstanding following the Effective Time of the
Merger. Each of the issued and outstanding options and warrants to
purchase SLTN Common Stock that are issued and outstanding as at the Effective
Time of the Merger shall remain issued and outstanding following the Effective
Time of the Merger. All indebtedness and other obligations of SLTN
that are issued and outstanding as at the Effective Time of the Merger,
including each of the issued and outstanding convertible notes to purchase SLTN
Common Stock, shall remain issued and outstanding following the Effective Time
of the Merger. As at the Effective Time of the Merger, (i)
approximately 58,136,113 shares
of SLTN Common Stock, (ii) options and warrants to purchase approximately
20,028,959 shares of SLTN Common Stock, and (iii) notes and other evidence of
indebtedness of approximately $2,700,000 are issued and outstanding
(collectively, the “SLTN
Securities”).
(b) ST Power Treasury
Stock. Each share of Common Stock that is held in the treasury of
ST Power or by any wholly owned subsidiary of ST Power shall automatically be
cancelled and returned and shall cease to exist and no consideration shall be
delivered in exchange therefor.
(c) Outstanding ST Power Common
Stock Owned by Persons Other than SLTN. As
at the Effective Time, by virtue of the Merger and without any action on the
part of the holder of any shares of the ST Power Common Stock or any shares of
capital stock of SLTN or the Surviving Corporation, each full share of ST Power
Common Stock that is issued and outstanding as at the Effective Time of the
Merger (other than shares of ST Power Common Stock owned of record or
beneficially by SLTN) shall be converted into and exchanged for the right to
receive one and one-half (1.5) full shares of SLTN Common Stock (the “Common Stock Exchange
Ratio”). As of the Effective Time, all shares of ST Power
Common Stock shall no longer be issued or outstanding and shall automatically be
canceled and retired and shall cease to exist, and each holder of a certificate
representing any such shares of ST Power Common Stock shall cease to have any
rights with respect thereto, except the right to receive an identical number of
shares of SLTN Common Stock, without interest, based on the Common Stock
Exchange Ratio as provided in this Section
1.7(c).
(d) ST Power Common Stock Owned
by SLTN. As at the Effective Time, each issued and outstanding
share of ST Power Common Stock that is owned of record or beneficially by SLTN
immediately prior to the Effective Time of the Merger shall automatically be
cancelled and returned and shall cease to exist and no consideration shall be
delivered in exchange therefor.
(e) ST Power
Warrants. As at the Effective Time, by virtue of the Merger and
without any action on the part of the holder of any shares of the ST Power
Common Stock or any shares of capital stock of SLTN or the Surviving Corporation
(i) each outstanding option or warrant to purchase shares of ST Power Common
Stock (collectively, “ST Power
Warrants”) shall be exchanged for an option or warrant to purchase an
identical number of shares of SLTN Common Stock at the same per share exercise
price (collectively, the “SLTN
Warrants”), and (ii) each full share of ST Power Common Stock that is
issuable upon exercise of any of such ST Power Warrants as at the Effective Time
of the Merger shall be converted into and exchanged for the right to purchase or
receive one full share of SLTN Common Stock upon exercise of such SLTN
Warrants.
(f) ST Power
Obligations. All indebtedness and other obligations, if any, of ST
Power that are issued and outstanding as at the Effective Time of the Merger
shall be assumed by SLTN, and to the extent that any such ST Power indebtedness
or other obligations (including obligations to issue ST Power Common Stock under
the Xxxxx Employment Agreement) would require ST Power to issue to any one or
more Persons additional shares of ST Power Common Stock, SLTN shall, pursuant
and subject to the terms of such agreements, issue an identical number of shares
of SLTN Common Stock to such Persons based on the Common Stock Exchange
Ratio.
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(g) SLTN Common Stock Owned by
ST Power. As at the Effective Time, each issued and outstanding
share of SLTN Common Stock, if any, that is owned of record by ST Power
immediately prior to the Effective Time of the Merger shall automatically be
cancelled and returned and shall cease to exist and no consideration shall be
delivered in exchange therefor.
1.8 Exchange of ST Power
Instruments.
(a) SLTN
shall designate Corporate Stock Transfer, Inc., or another a person reasonably
acceptable to ST Power to act as exchange agent in the Merger (the "Exchange Agent"), and, from
time to time on, prior to or after the Effective Time, SLTN shall make
available, or cause the Surviving Corporation to make available, to the Exchange
Agent SLTN Common Stock in amounts and at the times necessary for the
delivery of the Merger Consideration, to be delivered upon surrender of
certificates representing the shares of Common Stock to be converted into
SLTN Common Stock pursuant to Section 1.7.
