AGREEMENT AND PLAN OF REORGANIZATION
This AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is entered into
this 24 day of August, 2001, by and between Technol Fuel Conditioners, Inc.,
presently a Subchapter S corporation (hereinafter, "Company"), and
Brazilian-Indio Services, Inc., an Oregon corporation (hereinafter, "BIS"),
Xxxxxxxxxxxxxx.xxx, Inc., a Nevada corporation (hereinafter, "NRC") and,
Xxxxxxxx Xxxxxx, an individual (hereinafter, "EL"). Xxxxxxxxxxxxxx.xxx, Inc.
and Xxxxxxxx Xxxxxx are at times in this document collectively referred to as,
"Sellers". The Company, BIS, NRC and EL desire to enter into this Agreement and
Plan of Reorganization whereby the Company will acquire voting control,
reorganize BIS and become a successor issuer to BIS's Securities and Exchange
Commission ("SEC") reporting obligations as provided for in Rule12g-3(a) of the
Securities Exchange Act of 1934.
For good and valuable consideration, receipt of which is acknowledged, the
parties agree, represent and warrant the following:
Agreement
A. Sale of Shares and Reorganization.
1. The Company agrees to purchase 2,500,000 BIS common stock shares from
EL, which represents 50% of the issued and outstanding shares of BIS, and EL
agrees to sell 2,500,000 BIS common stock shares to the Company. The purchase
price for said 2,500,000 shares is Fifty-Five Thousand Dollars ($55,000).
2. In connection with a corporate succession transaction by means which may
include, but not be limited to merger, consolidation, exchange of securities,
acquisition of assets, or otherwise, NRC agrees to tender 2,500,000 BIS common
stock shares, which represents 50% of the issued and outstanding common stock
shares of BIS, to the Company. In consideration for this action, the Company
agrees to issue to NRC Two Hundred Thousand (200,000) of the Company's
restricted stock. The Company shares will be issued under the securities
transaction exemption afforded by Section 4(2) of the Securities Act of 1933, as
amended.
B. Representations, Warranties and Covenants of the Company: The Company
represents and warrants to Seller as of the date hereof and as of the Closing
Date:
SECTION 1. Enforceability of Agreement Against the Company. The Company has all
necessary power and authority to enter into this Agreement to which it is a
party, to carry out the obligations hereunder and to consummate the transactions
contemplated hereby. This Agreement constitutes the legal, valid and binding
obligations of the Company enforceable against it in accordance with the
respective terms.
SECTION 2. Incorporation, Authority and Qualification of The Company. The
Company is a presently a Subchapter S corporation. The Company presently has ___
shares issued and outstanding. The Company has all necessary authority to carry
on the business now being conducted by it. The Company is duly qualified to do
business, and is in good standing, in each jurisdiction, where the character of
its properties owned, operated or leased or the nature of its activities makes
such qualification necessary.
SECTION 3. No Conflict. The execution and delivery by the Company of this
Agreement and each Related Document to which the Company is a party has been
obtained and all applicable filings and notifications required by law,
agreement or otherwise have been made, the performance by the Company of this
Agreement and each Related Document to which they are parties will not:
(a) Violate or conflict with any term or provision of the articles or
certificate of incorporation (or other charter documents) of the Company; (b)
Conflict with or violate any law, rule, regulation, order, writ, judgment,
injunction, decree, determination or award applicable to Company;
(c) Conflict with, result in any breach of, constitute a default (or event
which with the giving of notice or lapse of time, or both, would become a
default) under, give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any lien on any of
the assets pursuant to, any assigned contract or any licenses;
(d) Without limiting the generality of the foregoing, result in the
termination, denial or impairment of any material contract, arrangement or
benefit granted with respect to the Company's business, or require the payment
of any fees, taxes or assessments, pursuant to any federal, state or local
program relating to minority-owned businesses.
SECTION 4. Consents, Approvals and Notifications. The execution and delivery
by the Company of this Agreement and each Related Document to which it is a
party does not, and the performance by it of this Agreement and such Related
Documents will not, require any consent, approval, authorization or other action
by, or filing with or notification to, any Governmental Authority or any other
Person with the exception of filings required by the Securities and Exchange
Commission, including, but not limited to, a Current Report on Form 8-K which
will be filed by the Company on, or before 15 days from the date of closing.
