EXHIBIT 6.1
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the "Agreement"), entered into
this 29th day of January 1997, by, between, and among Executive Marketing, Inc.,
a publicly held Delaware corporation (hereinafter the "Purchaser"), Total Media
Corporation, a privately-held Nevada corporation (hereinafter the "Private
Company"), the name of which is in the process of being changed to "Total Film
Group, Inc.", and the shareholders of the Private Company whose names and
signatures are set forth upon the signature page of this Agreement (the
"Shareholders").
RECITALS:
WHEREAS, the Purchaser wishes to acquire, and the Shareholders are willing
to sell, all of the outstanding stock of the Private Company in exchange solely
for a part of the voting stock of the Purchaser whereby the Shareholders would
acquire a controlling interest of the Purchaser; and
WHEREAS, the parties hereto intend to qualify such transaction as a
tax-free exchange pursuant to Section 368(a)(1)(B) of the Internal Revenue Code
of 1986, as amended;
NOW, THEREFORE, based upon the stated premises, which are incorporated
herein by reference, and for and in consideration of the mutual covenants and
agreements set forth herein, the mutual benefits to the parties to be derived
herefrom, and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the Purchaser, the Private Company, and the
Shareholders approve and adopt this Agreement and Plan of Reorganization and
mutually covenant and agree with each other as follows:
1. Shares to be Transferred and Shares to be Issued.
1.1 On the closing date the Shareholders shall transfer to the
Purchaser certificates for the number of shares of the common stock of the
Private Company described in Schedule "A," attached hereto and incorporated
herein, which in the aggregate shall represent all of the issued and outstanding
shares of the common stock of the Private Company.
1.2 In exchange for the transfer of the common stock of the Private
Company pursuant to subsection 1.1. hereof, the Purchaser shall on the closing
date and contemporaneously with such transfer of the common stock of the Private
Company to it by the Shareholders issue and deliver to the Shareholders the
number of shares of common stock of the Purchaser specified on Schedule "A"
hereof such that the Shareholders shall own approximately sixty-seven percent
(67%) of the outstanding common stock of the Purchaser.
2. Representations and Warranties of the Shareholders. Each of the
Shareholders, for himself, herself, or itself, and not for any other
Shareholder, represents and warrants to the Purchaser as set forth below. These
representations and warranties are made as an inducement
for the Purchaser to enter into this Agreement and, but for the making of such
representations and warranties and their accuracy, the Purchaser would not be a
party hereto.
2.1 Ownership of Stock.
a. Each of the Shareholders is the record and beneficial owner
and holder of the number of fully paid and nonassessable shares of the common
stock of the Private Company listed in Schedule "A" hereto as of the date hereof
and will continue to own such shares of the common stock of the Private Company
until the delivery thereof to the Purchaser on the closing date and all such
shares of common stock are or will be on the closing date owned free and clear
of all liens, encumbrances, charges and assessments of every nature and subject
to no restrictions with respect to transferability. Each of the Shareholders
currently has, and will have at closing, full power and authority to dispose,
assign, and transfer his, her, or its shares of the Private Company in
accordance with the terms hereof. Each of the Shareholders currently has, and
will have at closing, full power and authority to vote his, her, or its shares
of the Private Company, without restriction of any kind.
b. Except for this Agreement, there are no outstand-ing options,
contracts, calls, commitments, agreements or demands of any character relating
to the common stock of the Private Company listed in Schedule "A" and owned by
each of the Shareholders.
2.2 Accuracy of All Statements Made by the Shareholders. No
representation or warranty by the Shareholders in this Agreement, nor any
statement, certificate, schedule, or exhibit hereto furnished or to be furnished
by or on behalf of the Shareholders pursuant to this Agreement, nor any document
or certificate delivered to the Purchaser by the Shareholders pursuant to this
Agreement or in connection with actions contemplated hereby, contains or shall
contain any untrue statement of material fact or omits or shall omit a material
fact necessary to make the statement contained therein not misleading.
3. Representations and Warranties of the Private Company. The Private
Company represents and warrants to the Purchaser as set forth below. These
representations and warranties are made as an inducement for the Purchaser to
enter into this Agreement and, but for the making of such representations and
warranties and their accuracy, the Purchaser would not be a party hereto.
3.1 Organization and Authority. The Private Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada with full power and authority to enter into and perform the
transactions contemplated by this Agreement.