(b) As
soon as reasonably practicable after the Effective Time, the Exchange Agent
shall mail to each holder of record on the Record Date of Common Stock (i) a
letter of transmittal (which shall specify that delivery shall be effected, and
risk of loss and title to the certificates evidencing shares of Common Stock
shall pass, only upon delivery of the Common Stock to the Exchange Agent and
shall be in a form and have such other provisions as SLTN may reasonably
specify) and (ii) instructions for use in effecting the surrender of the Common
Stock in exchange for the Merger Consideration. Upon surrender of
Common Stock for cancellation to the Exchange Agent or to such other agent or
agents as may be appointed by SLTN, together with such letter of transmittal,
duly executed, and such other documents as may reasonably be required by the
Exchange Agent, the holder of such Common Stock shall be entitled to receive in
exchange therefor the amount of Merger Consideration theretofore represented by
such Common Stock which shall have been converted or exchange pursuant to
Section 1.7, and the Common Stock so surrendered shall forthwith be
canceled. In the event any Common Stock shall have been lost, stolen
or destroyed, SLTN may, in its discretion and as a condition precedent to the
delivery of the Merger Consideration in respect of the Common Stock, require the
owner of such lost, stolen or destroyed Common Stock to deliver a affidavit or
bond in such amount or form as it may reasonably direct as indemnity against any
claim that may be made against SLTN, the Surviving Corporation or the Exchange
Agent.
(c) All
Merger Consideration delivered upon the surrender of shares of Common Stock in
accordance with the terms of this Section 1.8 shall be deemed to have been paid
in full satisfaction of all rights pertaining to the shares of Common
Stock. At the Effective Time, the stock transfer books of ST Power
shall be closed, and there shall be no further registration of transfers on the
stock transfer books of the Surviving Corporation of shares of Common Stock that
were outstanding immediately prior to the Effective Time. If, after
the Effective Time, Common Stock are presented to the Surviving Corporation or
the Exchange Agent for any reason, they shall be canceled and exchanged as
provided in this Section 1.8.
1.9 Holders of Record of Common
Stock. Only holders of record of shares of Common
Stock as at the Effective Time of the Merger shall be entitled to receive SLTN
Common Stock as Merger Consideration as of the Effective Time of the
Merger.
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1.10 Closing. The closing
of the Merger (the “Closing”) will take place at
the offices of Xxxxxxx Xxxx LLP, counsel to SLTN, at its office in New York, New
York, within ten days following the delivery of satisfaction or waiver of the
conditions precedent set forth in Section 5 or at such other date as SLTN and
the ST Power Principal Shareholders shall agree (the “Effective Time”), but in no
event shall the Effective Time occur later than June 19, 2009. On the
Effective Time, the Parties shall consummate the Merger and cause the
Certificate of Merger to be filed at such Closing with the Secretary of State of
the State of Nevada and Delaware.
1.11 Dissenters Rights.
Notwithstanding anything in this Agreement to the contrary, any issued and
outstanding shares of Common Stock held by a Person who objects to the Merger (a
"Dissenting
Shareholder") and complies with all the provisions of Section
92A.380 of the Nevada Corporation Law concerning the right of holders of Common
Stock to dissent from the Merger and require appraisal of their shares of Common
Stock, as the case may be (the "Dissenting Shares") shall not
be converted as described in Section 1.7 but shall
become the right to receive such consideration as may be determined to be due to
such Dissenting Shareholder pursuant to Section 92A.380 of the Nevada
Corporation Law. If, after the Effective Time, such Dissenting
Shareholder withdraws his demand for appraisal or fails to perfect or otherwise
loses his right of appraisal, in any case pursuant to the Nevada Corporation
Law, his Dissenting Shares shall be deemed to be converted as of the Effective
Time into the right to receive his pro-rata shares of the Merger
Consideration. ST Power shall give SLTN (i) prompt notice of any
demands for appraisal of Dissenting Shares received by ST Power, and (ii) the
opportunity to participate in all negotiations and proceedings with respect to
any such demands. Neither ST Power nor SLTN will voluntarily make any
payment with respect to any demands for appraisal and will not, except with the
prior written consent of the ST Power Principal Shareholders, settle or offer to
settle any such demands.
ARTICLE II - CERTAIN
DEFINITIONS
Except as
defined elsewhere in this Agreement, the following terms shall have the meanings
set forth below:
“Applicable Law” means any
domestic or foreign law, statute, regulation, rule, policy, guideline or
ordinance applicable to the businesses of the Parties and/or the
Merger.
“Affiliate” means
any one or more Person controlling, controlled by or under common control with
any other Person or their affiliate.
“Business Day” shall mean any
day, excluding Saturday, Sunday and any other day on which national banks
located in New York, New York shall be closed for business.
“Dollar” and “$” means lawful money of the
United States of America.
“Effective Time” shall mean the
date upon which the Merger shall be consummated.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“GAAP” means generally accepted
accounting principles in the United States of America as promulgated by the
American Institute of Certified Public Accountants and the Financial Accounting
Standards Board or any successor Institutes concerning the treatment of any
accounting matter.
“Knowledge” means the knowledge
after reasonable inquiry.