The Company will become a successor issuer under Securities and Exchange
Commission Rule 12g-3(a) and will elect successor issuer status.
SECTION 5. Financial Statements.
5.1 The Company has furnished to Seller copies of (a) audited
balance sheets of the Company and audited statements of income, changes in
shareholders' equity and statements of cash flow for the period ending December
31, 2000 together with the reports and notes thereon, from an independent
certified public accountants (collectively, the "Audited Financial Statements").
5.2 The Audited Financial Statements (a) have been prepared in
conformity with GAAP applied on a consistent basis from year to year (except as
noted otherwise therein); and (b) assuming the Company will continue as a going
concern, are true and correct and present fairly in all material respects the
financial condition of the Company and the results of operations and changes in
cash flow of the Company for the periods to which each relates.
5.3 To the knowledge of the Company, the Interim Financial
Statements, if prepared, (a) have been prepared in conformity with GAAP applied
on a consistent basis from year to year (except as noted otherwise therein),
subject to normal recurring year-end adjustments (the effect of which will not,
individually or in the aggregate, be material) and the absence of notes (which,
if presented, would not differ materially from those included in the Audited
Financial Statements), and (b) assuming the Company will continue as a going
concern, are true and correct and present fairly in all material respects the
financial condition of the Company and the results of operations and changes in
cash flow of the Company for the periods to which each relates.
SECTION 6. Litigation. There is no claim, action, investigation, arbitration
or proceeding pending or, threatened against the Company, or against or
relating to any of the assets or the ability of the Company to perform its
obligations hereunder, before any arbitrator, judge, court or governmental
authority. The Company is not subject to any order, writ judgment, injunction,
decree, determination or award of any arbitrator, judge, court or governmental
authority.
SECTION 7. Environmental Matters. The Company has not used any
property, real or personal to generate, manufacture, refine, transport, treat,
store, handle, or dispose of any hazardous substances except in accordance with
all applicable federal and state environmental laws.
SECTION 8. Taxes. The Company has or will duly file or caused to be filed
all federal income tax returns and all other federal, state, county, local or
city tax returns which are required to be filed, including, but not limited to,
income and employee withholding taxes, and the Company has paid or caused to be
paid all taxes shown on said returns or on any tax assessment received by it to
the extent that such taxes have become due, or has set aside on its books
reserves (segregated to the extent required by sound accounting practice)
reasonably deemed by the Company to be adequate with respect thereto. No events
have occurred which could impose upon Seller, any transferee liability for any
taxes, penalties, or interest due or to become due from the Company.
SECTION 9. Absence of Changes. Since the date of the Audited Financial
Statements, the Company has operated its business in the ordinary course
consistent with past practices and there has not been, except as disclosed in
this Agreement or the Exhibits attached hereto:
i. any material adverse effect;
ii. any damage, destruction or loss (whether or not covered by
insurance) affecting any tangible asset or property used or useful in the
business operations, normal wear and tear excepted;
iii. any payments, discharges or satisfactions by the Company of any
liens, claims, charges or liabilities (whether absolute, accrued, contingent or
otherwise and whether due or to become due) relating to the business operations,
other than in the ordinary course of the business and consistent with
past practice;
iv. any licenses, sales, transfers, pledges, mortgages or other
dispositions of any tangible or intangible assets having a value over $1,000 (in
the aggregate) used or held for use in connection with the operation of the
business, other than in the ordinary course of business and consistent with past
practice;
v. any write-offs as uncollectible of any accounts receivable or
notes receivable of the operations, or any portion thereof, not provided for in
the allowance for uncollectible accounts in the Interim Financial Statements;
vi. any cancellations of any material debts or claims of, or any
amendments, terminations or waivers of any rights of material value to, the
business operations;
vii. any general uniform increase in or change in the method of
computing the compensation of employees of the Company who perform services for
the benefit of the business operations;
viii. any material changes in the manner in which the Company extends
discount or credits to customers or otherwise deals with customers of its
business;
ix. any material changes in the accounting methods or practices
followed by the Company and or any changes in depreciation or amortization
policies or rates theretofore adopted;
x. any capital commitments by the Company and for additions to
property, plant or equipment of the business operations;
xi. any agreements or commitments to merge or consolidate with or
otherwise acquire any other corporation, association, firm or other business
organization or division thereof;
xii. any declarations of dividend, payment of any dividend, issuance of
any securities, purchase or
redemption of any securities, commitments or authorizations for any changes to
its Articles of Incorporation or amendments to any by-laws, conversions of any
options, warrants or otherwise into common shares, and except as disclosed in
paragraph B.3. relating to the total shares issued and outstanding which
resulted from a corporate reorganization;
xiii. any other material transaction relating to the Company other than
in the ordinary course of the business and consistent with past practice; or
xiv. any agreements or understandings, whether in writing or otherwise,
for the Company to take any of the actions specified in items i. through xii.
above.