3.2 Capitalization. As of the date of the closing, the Private
Company will have a total of no more than 300 shares of common stock issued and
outstanding. All of the shares will have been duly authorized and validly issued
and will be fully paid and nonassessable. There are no options, warrants,
conversion privileges, or other rights presently outstanding for the purchase of
any authorized but unissued stock of the Private Company, except for the right
to
convert the loans referred to in paragraph 7.9 into shares of the Purchaser at
the rate of one share for each $1.00 of loan.
3.3 Performance of This Agreement. The execution and performance of
this Agreement and the transfer of stock contem-plated hereby have been
authorized by the board of directors of the Private Company.
3.4 Financial Condition. The Private Company has had no material
operations since its inception. A list and description of all of the assets of
the Private Company has been previously furnished to the Purchaser, which list
and description is true and correct in all material respects.
3.5 Liabilities. The Private Company has entered into a loan out
agreement for the services of Xxxxxx Xxxxx. Additionally, there are three motion
picture projects and an office lease. The Private Company has also borrowed
$950,000, which amounts are convertible into shares of common stock of the
Purchaser at the rate of one share for each $1.00 of principal due pursuant to
such loans. Other than these obligations, there are no material liabilities of
the Private Company, whether accrued, absolute, contingent or otherwise, which
arose or relate to any transaction of the Private Company, its agents or
servants occurring prior to the date of this Agreement, which in the aggregate
would create labilities to the Private Company in excess of $25,000. As of the
date hereof, there are no known circumstances, conditions, happenings, events or
arrangements, contractual or otherwise, which may hereafter give rise to
liabili-ties, except in the normal course of business of the Purchaser, or as
set forth in this subsection.
3.6 Litigation. There are no legal, administrative or other
proceedings, investigations or inquiries, product liability or other claims,
judgments, injunctions or restrictions, either threatened, pending, or
outstanding against or involving the Private Company or its subsidiaries, if
any, or their assets, properties, or business, nor does the Private Company or
its subsidiaries know, or have reasonable grounds to know, of any basis for any
such proceedings, investigations or inquiries, product liability or other
claims, judgments, injunctions or restrictions. In addition, there are no
material proceedings existing, pending or reasonably contemplated to which any
officer, director, or affiliate of the Private Company or as to which and of the
Shareholders is a party adverse to the Private Company or any of its
subsidiaries or has a material interest adverse to the Private Company or any of
its subsidiaries.
3.7 Taxes. All federal, state, foreign, county and local income,
profits, franchise, occupation, property, sales, use, gross receipts and other
taxes (including any interest or penalties relating thereto) and assessments
which are due and payable have been duly reported, fully paid and discharged as
reported by the Private Company, and there are no unpaid taxes which are, or
could become a lien on the properties and assets of the Private Company, except
as provided for in the financial statements of the Private Company, or have been
incurred in the normal course of business of the Private Company since that
date. All tax returns of any kind required to be filed have been filed and the
taxes paid or accrued.
3.8 Accuracy of All Statements Made by the Private Company. No
representation or warranty by the Private Company in this Agreement, nor any
statement, certificate, schedule, or exhibit hereto furnished or to be furnished
by or on behalf of the Private Company pursuant to this Agreement, nor any
document or certificate delivered to the Purchaser by the Private Company
pursuant to this Agreement or in connection with actions contemplated hereby,
contains or shall contain any untrue statement of material fact or omits or
shall omit a material fact necessary to make the statement contained therein not
misleading.
4. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to the Private Company and to the Shareholders as set
forth below. These representations and warranties are made as an inducement for
the Private Company and the Shareholders to enter into this Agreement and, but
for the making of such representations and warranties and their accuracy, the
Private Company and the Shareholders would not be parties hereto.
4.1 Organization and Good Standing. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware with full power and authority to enter into and perform the
transactions contemplated by this Agreement.