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“Material Adverse Effect” with
respect to any entity or group of entities means any event, change or effect
that has or would have a materially adverse effect on the financial condition,
business or results of operations of such entity or group of entities, taken as
a consolidated whole.
“Merger Consideration” shall
mean the reference to (a) all 32,105,000 shares of SLTN Common Stock, and (b)
all SLTN Warrants issued to the holders of ST Power Common Stock and ST Power
Warrants as at the Effective Time of the Merger pursuant to Section 1.7 of this
Agreement.
“Person” means any individual,
corporation, partnership, trust or unincorporated organization or a government
or any agency or political subdivision thereof.
“Tax” (and, with correlative
meaning, “Taxes” and
“Taxable”)
means:
(i) any
income, alternative or add-on minimum tax, gross receipts tax, sales tax, use
tax, ad valorem tax, transfer tax, franchise tax, profits tax, license tax,
withholding tax, payroll tax, employment tax, excise tax, severance tax, stamp
tax, occupation tax, property tax, environmental or windfall profit tax, custom,
duty or other tax, impost, levy, governmental fee or other like assessment or
charge of any kind whatsoever together with any interest or any penalty,
addition to tax or additional amount imposed with respect thereto by any
governmental or Tax authority responsible for the imposition of any such tax
(domestic or foreign), and
(ii) any
liability for the payment of any amounts of the type described in clause (i)
above as a result of being a member of an affiliated, consolidated, combined or
unitary group for any Taxable period, and
(iii) any
liability for the payment of any amounts of the type described in clauses (i) or
(ii) above as a result of any express or implied obligation to indemnify any
other person.
“Tax Return” means any return,
declaration, form, claim for refund or information return or statement relating
to Taxes, including any schedule or attachment thereto, and including any
amendment thereof.
ARTICLE III -.
REPRESENTATIONS AND WARRANTIES OF ST
Power.
ST
Power hereby severally represents and warrants to SLTN as follows:
3.1. Organization
and Good Standing. ST Power is an entity duly organized,
validly existing and in good standing under the laws of the State of
Nevada.
3.2. Authorization
and Approvals. ST Power has the requisite corporate power and
authority and have obtained all requisite licenses, permits, franchises,
approvals and consents necessary (i) to own and operate its properties and to
carry on its business as now being conducted, and (ii) to enter into and carry
out the terms and conditions of this Agreement, as well as all transactions
contemplated hereunder. All corporate proceedings have been taken and
all corporate authorizations have been secured which are necessary to authorize
the execution, delivery and performance by ST Power of this
Agreement. This Agreement has been duly and validly executed and
delivered by ST Power and constitutes the valid and binding obligation of ST
Power, enforceable in accordance with its terms.
3.3. Effect of
Agreement. As of the Effective Time of the Merger, the
consummation by ST Power of the transactions contemplated hereby, including the
execution, delivery and consummation of this Agreement, will comply with all
applicable law and will not:
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(a) violate
any law applicable to or binding upon SLTN or ST Power;
(b) violate:
(i) the terms of the Articles of Incorporation or Bylaws of ST Power; or (ii)
any material agreement, contract, mortgage, indenture, xxxx, xxxx, note, or
other material instrument or writing binding upon ST Power or to which ST Power
is subject;
(c) accelerate
or constitute an event entitling the holder of any indebtedness of ST Power to
accelerate the maturity of such indebtedness or to increase the rate of interest
presently in effect with respect to such indebtedness; or
(d) result
in the breach of, constitute a default under, constitute an event which with
notice or lapse of time, or both, would become a default under, or result in the
creation of any lien, security interest, charge or encumbrance upon any of the
assets or any other properties of ST Power under any agreement, commitment,
contract (written or oral) or other instrument to which ST Power is a party or
by which it is bound or affected.
3.4. Consents. All
consents, approvals or other authorizations or notices, required by any state or
federal regulatory authority or other Person or entity in order to permit SLTN
and ST Power to consummate the transactions contemplated by this Agreement have
been obtained and are in full force and effect.
3.5. Legal
Proceedings. There are no legal, administrative, arbitral or
other actions, claims, suits or proceedings or investigations instituted or
pending or, to the Knowledge of ST Power’s management, threatened against ST
Power, or against any property, asset, interest or right of ST Power, that might
reasonably be expected to have a Material Adverse Effect or that might
reasonably be expected to threaten or impede the consummation of the
transactions contemplated by this Agreement.
3.6. Regulatory
Compliance. ST Power has not violated any applicable laws, the
violation of which would be reasonably likely to have a Material Adverse
Effect.
3.7. Capitalization
of ST Power.