SECTION 10. Undisclosed Liabilities. The Company does not have any
liabilities or obligations of any nature that would be required by GAAP to be
reflected in the Financial Statements (subject, in the case of unaudited
statements, to normal year-end audit adjustments), except: (a) such liabilities
and obligations which are reflected in the Financial Statements, or (b) such
liabilities or obligations which were incurred in the ordinary course of
business for normal trade or business obligations and are not individually or in
the aggregate in excess of $___.
SECTION 11. Compliance with Laws. Except as individually or in the aggregate
would not have a Material Adverse Effect, the Company has complied in all
respects with all laws of all Governmental Authorities (including all tariff and
reporting requirements) with respect to its business operations.
C. Representations, Warranties and Covenants of BIS: BIS represents and
warrants to the Company as of the date hereof and as of the Closing Date:
SECTION 12. Enforceability of Agreement Against BIS. BIS has all necessary
power and authority to enter into this Agreement to which it is a party, to
carry out the obligations hereunder and to consummate the transactions
contemplated hereby. This Agreement constitutes the legal, valid and binding
obligations of BIS enforceable against it in accordance with the respective
terms.
SECTION 13. Incorporation, Authority and Qualification of BIS. BIS is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Nevada. BIS is authorized to issue 25,000,000 shares of
common stock and 0 preferred shares. BIS presently has 5,000,000 shares issued
and outstanding. BIS is duly qualified to do business, and is in good standing,
in each jurisdiction, if any, where the character of its properties owned,
operated or leased or the nature of its activities makes such qualification
necessary.
SECTION 14. No Conflict. The execution and delivery by BIS of this Agreement
and each Related Document to which BIS is a party has been obtained and all
applicable filings and notifications required by law, agreement or otherwise
have been made, the performance by BIS of this Agreement and each
Related Document to which they are parties will not:
(a) Violate or conflict with any term or provision of the articles
or certificate of incorporation (or other charter documents) of BIS;
(b) Conflict with or violate any law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award applicable to BIS;
(c) Conflict with, result in any breach of, constitute a default
(or event which with the giving of notice or lapse of time, or both, would
become a default) under, give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of any lien on any of
the assets pursuant to, any assigned contract or any licenses;
(d) Without limiting the generality of the foregoing, result in
the termination, denial or impairment of any material contract, arrangement or
benefit granted with respect to BIS's business, or require the payment of any
fees, taxes or assessments, pursuant to any federal, state or local program
relating to minority-owned businesses.
SECTION 15. Consents, Approvals and Notifications. The execution and
delivery by BIS of this Agreement and each Related Document to which it is a
party does not, and the performance by it of this Agreement and such Related
Documents will not, require any consent, approval, authorization or other action
by, or filing with or notification to, any Governmental Authority or any other
Person with the exception of filings required by the Securities and Exchange
Commission, including, but not limited to, a Current Report on Form 8-K which
will be filed by the BIS on, or before 15 days from the date of closing. BIS
will become a successor issuer under Securities and Exchange Commission Rule
12g-3(a) and will elect successor issuer status.
SECTION 16. BIS warrants that is has been timely with all its obligatory
filings pursuant to the Securities Act of 1934, as amended.
SECTION 17. Undisclosed Liabilities. BIS does not have any liabilities or
obligations of any nature that would be required by GAAP to be reflected in the
Financial Statements (subject, in the case of unaudited statements, to normal
year-end audit adjustments), except: (a) such liabilities and obligations which
are reflected in the Financial Statements, or (b) such liabilities or
obligations which were incurred in the ordinary course of business for normal
trade or business obligations and are not in the aggregate in excess of $1000.00
which will be assumed by Company, along with the legal costs for the 8-K filing
referencing this transaction.
SECTION 18. Compliance with Laws. Except as individually or in the aggregate
would not have a Material Adverse Effect, BIS has complied in all respects with
all laws of all Governmental Authorities (including all tariff and reporting
requirements) with respect to its business operations.