4.2 Capitalization. As of the date of the closing, the Purchaser will
have a total of no more than 1,500,000 shares of common stock issued and
outstanding. All of the shares will have been duly authorized and validly issued
and will be fully paid and nonassessable. Except for the Purchaser's obligations
hereunder with respect to the shares to be issued pursuant to subsection 1.2
hereof, there are no options, warrants, conversion privileges, or other rights
presently outstanding for the purchase of any authorized but unissued stock of
the Purchaser. As of the closing, the Articles of Incorporation, as amended, of
the Purchaser (the "Purchser Articles") and as currently in effect shall be in
the form previously furnished to the Private Company and the Shareholders
providing among other things for two authorized classes of stock, namely fifty
million (50,000,000) shares of common stock (par value $.001) and 500,000 shares
of preferred stock (par value $.001), none of which preferred shares are
outstanding. The rights, preferences, and privileges of the stock shall be as
set forth in the Purchaser Articles.
4.3 Performance of This Agreement. The execution and performance of
this Agreement and the issuance of stock contem-plated hereby have been
authorized by the board of directors of the Purchaser.
4.4 Financials. True copies of the financial statements of the
Purchaser consisting of the balance sheets as of the fiscal year ended December
31, 1996, and statements of income, cash flow and changes in stockholder's
equity for such fiscal year, have been delivered by the Purchaser to the Private
Company. The year-end statement has been examined and certified by Xxxxxxxxx,
Xxxxx & Xxxxx, P.C., Certified Public Accountants. Said financial statements are
true and correct in all material respects and present an accurate and complete
disclosure of the financial condition of the Purchaser as of December 31, 1996,
and the earnings for the periods covered, in accordance with generally accepted
accounting principles applied on a consistent basis.
4.5 Liabilities. There are no material liabilities of the Purchaser,
whether accrued, absolute, contingent or otherwise, which arose or relate to any
transaction of the Purchaser, its agents or servants which are not disclosed by
or reflected in said financial statements. As of the date hereof, there are no
known circumstances, conditions, happenings, events or arrangements, contractual
or otherwise, which may hereafter give rise to liabili-ties, except in the
normal course of business of the Purchaser.
4.6 Litigation. There are no legal, administrative or other
proceedings, investigations or inquiries, product liability or other claims,
judgments, injunctions or restrictions, either threatened, pending, or
outstanding against or involving the Purchaser or its subsidiaries, if any, or
their assets, properties, or business, nor does the Purchaser or its
subsidiaries know, or have reasonable grounds to know, of any basis for any such
proceedings, investigations or inquiries, product liability or other claims,
judgments, injunctions or restrictions. In addition, there are no material
proceedings existing, pending or reasonably contemplated to which any officer,
director, or affiliate of the Purchaser is a party adverse to the Purchaser or
any of its subsidiaries or has a material interest adverse to the Purchaser or
any of its subsidiaries.
4.7 Taxes. All federal, state, foreign, county and local income,
profits, franchise, occupation, property, sales, use, gross receipts and other
taxes (including any interest or penalties relating thereto) and assessments
which are due and payable have been duly reported, fully paid and discharged as
reported by the Purchaser, and there are no unpaid taxes which are, or could
become a lien on the properties and assets of the Purchaser, except as provided
for in the financial statements of the Purchaser, or have been incurred in the
normal course of business of the Purchaser since that date. All tax returns of
any kind required to be filed have been filed and the taxes paid or accrued.
4.8 Legality of Shares to be Issued. The shares of common stock of
the Purchaser to be issued by the Purchaser pursuant to this Agreement, when so
issued and delivered, will have been duly and validly authorized and issued by
the Purchaser and will be fully paid and nonassessable.
4.9 Tradability of Outstanding Shares. Of the shares of common stock
of the Purchaser to be outstanding as of closing, management reasonably believes
that up to 75,000 will not be restricted as defined in Rule 144 promulgated by
the Securities and Exchange Commission pursuant to the Securities Act of 1933,
as amended.
4.10 Accuracy of All Statements Made by the Purchaser. No
representation or warranty by the Purchaser in this Agreement, nor any
statement, certificate, schedule, or exhibit hereto furnished or to be furnished
by the Purchaser pursuant to this Agreement, nor any document or certificate
delivered to the Private Company or the Shareholders pursuant to this Agreement
or in connection with actions contemplated hereby, contains or shall contain any
untrue statement of material fact or omits to state or shall omit to state a
material fact necessary to make the statement contained therein not misleading.
5. Covenants of the Parties.
5.1 Corporate Records.
a. Simultaneous with the execution of this Agreement by the
Private Company, such entity shall deliver to the Purchaser copies of the
articles of incorporation, as amended, and the current bylaws of the Private
Company, and copies of the resolutions duly adopted by the board of directors of
the Private Company approving this Agreement and the transactions herein
contemplated.
b. Simultaneous with the execution of this Agreement by the
Purchaser, such entity shall deliver to the Private Company copies of the
articles of incorporation, as amended, and the current bylaws of the Purchaser,
and copies of the resolutions duly adopted by the board of directors of the
Purchaser approving this Agreement and the transactions herein contemplated.
5.2 Access to Information.
a. The Purchaser and its authorized representatives shall have
full access during normal business hours to all properties, books, records,
contracts, and documents of the Private Company, and the Private Company shall
furnish or cause to be furnished to the Purchaser and its authorized
representatives all information with respect to its affairs and business as the
Purchaser may reasonably request. The Purchaser shall hold, and shall cause its
representatives to hold confidential, all such information and documents, other
than information that (i) is in the public domain at the time of its disclosure
to the Purchaser; (ii) becomes part of the public domain after disclosure
through no fault of the Purchaser; (iii) is known to the Purchaser or any of its
officers or directors prior to disclosure; or (iv) is disclosed in accordance
with the written consent of the Private Company. In the event this Agreement is
terminated prior to closing, the Purchaser shall, upon the written request of
the Private Company, promptly return all copies of all documentation and
information provided by the Private Company hereunder.
b. The Private Company and its authorized representatives shall
have full access during normal business hours to all properties, books, records,
contracts, and documents of the Purchaser, and the Purchaser shall furnish or
cause to be furnished to the Private Company and its authorized representatives
all information with respect to its affairs and business the Private Company may
reasonably request. The Private Company shall hold, and shall cause its
representatives to hold confidential, all such information and documents, other
than information that (i) is in the public domain at the time of its disclosure
to the Private Company; (ii) becomes part of the public domain after disclosure
through no fault of the Private Company; (iii) is known to the Private Company
or any of its officers or directors prior to disclosure; or (iv) is disclosed in
accordance with the written consent of the Purchaser. In the event this
Agreement is terminated prior to closing, the Private Company shall, upon the
written request of the Purchaser, promptly return all copies of all
documentation and information provided by the Purchaser hereunder.
5.3 Actions Prior to Closing. From and after the date of this
Agreement and until the closing date:
a. The Purchaser and the Private Company shall each carry on its
business diligently and substantially in the same manner as heretofore, and
neither party shall make or institute any unusual or novel methods of purchase,
sale, management, accounting or operation.
b. Neither the Purchaser nor the Private Company shall enter into
any contract or commitment, or engage in any transaction not in the usual and
ordinary course of business and consistent with its business practices.
c. Neither the Purchaser nor the Private Company shall amend its
articles of incorporation or bylaws or make any changes in authorized or issued
capital stock, except as provided in this Agreement.
d. The Purchaser and the Private Company shall each use its best
efforts (without making any commitments on behalf of the company) to preserve
its business organization intact.
e. Neither the Purchaser nor the Private Company shall do any act
or omit to do any act, or permit any act or omission to act, which will cause a
material breach of any material contract, commitment, or obligation of such
party.
f. The Purchaser and the Private Company shall each duly comply
with all applicable laws as may be required for the valid and effective issuance
or transfer of stock contemplated by this Agreement.
g. Neither the Purchaser nor the Private Company shall sell or
dispose of any property or assets, except products sold in the ordinary course
of business.
h. The Purchaser and the Private Company shall each promptly
notify the other of any lawsuits, claims, proceedings, or investigations that
may be threatened, brought, asserted, or commenced against it, its officers or
directors involving in any way the business, properties, or assets of such
party.
5.4 Shareholders' Meeting or Consent. The Purchaser shall promptly
submit this Agreement and the transactions contemplated hereby for the approval
of its stockholders at a meeting of stockholders or for duly authorized consent,
and, subject to the fiduciary duties of the Board of directors of the Purchaser
under applicable law, shall use its best efforts to obtain stockholder approval
and adoption of this Agreement and the transactions contemplated hereby. In
connection with such meeting or action of the stockholders, the Purchaser shall
prepare a proxy or information statement to be furnished to the shareholders of
the Purchaser setting forth information about this Agreement and the
transactions contemplated hereby. The Private Party shall promptly furnish to
the Purchaser all information, and take such other actions, as may
reasonably be requested in connection with any action to be taken by the
Purchaser in connection with the immediately preceding sentence. The Private
Company shall have the right to review and provide comments to the proxy or
information statement prior to mailing to the shareholders of the Purchaser.
5.5 No Covenant as to Tax or Accounting Consequences. It is expressly
understood and agreed that neither the Purchaser nor its officers or agents has
made any warranty or agreement, expressed or implied, as to the tax or
accounting consequences of the transactions contemplated by this Agreement or
the tax or accounting consequences of any action pursuant to or growing out of
this Agreement.
5.6 Indemnification. The Private Company shall indemnify Purchaser
for any loss, cost, expense, or other damage (including, without limitation,
attorneys' fees and expenses) suffered by Purchaser resulting from, arising out
of, or incurred with respect to the falsity or the breach of any representation,
warranty, or covenant made by the Private Company herein, and any claims arising
from the operations of the Private Company prior to the closing date. Purchaser
shall indemnify and hold the Private Company harmless from and against any loss,
cost, expense, or other damage (including, without limitation, attorneys' fees
and expenses) resulting from, arising out of, or incurred with respect to, or
alleged to result from, arise out of or have been incurred with respect to, the
falsity or the breach of any representation, covenant, warranty, or agreement
made by Purchaser herein, and any claims arising from the operations of
Purchaser prior to the closing date. The indemnity agreement contained herein
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any party and shall survive the
consummation of the transactions contemplated by this Agreement.
5.7 Publicity. The parties agree that no publicity, release, or other
public announcement concerning this Agreement or the transactions contemplated
by this Agreement shall be issued by any party hereto without the advance
approval of both the form and substance of the same by the other parties and
their counsel, which approval, in the case of any publicity, release, or other
public announcement required by applicable law, shall not be unreasonably
withheld or delayed.
5.8 Expenses. Except as otherwise expressly provided herein, each
party to this Agreement shall bear its own respective expenses incurred in
connection with the negotiation and preparation of this Agreement, in the
consummation of the transactions contemplated hereby, and in connection with all
duties and obligations required to be performed by each of them under this
Agreement.
5.9 Further Actions. Each of the parties hereto shall take all such
further action, and execute and deliver such further documents, as may be
necessary to carry out the transactions contemplated by this Agreement.
6. Conditions Precedent to the Purchaser's Obligations. Each and every
obligation of the Purchaser to be performed on the closing date shall be subject
to the satisfaction prior thereto of the following conditions:
6.1 Truth of Representations and Warranties. The represen-tations and
warranties made by the Private Company and the Shareholders in this Agreement or
given on their behalf hereunder shall be substantially accurate in all material
respects on and as of the closing date with the same effect as though such
representations and warranties had been made or given on and as of the closing
date.
6.2 Performance of Obligations and Covenants. The Private Company and
the Shareholders shall have performed and complied with all obligations and
covenants required by this Agreement to be performed or complied with by them
prior to or at the closing.
6.3 Officer's Certificate. The Purchaser shall have been furnished
with a certificate (dated as of the closing date and in form and substance
reasonably satisfactory to the Purchaser), executed by an executive officer of
the Private Company, certifying to the fulfillment of the conditions specified
in subsections 6.1 and 6.2 hereof.
6.4 No Litigation or Proceedings. There shall be no litigation or any
proceeding by or before any governmental agency or instrumentality pending or
threatened against any party hereto that seeks to restrain or enjoin or
otherwise questions the legality or validity of the transactions contemplated by
this Agreement or which seeks substantial damages in respect thereof.
6.5 No Material Adverse Change. As of the closing date there shall
not have occurred any material adverse change, financially or otherwise, which
materially impairs the ability of the Private Company to conduct its business or
the earning power thereof on the same basis as in the past.
6.6 Shareholders' Execution of Agreement. This Agreement shall have
been duly executed and delivered by each of the parties owning in the aggregate
all of the outstanding stock of the Private Company as of the closing date.
7. Conditions Precedent to Obligations of the Private Company and the
Shareholders. Each and every obligation of the Private Company and the
Shareholders to be performed on the closing date shall be subject to the
satisfaction prior thereto of the following conditions:
7.1 Truth of Representations and Warranties. The represen-tations and
warranties made by the Purchaser in this Agreement or given on its behalf
hereunder shall be substantially accurate in all material respects on and as of
the closing date with the same effect as though such representations and
warranties had been made or given on and as of the closing date.
7.2 Performance of Obligations and Covenants. The Purchaser shall
have performed and complied with all obligations and covenants required by this
Agreement to be performed or complied with by it prior to or at the closing.
7.3 Officer's Certificate. The Private Company shall have been
furnished with a certificate (dated as of the closing date and in form and
substance reasonably satisfactory to the
Private Company), executed by an executive officer of the Purchaser, certifying
to the fulfillment of the conditions specified in subsections 7.1 and 7.2
hereof.
7.4 No Litigation or Proceedings. There shall be no litigation or any
proceeding by or before any governmental agency or instrumentality pending or
threatened against any party hereto that seeks to restrain or enjoin or
otherwise questions the legality or validity of the transactions contemplated by
this Agreement or which seeks substantial damages in respect thereof.
7.5 No Material Adverse Change. As of the closing date there shall
not have occurred any material adverse change, financially or otherwise, which
materially impairs the ability of the Purchaser to conduct its business.
7.6 No Liabilities of Purchaser. As of the closing date the Purchaser
shall have no liabilities which in the aggregate exceed $1,000.
7.7 Stock Dividend or Forward Stock Split. As of the closing date the
Purchaser shall have approved a one and one-half for one forward split of the
outstanding stock of the Purchaser or a one-for-two stock dividend, such that
the number of post-forward split shares of the Purchaser issued and outstanding
at closing shall be 1,500,000. The shares to be issued pursuant to subsection
1.2 hereof shall reflect post-forward split or dividend shares.
7.8 Name Change. As of the closing date the Purchaser shall have duly
approved an amendment to the articles of incorporation of the Purchaser to
change the name of the Purchaser to "Total Film Group."
7.9 Outstanding Convertible Promissory Note. Purchaser shall honor
the agreement to convert the outstanding promissory notes issued by the Private
Company into common stock of the Purchaser following closing as set forth in
several promissory notes in the aggregate amount of $950,000. The principal of
such notes shall be convertible into common stock of the Purchaser at the rate
of one share of such stock for each $1.00 of such debt.
8. Securities Law Provisions.
8.1 Restricted Securities. Each of the parties hereto, severally and
not jointly, represents that he, she, or it is aware that the shares issued or
transferred to him, her, or it will not have been registered pursuant to the
Securities Act of 1933, as amended (the "1933 Act"), or any state securities
act, and thus will be restricted securities as defined in Rule 144 promulgated
by the Securities and Exchange Commission (the "SEC"). Therefore, under current
interpretations and applicable rules, he, she, or it will probably have to
retain such shares for a period of at least two years and at the expiration of
such two year period his, her, or its sales may be confined to brokerage
transactions of limited amounts requiring certain notification filings with the
SEC and such disposition may be available only if the issuer is current in its
filings with the SEC under the Securities Exchange Act of 1934, as amended, or
other public disclosure requirements.
8.2 Non-distributive Intent. Each of the parties hereto, severally
and not jointly, covenants and warrants that the shares received are acquired
for his, her, or its own account and not with the present view towards the
distribution thereof and he, she, or it will not dispose of such shares except
(i) pursuant to an effective registration statement under the 1933 Act, or (ii)
in any other transac-tion which, in the opinion of counsel acceptable to the
issuer, is exempt from registration under the 1933 Act, or the rules and
regulations of the SEC thereunder. In order to effectuate the covenants of this
subsection 8.2, an appropriate legend will be placed upon each of the
certificates of common stock of issued or transferred pursuant to this
Agreement, and stop transfer instruc-tions shall be placed with the transfer
agent for the securities.
8.3 Evidence of Compliance with Private Offering Exemption. Each of
the parties hereto, severally and not jointly, hereby represents and warrants
that he, she, or it, either individually or together with his, her, or its
representative, has such knowledge and experience in business and financial
matters that he, she, or it is capable of evaluating the risks of this Agreement
and the transactions contemplated hereby, and that the financial capacity of
such party is of such proportion that the total cost of such person's commitment
in the shares would not be material when compared with his, her, or its total
financial capacity. Upon the written request of the issuer of the securities
issued or transferred pursuant to this Agreement, any party hereto shall provide
such issuer with evidence of compliance with the requirements of any federal or
state exemption from registration. The Purchaser and the Private Company shall
each file, with the assistance of the other and its respective legal counsel,
such notices, applications, reports, or other instruments as may be deemed by
each of them to be necessary or appropriate in an effort to document reliance on
such exemptions, unless an exemption requiring no filing is available in the
particular jurisdiction, all to the extent and in the manner as may be deemed by
such parties to be appropriate.
9. Change of Management. Upon and as a condition of closing this
Agreement:
9.1 Prior to closing the Purchaser will present to its shareholders
for approval the increase in the number of directors to three persons and the
election of Xxxxxx Xxxxx, Xxx Xxxxx, and Xxxxxx Xxxxxxx Esq. as directors of the
Purchaser effective immediately following the closing of this Agreement. Prior
to closing the Private Company will furnish material information of Xxxxxx
Xxxxx, Xxx Xxxxx, and Xxxxxx Xxxxxxx Esq. as nominees to be elected by the
shareholders of the Purchaser. Purchaser reserves the right to refuse to cause
the nomination of any or all such persons as directors of Purchaser if, after
review of the foregoing information concerning said persons, it is the opinion
of Purchaser that the election of such persons would not be in the best
interests of Purchaser.
9.2 The Private Company reserves the right to terminate this
Agreement if nominees selected by it are not elected or appointed as set forth
above.
10. Closing.
10.1 Time and Place. The closing of this transaction ("closing")
shall take place at 0000 Xxxxxxxx Xxxx., Xxxxx 0000, Xxxxxxx Xxxxx, XX, at 1:00
p.m., Tuesday the 4th day of
February 1997, or at such other time and place as the parties hereto shall agree
upon. Such date is referred to in this Agreement as the "closing date."
10.2 Documents To Be Delivered by the Private Company and the
Shareholders. At the closing the Private Company and the Shareholders shall
deliver to the Purchaser the following documents:
a. Certificates for the number of shares of common stock of the
Private Company in the manner and form required by subsection 1.1 hereof.
b. The certificate required pursuant to subsection 6.3 hereof.
c. Such other documents of transfer, certificates of authority,
and other documents as the Purchaser may reason-ably request.
10.3 Documents To Be Delivered by the Purchaser. At the closing the
Purchaser shall deliver to the Private Company and the Shareholders the
following documents:
a. Certificates for the number of shares of common stock of the
Purchaser as determined in sub-section 1.2 hereof.
b. The certificate required pursuant to subsection 7.3 hereof.
c. Such other documents of transfer, certificates of authority,
and other documents as the Private Company and the Shareholders may reasonably
request.
11. Termination. This Agreement may be terminated by the Purchaser or the
Private Company by notice to the other if, (i) at any time prior to the closing
date any event shall have occurred or any state of facts shall exist that
renders any of the conditions to its or their obligations to consummate the
transactions contemplated by this Agreement incapable of fulfillment, or (ii) on
February 28, 1997, if the closing shall not have occurred. Following termination
of this Agreement no party shall have liability to another party relating to
such termination, other than any liability resulting from the breach of this
Agreement by a party prior to the date of termination.
12. Miscellaneous.
12.1 Notices. All communications provided for herein shall be in
writing and shall be deemed to be given or made when served personally or when
deposited in the United States mail, certified return receipt requested,
addressed as follows, or at such other address as shall be designated by any
party hereto in written notice to the other party hereto delivered pursuant to
this subsection:
Purchaser: Xxxx Xxxxx, President
Executive Marketing, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Private Company: Xxxxxx Xxxxx
0000 Xxxx Xxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Shareholders: Xxxxxx Xxxxx
0000 Xxxx Xxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
12.2 Default. Should any party to this Agreement default in any of the
covenants, conditions, or promises contained herein, the defaulting party shall
pay all costs and expenses, including a reasonable attorney's fee, which may
arise or accrue from enforcing this Agreement, or in pursuing any remedy
provided hereunder or by the statutes of the State of Utah
12.3 Assignment. This Agreement may not be assigned in whole or in
part by the parties hereto without the prior written consent of the other party
or parties, which consent shall not be unreasonably withheld.
12.4 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto, their heirs, executors,
administrators, successors and assigns.
12.5 Partial Invalidity. If any term, covenant, condition, or
provision of this Agreement or the application thereof to any person or
circumstance shall to any extent be invalid or unenforceable, the remainder of
this Agreement or application of such term or provision to persons or
circumstances other than those as to which it is held to be invalid or
unenforceable shall not be affected thereby and each term, covenant, condition,
or provision of this Agreement shall be valid and shall be enforceable to the
fullest extent permitted by law.
12.6 Entire Agreement. This Agreement constitutes the entire
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all negotiations, representations, prior discussions, and
preliminary agreements between the parties hereto relating to the subject matter
of this Agreement.
12.7 Interpretation of Agreement. This Agreement shall be interpreted
and construed as if equally drafted by all parties hereto.
12.8 Survival of Covenants, Etc. All covenants, representations, and
warranties made herein to any party, or in any statement or document delivered
to any party hereto, shall survive the making of this Agreement and shall remain
in full force and effect until the obligations of such party hereunder have been
fully satisfied.
12.9 Further Action. The parties hereto agree to execute and deliver
such additional documents and to take such other and further action as may be
required to carry out fully the transac-tions contemplated herein.
12.10 Amendment. This Agreement or any provision hereof may not be
changed, waived, terminated, or discharged except by means of a written
supplemental instrument signed by the party or parties against whom enforcement
of the change, waiver, termination, or discharge is sought.
12.11 Full Knowledge. By their signatures, the parties acknowledge
that they have carefully read and fully understand the terms and conditions of
this Agreement, that each party has had the benefit of counsel, or has been
advised to obtain counsel, and that each party has freely agreed to be bound by
the terms and conditions of this Agreement.
12.12 Headings. The descriptive headings of the various sections or
parts of this Agreement are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
12.13 Counterparts. This Agreement may be executed in two or more
partially or fully executed counterparts, each of which shall be deemed an
original and shall bind the signatory, but all of which together shall
constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto executed the fore-going Agreement
and Plan of Reorganization as of the day and year first above written.
PURCHASER: Executive Marketing, Inc.
By /s/ Xxxx Xxxxx, President
SHAREHOLDERS: /s/ Xxxxxx Xxxxx, Individually
/s/ Xxxxxxxx X. Xxxxx, Individually
Xxxxxxx, Ltd.
A British Virgin Islands Corporation
By
Its
/s/ Xxxxxx Xxxxx, Trustee of the Xxxxx Xxxxx
Irrevocable Trust under Agreement dated October 2, 1996
/s/ M. Xxxxxxxx Xxxxx, Trustee of the Xxxxx Xxxxx
Irrevocable Trust under Agreement dated October 2, 1996
/s/ M. Xxxxxxxx Xxxxx, Trustee of the Xxxxxx Xxxxx
Irrevocable Trust under Agreement dated October 2, 1996.
/s/ Xxxxxxx Xxxxxxx, Individually
Meadow Brook Investments, LTD.
By /s/
Its By Power of Attorney
J.S.N. Capital Inc.
By /s/ Xxxxx Xxxxx
Its Pres.
PRIVATE COMPANY: Total Media Corporation
By /s/ Xxxxxx Xxxxx, President
SCHEDULE "A"
TO THE
AGREEMENT AND PLAN OF REORGANIZATION
NO. OF SHARES OF NO. OF SHARES OF
NAME OF THE PRIVATE COMPANY THE PURCHASER
SHAREHOLDER TO BE TRANSFERRED TO BE ISSUED
----------- ------------------- -----------------
Xxxxxx Xxxxx 43.75 437,500
Xxxxxxxx X. Xxxxx 43.75 437,500
Xxxxxxx, Ltd. 25 250,000
Xxxxxx Xxxxx, Trustee of the
Xxxxx Xxxxx Irrevocable Trust
under agreement dated
October 2, 1996 12.5 125,000
M. Xxxxxxxx Xxxxx, Trustee of the
Xxxxx Xxxxx Irrevocable Trust
under Agreement dated
October 2, 1996 12.5 125,000
M. Xxxxxxxx Xxxxx, Trustee of the
Xxxxxx Xxxxx Irrevocable Trust
under Agreement dated
October 2, 1996 12.5 125,000
Xxxxxxx Xxxxxxx 75 750,000
Meadow Brook Investments, LTD 37.5 375,000
J.S.N Capital Group 37.5 375,000
----- ---------
TOTALS 300 3,000,000
===== =========