(a)
Pursuant to its Articles of Incorporation, ST Power is authorized to issue an
aggregate of 260,000,000 shares of capital stock of which 250,000,000 shares are
Common Stock and 10,000,000 shares are preferred stock, issuable upon such terms
and conditions as the board of directors of ST Power may, from time to time,
designate. As at the date of this Agreement, (i) no shares of
preferred stock have been issued, and (b) an aggregate of 64,403,333 shares of
Common Stock are issued and outstanding and are owned of record by the following
Persons, and (c) such Persons shall be entitled to receive the following shares
of SLTN as the Merger Consideration:
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|
Shares of ST Power
|
Shares of SLTN Merger Consideration
|
||||
|
Solar
Thin Films -
|
43,000,000
shares
|
(1) | -0- | ||
|
Xxx
Xxxxxx
|
6,333,333
shares
|
9,500,000
shares
|
|||
|
Xxxxxxx
Xxxxxxxxxx
|
2,666,666
shares
|
4,000,000
shares
|
|||
|
Xxxx
Xxxxx
|
670,000
shares
|
1,005,000
shares
|
|||
|
Xxxxxx
Xxxxxxxx
|
300,000
shares
|
450,000
shares
|
|||
|
Solar
Grid Capitol, Inc.
|
1,200,000
shares
|
1,800,000
shares
|
|||
|
Xxxxx
Xxxxxxxxx
|
400,000
shares
|
600,000
shares
|
|||
|
Design
Investment Ltd.
|
500,000
shares
|
750,000
shares
|
|||
|
Gemillaa
Chesed
|
1,000,000
shares
|
1,500,000
shares
|
|||
|
Xxxxx
Family Trust
|
2,000,000
shares
|
3,000,000
shares
|
|||
|
Xxxxx
Xxxxx
|
2,000,000
shares
|
3,000,000
shares
|
|||
|
Corporate
Communications
|
2,666,666
shares
|
4,000,000
shares
|
|||
|
Strategic
Growth International Inc.
|
1,333,333
shares
|
2,000,000
shares
|
|||
|
Xxx
Steminak
|
333,333 shares
|
500,000 shares
|
|||
|
|
64,403,333
shares
|
(2)(3)
|
32,105,000
shares
|
||
____________________________________
(1)
At December 31, 2007, SLTN owned 50,000,000 shares. As at October 1, 2008,
SLTN (a) transferred 2,666,666 shares to Xxxxxxx Xxxxxxxxxx, reducing its
holdings to 47,333,334 shares, and (b) 3,000,000 shares to Xxx Xxxxxx, reducing
its holdings to 44,333,334 shares. In April 2009, SLTN transferred to
Strategic Growth International Inc. (“SGI”) 1,333,333 shares of ST Power Common
Stock pursuant to the terms of an investor relations agreement dated Xxxxx 00,
0000 xxxxxxx XXX and SLTN, further reducing its holdings in ST Power to
43,000,000 shares.
(b) All
of the issued and outstanding shares of Common Stock of ST Power have been duly
authorized and are validly issued, fully paid, and
non-assessable. There are no outstanding or authorized options,
warrants, purchase rights, subscription rights, conversion rights, exchange
rights, or other contracts or commitments that could require ST Power to issue,
sell, or otherwise cause to become outstanding any of its capital stock or any
other equity.
3.8. Material
Agreements. ST Power is not a party to any material agreement,
the failure to perform of which would have a Material Adverse
Effect.
3.9. Undisclosed
Liabilities. ST Power does not have any liability (whether
known or unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or unliquidated,
and whether due or to become due), including any liability for Taxes, except
for: (i) liabilities set forth in the financial statements of ST Power, and
(ii) liabilities which have arisen after the date of the financial
statements of ST Power 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).
3.10. Material
Defaults. ST Power is not in default, or alleged to be in
default, under any material agreement, contract, lease, mortgage, commitment,
instrument or obligation, and to the best Knowledge of ST Power of no other
party to any agreement, contract, lease, mortgage, commitment, instrument or
obligation to which ST Power is a party is in default thereunder, which default
would have a Material Adverse Effect upon the properties, assets, business or
prospects of ST Power.
3.11. Tax
Returns and Disputes. ST Power has: (a) filed all Tax
Returns (federal, state and local) required to be filed by it, (b) all such
Tax Returns filed are complete and accurate in all material respects, and
(c) the applicable taypayer has paid all Taxes shown to be due and payable
on the returns or any assessments or penalties received by it and all other
Taxes (federal, state and local) due and payable by it. ST Power has
collected and withheld all Taxes which it has been required to collect or
withhold and has timely submitted all such collected and withheld amounts to the
appropriate authorities. ST Power is in compliance with the back-up
withholding and information reporting requirements under the Code and any state,
local or foreign laws, and the rules and regulations thereunder.
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3.12. No
Adverse Change. Since December 31, 2008 there has been no
Material Adverse Change in the business, financial condition, results of
operations, assets, or liabilities of ST Power.
3.14. Disclosure. The
representations and warranties of ST Power contained in this Agreement and in
any agreement, certificate, affidavit, statutory declaration or other document
delivered or given by ST Power pursuant to this Agreement are true and correct
and do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements contained in such representations
and warranties not misleading to SLTN.
3.15. Advice of
Changes. Between the date of this Agreement and the Effective
Time of the Merger, ST Power shall promptly advise SLTN in writing of any fact,
the occurrence of which would render any representation or warranty contained in
this Agreement to be materially untrue.
ARTICLE IV
- REPRESENTATIONS AND WARRANTIES OF SLTN
SLTN hereby represents and warrants to
ST Power as follows:
4.1. Organization
and Good Standing. SLTN is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware.
4.2. Authorization. SLTN
has full power and authority to execute and deliver this Agreement and to
perform its obligations hereunder. This Agreement constitutes the
valid and legally binding obligation of A SLTN, enforceable in accordance with
its terms and conditions. SLTN need not give any notice to, make any
filing with, or obtain any authorization, consent, or approval of any government
or governmental agency in order to consummate the transactions contemplated by
this Agreement.
4.3. Operation
of Business. SLTN has the requisite corporate power and
authority and all requisite licenses, permits and franchises necessary to own
and operate its properties and to carry on its business as now being
conducted.
4.4. Execution
of Agreement. SLTN has the requisite corporate power and
authority and has obtained all approvals and consents necessary to enter into
and carry out the terms and conditions of this Agreement, as well as all
transactions contemplated hereunder. All corporate proceedings have
been taken and all corporate authorizations have been secured which are
necessary to authorize the execution, delivery, and performance by SLTN of this
Agreement. This Agreement has been duly and validly executed and
delivered by SLTN and constitutes the valid and binding obligations of SLTN,
enforceable in accordance with the respective terms.
4.5. Effect of
Agreement. As of the Effective Time of the Merger, the
consummation by SLTN of the transactions herein contemplated, including the
execution, delivery and consummation of this Agreement, will comply with all
applicable law and will not:
(a) violate
any applicable law to or binding upon SLTN;
(b) violate:
(i) the terms of the Certificate of Incorporation or Bylaws of SLTN; or, (ii) any
material agreement, contract, mortgage, indenture, xxxx, xxxx, note, or other
material instrument or writing binding upon SLTN or to which
SLTN is
subject; or
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(c) result
in the breach of, constitute a default under, constitute an event which with
notice or lapse of time, or both, would become a default under, or result in the
creation of any lien, security interest, charge or encumbrance upon any of the
assets or any other properties of SLTN under any
agreement, commitment, contract (written or oral) or other instrument to which
SLTN is a
party or by which it is bound or affected.
4.6. Consents. No
consents, approvals or other authorizations or notices, other than those which
have been obtained and are in full force and effect, are required by any state
or federal regulatory authority or other Person or entity in connection with the
execution and delivery of this Agreement and the performance of any
obligations contemplated hereunder.
4.7. Legal
Proceedings. There are no legal, administrative, arbitral or
other actions, claims, suits or proceedings or investigations instituted or
pending or, to the Knowledge of SLTN’s management, threatened against SLTN, or
against any property, asset, interest or right of SLTN, that might reasonably be
expected to have a Material Adverse Effect or that might reasonably be expected
to threaten or impede the consummation of the transactions contemplated by this
Agreement.
4.8. Compliance
with Laws. To the best Knowledge of SLTN, it has not violated
any federal, state, local or foreign statute or other law (including federal and
state securities laws), the violation of which would be reasonably likely to
have a Material Adverse Effect. All filings by SLTN with the SEC have
been filed in a timely fashion and are accurate and complete in all material
respects.
4.9. Capitalization.
(a) SLTN
is authorized to issue 150,000,000 shares of SLTN Common Stock and
2,700,000 shares of
preferred stock containing such terms and conditions as the SLTN board of
directors may, from time to time determine.
(b) All
of the issued and outstanding SLTN Common Stock and SLTN Securities have been
duly authorized and are validly issued, fully paid, and
non-assessable.
4.10. The
Merger Consideration. The Merger Consideration will, upon
issuance, be duly authorized, legally and validly issued, fully paid and
non-assessable, and free and clear of all liens, mortgages, pledges, and other
encumbrances of any nature, unless expressly provided herein to the
contrary.
4.11. Undisclosed
Liabilities. SLTN does not have any liability (whether known
or unknown, whether asserted or unasserted, whether absolute or contingent,
whether accrued or unaccrued, whether liquidated or unliquidated, and whether
due or to become due), including any liability for Taxes, except for:
(i) liabilities set forth in the SLTN financial statements included in
public filings under the Securities Act of 1933, as amended, and the Exchange
Act (the “SLTN Financial
Statements”), and (ii) liabilities which have arisen after the date
of the latest SLTN Financial Statements 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).
4.12. Material
Defaults. SLTN is not in default, or alleged to be in default,
under any material agreement, contract, lease, mortgage, commitment, instrument
or obligation, and to the best Knowledge of SLTN no other party to any
agreement, contract, lease, mortgage, commitment, instrument or obligation to
which SLTN is a party is in default thereunder, which default would have a
Material Adverse Effect upon the properties, assets, business or prospects of
the SLTN.
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4.13. Tax
Returns and Disputes. SLTN has: (a) filed all Tax Returns
(federal, state and local) required to be filed by it, (b) all such Tax
Returns filed are complete and accurate in all material respects, and
(c) the applicable taypayer has paid all Taxes shown to be due and payable
on the returns or any assessments or penalties received by it and all other
Taxes (federal, state and local) due and payable by it. SLTN has
collected and withheld all Taxes which it has been required to collect or
withhold and has timely submitted all such collected and withheld amounts to the
appropriate authorities. SLTN is in compliance with the back-up
withholding and information reporting requirements under the Code and any state,
local or foreign laws, and the rules and regulations thereunder.
4.14. Financial
Statements. All SLTN Financial Statements present fairly the
financial position, results of operations and cash flows of SLTN for the fiscal
period then ended and were prepared in accordance with United States generally
accepted accounting principles (“GAAP”), except with
respect to the unaudited SLTN Financial Statements which are subject to
non-material audit adjustments and do not contain all footnote disclosures that
are required under GAAP audited financial statements.
4.15. No
Adverse Change. Since December 31, 2008
there has been no Material Adverse Change in the business, financial condition,
results of operations, assets, or liabilities of SLTN.
4.20. Disclosure. The
representations and warranties of SLTN contained in this Agreement and in any
agreement, certificate, affidavit, statutory declaration or other document
delivered or given to ST Power pursuant to this Agreement are true and correct
and do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements contained in such representations
and warranties not misleading to ST Power.
4.21. Advice of
Changes. Between the date hereof and the Effective Time of the
Merger, SLTN shall advise ST Power shall promptly in writing of any fact, the
occurrence of which would render any representation or warranty contained in
this Agreement to be materially untrue.
ARTICLE V - CONDITIONS
PRECEDENT
5.1 Conditions Precedent to the
Obligations of ST
Power and the
ST Power Principal Shareholders. All obligations of ST
Power and the ST Power Principal Shareholders under this Agreement are subject
to the fulfillment, prior to or as of the Effective Time, as indicated below, of
each of the following conditions; any one of which may be waived at Closing by
Xxxxx Xxxxxxxxx, as representative of all of the ST Power Principal Shareholders
(the “ST Power Stockholders’
Representative):
(a) The
representations and warranties by or on behalf of SLTN contained in this
Agreement or in any certificate or document delivered pursuant to the provisions
hereof shall be true in all material respects at and as of Effective Time as
though such representations and warranties were made at and as of such
time.
(b) SLTN
shall have performed and complied in all material respects, with all covenants,
agreements, and conditions set forth in, and shall have executed and delivered
all documents required by this Agreement to be performed or complied with or
executed and delivered by it prior to or at the Effective Time.
(c) On
or before the Effective Time, the Certificate of Merger shall have been duly
filed with the Secretary of State of the State of Nevada and Delaware, and the
Effective Time of the Merger shall have occurred.
(d) On
the Effective Time, SLTN shall have sufficient authorized SLTN Common Stock to
complete the Merger and issue the maximum number of shares of SLTN Common Stock
that may constitute Merger Consideration.
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(e) SLTN
shall have issued to the ST Power Stockholders or the Exchange Agent (to be held
on behalf of the ST Power Stockholders pending delivery of their Common Stock)
the SLTN Common Stock.
(f) At
the Effective Time, the Merger Consideration to be issued and delivered
hereunder will, when so issued and delivered, constitute valid and legally
issued fully-paid and non-assessable SLTN Common Stock.
5.2 Conditions Precedent to the
Obligations of SLTN. All
obligations of SLTN under this Agreement are subject to the fulfillment, prior
to or at Closing, of each of the following conditions (any one of which may be
waived at Closing by SLTN):
(a) The
representations and warranties by ST Power contained in this Agreement or in any
certificate or document delivered pursuant to the provisions hereof shall be
true in all material respects at and as of the Closing as though such
representations and warranties were made at and as of such time;
(b) ST
Power shall have performed and complied with, in all material respects, with all
covenants, agreements, and conditions set forth in, and shall have executed and
delivered all documents required by this Agreement to be performed or complied
or executed and delivered by them prior to or at the Closing;
(c) On
or before the Effective Time, the Certificate of Merger shall have been duly
filed with the Secretary of State of the State of Nevada and Delaware at the
Effective Time of the Merger shall have occurred.
(d) Not
in excess of 2% of the total issued and outstanding shares of Common Stock shall
constitute Dissenters Shares as at the Effective Time of the
Merger.
ARTICLE VI
- COVENANTS
6.1 Corporate Examinations and
Investigations. Prior to the Effective Time, the Parties
acknowledge that they have been entitled, through their employees and
representatives, to make such investigation of the assets, properties, business
and operations, books, records and financial condition of the other as they each
may reasonably require. No investigations, by a party hereto shall,
however, diminish or waive any of the representations, warranties, covenants or
agreements of the party under this Agreement.
6.2 Further
Assurances. The Parties shall execute such documents and other
papers and take such further actions as may be reasonably required or desirable
to carry out the provisions hereof and the transactions contemplated
hereby. Each such party shall use its best efforts to fulfill or
obtain the fulfillment of the conditions to the Closing, including, without
limitation, the execution and delivery of any documents or other papers, the
execution and delivery of which are necessary or appropriate to the
Closing.
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6.3 Confidentiality. In
the event the transactions contemplated by this Agreement are not consummated,
SLTN, ST Power and the ST Power Principal Shareholders agree to keep
confidential any information disclosed to each other in connection therewith for
a period of three (3) years from the date hereof; provided, however, such
obligation shall not apply to information which:
|
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(i)
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at
the time of the disclosure was public
knowledge;
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(ii)
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is
required to be disclosed publicly pursuant to any applicable federal or
state securities laws;
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(iii)
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after
the time of disclosure becomes public knowledge (except due to the action
of the receiving party);
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(iv)
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the
receiving party had within its possession at the time of disclosure;
or
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(v)
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is
ordered disclosed by a court of proper
jurisdiction.
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6.4 Indemnification of Officers
and
Directors. It
is the intention of the Parties that SLTN shall indemnify its officers and
directors to the fullest extent permitted by Delaware law. In such
connection, the Parties agree not to amend the certificates of incorporation or
by-laws of SLTN if such amendment shall have the effect of reducing, terminating
or otherwise adversely affecting the indemnification rights and privileges
applicable to officers and directors of SLTN, as the same are in effect
immediately prior to the Effective Time of the Merger.
6.5 Expenses. It
is understood and agreed that following the execution of this Agreement, any and
all expenses with respect to any filings, documentation and related matters with
respect to the consummation of the transactions contemplated hereby shall be the
individual responsibility of each of SLTN and ST Power.
6.6 Specific
Performance. Each
of ST Power and the ST Power Principal Shareholders who are executing this
Agreement do hereby acknowledge and agree that, absent only a material breach by
SLTN of its representations and warrants or the failure on the part of SLTN to
perform any of its material covenants and agreements contained herein, if ST
Power shall fail or refuse to timely perform their respective covenants and
agreements contained herein (including those set forth in Section 5.2 and
Article VI), that would make it impossible or impracticable for SLTN to
consummate by the Effective Time the Merger contemplated hereby, SLTN would have
no adequate remedy at law. Accordingly, each of ST Power and the ST
Power Principal Shareholders do hereby agree that, in addition to any other
remedies available to SLTN at law or in equity, SLTN or their legal
representative may seek and obtain from the United States District Court for the
Southern District of New York or any state court of competent jurisdiction in
New York County, New York, specific performance of this
Agreement. Each of ST Power and the ST Power Principal Stockholder do
hereby consent to the jurisdiction of such federal court or state court of
competent jurisdiction in New York, New York.
ARTICLE
VII - TERMINATION.
7.1 Termination by the
Parties. If
the Effective Time of the Merger has not occurred by the close of business on
the Effective Time, then any Party hereto may thereafter terminate this
Agreement by written notice to such effect, to the other Parties hereto, without
liability of or to any Party to this Agreement or any shareholder, director,
officer, employee or representative of such Party, unless the reason for such
Effective Time having not occurred is:
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(a) such
terminating Party’s willful breach of the provisions of this Agreement,
or
(b) if
all of the conditions to such terminating Party’s obligations set forth in
Article V and Article VI have been satisfied or waived in writing by the date
scheduled for the Closing, and, notwithstanding such satisfaction or waiver,
such terminating Party fails or refuses to close the transactions contemplated
by this Agreement.
ARTICLE VIII
- SURVIVAL OF REPRESENTATIONS AND WARRANTIES
8.1 Notwithstanding
any right of either Party to investigate the affairs of the other party and its
shareholders, each Party has the right to rely fully upon representations,
warranties, covenants and agreements of the other Parties contained in this
Agreement or in any document delivered to one by the other or any of their
representatives, in connection with the transactions contemplated by this
Agreement. Notwithstanding the foregoing, all of
the representations and warranties of the Parties to this Agreement shall
terminate as at the Effective Time of the Merger.
ARTICLE IX - DISPUTE
RESOLUTION; NON-COMPETITION.
9.1 Resolution of
Disputes. Except as otherwise provided in Section 6.6 above,
any dispute arising under this Agreement which cannot be resolved among the
Parties shall be submitted to final and binding arbitration in accordance with
the then prevailing rules and regulations of the American Arbitration
Association (the “AAA”),
located in New York, New York. There shall be three arbitrators, one
selected by the claimant, one selected by the respondent and the third
arbitrator selected by the AAA. The decision and award of the
arbitrators shall be final and binding upon all Parties and may be enforced in
any federal or state court of competent jurisdiction. Service
of process on any one or more Parties in connection with any such arbitration
may be made by registered or certified mail, return receipt requested or by
email or facsimile transmission.
ARTICLE X
- MISCELLANEOUS
10.1 Waivers. The
waiver of a breach of this Agreement or the failure of any party hereto to
exercise any right under this Agreement shall in no way constitute waiver as to
future breach whether similar or dissimilar in nature or as to the exercise of
any further right under this Agreement.
10.2 Amendment. This
Agreement may be amended or modified only by an instrument of equal formality
signed by the Parties or the duly authorized representatives of the respective
Parties.
10.3 Assignment. This
Agreement is not assignable except by operation of law.
10.4 Notice. All
notices, requests and demands hereunder shall be in writing and delivered by
hand, by facsimile transmission, by E-Mail, by mail, by telegram, or by
recognized commercial over-night delivery service (such as Federal Express, UPS,
or DHL), and shall be deemed given: (a) if by hand delivery, upon such
delivery; (b) if by facsimile transmission, upon telephone confirmation of
receipt of same; (c) if by E-Mail, upon confirmation of receipt of same;
(d) if by mail, forty-eight (48) hours after deposit in the United States mail,
first class, registered or certified mail, postage prepaid; (e) if by
telegram, upon telephone confirmation of receipt of same; or (f) if by
recognized commercial over-night delivery service, upon such
delivery.
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If to
SLTN:
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||
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00
Xxxxxxxx Xxxxxxxxx
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||
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Xxx
Xxxxx, Xxx Xxxx, 00000
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||
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Attn:
Xxxxxx X. Xxxxx, Chairman and CFO
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||
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E-Mail: xxxxxxxx@xxxxx.xxx
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||
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If ST
Power or the ST
Power
Principal
Shareholders:
|
Solar
Thin Power, Inc.
|
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000
Xxxxx Xxxxxx
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||
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Xxxxxxxxxxx,
Xxx Xxxxxx 00000
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||
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Attention:
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||
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E-Mail:
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10.5 Governing
Law. This Agreement shall be construed, and the legal
relations between the Parties determined, in accordance with the laws of the
State of New York, thereby precluding any choice of law rules which may direct
the application of the laws of any other jurisdiction.
10.6 Publicity. No
publicity release or announcement concerning this Agreement or the transactions
contemplated hereby shall be issued by either party hereto at any time from the
signing hereof without advance approval in writing of the form and substance by
the other party.
10.7 Entire
Agreement. This Agreement and the collateral agreements
executed in connection with the consummation of the transactions contemplated
herein contain the entire agreement among the Parties with respect to the
transactions contemplated hereby, and supersedes all prior agreements, written
or oral, with respect hereof.
10.8 Headings. The
headings in this Agreement are for reference purposes only and shall not in any
way affect the meaning or interpretation of this Agreement.
10.9 Severability of
Provisions. The invalidity or unenforceability of any term,
phrase, clause, paragraph, restriction, covenant, agreement or provision of this
Agreement shall in no way affect the validity or enforcement of any other
provision or any part thereof.
10.10 Counterparts. This
Agreement may be executed in any number of counterparts, each of which when so
executed, shall constitute an original copy hereof, but all of which together
shall consider but one and the same document.
10.11 Binding
Effect. This Agreement shall be binding upon the Parties
hereto and inure to the benefit of the Parties, their respective heirs,
administrators, executors,
successors
and assigns.
10.12 Press
Releases. The Parties will mutually agree as to the wording
and timing of any informational releases concerning this transaction prior to
and through Closing.
[balance
of page intentionally left blank - signature page follows]
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IN WITNESS WHEREOF, this
Agreement has been duly executed by the Parties on the date and year first above
written.
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a
Delaware corporation
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By
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Signature:
|
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Print
Name: Xxxxxx X. Xxxxx
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Its:
Chief Executive Officer
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Dated June 30,
2009
|
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SOLAR
THIN POWER, INC.
|
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a
Delaware corporation
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By
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Signature:
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Print
Name:
|
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Its:
|
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Dated June 30,
0000
|
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- 00
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XX POWER PRINCIPAL
SHAREHOLDERS:
| SOLAR THIN FILMS, INC. | ||||
|
XXX
XXXXXX
|
By
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|||
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XXXXXXX
XXXXXXXXXX
|
XXXX XXXXX | |||
|
XXXXXX
XXXXXXXX
|
XXXXX XXXXXXXXX | |||
|
GEMILLAA
CHESED
|
XXXXX XXXXX | |||
|
SOLAR
GRID CAPITOL, INC.
|
DESIGN INVESTMENT LTD. | |||
|
By
|
By
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|||
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CORPORATE
COMMUNICATIONS GROUP, INC.
|
STRATEGIC GROWTH INVESTMENTS LLC | |||
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By
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By
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|||
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THE
XXXXX FAMILY IRREVOCABLE
|
||||
|
STOCK
TRUST
|
||||
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By
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||||
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XXX
STEMINAK
|
||||
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