SECTION 19. Change in Control of BIS. The BIS Board of Directors will nominate
Xxxxxx Xxxxxx, as President and Director, effective at Closing.
E. Miscellaneous Provisions.
SECTION 20. Conditions to Closing
20.1 Escrow. There will be no escrow of funds since funds will not change
hands until the enactment of a Regulation D, Rule 506 offering, where an escrow
shall be established, which the parties contemplate the Company enacting within
21 days from the execution of this Agreement. It is expressly understood by the
parties herein that the monies raised from said offering shall be used, inter
alia, for the purchase of BIS by the Company and, that BIS shall first receive
the $55,000 due and owing to them before any other distributions take place.
20.2 Conditions to Obligations of the Company. The obligations of the
Company to consummate the purchase of the shares shall be subject to the
fulfillment, at or prior to the Closing, of each of the following conditions,
any one of which may be waived by the Sellers without waiver of any other rights
or remedies which Sellers may have under this Agreement:
i. The Company's Closing Documents. At the Closing, Sellers shall
have executed and/or delivered this Agreement and any Related Documents to
which they are parties or for which each is responsible.
20.3 Conditions to Obligations of Sellers. The obligations of Sellers to
consummate the sale of the shares contemplated by this Agreement shall be
subject to the fulfillment, at or prior to the Closing, of each of the
following conditions, any one of which may be waived by the Company without
waiver of any other rights or remedies which the Company may have under this
Agreement.
i. Closing Documents. At the Closing, Sellers shall have executed and/or
delivered this Agreement and delivered the BIS shares to the Company.
SECTION 21. Indemnification
21.1 Survival. All representations and warranties and covenants and
agreements contained herein shall survive the execution of hereof and the
Closing Date. Any investigations by or on behalf of any party shall not
constitute a waiver as to enforcement of any representation, warranty or
covenant contained in this Agreement. No notice or information delivered by one
party shall affect the other party's right to rely on any representation or
warranty made by the party delivering the notice or information or relieve that
party of any obligations under this Agreement as the result of a breach of any
of its representations and warranties.
SECTION 22. General Provisions.
22.1 Headings and Interpretation. The headings used in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of any term or provision of this Agreement.
22.2 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party.
22.3 Entire Agreement. This Agreement represents the entire
understanding of the parties with reference to the matters set forth herein.
This Agreement supersedes all prior negotiations, discussions, correspondence,
communications and prior agreements among the parties relating to the subject
matter herein.
22.4 Amendment. This Agreement may not be amended or
modified except by an instrument in writing signed by the parties hereto.
22.5 Applicable Law. This Agreement shall be governed by the
substantive laws of the State of Oregon, without regard to its conflict of laws
provisions.
22.6 Notices: If to the Company:
0 Xxxx Xxxxxx
Xxx, 000
Xxxxxxxxx, XX 00000
000-000-0000
000-000-0000
If To BIS, EL and NRC:
0000 XX Xxxxxx Xx., Xxx. #000
Xxxxxxxx, XX 00000
000-000-0000
000-000-0000 (fax)
22.7 Counterparts and Facsimile Transmission Copies of
Originals. This Agreement may be executed in several original or facsimile copy
counterparts and all so executed and transmitted shall constitute one Agreement,
binding on all the parties hereto even though all the parties are not
signatories to the original or the same counterpart. Facsimile transmitted
signatures shall be deemed valid as though they were originals and the parties
may perform any and all obligations and duties in reliance on the facsimile
copies.
22.8 Further Assurances, Additional Documents, Etc. The
parties will cooperate with each other to accommodate the intent of this
agreement. BIS and Sellers will provide the Company with all financial records
of BIS so that there will be a seamless financial transition.
IN WITNESS WHEREOF, the parties hereto have executed, or
caused their duly authorized representatives to execute, this Agreement and Plan
of Reorganization as of the date first written above.
Technol Fuel Conditioners, Inc.
("The Company")
/s/
---------------------------
By:
Brazilian-Indio Services, Inc.
("BIS")
/s/_______________
By:
SELLERS:
Xxxxxxxx Xxxxxx
("EL")
/s/__________________
By:
Xxxxxxxxxxxxxx.xxx, Inc.
("NRC")
/s/__________________
By:
